Kansas Legislative Session Preview
Lawmakers return to Topeka for the start of the 2020 Kansas Legislative Session on Monday, January 13, with more money in the State General Fund than they’ve seen in years. With tax revenues exceeding estimates almost every month this fiscal year, expect to see some tension around how that excess money is spent. From expanding state government programs to providing tax cuts to their constituents, legislators are coming back with their ideas and proposals in hand.
However, even with the increased tax revenue, budget projections are in the red again in just two years. Mainly due to high demands on the Kansas Public Employee Retirement System (KPERS) and K-12 education, spending increases on healthcare, transportation, and social services are expected to add strain back on the state coffers. Efforts to identify new funding mechanisms to cover future spending won’t be out of the question.
Issues that have been gearing up for prime time during much of the interim include Medicaid expansion, a new state transportation plan, mental health services, and comprehensive tax reform. Notably, the decades-long battle over school finance shouldn’t be a central issue this year.
Taxes will be a top priority for the Republican leadership. Despite the Governor’s veto last year, the Legislature will take another stab at decoupling from Federal law on key items such as the standard deduction, earnings on foreign income, and small business expensing. Taxing internet sales, reducing the food sales tax, and property tax relief will also be on the docket.
As part of the agreement to end the 2019 Legislative Session, the Senate agreed to hold a vote on Medicaid expansion at the beginning of this year. Over the summer and fall, the Senate developed a Medicaid expansion plan quite different from what the House passed, and Governor supported last year. This Senate Republican plan is rumored to be one of the first items taken up this year.
The Kansas Supreme Court issued several decisions earlier last year that could lead to action by the Legislature. In the school finance lawsuit, while the Court ruled that the Legislature’s 2019 fix did indeed adequately fund schools, it retained jurisdiction over the case to ensure appropriations are met. In addition, the Court ruled that the state’s non-economic damages cap was unconstitutional. With the cap on pain and suffering removed, insurance and medical malpractice rates are likely to rise. Tort reform initiatives will be introduced this session to help offset this increase as well as legislation to reinstate the cap on non-economic damages. We could also see an attempt at a constitutional amendment after the Court’s landmark opinion last April that the Kansas Constitution protects a woman’s right to an abortion.
Of course, the upcoming Kansas House, Senate, and Congressional elections will impact the 2020 Legislative Session in interesting ways, as many members are running for other seats. Two state Senators have announced runs for the U.S. Senate seat being vacated by Senator Pat Roberts; several legislators are eyeing U.S. House races; and four state Representatives are challenging current state Senate seats. The 2020 elections will certainly add pressure onto legislators looking for positive votes on which they can campaign.
As we start this new decade, we look forward to representing our clients and will keep you informed as these issues and more unfold throughout the session. Happy new year!