Senator Hilderbrand Legislative Newsletter Feb. 7

I had the opportunity to present Jake Holmes of Mulberry a Senate Tribute. Jake took home the gold at the Junior World Finals in Las Vegas, and became a world champion in the 12 and under tie-down roping and breakaway.

ATTORNEY GENERAL TESTIFIES ON MEDICAID EXPANSION

Attorney General Derek Schmidt testified for just under an hour before the Senate Public Health and Welfare Committee. Most of his time was spent reviewing three types of cases currently being argued in high level courts, which may put several ACA provisions in jeopardy. Several of these provisions, if overturned, would affect the current Medicaid expansion plan.

The second type of cases the Attorney General explained were cases related to the Health Insurance Providers (HIP) fee. Currently, the State of Kansas, along with five other states, is involved in a suit in the United States District Court arguing that HIP fees, which are mandated by the ACA, are a de facto tax on state treasuries. The states contend the federal government does not have the legal authority to tax state treasuries. This case is currently awaiting a hearing in the 5^th Circuit Court of Appeals.

The final type of cases the Attorney General brought to the committee’s attention were those dealing with religious freedom and its interaction with health insurance. The State of Kansas recently joined an amicus brief filed by sixteen states alleging the current religious exemption rules in the ACA ensure that proper respect is afforded to sincerely held religious objections to rules governing this area of health insurance and coverage.

REVENUE NUMBERS ARE GOOD; TAXPAYERS SHOULD BENEFIT

Kansas has collected more tax revenue than expected almost every month for more than two years now and in January the trend continued. The latest Department of Revenue report released last week shows collections were nearly $60 million more than anticipated leading Republican legislators to continue to work on their plans to help Kansans benefit with long-term tax solutions. Two bills being heard in the Assessment and Taxation Committee are SB 294 and SB 295 which demand transparency in property taxes and rising appraisal rates.

The $60 million more than analysts predicted translates into a 9% January surplus. Since the current budget year began in July, tax collections have run nearly $111 million more than budget officials expected. Even with extra revenue being collected monthly, Governor Kelly continues to reject that idea that Kansans should be able to itemize on their mortgage interest, healthcare costs, and property taxes.

Hearing on SB 294(I cosponsored this bill) was held in Assessment and Taxation on Tuesday, February 4^th

Honorable Wayne Niederhauser, Former State Senate President from Utah, gave a presentation on the Utah Tax Model. The goal of their Property Tax System is to protect taxpayers against automatic or unnecessary property tax increases as well as allow local government to pay for the services they provide for constituents.

The bill wants to promote transparency by implementing Truth-In-Tax. If the local entity wants to receive more property tax revenue this year than last year, they may adopt a higher property tax rate than the Certified Rate. Before they adopt that a higher rate, the entity must notify all property owners within the jurisdiction that they plan to raise property taxes and when and where they hold a public hearing about the proposed property tax hike. In the public hearings, the City Council explains why they want to increase property taxes. Members of the public may express support or opposition to the proposed property tax hike. At the conclusion of the hearing, the local elected officials must vote on the final property tax rate.

A helpful 8 minute video to help understand Utah’s Model can be found at https://www.wasatch.edu/domain/1437

Hearing on SB 295(I cosponsored this bill) was held in Assessment and Taxation on Thursday, February 6^th

The goal of SB 295 would be to prevent the county appraiser from increasing the valuation of property solely as a result of normal repair, replacement, or maintenance of existing structures, equipment, and improvements in their property. The bill indicates that normal repair, replacement, or maintenance does not include new construction. There are things such as building sheds or adding square footage that should be looked at when appraising a property, but many believe that homeowners should not be penalized for maintaining their property. The way the system is set up now ends up taxing many out of their homes causing people to leave. As Kansas has seen more people leave than migrate into the state, this bill would help keep many in their homes and in the state.

GOVERNOR’S REORGANIZATION PLAN

We’re still researching the pros and cons on how one massive agency proposed by Governor Kelly would affect some of Kansas’ most vulnerable citizens.  The governor submitted an Executive Reorganization Order, ERO 44, to create a new Health and Human Services Agency which would combine the Department of Families and Children (DCF), Kansas Department of Aging and Disabled Services (KDADS) and the Juvenile Services Division of the Department of Corrections.

The current Secretary of KDADS and DCF, Laura Howard, is set to head the new department and has been crisscrossing the Statehouse to meet with Legislators and share the Governor’s vision.

