Bleeding Kansas Revenue Shortfall Will Require Grassroots Leadership To Deal with Crisis
Recently former Florida Governor, Jeb Bush, fumbled the ball when Fox News reporter Megyn Kelly asked him: “(On the subject of Iraq), knowing what we know now, would you have authorized the invasion? Bushsaid, “I would have.”
But after Bush was blasted by his opponents for his yes answer, he used his mulligan on the Sean Hannity show and said, “I interpreted the question wrong, I guess.”
A similar question is being asked throughout the state of Kansas. Only this question is not about Iraq. It’s about a revenue war being played out by Governor Brownback, the legislature and the Kansans left fearingthe worst if it is not resolved.
Here’s the question!
Knowing what we know now about our states’ $800 million dollar revenue shortfall and projected loss of $3.7 billion future tax dollars, would you have authorized the largest tax cut in the State’s history?
Governor Brownback continues to answer the question, “I would have.”
In spite of getting lawmakers to fill part of the gap by: transferring an additional $132 million from the highway fund, $72 million from other funds, and stopping a planned transfer of $54 million from the general-fund to a local government tax deduction fund, Duane Goossen, former budget director under three former Kansas governors said, “Most of those transfers are short-term solutions, not ongoing revenue, and if approved would lower the FY2016 gap to about $540 million.”
“In addition, lawmakers have been debating whether to increase the fee that managed care companies pay to operate in Kansas,” Goossen said. “Passage is still uncertain, but if implemented the proceeds would be used to draw down additional federal Medicaid funds and close the budget gap by another $60 million or so.”
But here’s an assumption that may not happen. Goossen said, “Then if $50 or $60 million carries over from FY2015, (a big if at this point), the “gap” would be a little over $400 million-the amount that lawmakers are trying to cover with new taxes.”
Kansans can anticipate dramatic cuts to social programs that make up more than 90 percent of the general-fund operating budget including 63 percent for education, 4.3 percent for transportation, 0.3% for Human Services and 27 percent for public safety.
Let’s review how we got in this mess. Who is behind it? And, what Kansans must do to get involved now.
How did we get in this mess?
Governor Brownback started the process by calling on the legislature to eliminate the income tax in his “State of the State” message during January of 2012.
The Kansas House of Representatives accommodated the Governor’s wishes and passed a bill cutting individual income tax rates and exempting pass-through business owner income from being taxed at all.
Former senate president, Steve Morris, sent the bill to his senate tax-committee. The supporters of the tax bill on the senate committee lobbied hard for the House bill’s passage. Ultimately, they prevailed. The senate tax-committee recommended what the House had passed with a few modifications.
Morris and senate moderates defeated the committee’s recommendation with a 20-20 vote. While presiding in the senate, Morris received a phone call from Governor Brownback.
Morris left the senate chamber to take the call in his office. Brownback told Morris this tax policy, as is, would bankrupt the state. Brownback went on to suggest that if Morris helped get the bill through the Senate, they would work together to fix it in the conference committee and pass a bill that didn’t bankrupt the state.
Morris hesitated at first, but told me it’s pretty hard for a Republican senate leader to say no to a Republican governor. Morris got the votes in the senate to reconsider and sent the bill back over to the House. In hindsight, Morris acknowledged that trusting the Governor and passing the tax bill was a huge mistake on his part.
Governor Brownback, however had a different plan than the one he committed to with Morris. The Governor went to the House Republican caucus and asked them to concur with what the senate had passed. This would bypass the need for a conference committee to reconcile the differences in the bills and all but ensure the fiscal nightmare the state faces today.
As the senate debated a more modest tax-cut approved by a conference committee; the House Republican Speaker, Mike O’Neal, brought up the tax bill for a vote. O’Neal received harsh criticism by other House Republicans for going against the rules of his own chamber to speed up passage of the bill.
To expedite passage of the bill, O’Neal used a parliamentary procedure to cut off debate including changes and explanations of votes. This must have seemed like a scene out of the popular TV series “House of Cards”, where actor, Frank Underwood, passed a bill using the same tactics in a fictional episode, which makes one wonder just how much truth is portrayed in the “House of Cards” series.
It became obvious, The House and governor didn’t want anything to do with Morris’s tax bill revision ideas.
During his plea to keep the House bill alive, Governor Brownback told Morris the bill would then go to a joint conference committee and become a law that all could agree on, which never happened.
“I believe he never intended to bring the bill to conference because he wanted to make a bold statement with his original intention to cut income taxes,” Morris said.
The House complied with the Governor’s request to concur and Brownback signed the bill into law during May of 2012.
Morris said, “The governor just flat out lied to us and stabbed us in the back.”
The Governor’s betrayal of Morris was the first shot fired across the bow to start a civil war within the Kansas Republican Party. The divide widened when Governor Brownback, with the help of dark money, purged 20 moderate Republicans during their primary elections in the fall of 2012.
