December Revenue Collections
The month of December was the second monthly report based on the revised consensus revenue estimates made in November 2009. Through December, total State General Fund (SGF) receipts for the 2010 fiscal year were $16.8 million below estimates. Tax only collections to the general fund were $17.6 million below predictions. Corporation income taxes collected $140.3 million in December, exceeding estimates by $22.7 million or 19.3 percent. Individual income taxes failed to meet predictions by $29.1 million, or 2.5 percent, while estate and severance taxes collected $1.9 million and $1.2 million less than anticipated, respectively. Tax only receipts through December of FY 2010 are below fiscal year 2009 figures by $243 million. Total SGF receipts through December of FY 2010 are currently $293 million, or 10.6 percent, below FY 2009.

It should also be noted Secretary of Revenue Joan Wagnon collected $40 million in tax settlement agreements through December by using the negotiated settlement authority granted to her by the Legislature during the 2009 session. Consensus revenue estimates for FY 2010 projected $35 million in additional tax collections through the negotiated settlement.

FY 2010 Rescission Bill
On Tuesday, January 19, the Senate Ways and Means Committee is scheduled to begin hearings on Senate Bill 350, the rescission bill for the 2010 fiscal year, in room 548-S.

Senate Concurrent Resolution 1615
The Senate Judiciary Committee is scheduled to hold a hearing on SCR 1615 on Friday, January 15, in room 548-S. The concurrent resolution declares the sovereignty of Kansas and serves as a Notice and Demand to the federal government to immediately cease and desist all mandates that are beyond the scope of the powers delegated under the Tenth Amendment in the United States Constitution. In addition, SCR 1615 prohibits all federal legislation that requires states to comply under threats of penalties or sanctions or requirements that states pass legislation to maintain certain funding.

Governor’s Budget Summary
On Monday, January 11, Governor Mark Parkinson presented his budget and policy agenda during the annual State of the State address. The following information on Governor Parkinson’s proposals is listed below as provided by the Kansas Legislative Research Department.

• The Governor recommends the largest tax increase in Kansas history, a total increase of almost $380 million - $308 million in sales and compensating use taxes and $70 million in cigarette and tobacco products;
• The Governor’s recommended sales tax rate increase from 5.3 percent to 6.3 percent with a 1.0 percent increase in the rate, is an 8.4 percent change;
• The Governor’s Budget Report does not comply with Kansas law requiring that a budget be prepared that has the required State General Fund ending balance requirement of 7.5 percent. This is the first time that no effort is made to comply with the ending balance law;
• The Governor’s recommended FY 2011 State General Fund amount of $5.83 billion is an increase of $380 million or 7.0 percent above the revised FY 2010 amount;
• The Governor’s all funds revised budget in the current year (FY 2010) of $14.5 billion is an increase of $0.5 billion ($536.9 million) or 3.8 percent above the actual FY 2009 amount;
• The Governor’s projected ending balance in FY 2010 is virtually zero, $400,000 and is zero in FY 2011;
• The Governor’s revised FY 2010 all funds budget of $14.5 billion – the first time that the Kansas all funds budget will exceed $14 billion;
• The Governor’s revised FY 2010 all funds budget is an increase of $1.4 billion or 11.1 percent above the FY 2010 budget as approved by the 2009 Legislature;
• The number of authorized full-time equivalent (FTE) positions as recommended by the Governor in his revised FY 2010 budget is an increase of 150.3 FTE positions above the actual number of positions in FY 2009. The FY 2010 revised recommended amount is 41,586.6 FTE positions, as compared to, 41,436.3 FTE positions in actual FY 2009;
• The Governor’s recommended FY 2011 FTE positions is 41,522.6, down from the revised FY 2010 amount by 64 positions or 0.15 percent;
• The Governor’s FY 2011 FTE positions is an increase of 86 positions of 0.2 percent above the FY 2009 actual amount;
• The Governor recommends transferring an additional $80 million from the State Highway Fund to the State General Fund in FY 2010;
• The Governor recommends a $50 Base State Aid Per Pupil increase in FY 2011 at a cost of $32.8 million from the State General Fund; and
• The Governor continues the $8.5 million for the state employee undermarket pay adjustments in FY 2011.

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