 2020 Legislative Policy Watch Weekly E-Update |
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Issue No. # 5, February 7, 2020
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About Policy Watch E-Updates
The Legislative and Policy Watch Weekly E-Update is a project of the Kansas Rural Center.
Editor: Mary Fund
Paul Johnson, Policy Analyst
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Policy Watch Sponsors
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The Kansas Rural Center
promotes the health of the land and its people through research, education and advocacy that advance an ecologically sound, economically viable, and socially just agriculture. For more information about KRC go to
www.kansasruralcenter.org.
The Kansas Natural Resource Council (KNRC)
promotes environmentally responsible practices and sustainable natural resource policies to ensure the quality and abundance of these resources for future generations. For more information about our organization and programs, or how to become a member, please visit
Kansas Farmers Union is the state's oldest active farm organization working to protect
and enhance the economic interests & quality of life for family farmers, ranchers & rural communities. For more information go to:
League of Women Voters of Kansas is a grassroots, volunteer, non-partisan political organization with nine local Leagues across the state. For nearly 100 years, LWVK has encouraged the informed and active participation of citizens in government and has influenced public policy through education and advocacy. The League never endorses candidates or political parties
. For more information, contact
lwvk.org.
Climate and Energy Project (CEP) is a
Kansas-based non-partisan non-profit working to find practical solutions for a clean energy future. For More information go to:
Friends of the Kaw (FOK)
works to protect and preserve the Kansas River for present and future generations. For more information go to:
Audubon of Kansas
is a statewide, non-profit organization established to promote appreciation and stewardship of Kansas' natural ecosystems, with special emphasis on conservation of prairies, birds, other wildlife and their habitat. For more information about our organization and programs, please visit
www.audubonofkansas.org
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Stay Up-to-Date
For live audio streaming, information, calendars, schedules and Bills, g
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Contact Your Legislator
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Kansas Congressional Representatives
Contact Information
Sen. Jerry Moran
DC Ofc 202-224-6521
Sen. Pat Roberts
DC Ofc 202-224-4774
Rep. Roger Marshall,
1st Dist.
DC Ofc: 202-225-2715
Rep. Steve Watkins
2nd Dist.
DC Ofc: 202-225-6601
Rep. Sharice Davids
3rd Dist.
DC Ofc: 202-225-2865
Rep. Ron Estes
4th Dist.
DC Ofc.: 202-225-6216
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PRIVATE ACTIVITY BONDS AUDIT:
Bonds Could Benefit Housing
by Paul Johnson
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The Kansas Legislative Division of Post Audit (LPA) presented their January 2020 Private Activity Bond audit to the Joint Legislative Post Audit committee on January 29. This audit compared how the structure and use of private activity bonds (PAB's) in Kansas compared to other states. 'Qualified' PAB's are tax exempt bonds allocated to states by the United States Treasury. Kansas' allocation in 2018 was $311 million. If used for certain defined purposes, these bonds are tax-exempt so the interest earned by the investor is exempt from federal income tax (thus driving down the interest rate 1-2%).
Unfortunately, qualified PAB's - issued by the Kansas Department of Commerce - are unknown to most lawmakers, and Kansas uses PAB's far less than surrounding states or the national average.
In 2018, Kansas only issued 16% ($49 million) of its $311 million in bond authority. 49 other states issued an average of 61% of their bond authority. 'Exempt' facility bonds such as airports, waste disposal and multifamily housing for low-income individuals (like apartments) qualify. Kansas issued $43.9 million in 2018 plus $5 million for the Beginning Farmer Loan Program.
Qualified PAB's can be converted to qualified mortgage bonds to help first-time homebuyers and veterans obtain more affordable mortgages. There are income and home price limits. Kansas has not issued a qualified mortgage bond since 2008. While Kansas issues no qualified mortgage bonds (for first-time homebuyer loans), the national average in 2018 was 29% of allocated PAB's.
Kansas officials claim that interest rates are so low that conventional loans are available without the extra administrative costs and that the small population in Kansas limits a cost-efficient mortgage bond program. However, other small states such as Oklahoma and Iowa continue to issue qualified mortgage bonds. These states use revenue generated from these first-time homebuyer loans to expand other housing programs without the need for state revenues.
