Why does removing the small business exemption mean increasing taxes on the poorest of the poor?

Submitted by Richard Hilderbrand, Kansas District 13 Senator

There is a lot of frustration among the citizens of Kansas over the current legislature’s inability to balance the budget. This frustration is well-founded and must be addressed with a fiscally responsible solution. There is a large percentage of citizens that believe the small business exemption is the cause and want to see the exemption removed. If a tax proposal to remove the LLC exemption was ever to come before both chambers, it would likely pass by a veto-proof margin. If this is the case, then why hasn’t this happened yet? It is obvious this is the one part of the tax plan that most legislators and citizens both believe should be changed. One only needs to look at The Hays Daily News article dated May 5, 2017. In this article, it has this very revealing quote “If we take that part out of the overall tax plan, we take all of our leverage out,” said Sen. Laura Kelly, D-Topeka. Kelly said closing what is often referred to as the LLC loophole is the “politically palatable” part of the tax hikes, but it isn’t the bulk of the money the state needs to raise. “The real money in the tax cuts was not in that provision, it was in the reduction of the brackets,” she said, referring to income tax rates.

http://www.hdnews.net/news/local/lawmakers-continue-hunt-for-tax-solution/article_c688638d-2db8-5911-b855-8e2d60006045.html

In a recent Docking Institute poll, it asked how the citizens of Kansas wanted their legislators to fix the current budget crisis. This is what this poll showed: 41 percent want their legislators to cut spending, 34 percent want their legislators to cut spending and increase taxes, and 25 percent want their legislators to increase taxes to fix this budget crisis. You will notice that 75 percent think all or part of the solution is to cut spending, while none think the solution is to raise state spending.

http://www.fhsu.edu/uploadedFiles/executive/docking/Kansas%20Speaks%202017(1).pdf

Then why do the only bills that we are voting on so far have large increase in spending along with over $1 billion in new taxes to pay for it? This not only defies the wishes of our constituents, but more importantly it is reckless and is fiscally irresponsible. I have heard from those that want to pass this massive tax and spend policy that this is the hardest thing to do. I strongly disagree with this view. The hardest thing to do is continue to vote on your principles and to not be swayed by the emotions of the day. We must get our finances in order and established for a long-term solution, so that our state can get back on the road to recovery.

We do have a budget crisis and our constituents are counting on us to fix this problem. This is something that we must do, we must quit playing politics over this issue. The constituents in Kansas expect the legislators to fund education to meet the requirements of the ruling handed down by the Kansas Supreme Court. They also expect the legislators to fully fund KPERS and to quit deferring the payments that have become the norm. They also want the money that is ear marked for our highways to stay in KDOT.

Just last night the House took up SB 30. It failed on a vote of 53-yeas to 68-nays. If this bill would have passed, and subsequently passed the senate, it would have looked like this:

*It would have raised taxes on every single tax payer by $1.217 billion over the next two years.

*Lowered the minimum earned income from $5,000 to $2,500 for single filers, and from $12,500 to $5,000 for families.

*Retroactively raised the lowest tax bracket for families making $0-$30,000 from 2.7 percent to 2.9 percent for the 2017 tax year.

*Raised the lowest tax bracket for families in year 2018 from 2.9 percent to 3.1 percent.

*Retroactively raised the middle tax bracket for families making $30,001 – $60,000 from 4.6 percent to 4.9 percent for the 2017 tax year.

*Raised the middle tax bracket for families in year 2018 from 4.9 percent to 5.25 percent.

*Retroactively created a new top tax bracket for families making $60,001 and above from 4.6 percent to 5.2 percent for the 2017 tax year.

*Raised the new top tax bracket for families in year 2018 from 5.2 percent to 5.7 percent.

*Retroactively raised the lowest tax bracket for individuals making $0 -$15,000 from 2.7 percent to 2.9 percent for the 2017 tax year.

*Raised the lowest tax bracket in year 2018 from 2.9 percent to 3.1 percent.

*Retroactively raised the middle tax bracket for individuals making $15,001 – $30,000 from 4.6 percent to 4.9 percent for the 2017 tax year.

*Raised the middle tax bracket in year 2018 from 4.9 percent to 5.25 percent.

*Retroactively created a new top tax bracket for individuals making $30,001 and above from 4.6 percent to 5.2 percent for the 2017 tax year.

*Raised the new top tax bracket in year 2018 from 5.2 percent to 5.7 percent.

*Retroactively repealed the small business exemption.

http://www.kslegislature.org/…/doc…/ccr_2017_sb30_h_2129.pdf

This tax bill would have put an even bigger burden on our constituents that are struggling to make ends meet. How can we as a state ask an individual that is making only $2,500 and a family making $5,000 a year to retroactively pay for our out of control spending? It would have classified, per this new tax structure, an individual making $30,001 and a family making $60,001 as rich and taxed them the same rate as someone making $1 million. This is not a fiscally responsible tax plan.

