Voice For Liberty

Tag: Kansas legislature

Articles about the Kansas legislature, both the House of Representatives and the Senate.

  • Tax policies are not tomfoolery

    By Kansas Representative Richard Carlson, Jonathan Williams, and Ben Wilterdink, both of American Legislative Exchange Council. A version of this appeared in the Wichita Eagle.

    Across the country, states like Kansas are looking for ways to become more economically competitive and grow their economy. Fortunately, Kansas appears to be on the right track. Contrary to a recent column by H. Edward Flentje (H. Edward Flentje: State budget high jinks, February 24 2013 Wichita Eagle), the evidence presented in the American Legislative Exchange Council’s economic competiveness guide Rich States, Poor States is well-researched and empirically supported. In fact, the criticisms of the report that Flentje mentioned are severely lacking in research and substance and have been debunked by several economists quite a few times, including the former research vice-president for the San Francisco Federal Reserve Bank. By choosing to rely less on income taxes and more on consumption based taxes (such as the sales tax), Kansas is on firm footing for real economic growth.

    Mainstream economists agree that taxes represent a net drag on an economy. Furthermore, not all taxes are equally as bad for an economy. A study done by the Organization for Economic Cooperation and Development ranked taxes in terms of most distortionary and damaging to an economy. The study found that taxes on capital and income were the most damaging, while taxes on consumption and property were the least damaging.

    In just the last decade, the nine states that avoid a personal income tax greatly outperformed the nine states with the highest personal income tax rates. The population in states with no income tax has grown 149 percent faster than their high tax counterparts. While states with high income tax rates have lost jobs over the past decade, no income tax states have seen a healthy 5.4 percent growth in jobs. Even state revenue has grown 82 percent faster in no income tax states versus their high tax counterparts.

    Lowering income taxes and broadening the sales tax base while keeping rates low is a key pillar of pro-growth tax reform. These points are well-documented in Rich States, Poor States while the conclusions from the referenced “Snake Oil” critique are based on measuring a state’s growth in per-capita income from 2007-2011 alone (the worst economic downturn in recent history). This is a deceiving metric because it penalizes states that have a high rate of population growth and rewards states for losing citizens (and their incomes). Low tax states are booming with people and businesses flocking into them, mainly coming as refugees from their high tax counterparts.

    For example, California gained no congressional seats in 2010 for the first time in its history; Texas, by contrast, picked up four more seats this census. As people flee high tax states for opportunity and jobs, the population decreases, which can substantially spike the per-capita income of the state. This point is especially relevant when unemployed people leave a state with high taxes to find a job in another (commonly low tax) state. Their $0 of income is no longer calculated into the per-capita measures and neither is their unemployment status. The state they left now has higher per-capita income growth and even a lower unemployment rate, but the state has lost a citizen, a worker, and potential future revenue they would have received, shrinking the overall economy. This is exactly the trend that we are seeing when it comes to migration data and IRS tax return statistics.

    Put simply, efforts to lower taxes on personal income and reform the tax code to keep tax rates low while broadening the base are anything but tomfoolery. The evidence is clear that these tax reform efforts help to grow the economic pie for everyone and will help Kansas achieve greater economic prosperity.

    For an example of how per-capita statistics can mask underlying trends, see In Kansas, more debunking of the benefit of high taxes. Also, see States that Spend Less, Tax Less — and Grow More.

  • Sedgwick County begins legislative updates sharing

    In a move sure to help citizens learn more about government, Sedgwick County has started posting legislative updates from its lobbyist in Topeka. Correction: These reports are from our taxpayer-funded lobbyist.

    The reports can be found on the Government Relations page.

    This program was started at the initiative of Commissioner Karl Peterjohn. Other local units of government should follow this example. These reports, after all, are paid for by taxpayers.

    [gview file=”http://www.sedgwickcounty.org/communications/Legislative%20Activities/2013/week%20740.pdf”]

  • Avoiding the truth about Kansas school spending, Tuesday edition

    Once again we see the Kansas public school establishment dodging the facts about Kansas school spending. An example from yesterday was provided by Kansas House of Representatives Minority Leader Paul Davis on his Facebook page. Here’s what he posted:

    Paul Davis Facebook Posting

    Rep. Davis, it’s not the governor that makes claims regarding the level of school spending in Kansas. The Kansas State Department of Education compiles and reports spending numbers. For those who can’t navigate the KSDE website to find spending numbers, I’ve provided them here, and also at the end of this article.

    From this table we can see that after peaking in fiscal year 2009, state aid to schools fell in 2010. Since then it has risen each year, in both total dollars spent and dollars spent per pupil. (By the way, who was governor when state aid to schools fell?)