People who support the merger say the ability to offer a range of services to a single family through one office as an advantage. However, many of the programs within these agencies are already facing criticisms in the news and among the public. The Department for Children and Families, for example, has been working to ensure Kansans foster children find homes and will no longer be sleeping in workers’ offices.

The Senate Health Committee has 30 days to review the Executive Reorganization Order and decide whether or not to send it to the full Senate for further review.  The Senate will then have an additional 30 days to respond.

IS GOVERNOR KELLY GETTING READY TO INTRODUCE HER VERSION OF THE GREEN NEW DEAL?

Governor Laura Kelly submitted Executive Reorganization Order Number 46 to the Senate last week. This ERO moves the Energy Office out of the Kansas Corporation Commission and establishes it as a separate, independent entity. The Governor claims the reorganization will allow the office to preserve its existing programs but will also allow the office to begin developing policy, including developing a state energy plan and engage in “stakeholder outreach.”

The Governor said the reorganization is a first step for the state to draft a comprehensive energy plan, a strong suggestion made by London Economics (more on that below), which, we can assume, would focus strongly on renewable energy and energy efficiency.

I AM PROUD TO BE A COSPONSOR OF THE PLAN TO KEEP KPERS SOLID

Several Republican Senators along with myself sent SB 368 to the Ways and Means Committee. SB 368 will pay back money owed to the Kansas Public Employee Retirement System (KPERS) and should also serve as a message to Governor Kelly that her plan to use state employee pension funds to balance her budget is not one that we support. We must be vigilant in keeping KPERS strong for our teachers and state employees.

The bill pays off $268 million in state/school group debt to KPERS and will save the state $209 million in interest payments by doing so early. Notably, once the funds are transferred, they cannot be removed from the KPERS Trust Fund. This bill is similar to the 2019 SB 9 which passed both the House and Senate unanimously. SB 368 has 23 sponsors.

AT-RISK STUDENT FUNDING CONCERNS

School District officials from across the state came to Topeka to urge members of the Education Committee to preserve high-density at-risk school funding. The $50 million funding source is set to run out at the end of the current school year unless the Senate approves SB 271. Districts qualify for the additional high-density funding source when the at-risk population is 35% or more of all students.

I will be supporting this bill as long as it does not get amended in a negative way. If this statute is allowed to sunset, it will have a negative impact on every school district in my Senate district.

UTILITY STUDY RESULTS ARE IN

The Senate Utilities Committee heard a full report on the Kansas Electric Rate Study from London Economics International, the firm chosen by the committee to complete an in-depth analysis of the causes of Kansans’ high electric bills. The firm completed Phase One of the rate study, focusing specifically on rate-making options and possible ways to improve the competitiveness of Kansas electricity. A.J. Goulding, LEI president, and Gabriel Roumy, managing consultant of the study, spoke for just under an hour about the firm’s process to study electric rates in Kansas.

Our state’s rates have made headlines in the last several months for being considerably higher than the regional average. The LEI study found the primary reasons for these unusually high rates to include high tax rates in the state, slowing consumer demands for electricity, investment by electric providers in complying to strict government standards related to the environment and increasing transmission costs.

RAW MILK HAS VOTERS TALKING

The Senate Ag and Natural Resources Committee will hear two controversial, and competing, bills next week related to the sale of raw milk. Presently, the state allows the sale of raw milk. However, there are two caveats: all raw milk must be sold on the premises of the farm where it is produced and dairy producers may only advertise their raw milk products by posting a sign on their farm premises stating raw milk, or raw milk products, can be purchased on that premises. Current statutes prohibit farmers and other dairy producers from advertising raw milk in any other way, including verbally telling potential customers about their products in any place except their farm. Raw milk proponents contend this statute makes it nearly impossible to sell their product.

The existing statute was challenged in November 2019 when two goat farmers, who sell raw goat’s milk, contended in the Shawnee County District Court that the strict advertisement laws violated their 1^st and 14^th Amendment rights. In an unprecedented move, both the Kansas Attorney General, Derek Schmidt, and the Kansas Secretary of Agriculture, Mike Beam, conceded to the court, agreeing the statute was unnecessary and unenforceable.

Secretary Beam then began urging the 2020 Legislature to amend the state’s raw milk statutes, which leads us to where we are today.