The state has increased its spending in the general fund from $5,268,100,000 in 2010 to an estimated $6,306,030,075 for 2017. This is an almost 20 percent increase in spending over seven years. That is an average increase of 2.46 percent per year. The average rate of inflation during that same period is only 1.7 percent per year. If the state’s spending would have been the same as the rate of inflation, our spending in 2017 would only be $5,807,414,859. The estimated revenue for 2017 is $6,073,100,000. That would have left the state with $265,685,140.54 to go towards meeting some of our other needs that I highlighted earlier.

http://budget.ks.gov/publications/FY2017/FY2017_Comparison_Report–UPDATED–8-15-2016.pdf

http://budget.ks.gov/publications/FY2017/FY2017_GBR_Vol2.pdf

So, I ask this question: Why must the poorest of the poor pay for the states irresponsible fiscal policies?

 

Submitted by Krista Harding

The prolonged periods of rain and wet growing conditions is causing some issues in our area. The conditions we have had recently are ideal for many landscape fungi and diseases to appear.

One fungal disease happening to sycamore trees is anthracnose. Anthracnose is favored by cool, wet weather. The young leaves may wither and turn black. Older leaves will have a brown discoloration that follows the major veins of the leaves. In some cases, the petiole (leaf stem) is infected, which causes leaf drop. Although this is most common on sycamore trees, it can also affect birch, elm, walnut, oak and ash.

In severe anthracnose cases, the tree drops heavily infected leaves and may completely defoliate. However, healthy trees will leaf out again in just a few weeks. Anthracnose seldom causes significant damage to trees in Kansas, so chemical control is not necessary. Fungicides do not cure infected leaves, so applying fungicides now will not help.

Both my climbing and Knock Out roses look good this year and are blooming like crazy! But, I have my guard up and am on the lookout for rose slug infestations. Some people might think that the small green worm they find on roses is a caterpillar of some sort. However, it is not. It’s actually the larva of a sawfly. This insect skeletonizes rose leaves and young larvae will remove the green layer of leaf, leaving behind a clear material. As the larvae mature, they make holes in the leaf and eventually may consume all of the leaf but the major veins. Since these insects are not caterpillars, insecticides with BT will not be an effective treatment. Instead, try a strong jet of water to dislodge the slugs and make it more difficult for them to return to the plant. Other effective treatments include insecticidal soap, horticulture oils, spinosad and permethrin.

Another pesky landscape insect to be watching for is Euonymus scale. Euonymus scale looks like small, white cottony spots on affected foliage. The leaves will turn yellow and die as this insect continues to feed by sucking the plants juices. Heavy infestation happens on the undersides of leaves, twigs and stems. Labeled insecticides include malathion, permethrin and cyhalothrin. However, control is almost impossible for euonymus that has been heavily attacked and is in very poor health. In those instances, complete removal of those plants is recommended.

Finally, watch for rust on hollyhocks. This is the most common disease on hollyhock and can cause serious injury as leaves are progressively killed through the summer. Rust shows up as yellow spots on the surface of the leaves and orangish to brown pustules on the underside. The first line of defense in preventing rust is to remove all hollyhock stalks, leaves and other debris in the fall and destroy it. Remove any infected foliage you see now. A fungicide such as Immunox can be applied to protect healthy foliage. However, if you fight rust every year, I recommend a preventative fungicide application as the leaves emerge in the spring.

Should you have any horticulture questions this growing season, give me a call. As a reminder, I have office hours in each of the three locations within the Extension district. I am in the Erie office Monday, Wednesday and Friday; Iola on Tuesday and Fort Scott on Thursday.

Krista Harding is a K-State Research and Extension Agricultural agent assigned to Southwind District. She may be reached at 620-244- 3826 or [email protected].

K-State Research and Extension is an equal opportunity provider and employer.

Weekly Overview:

Senators spent a lot of time and energy this week on conference committees, wrapping up some final pieces of legislation to send to the Governor’s desk.

On Wednesday, the Senate voted on an income tax increase bill that ultimately failed to garner 21 votes for passage. I voted against this massive tax bill that would have taken over 1 billion dollars out of your incomes and out of our economy. The senate has now gone back to the drawing board and are looking for ways to craft a compromise tax bill that can pass both chambers to help balance the budget. I will keep you posted on the progress as this continues to move forward.

