Sales tax views aired

4/21/2013

By RACHAEL GRAY

rgray@gctelegram.com

One out of three southwest Kansas legislators say they will vote down extending a temporary sales tax hike Gov. Sam Brownback says is needed to eliminate extreme cuts from the state's budget.

Another local legislator is in favor of the measure, and one is undecided, they told an audience at Saturday's Chamber of Commerce Legislative Coffee held Saturday at St. Catherine Hospital.

Rep. Don Hineman, R-Dighton, said he will vote down the extension in order to maintain his political career. Rep. John Doll, R-Garden City, is in favor of the extension, while Rep. Russ Jennings, R-Lakin, is undecided.

Hineman explained to audience members that politics in Kansas are tough, and that if he approves the extension he will lose his political position in the next election.

"If you make that vote, you're putting your political life on the line," he said.

"If I do vote for it, it would end my political career. Politics in this state are brutal," he said.

"Anyone who votes to extend the sales tax, that vote will be used against them. And then it will be someone else representing the area. I don't know who that will be," Hineman said.

Doll said extending the sales tax hike is necessary for the state.

"If we don't keep sales tax what it is, we won't have a budget in 2015," Doll said.

Jennings is still undecided on the measure, he said Saturday.

He echoed Hineman saying the issue is very political. He said legislators are labeled certain ways for voting certain ways.

"For instance, if you don't support X bill, you are a spend-and-raise liberal," he said.

Kansas could fall into deep financial trouble if lawmakers fail to agree on extending a temporary sales tax hike and cutting popular tax deductions before they end this year's legislative session, according to an analysis of new budget projections.

Brownback's budget division estimates that Kansas will spend all its reserves and still have to cut $64 million from the state's budget in 2014 if lawmakers don't approve tax policy changes, The Wichita Eagle reported Saturday. In 2015, $545 million in cuts would be needed, the figures show.

Last year, Brownback signed into law a measure eliminating taxes on profits for nearly 200,000 businesses and farms and dropping rates for individuals. Those cuts will result in sharp income reductions, according to state tax revenue estimates released Friday.

That's the main reason lawmakers are considering cuts of 2 to 4 percent to higher education, along with reduced funding for aviation training and less money for the state's court system.

The legislators did agree that Brownback's 2012 tax measure was a mistake.

Jennings said the bill originally had big tax cuts and pay-fors that would help make up that deficit.

"Well, they passed the tax cuts but not the pay-fors," he said.

Brownback is pushing lawmakers to extend a temporary six-tenths of a cent sales tax hike, approved in the midst of the recession, which is scheduled to expire in July. House Republican leaders strongly oppose extending the sales tax and have rejected a Senate tax cut plan that extends it.

Brownback wants the sales tax extended as part of his effort to further reduce income taxes and raise more revenue by phasing out tax deductions.

His administration says last year's cuts have to be viewed in conjunction with his proposal this year, which pays for some of the cuts by phasing out tax deductions such as the popular mortgage interest deduction.

The Senate has rejected the governor's proposal to eliminate the mortgage deduction in favor of a plan to phase out all deductions, except for charitable contributions. The Senate plan would bring in $497.3 million in new revenue over five years, with most of that coming from extending the sales tax increase.

During Saturday's legislative coffee, the lawmakers also discussed bringing business to southwest Kansas and growing the economy. Legislators said it's a challenge when the national and state economies are flat.

They also discussed the Affordable Healthcare Act and what it would mean to Kansans.

Doll said the act is a work in progress.

Shawna Deal, St. Catherine Hospital, asked what the measure means for southwest Kansans and business owners.

"That's something that can be better answered in a year," Doll said.

Doll said it would be foolish for Kansas to opt out of the act, as Kansans are paying taxes for it.

Jennings warned that individuals buying their own insurance could see rates double.

He also said the act would mean 300,000 more Kansans are covered if the state participates, and that it would expand positions in medical care.

"I would hate to see us spend the money on federal taxes and then not be receiving the benefits," he said.

Jennings said he wasn't a fan of the act.

"But it's the law and it's not going to change anytime soon," he said.

Hineman said there's a public benefit to having everyone insured.

But he said there are a lot of unknowns in the act the employers are going to have to adjust and expand.

"There's some good to Obamacare, but there are some major frustrations," he said.

Dr. William Clifford, a member of the Garden City Community College Board of Trustees, said Saturday he was disappointed state Sen. Larry Powell, R-Garden City, was not in attendance.

Steve Dyer, Garden City Area Chamber of Commerce president, said the chamber sent several emails and left phone messages with Powell.

"And we did not hear anything back," Dyer said.

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