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AP: State expects $179M from federal jobs legislation
Published 8/13/2010 in Local News
TOPEKA (AP) — New federal legislation has prevented a new financial crisis in Kansas, but questions remained Thursday about how long the state's current budget would stay balanced.
Officials estimate Kansas will receive $179 million from legislation enacted this week to help states and prevent layoffs of teachers and government workers. Without it, the state would have faced a $131 million shortfall in its $13.7 billion budget.
But the relief isn't exactly what state legislators anticipated when they drafted Kansas' spending blueprint for the fiscal year that began July 1. Some officials wonder whether some of the funds will come with rules limiting how Kansas can use the money.
Even if the bailout preserved the state's finances for now, as Democratic Gov. Mark Parkinson contends, prominent Kansas Republicans expect problems later this year.
"I still believe we have a very fragile budget," Kansas Senate Ways and Means Committee Chairman Jay Emler, a Lindsborg Republican, said Thursday. "If there's a problem in any one month, then we have to worry about how we're going to balance it at the end of the year."
The state expects to receive an additional $87 million in funds for Medicaid, which covers medical services for the poor and disabled. Another $92 million would go to public schools.
Legislators assumed in their budgeting that Kansas would receive $131 million, all of it Medicaid funds.
U.S. Department of Education officials said they plan to release guidelines today for how states can use the new education dollars. They said flexibility for individual states will depend on how well they've maintained education funding at pre-recession levels.
Parkinson's administration believes Kansas will be able to substitute federal dollars for state school aid, freeing up state dollars for other parts of the budget — and perhaps leave a small cushion.
But other budget gaps still could emerge, depending on how well the state's tax collections meet expectations.
State officials also anticipate that a statewide property tax levy helping to finance public schools could raise from $25 million to $30 million less than anticipated this year because property values have declined.
"I think our kind of best guess from what we hear is that this may simply be a wash all around," said Mark Tallman, a lobbyist for the Kansas Association of School Boards.
Democrats have promoted the $26 billion federal legislation as saving thousands of teachers' jobs nationwide.
Parkinson's office said the state could have avoided as many as 3,600 layoffs, depending on how it would have responded to a budget shortfall of $131 million.
"There was no way education was going to be protected with that size of a hole," Parkinson spokeswoman Amy Jordan Wooden said. "There's just no math that gets you there without teachers being laid off."
But the state Department of Education had no figures on potential layoffs, and Kansas House Appropriations Committee Chairman Kevin Yoder, an Overland Park Republican, was skeptical.
Yoder said federal bailouts for states will end eventually, and Congress should concentrate on creating new private sector jobs instead of preserving government employment.
"If we don't have private sector growth, more cuts are coming," Yoder said of the state's budget.
Stephene Moore's campaign noted Thursday that the new federal spending is financed partly by rewriting tax laws for individuals and corporations with overseas income.
"Kevin Yoder is continuing to side with corporations that ship American jobs overseas, instead of our teachers, families, and community," Moore campaign manager Matt Sinovic said.
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