Hopefully this audit is the start of a more comprehensive debate on 'affordable housing' in Kansas. Kansas needs to develop a statewide housing assessment report - this information has not been updated since the late 1990's. By law, the Kansas Housing Resources Corporation (KHRC) - which is the statewide housing agency in Kansas - is prohibited from managing qualified mortgage revenue bonds. Kansas is the only state with such a restriction for their statewide housing agency.
KHRC has other housing programs that could be coupled with first-time homebuyer loans to serve the entire state. This restriction is missing opportunities to generate fee income and expand the homebuyer program.
Overall qualified PAB's could also be part of the statewide energy plan to assist local governments as well as small businesses to benefit from cost-saving energy conservation improvements. KHRC is active in using these bonds to develop more multi-family affordable apartment complexes. While the Governor has concentrated on developing a state energy plan this year, next year in the State of the State an affordable housing plan should be presented that details the housing needs in Kansas and presents a comprehensive housing affordability strategy.
For the full audit report:
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STATE OF KANSAS - 2019 DEBT STUDY
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The purpose of the 2019 Debt Study - presented by the Kansas Development Finance Authority (KDFA) - is to give policymakers a picture of the State's debt on June 30, 2019. Kansas has a total indebtedness of $5.957 Billion of which $4.223 Billion is 'tax-supported' and thus backed by Kansas tax revenues. The remaining $1.734 Billion is user-fee backed or self-supporting.
Kansas ranks 18th of the 50 states with a per capita bonded indebtedness of $1,518 versus the national mean of $1,493. Surrounding states have much lower per capita levels - Oklahoma ($320), Colorado ($484), Nebraska ($23), Missouri ($487), Iowa ($207) and the regional mean being ($506). Kansas saw its credit ranking downgraded three times during the previous administration and has seen the credit ranking upgraded twice since the changed tax policy in 2017.
In 2020, State General Fund (SGF) debt service was $189 million which is 2.42% of the entire $7.67 Billion SGF. The key financing projects have been a $500 million bond issued for KPERS in 2004, State Capitol Restoration bonds totaling $327 million, $307 million in bonds for the National Bio and Agro-Defense facility at KSU and $1 Billion in bonds in 2015 for KPERS.
In terms of KPERS, Kansas issues the bonds at 4-5% in cost and KPERS has averaged just at 8% in their returns so the difference is allowing KPERS to improve its financial standing. Moody's and Standard & Poor are the rating agencies. At this point they are neutral on the debt situation in Kansas as opposed to being negative. Kansas cannot expect a full restoration of our credit rating in the near future.
Kansas continues to have nothing in a rainy-day fund to back stop a national recession.
Payments that are due for public schools and KPERS obligations are slated to be somewhat higher than the projected increases in Kansas growth rates. The tax-supported debt for the State Highway Fund is $2.099 Billion thus greater than the SGF debt of $2.019 Billion.
All in all, unaffordable tax cuts in 2020 plus any expansion in the proposed new transportation plan can spin Kansas towards credit reductions.
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WEALTH Day
Monday February 10
8:15 a.m. to 3 p.m.
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Water, Energy, Air, Land, Transportation
and Health
February 10, 2020
STATE CAPITOL
WEALTH Day is a collaborative effort to highlight environmental, resource, agricultural, transportation and health issues at the Statehouse. Hosts include:
Climate + Energy Project,
Kansas Rural Center,
Kansas Interfaith Action,
Kansas Natural Resources Council,
Kansas City Chapter NAACP,
Metropolitan Energy Center,
Grassland Heritage Foundation, and
Friends of the Kaw.
Join Kansans to learn about and advocate for critical environmental, resource, and social issues at the Kansas State Capitol Building on Monday February 10. Held at the Visitor Center Classroom and Auditorium and on the 1st and 2nd Floor rotundas of the Capitol.
WEALTH Day Agenda -
8:15-8:50 Interfaith Climate Prayer Vigil - Visitor's Center Classroom
9:00-10:15 Policy Briefing - Visitor's Center Auditorium
10:00-3:00 Solutions Showcase: exhibitors - 1st floor Rotunda
11:00-11:30 Local Foods Luncheon - 2nd floor, North Wing
11:30-12:45 Climate Hearing - 582-N
1-1:30
Climate Rally - 2nd floor, North Wing
1:30-2:00
Water Dialog - 118-N
2:00 -3:00 p.m.
