State shortfall deepens

Kansas? revenue shortfall deepened in October, setting off another round of speculation that budget cuts, tax increases or a combination of both would be needed to balance the budget and protect school funding.

For October, revenue fell $14.9 million below estimates, leaving the state $57.4 million under projections for the fiscal year, which started July 1, according to figures released Nov. 2. That shortfall is close to the amount of the ending balance legislators left when they ended the 2015 session in June.

This past Friday, state budget experts, citing a sluggish economy, especially in the farm, oil and gas sectors, decreased Kansas revenue projections through June 2017 by $354 million.

The revised revenue analysis required Gov. Sam Brown?back?s administration to implement $124 million in budget maneuvers to prevent a deficit in the current fiscal year. The adjustments included diverting $50 million for highway projects.

School funding wasn?t cut in the administration?s moves, but with the budget in perpetual crisis and school finance making up half of the budget, cuts could soon be under consideration.

Essentially the state is operating with a minuscule ending balance that could be wiped out at any time.

The precarious budget situation prompted more calls from moderate Republi?cans and Democrats to roll back Brownback?s income tax cuts from 2012 and 2013, which included exempting limited liability companies from paying state income taxes.

Ever since the tax cuts have taken effect, the state has faced numerous fiscal cliffs and last session Brownback signed into law sales, cigarette and alcohol tax increases to help balance the budget.

Republicans increased the state sales tax from 6.15 percent to 6.5 percent to balance the budget. But since then, state sales tax collections have fallen below projections?$14.8 million for October, and $34.3 million for the fiscal year.

While many legislators have said they want to protect the current level of K-12 funding, Brownback?s budget director, Shawn Sullivan, told The Associ?ated Press (in late October) that he would not rule out cuts to public schools. ?I?m not going to officially take it off the table at this point,? he said.

Editor: This analysis of the state?s revenue situation was produced by the Kansas Association of School Boards.

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