The Governor’s proposed budget has been released. We will write more about it as we have time to review it. Click here to download the full text as a PDF.

 

Last night Governor Sam Brownback delivered his 2012 State of the State address. It was a rather brief speech but stuffed with huge plans to move our state further down his Road Map for Kansas.

 

As expected, a great deal of emphasis was placed on drastic changes to the Kansas tax code. He would see the individual income tax brackets reduced to 2 from 3 and the top tax rate would be 4.9% instead of the current 6.45% while the bottom rate would drop to 3% from the current 3.5% bottom tier rate.

Along with the income tax cuts he added in some very tough cuts to tax breaks including itemized deductions and the very contentious elimination of the earned income credit and child and dependent care breaks that are hugely beneficial to the State’s lowest earners.

In fact, in the last Legislative session advocates for Kansas families were fighting a bill that would phase out the earned income credit. At that time it was estimated that 6,500 Kansas families would be pushed below the poverty guideline if the earned income credit was ended.

Like a cherry on the top of his tax overhaul, the Governor would like to see the Legislature  limit further growth in government expenditures to no more than 2% a year with any additional revenue used to lower the State income tax.

The danger in a system like this is that most programs and services in Kansas are currently running at greatly decreased budgets, if this is adopted, funding levels for these would essentially be frozen at levels that are not sustainable. In addition, limiting all government expenditures to no more than 2% would further hobble systems like education, Medicaid, social services, and KPERS all three of which require more funding each year than 2% would allow.

There was not much said regarding the Medicaid makeover; much of the details of that plan are awaiting the responses to the RFP as the state has left the determination of many elements of the plan to the Managed Care organizations they are going to be contracting with. Governor Brownback did stress that Kansans with disabilities would be given a better chance at finding meaningful employment and a bridge away from Medicaid. We have heard that an announcement regarding several employment initiative is coming in a few weeks.

All in all, the State of the State was pretty much what was expected, the Governor’s budget is slated to be released this morning and once we have more information on that we will make it available to you. You can read or download a copy of the 2012 State of the State address on the Governor’s website.