Capitol Comments Articles
Joint Budget Committee Meets

Budget Plan (Jan. 11, 2024) – Today, the Senate Ways and Means Committee met jointly with the House Health and Human Services Committee to get a Consensus Revenue Estimate Report. The committee, chaired by Senator Rick Billinger (R-Goodland), received a presentation from the Kansas Legislative Research Staff on Human Caseloads.

The group has revised estimates in fiscal years 2024 and 2025 based on expenditures in last fiscal year and future considerations. The committee heard that the estimate for FY 2024 is a decrease of $65,8 million, or 1.3 percent, compared to previous estimates. The estimate for FY 2025 is an increase of $122.6 million, or 2.5 percent, from all funds, including a State General Fund increase of $45.9 million. The revised estimates for all human service consensus caseloads is $5.0 billion from all funding sources, including $1.5 billion SGF for FY 2024 and is $5.1 billion from all funding sources, including $1.5 billion from SGF for FY 2025. The KanCare portion of estimates for FY 2024 is $4.5 billion from all funding sources, including $1.2 billion SGF, a decrease of $71.9 million. And in FY 2025, the KanCare portion of estimates for FY 2025 is $4.7 billion from all funds, including $1.2 billion SGF.

Staff highlighted Medicaid unwinding and its changes impacts to estimates in addition to the highlighting that 48,000 individuals have lost coverage during the unwinding, with 64.3 percent of those being under the age of 21.

The committee also heard from fiscal analysts on the most recent Consensus Revenue Estimates for FY 2024 and FY 2025. The overall estimate for FY 2024 was decreased by $67.7 million. Of that amount, the estimate for total taxes was decreased by $65.0 million, while the estimate for other revenues was a decrease by $2.7 million. The estimates include some growth in the FY 2024 and FY 2025 but also include consumer price growth in 2025 and 2025.

For FY 2024, the group is estimating State General Fund receipts to be $10.284 billion, a decrease of $67.7 million below the previous estimates. Total SGF receipts of $25.7 million were highlighted.

In FY 2025, the initial estimates for FY 2025 is $10.257 billion, and is a .3 percent decrease below the newly revised FY 2024 total.

The committee also saw a five-year overview, based on the latest CRE, and including projected expenditures for caseloads and school finance. The SGF Profile shows ending balances in FY 2024 of $2.8 million, with estimated balances in future years:

  • FY 2025 - $3.5 billion
  • FY 2026 - $3.8 billion
  • FY 2027 - $4.1 billion
  • FY 2028 - $4.5 billion

Next, the committee heard from Secretary of Administration and Director of the Budget Adam Proffitt, who presented Governor Laura Kelly's FY 2025 budget proposal. The proposal, the base from which the legislature will use to build their own budget, is a starting point for legislative budget discussions.

Proffitt highlighted the proposal uses one-time revenues to pay for one-time expenditures, including:

  • $500 million for early debt retirement
  • $500 million for capitol projects
    • Hutchinson Correctional Facility
    • Topeka Correctional Facility medical/behavioral support building
    • KHP Training Academy
    • KUMC Cancer Research Center (including a private match)
  • $200 million for post-secondary education projects
    • KSU Ag Innovation Initiative (matching dollars)
    • FHSU Stroup Hall expansion for nursing workforce development
  • $80 million for community investment projects (housing, infrastructure, etc.)
    • Emergency housing matching dollars
    • World Cup operation Matching dollars
    • Moderate Income Housing
    • KDHE small town water infrastructure grants

Proffitt highlighted the governor's proposed tax plan, including:

  • Exempting social security income from state income tax
  • Increases in standard deduction for personal income tax
  • Speeding up the state level food ingredient sales tax and include diapers and feminine hygiene products
  • Add a back to school state sales tax holiday
  • Exempt first $100,000 of appraised value for residential homeowners
  • Increasing the childcare tax credit
  • Restoration of the LAVTRF transfer in FY 2025

The need for Medicaid expansion was highlighted with an update on the most recently passed states. The director emphasized this is a SGF 15-year budget neutral proposal. Additional investments of $2.0 million in the Kansas nursing initiative were included. On the topic of education, the governor's proposal includes funding for Early Childhood Care and Education to increase capacity, sustainability grants and a pilot program in NW Kansas, in addition to funding for special education. Water investments also were emphasized.

Upon questioning, the Senate President Ty Masterson (R-Andover) pointed to other states with Medicaid expansion having less workforce participation. The budget director cited 77 percent of those that could qualify have at least one working adult in the household. He also pointed out that during the pandemic, the workforce participation didn't go down when people couldn't get kicked off. The Senate President questioned that 150,000 don't have access to health care and suggested expansion could displace those currently eligible for Medicaid. Representative Kristey Williams (R-Augusta) asked Secretary Proffitt about work requirements and if similar requirements have been given. Representative Stephen Owens (R-Hesston) discussed the disabled wait list, and questioned how many people qualify for exchange subsidies, and asked about how many people would come off private insurance, and suggested that hospitals and physicians lose money on Medicaid. Committee members questioned about the federal government expenditures and suggested we aren't meeting current obligations for those on the waiting lists.