BUDGET COMPROMISE REACHED
The House and Senate compromised on a $10.2 billion “all funds” budget for fiscal year 2005 this week.  This budget decreases state spending by three-tenths of one percent.  The budget follows many of the recommendations set out by Governor Kathleen Sebelius this January. The budget provides for the funding of all state programs, excluding education and transportation, which will be debated at a later time.  The plan also provides all state employees with a three percent pay raise.
The most significant change in the budget from the Governor’s is in the allocation of funds for early childhood education.  The Governor recommended allotting $10 million for the statewide expansion of Smart Start programs, which help families that have young children with daycare and parenting education.  The House reduced this amount to $4.1 million, adding $2 million for family preservation programs and $200,000 for infant and toddler health.  The final compromise allocated $8.4 million for Smart Start. $14 million was also added for physically and developmentally disabled and frail-elderly who meet low income guidelines.
As a point of interest, a recent study by Kansas State University found that Kansas ranked 48 in spending per capita on human support services. The budget will now be sent to the Governor for her approval.  I ended up NOT supporting this legislation (HB 2675) because it includes a pay increase for elected officials, and I just don’t think it is appropriate to be giving Kansas politicians a pay increase at this time.
ARKANSAS SCHOOL FINANCE SOLUTIONS DETERMINED BY COURTS
Like Kansas, the State of Arkansas currently has a lawsuit in the courts deeming their school funding system unfair to all students.  After an extended special session of the legislature failed to find a solution to this inequality, the court appointed special masters to direct the state’s school finance formula.
The current proposal would provide a new finance formula that gives more money to schools based on the number of low-income children they serve, a new testing system, $40 million for a pre-kindergarten program, and a $10 million study of facilities needs.  These proposals are a $400 million increase for education.  Consultants hired by the courts had recommended improvements of $847 million.  The special masters will determine if this plan meets the conditions set forth by the court in the next few weeks.
The Arkansas case mirrors our education situation in Kansas in several ways.  Arkansas and Kansas are states that both have about 2.6 million people and over 300 school districts. The terms of the lawsuits are very similar and the Kansas courts have indicated that they will intervene if the legislature does not come to a compromise on school funding. The Kansas House has already passed two school funding bills, one providing a $155 million increase in school funding.  The Senate has yet to pass an education plan.  The case in Arkansas demonstrates the importance of the Kansas legislature finding a solution to the school funding problem in Kansas.  It is important that dollars are spent in the classroom, not the courtroom.  It is likely the legislature can devise a solution that will cost taxpayers less than a court designed solution.
I believe that to provide long term improvement to education is to facilitate long term economic development.  Education and economic development go hand in hand when we help citizens acquire the knowledge and skills needed for our knowledge based, high-tech economy.  By providing a quality education to Kansas students, we will help ensure the prosperity of our state for years to come.
SENATE YET TO PASS EDUCATION PLAN
This week the Senate failed to pass two education plans, adding up to four education plans being voted down in the Senate. The Senate considered the $155 million plan passed by the House last week.  The plan only received 16 of 40 votes.  The Senate also voted on a Senate leadership plan, which only received 12 votes.
The Senate also voted down the Governor’s Education First and a smaller Senate leadership plan earlier in the session. The House passed HB 2940 last week which provides for a definition of suitable education as it pertains to our K-12 schools. During debate, a compromise school finance proposal proposed by Rep. Bill Kassebaum (R-Burdick) was successfully amended into the bill to suitably fund our K-12 schools.  The amendment was broken into five distinct parts. Part one was to strike the original language of the bill. That part of the amendment failed while all other parts of the amendment were passed and added to the Bill. I voted for all five parts of the Kassebaum amendment.
The Bill provides for $155.4 million in new education spending:
1. Increase the Base State Aid per Pupil by $10058.5 million
2. Increase at risk weighting from 0.10 to 0.1527.1 million
3. Increase Bilingual weighting from .20 to .221.2 million
4. Increase special education funding from 82.2 to 100%54.3 million
5. Increase the LOB from 25% to 30%14.3 million
The taxing provisions include:
1. 4.5% surcharge on personal income tax, generating approximately $90 million.
2. 2/10 of a penny increase in the sales tax to 5.5%, generating approximately $66 million.
This education plan received bi-partisan support in the House and gained the support of the Governor.  The Senate is expected to debate a new school finance plan before the end of the week.
BILL WOULD CREATE HEALTH CARE SAVINGS PLANS
A bill being worked now in conference committee works with current federal law to create Health Savings Accounts (HSA) for Kansans. The new HSA allows Kansans to deposit 100% of their health insurance deductible into the account and carry over any balance to future years.  This money is taken out of their paycheck before state and federal taxes are applied.  This money can be used for co-pays, dental expenses not covered by insurance, vision care and over the counter medicine.  Kansans need to seek this service through their current health care service to see if this is offered.
