On Friday, April 20, the Consensus Revenue Estimating (CRE) Group predicted that state revenues will be $217 million more than predicted in November for FY 18 and $316 million above estimates for FY 19.  This means that Kansas tax revenues will see a 10% increase over last fiscal year, with the 2017 income tax hike in effect.

It appears that there are sufficient ending balance predictions to fund the recently passed K-12 funding legislation at the $525 million intended level – allowing restoration of the $80 million “error” that was somehow not part of the final language.  No one knows yet if the Kansas Supreme Court will accept the proposed funding plan.  This sets up a battle for the veto session over a long list of general budget items that have not yet been negotiated, repaying internal borrowing from the highway and retirement funds, additional school funding and the Senate’s new tax bill.  The Senate tax legislation is designed to decouple Kansas income tax rules from the Trump tax changes that are predicted to raise state tax bills for those who could no longer itemize.  The Senate tax legislation increases the individual standard deduction.

Senate President Susan Wagle, R-Wichita, is quoted as follows:  "As a result of the strong (President Donald) Trump economy, these numbers include an unexpected federal windfall to the state due to federal tax reform. The surplus from this unanticipated windfall should be returned to the Kansas taxpayers. If any funds remain, we should exemplify fiscal responsibility and make the payments to KPERS that have been delayed and repay the loan that the Legislature took out last year to pay the bills. We owe it to future generations to pay back our current debts and obligations.   "When we return next week, I will urge my colleagues to pass legislation to allow Kansans who currently itemize under state tax law to continue to do so in the future."