They’re back! The 2020 Session began last Monday with much of the hall talk focused on the recently revealed Medicaid expansion plan deal brokered by Governor
Laura Kelly and Senate Majority Leader
Jim Denning. How the issue plays out is still unknown but enthusiasm for an expansion plan passing this session is high. As a reminder, all 40 Senate seats and all 125 House seats will be up for election this fall so look for this once every four-year occurrence to add an extra helping of politics into the mix this session.
New face in the JOCO delegation. Senator
Mary Pilcher-Cook, a 15-year veteran of the statehouse, announced in late December she would step down after the first week of session. GOP delegates from the Shawnee area selected long-time local TV meteorologist
Mike Thompson to fill the remainder of her term. He was assigned to the Senate Commerce; Judiciary; Education and Public Health and Welfare committees. Thompson has announced he will run for a full term this fall. Welcome to the JOCO delegation Senator Thompson.
Congratulations Brad Stratton. Join us in congratulating former Chamber Board Chairman Brad Stratton on his appointment and confirmation to the Kansas Public Employees’ Retirement System (KPERS) Board of Trustees. Stratton was confirmed by the Senate on January 16.
Governor’s State of the State and Budget. On Wednesday evening Governor
Laura Kelly addressed a joint session of the legislature for her second State-of-the-State address. Major themes of her speech included Medicaid expansion; continued efforts to close the so-called "Bank of KDOT" and instituting reforms recommended by the Tax Policy Council she assembled last year including relief from high sales tax on food. Kelly also spoke globally about the Kansas economy, her support for the federal United States Mexico Canada Trade Agreement (USMCA) and concerns about the impact of layoffs at Wichita’s Spirit AreoSystems.
House Speaker
Ron Ryckman delivered the GOP response, rebutting what he characterized as the Governor’s band aid approach to fiscal policy. Ryckman promised the GOP-led legislature would offer budget proposals that would put Kansas on a stronger financial footing in the years ahead. Look for the budget – and the revenue proposals to support it – to be a major source of friction throughout the session.
On Thursday, before a joint session of the House Appropriations Committee and the Senate Ways and Means Committee, Governor Kelly’s budget director,
Larry Campbell, walked lawmakers through the high points of her proposed nearly $20 billion budget. In the overview Campbell touched on a few details:
• Limiting to $158.7 million the transfer of state highway funds to the general fund which he pointed out is $73.1 million less than last year’s transfer;
• Reamortizing KPERS over 25 years;
• Allocating $53.2 million for food sales tax relief;
• Early payoff of $602 million in existing debt including the Pooled Money Investment Board (PMIB) loan and bonds associated with the now-replaced Department of Commerce IMPACT program;
• An 8.0% ending balance.
Detailed analysis of the Governor’s proposals will occur in the coming weeks as lawmakers pore over the details in legislative committees tasked with crafting the state’s budget for the next fiscal year. To review the presentation and the details of the Governor’s budget proposal use this link: https://budget.kansas.gov/budget-report/
Economic Development. Secretary of Commerce
David Toland had a busy week making presentations to various House and Senate committees on activities within the department. Specifically, his presentation on the effectiveness of the Rural Opportunity Zone (ROZ) program drew a lot of interest. The department’s analysis showed the program is not producing the intended result of incentivizing relocation to rural communities.
The department’s analysis showed that 91% of the ROZ-eligible counties sustained out-migration. Of the seven counties that reversed that trend under ROZ the highest rate of change over the duration of the program was Linn County at only 2.47%. While that is certainly better than losing population the minimal percentage change didn’t fill anyone with tremendous optimism about the effectiveness of ROZ. Further analysis showed that 83.83% of the respondents indicated the benefits of ROZ had very little to do with their decision to relocate. To read the report,
click here.
The Department of Commerce and the House and Senate Commerce Committees, with analysis from Legislative Post Audit, will continue to look at the state’s menu of incentive programs with an eye toward eliminating ineffective programs and instituting new or revised programs that aid economic development professionals in growing the Kansas economy.
The department also announced it has launched its transparency database as a result of legislation passed during the 2019 session. The Overland Park Chamber supported this legislation last session. To view the database,
click here.
Toland also spoke to legislators about the much-discussed audit reviewing the Economic Development Initiatives Fund (EDIF) – a program designed to bolster economic development efforts in Kansas. The audit report found that only about $7.8 million (18%) of the EDIF funds in FY 2018 went to programs consistent with the intent of the enabling legislation while 34% of the funding ($14.4 million) was allocated by the legislature to programs that could be considered as related to economic development.
Additionally, the report found that 48% ($20.1 million) was appropriated by lawmakers to the state general fund and thus nearly impossible to show its relevance to economic development. The Chamber continues to advocate for strong economic development tools that are vital to recruitment and retention efforts and will work closely with the legislature to ensure economic development resources, including the EDIF, are used to their fullest potential. To read the full report,
click here.
USMCA. While certainly not Topeka, the passage of the United States Mexico Canada Trade Agreement (USMCA) is noteworthy none-the-less and thus it warrants inclusion in this week’s Report. The Chamber has supported this legislation and we are pleased that
Senator Pat Roberts,
Senator Jerry Moran and
Representative Sharice Davids all voted to adopt USMCA. This successor agreement to NAFTA is vitally important to trade in Kansas.
The Office of the United States Trade Representative indicates that Kansas exported $4 billion worth of exports to Canada and Mexico in 2018. The multi-faceted agreement has numerous provisions that:
• opens the door for more balanced trade with agricultural products;
• provides greater protection for intellectual property;
• helps open markets by addressing barriers to free trade;
• cuts red tape that impact customs and trade rules.
The Week Ahead. Following today's Martin Luther King, Jr., Day holiday, the legislature begins to move into a higher gear with committee action beginning to heat up. Most notable may be hearings in the Senate Public Health and Welfare Committee on SB 252 – the Medicaid expansion bill and hearings on a Constitutional amendment (SCR 1613 and HCR 5019) that would “reserve to the people the right to regulate abortion through their elected state representatives and senators.”
Upcoming Events:
Legislative Policy Series.
Breakfast #2 in our series held in conjunction with the Johnson County Public Policy Council begins at 7:30 a.m. on Saturday,
February 8. Panelists will be: Senator
Dinah Sykes and Representatives
Chris Croft,
Susan Ruiz,
Sean Tarwater and
Brandon Woodard. For more information or to make reservations,
click here.
Public Policy Committee Meeting. The next meeting of the Public Policy and Advocacy Committee will be noon-1:30 p.m. on Friday,
February 14 at the Chamber. Our guest is Director of the Budget
Larry Campbell.