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Governor's Budget Balancing Options: (From the GBA memo)
In order to balance the FY 2016 and FY 2017 budgets, I offer the following three choices to the 2016 Legislature:
Option One Governor’s Allotment Authority The Governor would use his special allotment authority to reduce most of the remaining sales tax going into the State Highway Fund. This would transfer $70.0 million to the State General Fund in FY 2016 and $115.0 million in FY 2017.
The Governor would also carry forward into FY 2017 the 3.0 percent reduction made to Universities in FY 2016, which would be $17.7 million in reduced expenditures.
Legislative Approval Required
In option one; the state could securitize future tobacco settlement payments in excess of $42.0 million for an estimated one-time revenue infusion of approximately $158.0 million in FY 2017. Children’s programs currently financed through the Children’s Initiatives Fund would continue to receive funding of $42.0 million per year. Legislative approval to securitize future tobacco settlement payments would be provided to the Governor through a budget proviso.
Option Two Governor’s Allotment Authority The Governor would use his special allotment authority to reduce most of the remaining sales tax going into the State Highway Fund. This would transfer $70.0 million to the State General Fund in FY 2016 and $115.0 million in FY 2017.
The Governor would also carry forward into FY 2017 the 3.0 percent reduction made to Universities in FY 2016, which would be $17.7 million in reduced expenditures.
The Governor would also utilize the special allotment authority to reduce expenditures or transfer $25.0 million in targeted efficiency savings.
Legislative Approval Required
In option two, the FY 2016 fourth quarter KPERS payment would be delayed, as provided for in 2016 House Substitute for SB 161, but repayment would not be made until FY 2018. Legislative approval to reduce KPERS contributions and delay repayments would be provided to the Governor through a budget proviso.
Option Three Governor’s Allotment Authority The Governor would use his special allotment authority to reduce most of the remaining sales tax going into the State Highway Fund. This would transfer $70.0 million to the State General Fund in FY 2016 and $115.0 million in FY 2017.
Legislative Approval Required
In option three, three to five percent expenditure reductions would be made to most state agencies for FY 2017 and would total $139.3 million. Following is a summary of the reductions that would be made to state agencies:
3.0 percent reduction
Department for Aging & Disability Services (excludes HCBS appropriation) – $11,001,850
Department of Agriculture – $296,831
Department of Administration (excludes debt service) – $282,047
Fort Hays State University – $1,016,467
Office of the Governor – $201,225
Kansas Guardianship Program – $34,389
Health & Environment—Environment – $133,228
Historical Society – $130,885
Department of Labor – $9,363
KSU—Veterinary Medical Center – $452,898
Kansas State University—ESARP – $1,422,673
Emporia State University – $948,769
Pittsburg State University – $1,085,716
State Library – $120,751
Board of Regents (excludes debt service) – $5,930,603
Court of Tax Appeals – $23,837
Department for Children & Families (excludes caseloads) – $4,225,999
Department of Education* – $ 57,262,285
* The Department of Education reduction excludes KPERS, bond/interest aid, LOB aid and Capital Outlay aid.
University of Kansas Medical Center – $3,365,797
Kansas Water Office – $34,637
5.0 percent reduction
Health & Environment—Health – $35,636,050
Kansas State University – $5,122,604
University of Kansas (excludes debt service) – $6,814,504
Wichita State University – $3,728,210
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