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Kansas Liberty: 06 November 2008
Forecasters say Kansans could be looking at a $1 billion deficit 18 months from now
Governor orders steeper cuts in face of budget crisis
Kansas is headed for a financial disaster, but nobody's sure yet exactly what to do about it.
Gov. Kathleen Sebelius said Wednesday she ordered state agencies to trim their budgets in light of a likely budget deficit of $137 million in fiscal year 2009.
It's the governor's second such effort to rein in spending. Earlier this year, Sebelius asked state agencies and departments to pare their 2009 budgets by two percent and their 2010 budgets by five percent.
It could get a lot worse. If current trends continue, Kansas could face a budget deficit of almost $1 billion by June 2010.
Sebelius said at a press conference Wednesday that she upped the targeted cuts to three percent in FY 2009 after the new forecast on the pending deficit was made public. But she also admitted she had no solution to offer, saying only that she was pursuing "a wide variety of options."
Unlike the federal government, Kansas is prohibited by state law from running a budget deficit. So, the shortfall will have to be made with either tax increases or spending cuts, or a combination of both.
Sebelius acknowledged during the press conference that there would be little appetite among legislators for tax increases when the session convenes in January.
Some legislators have indicated that the state’s budget crisis is the worst since 2002, when Gov. Bill Graves engineered a $250 million tax increase, but still had to cut education and social spending to ensure the state would remain in the black.
The Kansas Board of Regents has already defied her request to cut spending two percent and said they would ask for a four percent increase instead. