One way of looking at the impact of the state income tax cut legislation is from the viewpoint of Stafford County, the home of the two candidates in the 33rd senate district Republican primary race. According to census information the Stafford County median family has an annual income of $51,414. With standard deductions and exemptions this family paid $1,592 in state income tax in 2011. Under the income tax legislation this family will pay $1,178 on the same income in 2018 for a reduction of $414.
The Legislative Research Department expects the tax cut legislation to reduce state revenue by $934,000 per year by 2018. The annual state general fund revenue is about $6,000,000, so this reduction is about 16%.
Stafford County has three school districts that spent $11,850,000 in the 2010-11 school year. The state aid totaled $6,054,000 or 51% of expenditures. If this amount was reduced by the expected 16% shortfall in 2018 revenues the districts would lose $1,890,000 in funding. If the district cost per teacher is $75,000 then this would be equivalent to 25 teachers out of the approximately 90 current faculty members. Losing this many teachers would lead to major changes. Consolidating districts may be one possible solution. There have been 18 school district consolidations or dissolutions in the state over the past 12 years.
The Governor stated that the tax cuts will actually increase state revenues due to expanding employment. In the July 22, Hutchinson News candidate survey candidate Mitch Holmes stated he was very confident that the tax cuts will have the desired effect. Candidate Ruth Teichman stated she preferred a more conservative approach to lowering the income tax to avoid a shift to increased property taxes.
In the July 19, Great Bend League of Women Voters forum. Candidate Teichman stated that left unchanged the tax cuts would reduce public safety, education and correction services; that we cannot live and support what we have now and there was a plan in the senate (where she currently serves) that would keep us whole. Candidate Holmes said Teichman votes with Democrats, that there are Democrats in Lawrence and that, “Lawrence is frequently called the San Francisco of Kansas. Is that what you want?”
Both candidates have made decisions that I disagree with, but I intend to vote for Ruth Teichman and urge the voters in the 33rd district to do the same. It would be great if the tax cuts increase revenues, but the odds of that happening are low. I believe Ruth Teichman will pursue a balanced, conservative approach to difficult choices about taxes and services. I believe Mitch Holmes’ emphasis on divisiveness and lack of plan for anything other than the most optimistic outcome would likely lead to retention of the income tax cuts even if revenues decrease as projected, and a reduction in all state services of about 15%, less whatever property tax increase local governments decide to make.