    Rep. Davis may be referring to base state aid per pupil when making his argument. That number has fallen. But as you can see, total State of Kansas spending on schools has been rising after falling under a previous governor’s administration. Readers should also note that as Kansas state aid to schools fell, federal aid rose, almost making up the difference.

    I would also remind the minority leader that tax cuts do not have a cost that needs to be paid for. It is government that has a cost. Reducing taxes lets people keep more of what is rightfully theirs, and that is always good.

    Paul Davis Facebook Posting

    Then: A reader left a comment wondering whether the school spending figures included mandatory KPERS payments. These are payments to the Kansas Public Employees Retirement System. These payments are part of the cost of having employees, as long as schools want to provide a retirement plan to their employees. Rep. Davis’ response is correct. The state sends funds to school districts, which the districts then send to KPERS. These funds, then, are included in total school spending figures.

    Which is how it should be. How should the comment “it definitely doesn’t all go to classrooms” and Davis’ response be interpreted? The education spending establishment would like us to ignore that spending. But it’s money that’s spent. It’s part of the expense of having teachers. So does it go to the classroom? You be the judge.

  • Spending and taxing in the states, Kansas and Texas in particular

    Taxes flowing to the capitol

    In the current policy debate in Kansas, we often compare our state with Texas. The prevailing themes sounded by Democrats and other spenders include that because Texas has no income tax, its other taxes (sales and property) are higher. We also hear that Texas is “atop a sea of oil” from which the state collects a gusher of tax revenue.

    But what are the facts? Regarding taxation: In 2011 Kansas state government collected $2,378 in taxes for each person. Texas collected $1,682. We see that Texas collects far less tax per person than does Kansas. Texas may have higher sales or property taxes than Kansas, but the total tax burden in Texas is lower.

    Spending follows the same pattern. In 2011 Kansas state government spent $5,115 per person in total, with $1,974 in general fund spending and $130 in bond spending. For Texas the total was $3,718 spent per person in total, with $1,654 in general fund spending and $50 in bond spending.

    The lower level of spending means Texas has a less burdensome state government, which allows more money to remain in the productive private sector. In Kansas, we spend more on government.

    The “sea of oil” and bountiful severance tax revenue: In 2011 Kansas, which has a severance tax of its own, collected $42.54 in this form of tax for each person. How much did Texas collect from its severance tax? $104.29 per person. The difference between the two — $61.75 per person per year — is only a small portion of the difference between Kansas and Texas taxation.

    To see how your state compares with others in spending, use the interactive visualization below. To use the visualization, click the check boxes to add or remove states and years from the chart. Use the visualization below, or click here to open it in a new window. Data is from National Association of State Budget Officers and U.S. Bureau of Economic Analysis (BEA); visualization created by myself using Tableau Public.


    (alternate link to the above table)


    (alternate link to the above table)

  • Kansas school spending excused

    Kansas public school teachers and the education bureaucracy want taxpayers to trust them as a reliable source for facts about Kansas schools. But the record doesn’t inspire trust.

    At a recent meeting of the South-Central Kansas Legislative Delegation with citizens, teachers jeered when a legislator cited the spending numbers for USD 259, the Wichita public school district. A comment left to a KAKE TV news story claims that spending numbers presented by the legislator are “misrepresented,” because he included every single dollar. In fact, the numbers presented were correct, as explained in In Kansas, don’t mention the level of school spending.

    kansas-school-funding-comment-2013-03-02

    The writer seems to believe that “bond money” shouldn’t count as school spending. This is a common stance taken by public school spending boosters. They argue that spending on buildings, or perhaps on teacher pension costs, shouldn’t count as money spent educating students.

    Part of the reason for this deflection is that when people learn the true level of school spending, they’re usually astonished at how much is spent. So the school spending lobby has to explain — rather, make excuses for — the high level of spending. Recently Kansas Association of School Boards (KASB) recommended Kansans ignore employee pension costs and the costs of buildings and equipment. Here’s how KASB explained this as part of a document titled Questions about recent Kansas Policy Institute survey:

    Finally, districts received $690 per pupil in KPERS contributions for district employees, and districts spent $2,320 for capital costs such as buildings and equipment, payments on construction bonds for new schools, and other local revenues like student fees. None of these funds — almost 25 percent of total revenues — can be spent for regular education operating costs.

    (See Ignore this Kansas school spending, please.)

    Should teacher pension costs and the cost of buildings and equipment be included in school spending? Of course — unless you’re arguing for more school spending.

    The comment writer also claimed that lawmakers have “cut education funding consistently.” As shown on the nearby chart, it’s true that spending on Kansas schools, on a per-pupil basis, fell slightly for two years running. It then rose a small amount last year. Spending from all sources, individually and collectively, is much higher than ten years ago. I don’t see how you can make an argument for consistent cutting — unless you decide to ignore parts of spending.

