Secretary King on Sales Tax

By Tim Carpenter:

Members of the House Appropriations Committee absorbed a warning Tuesday that reacting to the state’s budget deficit by seizing the 0.4 percent of Kansas sales tax earmarked for highway programs would result in swift cancellation of projects.

The dedicated source of transportation funding was authorized in 2010, when the Legislature adopted a three-year, 1-cent spike in the sales tax to prevent deeper budget cuts.

Gov. Sam Brownback and Republican lawmakers maneuvered in 2013 to set the sales tax at 6.15 percent, higher than the scheduled rollback to 5.7 percent, but leave in place the 0.4 percent previously earmarked for the Kansas Department of Transportation.

“It is important to us - it is imperative to us - that that four-tenths stays with us,” KDOT Secretary Mike King said. “You take that four-tenths away from us, you take our borrowing ability away from us, and we would cut projects. We would cut projects in this calendar year.”

“If you think about it from a debt perspective,” King said, “the people that are loaning us money, they want to see, ‘OK, what’s your assets? What’s your cash?’ “The state’s 10-year highway improvement program, known as T-Works, has been a favorite target of Brownback’s budget staff. With a state deficit of $700 million during the next 18 months, the governor recommended peeling an extra $250 million from KDOT reserves to stabilize the budget.

Under the proposal Brownback submitted to the Legislature, KDOT would be capable of completing allT-Works projects that have been initiated. Reworking of the agency’s budget blueprint would force about $297 million in project delays in the next two fiscal years, King said. King said stripping out an average of $220 million provided annually to KDOT with the 0.4 percent salestax would prevent the agency from completing projects on the 2015 calendar.

Senate Minority Leader Anthony Hensley, D-Topeka, said stripping out the sales tax money allotted to KDOT would result in weakening of the state’s transportation infrastructure and undercut the economic development benefits derived from public works projects.

“I definitely oppose taking the four-tenths from KDOT,” Hensley said. “Secretary King is right. It would be destabilizing and downright jeopardizing of future projects.”

The senator said there had been discussion among some legislators about absorbing the KDOT sales tax revenue into the general budget, along with implementation of a higher state gasoline tax. Brownback also has proposed raises in the tobacco and alcohol taxes.

House Minority Leader Tom Burroughs, D-Kansas City, said the T-Works initiative has been one of the biggest job creators in the state and should be funded to “prevent irrevocable damage to the safety of our roads and transportation infrastructure.”

“If Governor Brownback continues to make withdrawals from the ‘Bank of KDOT’ to cover the state’s budget shortfall, planned projects will not just be delayed but cancelled,” Burroughs said. KDOT officials presented the House budget committee with documents showing 1,165 highway projects had been completed under T-Works. The program also had allowed for improvement of 8,600 miles of road and repair or replacement of 650 bridges.

The majority of the state’s bridges and interstate highways carry a rating of “good,” King said. The state’s goal is to have 85 percent of bridges with that rating. Kansas figures for bridges at that benchmark: 87.2 percent in 2010, 87.7 percent in 2011, 87.5 percent in 2012 and 86.4 percent in 2013.

In terms of surface roads, the percent achieving that quality rating was higher for interstate roadways. The numbers: 96.9 percent in 2010, 96.2 percent in 2011, 98 percent in 2012 and 96.3 percent in 2013. Noninterstate roads haven’t rated as highly, with marks at 86.4 percent in 2010, 84.4 percent in 2011, 83 percent in 2012 and 83.4 percent in 2013.


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