Kansas lawmakers scramble for budget fix after tax hike veto

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Posted: Feb 22, 2017 8:07 PM
Kansas lawmakers scramble for budget fix after tax hike veto

TOPEKA, Kan. (AP) — Kansas legislators pushing to roll back Republican Gov. Sam Brownback's signature income tax cuts scrambled Wednesday to find a new plan to fix the state's dire budget problems after he vetoed their bill.

The bill vetoed Wednesday morning would have raised more than $1 billion over two years by raising income tax rates and ending an exemption for more than 330,000 farmers and business owners. Brownback called the measure "punitive," but bipartisan majorities saw it as crucial to closing projected budget shortfalls totaling nearly $1.1 billion through June 2019 without deep spending cuts.

The House voted 85-40 to override the veto within two hours of the governor's action. But the Senate's vote Wednesday afternoon was 24-16, leaving supporters of the bill three votes shy of the necessary two-thirds majority to overturn the veto.

A majority of Republicans in both GOP-controlled chambers voted to override the veto, reflecting a view that tax cuts Brownback championed in 2012 and 2013 went too far and are a key factor in Kansas' persistent budget problems since. But the votes Wednesday also showed that GOP legislators are split on a budget fix.

Some supporters of the bill said Brownback's conservative allies need to come up with a new plan — even though it would include cuts in aid to public schools. But other lawmakers predicted they will pass another, similar bill increasing income taxes.

"I think we could see several vetoes," Senate President Susan Wagle, a Wichita Republican who voted against an override, told GOP senators during a pre-vote caucus.

Brownback successfully pushed GOP legislators to slash personal income taxes in 2012 and 2013 as an economic stimulus and touts his experiment as a model for other states and the federal government. He argues that the state's budget problems result from slumps in agriculture and energy production.

Even some Republicans came to a different conclusion last year as voters ousted two dozen Brownback allies from the Legislature to give both Democrats and GOP moderates more power.

Ending the income tax exemption for farmers and business owners has broad, bipartisan support from lawmakers.

But some Republicans had misgivings about a provision in the vetoed bill that would have restored a third income tax bracket Brownback fought to eliminate and another to set the top tax rate at 5.45 percent instead of the current 4.6 percent.

They also were upset that the changes would have been retroactive to the beginning of this year to collect new revenue more quickly. Brownback seized on that point — though he's signed tax bills with retroactive provisions in the past.

Wagle and other GOP leaders in the Senate also proposed cutting aid to public schools immediately to allow the state to pay other bills on time through June. They dropped such a plan earlier this month when support for education funding cuts collapsed.

During the Senate's debate, conservatives said lawmakers should cut spending first. And after the Senate vote, Brownback said in a statement, "I encourage them to find savings in the state's budget before asking Kansans to find savings in theirs."

Yet Brownback's own budget-balancing package is designed to avoid cuts in education funding and other programs. It relies heavily on internal government borrowing and other accounting moves, and he seeks to increase cigarette and liquor taxes and annual filing fees paid by for-profit businesses.

Key Republicans said they will look again the governor's ideas, and his proposal for $317 million in internal borrowing already has won House approval.

But some supporters of the bill vetoed by Brownback remained defiant, suggesting that if lawmakers keep tweaking provisions, they eventually will find a bill garnering two-thirds majorities in both chambers.

"We should keep trying something similar until we get one that sticks," said Democratic state Rep. Tom Sawyer of Wichita.

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Associated Press writer Allison Kite also contributed to this report.

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Follow John Hanna on Twitter at https://twitter.com/apjdhanna