SB 300 (to be heard on Wednesday): This bill strikes all language from current statutes that makes the sale of raw milk legal. In effect, this bill would require all milk sold throughout the State of Kansas to be pasteurized before it is sold to any consumer.

SB 308 (to be heard on Thursday): This bill legally allows the on-farm retail sale of raw milk products only if they conform with specified labeling standards outlined in the bill. These standards state the label of the raw milk product must include the following warning: “This product contains ungraded raw milk that is not pasteurized and, as a result, may contain organisms that cause food-borne illness, especially in infants, young children, older adults, pregnant women and people with weak immune systems.” The warning must be printed in uniform size and must be in the same size font as the largest font used on the label.

An identical warning must be printed on all advertisements used for the sale of raw milk products. However, the bill would allow raw milk producers to advertise their products in any way they desire, provided they include the required warning statement somewhere on the advertisement. This would make current statues comply with the District Court’s ruling on the advertising rights of raw milk producers.

COMING UP NEXT WEEK

Monday, February 10 (Last day for committee bill requests)

Ø Hearing: SB 267 — Clarifying that a violation of the statute requiring secured vehicle loads is a traffic infraction. (8:30, Transportation, 546-S)

Ø Hearing: SB 305 — Increasing the bond amount required for a vehicle dealer license. (8:30, Transportation, 546-S)

Ø Discussion and action: SB 252 — Expanding medical assistance eligibility and implementing a health insurance plan reinsurance program. (9:30, Public Health and Welfare, 118-N)

Ø Hearing: SB 321 — Amortizing the state and school KPERS unfunded actuarial liability over a 25-year period and authorizing the transfer of $268,412,000 from the state general fund to the KPERS fund during fiscal year 2020 and eliminating certain level-dollar employer contribution payments. (10:30, Ways and Means, 548-S)

Ø Hearing: ERO 45 — Transferring the functions of the state employee health benefits plan and the state worker compensation self-insurance fund from the department of health and environment to the division of the state employee health benefits plan within the department of administration. (10:30, Ways and Means, 548-S)

Ø Hearing: SB 335 — Authorizing school districts to pay the tuition for a student’s dual enrollment in a postsecondary educational institution. (1:30, Education, 144-S)

Ø Hearing: SB 380 — Prohibiting municipalities from imposing additional requirements on video service providers for the provision of wireless services. (1:30, Utilities, 548-S)

Tuesday, February 11

Ø Hearing: SB 152 — Authorizing the secretary of health and environment to collect underground injection control program fees and redirecting water well license program fees. (8:30, Agriculture and Natural Resources, 159-S)

Ø Hearing: SB 153 — Providing for department of health and environment response operations for water and soil pollutant release, discharge or escape (8:30, Agriculture and Natural Resources, 159-S)

Ø Hearing: SB 326 — Increasing the age for eligibility to renew drivers’ licenses online to 65. (8:30, Transportation, 546-S)

Ø Hearing: SB 342 Allowing drivers’ license renewal notices to be sent electronically. (8:30, Transportation, 546-S)

Ø Hearing: SB 242 — Property tax abatement for agricultural improvement destroyed or substantially destroyed by a natural disaster. (9:30, Assessment and Taxation, 548-S)

Ø Hearing: SB 279 — Expanding the property tax exemption for property used to provide humanitarian services to include additional not-for-profit organizations. (9:30, Assessment and Taxation, 548-S)

Ø Hearing: SB 338 — Allow municipalities to adopt an alternate budget procedure. (9:30, Ethics, Elections and Local Government, 142-S)

Ø Hearing: SB 290 — Updating how the securities commissioner may be appointed and removed.(9:30, Financial Institutions and Insurance, 546-S)

Ø Hearing: SB 289 — Updating the version of risk-based capital instructions in effect. (9:30, Financial Institutions and Insurance, 546-S)

Ø Discussion and action: SB 304 — Establishing a process by which a reciprocal may convert to into a mutual insurance company. (9:30, Financial Institutions and Insurance, 546-S)

Ø Discussion and action: SB 252 — Expanding medical assistance eligibility and implementing a health insurance plan reinsurance program. (9:30, Public Health and Welfare, 118-N)

Ø Discussion and action: SB 283 — Authorizing sports wagering under the Kansas expanded lottery act.(10:30, Federal and State Affairs, 144-S)

