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Minutes for SB309 - Committee on Ways and Means
Short Title
Creating the fixing instant revenue shock for taxpayers fund and the local extraordinary needs fund, establishing the joint committee on local extraordinary needs grants and abolishing the local ad valorem tax reduction fund.
Minutes Content for Wed, Mar 15, 2023
Chairperson Billinger opened the hearing on SB 309. David Wiese, Office of the Revisor of Statutes, provided an overview of the bill and responded to questions from Committee members. (Attachment 9)
Senator Ty Masterson spoke in support of the bill as it would alleviate revenue shortfalls that would be created by the implementation of SB 248 or any other bill that resulted in a loss of revenue for cities and counties. It establishes two funds and would hold local governments harmless from losses and also adds a small layer of accountability. The fixing revenue shock for taxpayers fund would protect taxpayers from property tax increases and the extraordinary needs fund was developed to help rural communities with large projects such fire stations. Senator Masterson responded to questions from Committee members. (Attachment 10)
Jay Hall, Kansas Association of Counties, testified in opposition to the bill. His organization supports the concepts of both funds but opposes the bill because we are not able to bind future legislatures. While this legislature may appropriate funds, future legislatures may not. If a county loses revenue it will create a gap that would probably have to be made up for by increasing property taxes. There will come a day when we won't be here and there is no legislative mechanism to ensure these funds are always there. Mr. Hall responded to questions from Committee members. (Attachment 11)
Jim Howell, Sedgwick County Commissioner, testified as an opponent of the bill. Sales tax is not a static amount and they saw an average 2.2 percent increase year over year during the last decade. This bill starts with $220 million and that might cover the first year but that likely would end when the budget gets tight. Also, the sales tax was voter-approved and included food so this decision should be up to local governments. Commissioner Howell responded to questions from Committee members. (Attachment 12)
Tim Danneberg, City of Olathe, spoke in opposition to the bill as it does not provide an ongoing funding source to make up for the lost revenue. It would likely require property tax revenue to fill the gap. The Legislature has used this type of approach in the past and it proved unsuccessful. (Attachment 13)
Mike Taylor, Kansas County Commissioners Association, testified as an opponent of the bill. Many communities have used sales tax to pay for bonds for things such as grocery stores. This bill could result in local governments defaulting on those bonds. Basically, there is a lack of trust based on the track record of past legislatures. (Attachment 14)
Written only testimony in opposition to the bill was submitted by:
Dr. JuliAnn Mazachek, President of Washburn University (Attachment 15)
Randy Leis, Kansas Legislative Policy Group (Attachment 16)
Michael Koss, City of Overland Park (Attachment 17)
Matthew Allen, City of Garden City (Attachment 18)
James Crowl, Shawnee County Counselor (Attachment 19)
Nathan Eberline, League of Kansas Municipalities, testified as a neutral conferee. The League appreciates efforts to develop a plan to replace the sales tax revenue lost by proposed exemptions however, the better plan is to not pass SB 248 in its current form. Local governments are wary of trading a guaranteed source of revenue for a year-by-year appropriation by the state. (Attachment 20)
There being no further conferees, Chairperson Billinger closed the hearing on SB 309.