Cookies & Conversation - 1st Floor Rotunda
For more information and to register go to CEP's webpage at:
CLICK
HERE for the WEALTH DAY Policy Briefing List of Bills that will be discussed from 9 a.m. to 10:15 a.m.
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KRC's Legislative and Policy Agenda for 2020 and WEALTH DAY
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KRC encourages its friends and constituents to attend WEALTH Day on Monday February 10. The day includes informative sessions on the WEALTH network's key topics,
and opportunities to talk with your legislators, and to familiarize yourself with the Capitol and legislative process as well as to visit the booths and displays from Kansas' network of environmental and social justice organizations and more.
To review KRC's legislative talking points that we would like you to focus on in your visits with legislators on Monday (or in letters or e-mails), click HERE . Not all are reflected in bills being considered this session, but present an educational opportunity for you to share your thoughts with policymakers on issues important to Kansas' food, farm and energy future.
We also attach the Kansas Rural Center's Policy and Legislative Agenda for 2020
HERE. This is a more complete outline of all our state policy priorities.
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Hearings on Raw Milk Sales Bills Next Week
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Hearings will be held Wednesday Feb. 12 on SB 300 which would prohibit sales of unpasteurized milk, and on Thursday Feb. 13, on SB 308 which will
allow on-farm retail sale of unpasteurized milk as long as certain labeling and advertising requirements are met. The bills will be before the Senate Agriculture committee which meets at 8:30 a.m. both days in Room 159-S. To get information about testifying, contact Judy Marks, Committee assistant at 785-296-7353.
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| Farmers' Market Sales Tax Exemption Bill Introduced |
On February 6, HB 2578 was introduced and referred to the House Committee on Taxation. The bill would exempt sales tax on all sales of farm products sold at a farmers' market. We will have more on this in next week's Policy Watch.
Eliminating sales tax at all Kansas farmers' markets would assist low and fixed income shoppers by incentivizing consumers to shop locally, but it would also ease the burden on the farmers selling at the markets. For many growers, the tax is an extra hassle for the small amounts they sell and may deter more growers from participating due to lack of information or paperwork involved. Since farmers' markets are an excellent springboard for increasing growth of more producers growing fruits and vegetables in Kansas and act as incubators for larger operations and related businesses, eliminating the sales tax would support growth of the specialty crop industry, local farmers and economies in Kansas.
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KANSAS CHILD SUPPORT ENFORCEMENT OVERVIEW
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Child support income is vital to thousands and thousands of Kansas children and families. The child support system in Kansas involves 246,799 children (close to 1 in 3 children) and a total of 582,394 unique persons. Unfortunately compared to the other 49 states, Kansas current monthly child support collection rate in 2018 was 56.21% compared to a national average 65.66% placing Kansas 42nd of the 50 states. Kansas was the first state in the nation to completely privatize the Department of Children & Families (DCF) child support enforcement program in 2013. Collections have seen little improvement since that time.
Child support is divided into a DCF portion known as 'IV-D' and a private system known as 'non-IV-D'. DCF does fund the Kansas Payment Center (KPC) that processes 95+% of all child support payments that includes both IV-D and non-IV-D cases. In 2018, KPC handled a total of $423.4 million in disbursements. On the IV-D side the total was $198 million in 1,367,262 payments while the non-IV-D side was $225 million in 593,873 payments. The current monthly support percentages listed above apply only to IV-D cases. Such collection rates are not now available for the non-IV-D cases.
When DCF privatized the system in 2013, ten-year contracts were signed with four entities (the largest to Young-Williams - a private law firm). Kansas is now in year seven of these contracts and questions are being asked on the success of this arrangement? DCF has awarded a contract to Midwest Evaluations and Research from Emporia to evaluate this system and make recommendations for improvements by July 2020.
Kansas uses a judicial model to establish child support orders through district courts while 24 states have adopted an administrative model that uses fair hearing officers instead of the courts. Child support orders can be established somewhat quicker and parents do not need attorneys in the fair hearings model. The Kansas Supreme Court establishes a guideline chart showing the amount of support owed depending on the number of children and the income of the parents so that payment is already determined.
