While budget deficits are common in most states this year, Kansas has been hit particularly hard by revenue shortfalls that have increased the state’s red ink to more than $300 million.
Measures taken by former Gov. Bill Graves to plug the money drain, along with improved revenue collections for December 2002, has provided some relief, but it will undoubtedly take additional cost-cutting and revenue generating options to get Kansas where it needs to be.
Legislatures and other officials are looking for ways to give the state’s budget some breathing room.
Unless the state takes drastic measures to curb flow of money from the general fund, the state will be facing a $600-million deficit in 2003 and $1-billion deficit in 2004.
Budget cuts already undertaken by the former administration include withholding $48 million in payments to local governments, cutting more than $70 million from the budgets of state agencies, and keeping a $94.6-million repayment of a loan from the Kansas Department of Transportation’s (KDOT) Comprehensive Transportation Program (CHP). Further recommendations include moving the on-demand transfers of sales tax collections on motor fuels from the general fund to the CHP.
Although Gov. Kathleen Sebelius will recommend proposals to the state legislature to increase revenue from gambling sources and collection of sales tax on Internet sales, the loss of revenue earmarked for the CHP may not be recovered. In her state of the state address, Gov. Sebelius has already recommended withholding demand transfers through 2004, totaling more than $250 million. If this trend continues through the life of the CHP in 2009, the total loss will be nearly $1 billion.
According to KDOT Public Information Officer Marty Mathews, this will have a definite impact on CHP projects. “It will have an impact, although exactly what projects will be affected is unknown,” he said.
The CHP has a total budget of $13.4 billion, which will be collected and spent through 2009.