Morris received the brunt of vicious false attacks from outside influences in his defeat with funds provided by the Kansas Chamber of Commerce, American’s for Prosperity, and a now defunct group called KanPac (Kansans for a true Republican Majority).
O’Neal, retired from the legislature and was rewarded for his efforts when he was hired during September of 2012 to become President and CEO of the Kansas Chamber of Commerce, a group who is a strong advocate for Governor Brownback’s aggressive income tax cut experiment.
Who continues to set the agenda based on their influence and power over the irrational Republican decision makers in the Kansas Legislature?
Almost all legislative bills and decisions have the stamp of one or more of the following groups:
The American Legislative Exchange Council (ALEC)
ALEC is a corporate dating service organization who gathers once a year to bring together corporate leaders, lobbyists, and state and federal legislators to primarily influence legislation favorable to their corporate interests. Speaker of the House Ray Merrick and Senate president Susan Wagle are both on their board of directors.
Speaker Merrick, a member of the host committee for ALEC’s 42nd annual meeting to be held in San Diego during July, recently sent out a fund raising letter to seek gifts of $5,000 to $100,000 from corporate sponsors noting that sponsorships allow an opportunity to “educate legislative members on your platform.”
Merrick, (whose name was misspelled) said in his letter that “free market legislatures hold 68 chambers across the U.S.” ALEC continues to influence legislatures with model bills that promote free market solutions including their strategy to torpedo Obama Care by blocking the expansion of Medicaid.
Charles and David Koch of Koch Industries are among ALEC’s most influential corporate donors.
Americans for Prosperity (AFP)
This is a Koch brothers’ funded operation with a motto to “leave our children with more financial security by putting brakes on government spending.” AFP has pushed hard for income tax cuts and to stop the expansion of Medicaid in Kansas.
State director, Jeff Glendening, called the exemption for LLC’s (Limited Liability Companies) a great move to bring in small businesses. He also said, “Americans for Prosperity hopes the state marches on to a zero income tax for all businesses and individuals.”
Kansas Policy Institute (KPI)
Dave Trabert, the primary lobbyist for the group opposes government spending and works closely with ALEC. Trabert speaks for the Friedman Foundation in promoting private educational choices. KPI supported the income tax cuts and opposes the expansion of Medicaid.
Kansas Chamber of Commerce
This organization supported the aggressive tax cut legislation and opposes the expansion of Medicaid. President and CEO, Mike O’Neal, believes more tax cuts are in order.
Democratic House member, Jarrod Ousley, of Merriam, told me, “These four groups stifle discussion on budget matters, and all issues that come before the legislature are decided by one or more of the groups.”
What can citizens do to restore fiscal responsibility in the Legislature?
1. Ban legislators from lobbying for a period of time after leaving office.
- a. Pass anti-corruption laws that prohibit lawmakers from receiving money from those companies or organizations they represent.
2. Get more transparency in governing by allowing debate and input.
- a. Install cameras and live-streaming capabilities into the statehouse chamber and committee meetings.
- b. Stop Gut and Go tactics because theystifle honesty and eliminate debate. House bill 2258 began as a non-controversial mortgage definition which passed 121-0, but was gutted in the senate and used as a shell to insert new Medicaid rules including a controversial $25 limit per day on an ATM withdrawals, which may now cost the state $102 million in federal block grant money because it limits access to benefits and requires recipients to pay frequent withdrawal fees.
- c. Moderate Republican, Rep. Mellissa Rooker, from Fairway, explained in her newsletter, the bill was debated for six hours on the senate floor with many amendments added, and passed 30-10 at 2:30 p.m. on April 2nd. One hour later it was up for a motion on the House floor with no opportunity to amend or time to read its contents since the original House version was not open for debate, just an up and down vote.
Governor Brownback’s dramatic income tax cutexperiment has created a severe revenue crisis that willaffect the quality of life for millions of Kansans. Removing moderate Republicans from the legislature using sleazy campaign tactics, has caused dissention, lack of trust, and a breakdown in compromise opportunities.
Legislation continues to be influenced by special interest groups without regard to the wishes of the majority of Kansas citizens. Not expanding Medicaid is an example.
Solving the revenue issue remains a stalemate because nine Republican House members and eleven Republican senate members signed pledges to oppose tax increases at any cost.
This means disastrous budget cuts will occur with terrible consequences for education, governmental services and the future viability of the state.
Citizens need to rally, get involved and become informed as to which legislators represent what is best for all Kansans rather than bending to the wishes of special interest- groups, and then vote accordingly in the 2016 statewide elections.
Larry Weigel, founder of a national Medicare consulting business lives in Manhattan, KS and believes Kansans must become involved in the political process to make the necessary changes in the radical leadership within the Kansas legislature by participating in a grassroots statewide effort.