Since two-thirds of DCF's child support program is federally funded, federal regulations prohibit DCF from establishing custody/parenting orders along with the monetary child support order. State resources would be required - but parents that are both financially and emotionally involved with the children are more successful cases. Since DCF contracts with KPC to handle all child support payments, is it possible for KPC to compute the % of non-IV-D payments made as DCF must do with their own IV-D cases?
KRC requested an informational hearing before the House Social Services Budget committee to discuss some of the policy issues listed above. Hopefully this review becomes an annual review of the child support system in Kansas. KRC requested that once the Midwest Evaluations & Research report comes out this summer that the Kansas Legislature will have established an interim committee to review the report next fall and bring recommendations to the 2021 Kansas Legislature in January.
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| CALENDARS for Week of February 10, 2020 |
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For next week's full committee schedules, go to "Calendars" on the Menu at:
HOUSE
Energy, Utilities and Telecommunications Committee 9 a.m. Room 281-N
Tues. Feb. 11 Informational Briefing: "Current Trends in Seismicity in Ks." by Ks. Geological Survey
Thurs. Feb. 13 HB 2585 Exempting the retail sale of electricity by public utilities for electric vehicle charging stations from jurisdiction of state corporate commission.
Agriculture & Natural Resources Budget Committee 1:30 p.m. Room 142-S
Mon. Feb. 10 Budget Hearing Ks. Department of Agriculture (KDA)
Tues. Feb. 11 Discussion & action on KDA budget
Thurs. Feb. 13 Discussion and action on Citizens Utility Ratepayer Board budget
Commerce, Labor and Economic Development 1:30 p.m. Room 112-N
Tues. Feb. 11 Informational Hearing: Kansas Framework for Growth, Brookings Institute
Agriculture 3:30 p.m. Room 582-N
Monday Feb. 10 HB 2463 Amending Kansas Pesticide law's license requirements and Ks. chemigation safety law's permitee requirements
Rural Revitalization 9 a.m. 582-N
Tues. Feb. 11 HB2516 Enacting first time home buyers saving s account act
SENATE
Agriculture & Natural Resources 8:30 a.m. Room 159-S
Weds. Feb. 12 SB 300 Prohibiting the sale of unpasteurized milk for human consumption
Thurs. Feb. 13 SB 308 Allowing the on-farm retail sale of unpasteurized milk so long as certain labeling and advertising requirements are met.
Commerce 8:30 a.m. Room 548-S
Thurs. Feb. 13 Presentation on Kansas Framework for Growth- Economic Blueprint Brookings Institute
Ethics, Elections and Local Government 9:30 a.m. 142-S
Weds. Feb. 12 SB 310 Requiring all voting systems for elections to use individual voter verified paper ballots
Utilities 1:30 p.m. Room 548-S
Tues. Feb. 11 Continuation of the London Economics presentation on Rate Study
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Mark Your Calendar--
League of Women Voters of Kansas Day of Action |
February 13
at the State Capitol 8 a.m. to 5 p.m. (time tentative)
LWVK will have a couple of hours of presentations and time to meet with state legislators about critical issues. Members are encouraged to wear white.
"Women have played a fundamental role in shaping an inclusive and active electorate. Women have powered -- and continue to power -- the vote. On the 100th birthday of the League of Women Voters, we are keeping in line with the fact that we were born from the suffrage movement and are centering our 2020 Day of Action around the theme: Women Power the Vote. "
Stay tuned for further details.
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About Policy Watch and Sponsors
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Contributors to KRC are automatically on the Policy Watch list, if they provide an e-mail address; or you can subscribe just for the Updates for $25. KRC will send complimentary copies to non-contributors for several issues upon request.
To get information on how to support Policy Watch, click HERE!
In 2020, KRC is partnering with the
Kansas Natural Resource Council
(KNRC),
Kansas Farmers Union (KFU), League of Women Voters of Kansas (LWVK), Climate and Energy Policy (CEP), and Friends of the KAW
to send Policy Watch to their members. We thank them for their support.
To opt out of receiving Policy Watch as a member of one of these organizations, see the following:
If you are on KRC's mailing list, and would like to opt out of receiving KRC Weekly Updates, please contact Joanna Voigt at [email protected].
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To learn more about the Kansas Rural Center, please visit our website at
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The Kansas Rural Center
4021 SW 10th Ave. #337
Topeka, Kansas 66604
866-579-5469
www.kansasruralcenter.org
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