    Kansas school spending per student, adjusted for CPI

  • In Kansas, don’t mention the level of school spending

    At a meeting of the South-Central Kansas Legislative Delegation today, it was apparent that facts are either not known — or not important — to public school spending advocates.

    The audience for today’s meeting was, apparently, heavily stocked with teachers who were eager to voice approval or displeasure with statements made by either the public speakers or the legislators. At one time the teachers drew a reprimand from Representative Nile Dillmore.

    Here’s what Kansas should learn from this meeting — something important that affects actual public policy: We can’t have an honest discussion of school finance unless we recognize and agree on some facts such as the current level of spending. The teachers in today’s audience either don’t know the facts, or don’t want to talk about them.

    [powerpress url=”http://wichitaliberty.org/wp-content/uploads/2013/03/kansas-school-funding-2013-03-02.mp3″]Teachers react to school spending.

    In the nearby audio clip, Representative Gene Suellentrop told the audience the spending figures for USD 259, the Wichita public school district. According to figures available from the Kansas State Department of Education, he was correct to the dollar. The audience reacted with jeers.

    So we’re left wondering this: Do Kansas schoolteachers know the correct level of school spending? Or do they know, but don’t believe it? Or do they know, but don’t want to talk about it?

    This is particularly troubling for Kansas, as the public school bureaucracy insists on more school spending. But talking about actual school spending is somehow uncouth and deserves to be shouted down.

    Newspaper editorial boards aren’t helping Kansans learn about school spending and student achievement. Surveys find that like the general public across the nation, Kansans are uninformed on school spending.

    This is the uncomfortable condition of public discourse in Kansas. We are lacking in knowledge and facts. Even worse, we’ve taken something that ought to be noncontroversial (the education of children) and turned it into a shouting match. This is what we get by turning over important things to politics.

  • Kansas House votes for property rights

    state-historic-preservation-environsToday the Kansas House of Representatives passed a bill that will protect property owners from harm simply because their property is near a historic property.

    The bill is HB 2118, as described by its supplemental note:

    HB 2118 would delete provisions related to environs restrictions from historic property reviews.

    Under current law, proposed projects within 500 feet of the boundaries of a historic property located in a city or within 1,000 feet of the boundaries of a historic property located in the unincorporated portion of a county are subject to historic design and appearance restrictions.

    The bill would limit historic reviews conducted under the act to proposed projects that would directly involve, damage, or destroy a property included in the National Register of Historic Places or the State Register of Historic Places.

    The bill passed today by a vote of 99 to 24. Those voting against this bill — those who wish to keep the current restrictions on private property rights — were Alcala, Ballard, Becker, Bridges, Burroughs, Carlin, Crum, Davis, Dillmore, Grant, Henderson, Henry, Hill, Kuether, Lane, Meier, Pauls, Ruiz, Sloop, Tietze, Weigel, Whipple, Wilson, and Winn.

  • Kansas school supporters should look more closely

    Those such as Kansas House of Representatives Minority Leader Paul Davis who uncritically tout Kansas schools as among the best in the nation are harming both students and taxpayers when they fail to recognize why Kansas performs well compared to other states.

    Paul Davis Facebook Post, February 22, 2013

    Davis recently posted on his Facebook page a quote from Geary County schools superintendent Ronald Walker: “Kansas has always performed academically in the top 10 of all states. As bills are introduced in the current Legislature without the input of educators, the state is in jeopardy of losing ground.”

    Kansas does perform well compared to other states on the National Assessment of Educational Progress (NAEP), known as “The Nation’s Report Card.” Nearby is a table showing scale scores for Kansas and National Public schools for math and reading in grades four and eight. Looking at the top row, which reports scores for all students, it is the case that Kansas does better than the national average in all cases.

    But if we look at the data separated by racial/ethnic subgroups, something different becomes apparent: Kansas lags behind the national average in some of these areas.

    Why is there this apparent discrepancy? In general, white students perform better than black and Hispanic students. Kansas has a much higher proportion of white students than the nation. In Kansas, about 69 percent of students are white, compared to 53 percent for the entire nation.

    This difference in demographic composition hides the fact that, for example, fourth grade black students in Kansas underperform the national average for black students in reading.

    Some may say that it’s racist to talk about student achievement in this way. But I would ask this: Is it better to gloss over these facts, or to recognize and confront them? These details are not mere numbers on a spreadsheet. They are children.

    Let’s ask Rep. Davis if he’s aware of these statistics.

    Kansas and National NAEP Scores, 2011, by Ethnicity and Race

  • Renewables portfolio standard: Good or bad for the Kansas economy?

