Kansas lawmakers came back from their spring break this week and were confronted with more bad economic news. The state collected $4.4 million less in taxes in April than expected. It was the first monthly report on tax collections since state officials issued a new, more pessimistic fiscal forecast less than two weeks ago. At the same time, a new monthly survey - the Mid-America Business Conditions Index - indicated slow economic growth remains ahead for several Midwestern states, including Kansas. And, estimates for state sales tax revenue has been downgraded by $30 million dollars for the current and coming fiscal years. With Kansans spending less money for gas, economists had expected them to spend more money elsewhere, boosting sales tax receipts. But that hasn't materialized. The state faces a $400 million budget shortfall in the fiscal year that begins July 1st but filling that hole could be complicated by a looming court decision on public school funding.
A three-judge panel in Shawnee County ruled in December that Kansas needs to spend $548 million more per year on K-12 education. The ruling is under appeal by the state, but the court has scheduled a hearing next week. Some political pundits have speculated that the judges might rule against a recently approved method of funding public schools that uses block grants for the next two years. If that happens, the state will likely appeal to the state supreme court. However, lawmakers could still be forced to address the issue of public school funding again, just as they are trying to wrap-up this year's legislative business.
Lawmakers took today (FRI) off but will have much work to do next week as they consider tax hikes and budget cuts, while trying to craft a new state budget.