Ø Discussion and possible action on: SB 255 — Appropriations to the University of Kansas Medical Center; creating the Cancer Research and Public Information Trust Fund. (10:30, Ways and Means, 548-S)

Ø Hearing: SB 354 — Amending the private and out-of-state postsecondary educational institution act clarify the state board of regents’ authority and provide additional student protections and institutional accountability. (1:30, Education, 144-S)

Wednesday, February 12 (last day for individual bill introduction)

Ø Hearing: SB 300 — Prohibiting the sale of unpasteurized milk for human consumption. (8:30, Agriculture and Natural Resources, 159-S)

Ø Hearing: SB 361 — Affording public employees and professional employees certain rights with respect to withholding of public employee organization and professional employee organization dues.(8:30, Commerce, 548-S)

Ø Hearing: SB 315 — Providing for the love, Chloe foundation license plate. (8:30, Transportation, 546-S)

Ø Hearing: SB 316 — Providing for the together as one foundation license plate. (8:30, Transportation, 546-S)

Ø Hearing: SB 278 — Expanding the ability for cities and school districts to operate and finance a community historical museum. (9:30, Assessment and Taxation, 548-S)

Ø Hearing: SB 310 — Requiring all voting systems for elections to use individual voter-verified paper ballots. (9:30, Ethics, Elections and Local Government, 142-S)

Ø Hearing: SB 292 — Granting the commissioner of insurance flexibility in assessing certain excess lines coverage penalties. (9:30, Financial Institutions and Insurance, 546-S)

Ø Hearing: SB 347 — Concerning insurance department regulations for financial examinations, including requirements for hiring consultants, examination fees and examiner compensation. (9:30, Financial Institutions and Insurance, 546-S)

Ø Hearing: SB 334 — Modifying certain rules of evidence in the code of civil procedure related to authentication of records and documents. (10:30, Judiciary, 346-S)

Ø Hearing: SB 344 — Removing the requirement to photograph vehicles in the scrap metal theft reduction act. (10:30, Judiciary, 346-S)

Ø Hearing: SB 348 — Increasing reimbursement rates for providers of home and community-based services under the intellectual or developmentally disabled waiver. (10:30, Ways and Means, 548-S)

Ø Hearing: SB 339 — Allowing the state corporation commission to approve certain electric contract rates and associated cost recovery from all rate classes. (1:30, Utilities, 548-S)

Thursday, February 13

Ø Hearing: SB 308 — Allowing the on-farm retail sale of raw, unpasteurized milk so long as certain labeling and advertising requirements are met. (8:30, Agriculture and Natural Resources, 159-S)

Ø Hearing: SB 275 — Eligibility requirements for restricted driving privileges and elimination of additional 90-day wait period of suspended or revoked licenses. (8:30, Transportation, 546-S)

Ø Hearing: SB 356 — Clarifying the weight restrictions for drivers’ licenses. (8:30, Transportation, 546-S)

Ø Hearing: SB 320 — Expanding the definition of “infectious disease” in certain testing statutes related to crimes in which the transmission of body fluids from one person to another may have been involved.(9:30, Public Health and Welfare, 118-N)

Ø Hearing: SB 359 — Removing the monetary cap on irrevocable prearranged funeral agreements.(9:30, Public Health and Welfare, 118-N)

Ø Hearing: SB 362 — Allow retail sales of fireworks all year; extend the seasonal sales of fireworks; repeal the ban on bottle rockets; allow cities and counties to regulate or ban fireworks sales. (10:30, Federal and State Affairs, 144-S)

Ø Hearing: SB 333 — Modifying criminal procedures relating to a defendant’s competency or incompetency to stand trial. (10:30, Judiciary, 346-S)

Ø Hearing: SB 332 — Changing requirements for court orders directing a child to remain in a present or future placement issued for children in need of care. (10:30, Judiciary, 346-S)

Ø Hearing: SB 336 — Creating the Kansas reinvest in postsecondary education act. (1:30, Education, 144-S)

Friday, February 14 (last day for committee bill introductions)

Ø Happy Valentine’s Day!

Ø 8 AM Session

Ø Hearing: SB 346 — Authorizing the insurance department to retain the proceeds of the sale of insurance department surplus real estate and any improvements thereon in the insurance department service regulation fund. (10:30, Ways and Means, 548-S)

Ø Many committees will meet on call of the chair.

Thank You for Engaging

Thank you for all 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 I am proud to be your voice in the Kansas Senate.