School Finance

As you know, President Wagle appointed a Senate Select Committee on Education Finance early in this legislative session. The committee, chaired by Majority Leader Denning, has been working hand-in-hand with the House’s K-12 Education Budget Committee and the legislature’s outside legal counsel to produce a new school finance formula. The committees have made great strides forward this week, and we look forward to continuing that momentum into next week.

Human Trafficking

On Thursday, both the House and the Senate unanimously passed House Substitute for Senate Bill 40, a bill strengthening anti-human-trafficking laws in Kansas. Kansas Attorney General Derek Schmidt’s office teamed up with legislators to write this bill after identifying ways to best help combat human trafficking. This bill strengthens pre-existing laws and creates new laws, such as a mandatory human trafficking awareness course for truck drivers, so that they may easily identify and report signs of possible human trafficking. Further, this bill will “prohibit using communication devices to facilitate human trafficking or knowingly selling travel services connected with human trafficking. It would also create the crime of internet trading child pornography and increase penalties for sexual exploitation of a child,” as explained in a Topeka Capital-Journal news report. The bill is now waiting for Governor Brownback’s signature.

Thank you for all of your calls, emails, and letters regarding your thoughts and concerns about happenings in Kansas. Constituent correspondence helps inform my decision-making process and is taken into great consideration when I cast my vote in the Kansas Senate. I hope you’ll continue to engage with me on the issues that matter most to you, your family and our community. If you are on Twitter or Facebook, I encourage you to follow along with the #ksleg hashtag for real-time updates on legislative happenings in Topeka. Please know that I am fully committed to addressing the current issues in our state, and am proud to be your voice in the Kansas Senate. You can follow me on Facebook “Hilderbrand for Kansas” and on twitter #Hilderbrand4ks.

FLOOR ACTION:

CONFERENCE COMMITTEE REPORTS:

JUDICIAL SURCHARGE; COLLECTION OF COURT DEBTS (HB 2041): HB 2041 extends the sunset provision for judicial surcharges on several docket fees until June 30, 2019. Current law allows the judicial branch to impose an additional charge per docket fee to fund the costs of non-judicial personnel until June 30, 2017. The bill also would require the cost of collection of debts owed to courts or restitution be paid by the responsible party as an additional court cost in all cases where the party fails to pay any debts owed to courts or restitution and the court contracts with an agent to collect the debt or restitution. Currently under law, the cost of collection is paid by the defendant as an additional court cost only in criminal, traffic and juvenile offender cases. The Senate adopted the Conference Committee Report Tuesday May 9, by a vote of 23-15

EMPLOYMENT SECURITY LAW (HB 2054): HB 2054 modifies provisions in the Employment Security Law regarding access to information, law related to the Kansas Sentencing Commission, law related to law enforcement and law regarding fee funds. The Senate adopted the Conference Committee Report Tuesday May 9, by a vote of 36-2

HUMAN TRAFFICKING AND NEW CRIMES (House Sub SB 40): H Sub SB 40 amends the law concerning human trafficking, including the creation of new crimes and amendments to existing crimes and other related provisions. The Senate adopted the Conference Committee Report Thursday May 11, by a vote of 40-0

AG, SCRAP METAL, AND OFFICE OF THE INSPECTOR GENERAL (SB 149): SB 149 creates and alters law related to the Attorney General, the Scrap Metal Theft Reduction Act and the Office of the Inspector General within the Kansas Department of Health and Environment. The Senate adopted the Conference Committee Report Thursday May 11, by a vote of 40-0

BILL SIGNINGS:

1. Sub. for SB 101 – Adds sexual assault to the list of crimes which allow the issuance of Protective Order, amends the notification of sexual assault examination law and allows for victims of crime to receive compensation for mental health counseling.

SB 205 – Establishes rules for calculating service credit for KPERS employees and provides an increase in death benefits to be paid to the surviving spouses of firefighters who die in the line of duty.

HB 2096 – Amends restrictions on operation of transit buses in Wyandotte County and designates a portion of US-75 as the Eldon K. Miller Memorial Highway.

HB 2098 – Names the Mined Land Wildlife Area bison herd the “Bob Grant Bison Herd.”

HB 2353 – Clarifies definitions related to the State Use Law program.

HB 2356 – Revises various definitions related to the state’s bidding process.

The Governor has now signed 68 bills into law this session and vetoed two. By law, the Kansas governor has 10 calendar days to sign the bill into law, veto the bill or allow the bill to become law without his or her signature.

NEXT WEEK:

Next week is the third week of Veto Session. We will continue working on our three big-ticket items: taxes, budget and school finance. I hope you’ll reach out with any comments, questions or concerns regarding these issues or others. If you are on Twitter or Facebook, I encourage you to follow along with the #ksleg hashtag for real-time updates on legislative happenings in Topeka as we work to wrap this legislative session up.