    Kansas wind turbines

    A report submitted to the Kansas House Standing Committee on Energy and Environment claims the Kansas economy benefits from the state’s Renewables Portfolio Standard, but an economist presented testimony rebutting the key points in the report.

    RPS is a law that requires the state’s electricity utilities to generate or purchase a certain portion of their electricity from renewable sources, which in Kansas is almost all wind. An argument in favor of wind energy requirementy from the Polsinelli Shugart law firm is at The Economic Benefits of Kansas Wind Energy.

    Michael Head, a Research Economist at Beacon Hill Institute presented a paper that examined each of Polsinell’s key findings. The paper may be read at The Economic Impact of the Kansas Renewable Portfolio Standard and Review of “The Economic Benefits of Kansas Wind Energy” or at the end of this article. An audio recording of Head speaking on this topic is nearby.

    [powerpress url=”http://wichitaliberty.org/audio/michael-head-kansas-rps-2013-02-14.mp3″]Michael Head, Beacon Hill Institute

    Here are the five key findings claimed to be economic benefits to the Kansas economy, and portions of Head’s responses.

    Key Finding #1: “New Kansas wind generation is cost-effective when compared to other sources of new intermittent or peaking electricity generation.”

    The first observation to make from this key finding is that if it were true the state RPS policy is not necessary. If wind power is truly cost-effective compared to other sources of energy, state mandates that wind power be used should be repealed, allowing wind power to compete with other technologies to provide low cost electricity in Kansas.

    This point is obvious. The actions of the wind power industry — insisting on mandates and subsidies — lets us know that they don’t believe their own claim.

    Key Finding #2: “Wind generation is an important part of a well-designed electricity generation portfolio, and provides a hedge against future cost volatility of fossil fuels.”

    Hedging has been, and will continue to be, a useful tool for utilities, and benefits the consumer. But the Kansas state government should not engage in this level of industrial policy by regulating just how much utilities can hedge, all for the sake of requiring wind power production. This is not a benefit in itself. Utilities will attempt to maximize profits by consistently analyzing the energy market and making the best decisions, often through long term purchasing agreements. … In short, hedging is a valuable tool when left to the discretion of the utility, but by utilizing a heavy-handed mandate, state lawmakers are actually constraining the ability of the utilities to make sound business decisions.

    Key Finding #3: “Wind generation has created a substantial number of jobs for Kansas citizens.”

    This key finding fails to take into consideration opportunity costs, a concept that Bastiat explained in his 1850 essay, and is a prime example of the reviewed paper only considering benefits. If a shopkeeper has a window broken, this creates work for a glazer to replace the window. However, this classic “broken window” fallacy mistakes breaking windows as job creation policy. At this point “The Economic Benefits of Kansas Wind Energy” is correct, wind generation does create jobs, just as a broken window creates jobs. But the report stops at this point and fails to provide a complete analysis of the effect of wind generation on total employment in Kansas.

    As Bastiat showed, a consideration must be made to the opportunity cost. How would the shopkeeper have spent his money if he did not need to replace his window? He could use the money on capital investment, further growing his business, hire another worker or make various other purchases. Regardless of what it was, they would have all brought him more benefit, than replacing his window. If not, he would have broken the window himself.

    This is one of the most important points: By forcing Kansans to pay for more expensive electricity, we lose the opportunity to use money elsewhere.

    Key Finding #4: “Wind generation has created significant positive impact for Kansas landowners and local economics.”

    This key finding makes a common mistake by assuming transfer payments are a benefit, a fallacy. The transfers of money via lease payments or property tax payments are not benefits. This transfer of money is a cost to one party and a benefit on the other, and can be illustrated easily.

    What if Kansas wind farms vastly overpaid for their land and lease payments were valued at $1 billion a year. This report would place the benefit of wind power leasing this land at $1 billion a year. But the project has not changed, where did these new benefits come from?

    In fact, there would not be any change to the net benefit of the project. Landowners would amass benefits equal to $1 billion minus the land value and utilities would amass costs equal to $1 billion minus the land value. These costs would in turn be passed along to rate payers in the form of higher utility costs. This illustrates the point that this policy is industrial policy. By dispersing the costs of a project to all citizens in the state, small, but powerful, groups with strong lobbying efforts are able to gather the rewards.

    Key Finding #5 “The Kansas Renewable Portfolio Standard is an important economic development tool for attracting new business to the state.”

    This key finding is related closely with the analysis of the job benefits that wind power purportedly conveys. Of course, legally requiring that utilities use specific sources of electricity will attract new business in that sector to the state. But we need to see the whole picture. This policy has costs, which will be borne by state residents and businesses via higher utility prices.

    In conclusion, Head asked the obvious question: “With all of these supposed benefits of wind power, why does it require a government mandate and taxpayer funding?”