HSA is substantially different from current medical savings accounts.  The medical savings account required a minimum of $2500 entered into the account and the balance had to be used within the year and would be lost if not used during the current calendar year. This money from the HSA can be used upon retirement for long term health care and it is hoped to reduce the burden on Medicaid or supplement the services Medicare doesn’t provide.
BIG TENT COALITION HOLDS RALLY AT THE STATEHOUSE
This week the Big Tent Coalition rallied at the statehouse to gain support for their cause.  The Big Tent Coalition is a group of 80 advocacy groups that want to eliminate waiting lists for in-home services for the elderly and disabled.
The current budget has an increase of $13 million in funds to decrease the number of Kansans on waiting lists for in-home services.  The Big Tent Coalition is lobbying for an additional 38.8 million to eliminate the waiting list entirely. Home and Community Based Services are available to individuals who may not be able to remain in their home without extra help.  The frail elderly waiver provides those services to low income seniors ages 65 and older.  Waivers are also available to help disabled Kansans with in- home services so that they can maintain their independence.
This waiver provides funds to pay for services that keep people independent.  By providing certain services, people can stay in their own homes instead of moving to a more expensive nursing home. In addition to the personal benefits the frail elderly waiver provides, home care is significantly less expensive than nursing home care.  The average annual cost of providing home care is $11,424 per person.  The average annual cost of nursing home care is $30,412.
CONCEALED-CARRY WEAPONS BILL TO GO TO GOVERNOR
House bill 2798 passed through the conference committee of the House and Senate this week and will now move onto the Governor. The bill allows Kansans to carry a concealed weapon after paying a $150 application fee and passing a background check by the Kansas Bureau of Investigation.  Permit holders are also required to complete a firearms safety and training course.  After the background check and training, the KBI would issue a permit. The bill prohibits concealed weapons from many locations, including police stations, prisons, courthouses, polling places, government offices, establishments that serve liquor primarily, schools, and mental health facilities.
I own firearms, enjoy hunting and trap shooting, and strongly support our 2 amendment rights to have firearms.  I voted against the concealed-carry weapons bill, however, based on several letters I received from constituents asking me not to support this bill.  The Governor has promised to veto this legislation, and I do not think there are enough votes in the House to override her veto.  I would also expect another attempt will be made again next year to pass this legislation (or some variation of it).
STREAMLINED SALES TAX BILL STALLED IN SENATE COMMITTEE
The House passed House Bill 2599 last month, which delays implementation of Kansas’s Streamlined Sales Tax Law, passed last session, until Congress has acted on this issue.  The Streamlined Sales Tax Law, which calls for destination-based sourcing has caused some problems for small businesses, causing several legislators to call for its repeal.  This bill has yet to pass out of Senate committee this session.
Destination-based sourcing requires businesses to charge sales tax based on the point of delivery, rather than the location of the business.  This is a complete change in sales tax collection in Kansas.  Kansas has joined into the Streamlined Sales Tax Project, the combined effort of 40 participating states and the business community working to establish uniformity among the several states’ sales tax laws.
After last session, Governor Sebelius asked for a moratorium on implementation of the law in order to give businesses time to learn how to comply.  At the same time, the Department of Revenue was updating its technology to ease implementation and collection.  Software is now available on the Department of Revenue’s website that allows a business to figure sales tax by using an address.
Many Kansas businesses have already taken the necessary steps to become compliant with this law.  Also, several large online retailers, such as Amazon.com, Toys R Us, Babies R Us and  Target are now remitting sales tax on Kansas orders. When fully implemented, the Streamlined Sales Tax law will also assist cities, school districts and the state by capturing an estimated $71 million to $150 million that is lost in sales tax revenue to these out-of-state companies.  That is money that could be used to strengthen our schools and provide essential services to Kansans and hold down taxes for Kansas residents.
ENHANCED 911 COMPROMISE REACHED
The House and Senate both passed bills this session that would add fees to cell phone users’ bills to purchase technology for E911 services.  E911 allows emergency dispatchers to physically locate a cell phone user after they make a 911 call. E911 service is already available to land-line phone customers, but nearly half of all calls coming into emergency dispatch centers are from cellular phones.  Technology to provide E911 service would be purchased from revenue collected by adding a 50 cent fee to cell phone users monthly bills.  Land-line customers already pay similar fees.
Both houses had passed different amounts for the fees to be assessed.  In the compromise, the maximum fee will be 50 cents, with the largest counties having a maximum of 25 cents by 2010. The bill will now move on to the Governor for her signature.  I voted to support this legislation.

Paid for by Tom Holland for Kansas Senate
Kris Marsh, Treasurer