“I am concerned for the security of our great nation; not so much because of any threat from without, but because the insidious forces working from within.” General Douglas MacArthur.
On the 9th I attended the USD 490 School Board regular monthly meeting and was given the opportunity to provide an update on the state of the Kansas economy and listen to the concerns of the various board members. We engaged in a dialog and four members expressed their views and asked me about the direction I thought the state budget was heading.
We had a brief discussion on the consolidation of services topic. I am not recommending consolidation of schools, and I do not wish to shoot any mascot, I am trying to engage a meaningful discussion on what may or may not work to get us out of this funding shortfall. I am not a proponent of forced consolidation, I am just informing my constituents of rumblings in the capitol halls.
I want to get away from “that will never work”! and get to “well we never did that before, lets talk about it”. As far as consolidation is concerned statute provides for consolidation by an agreement between the districts desiring to consolidate or by edict from the State Board of Education. I think we all could agree that we do not want the State BOE to require us to make this change.
I believe the board has a good understanding of the dire financial status of the state economy and that the district will certainly have to face reduced funding. I would congratulate them on the exceptional work they have accomplished to date, many cuts have been made, positions remain unfilled, they continue to monitor the economic condition of the state and at the same time provide for the education of our children.
The latest revenue estimates indicate we are about $235 million short to finish out this fiscal year that ends on June 30th. As we violate state law that requires a 7% ending balance and come out of this fiscal year with a zero balance, we enter FY 2011 $263.5 in the hole. We must end with a zero balance. To get to the statutory required 7% ending balance June 30, 2011, we need around $700 million.
One topic that came to the front was the consideration of a top to bottom review of tax exemptions and tax abatements. Kansas has attempted to change the way we do business on several occasions over the years, I have been told.
Any time the mentioning of broadening the tax base by removing exemptions and/or including services in the sales tax rate have been met with stiff resistance. The Internet has vastly changed the need for high cost fixed property. The reliance on property tax is now and has been the mainstay of taxes due to its reliability, stability and ease of administration. It is also the most contentious and challenged form of taxation.
Property tax is the preferred method of increasing revenues to the state, cities and counties. All government entities could boast of no increase in mill levy, while at the same time revenues were increasing 3% to 10% annually. Think about your property tax appraisal.
The Department of Revenue website; www.ksrevenue.org is the best source for statistical sales tax information. From their homepage surf over to statistics, then to sales tax report. The state currently exempts sales tax for over 100 entities and categories of services. The 2008 numbers are $6.05 Billion in exemptions, with $1.9 Billion in sales tax receipts. Yes, we exempt more than we take in.
The exemption for off road diesel fuel used for farming and construction resulted in a total of $88,147,009 in uncollected sales tax. What about lifting this exemption? Call all your farmer and contractor friends and run this one by them. An extra $.05 (1 nickel) per gallon of gasoline sold last December would bring in close to $8 million.
Now here is a thought! What if we all decided that we could live without any tax exemptions for say a year? We could put that $6 Billion against our debt, budget shortfall, SRS waiting lists, school funding, highway construction, create a “rainy day fund” or (insert your favorite entitlement here) or a combination of them all. This is not what I propose, I just it bring for your comment.
I REALLY hope I get your opinion on this update.
I hope you all had a good celebration of Veterans Day. I spent the day with the El Dorado Middle School 8th grade Class. I was able to do double duty as a Veteran of the US Army and as a Legislator. We had a great day discussing the aspects of military service and the role of a citizen legislator. I presented some handbooks on Representative Democracy to the students that they will use later this week in their discussions. .
I consider it an honor and privilege to be your representative in Topeka and I do want to know what you think. Contact me at home 316-321-2087, 1115 Rim Rock Road 67042, johng@carlisleinc.net; previous editions of this newsletter are available at www.johngrange.net. Thanks again, John.
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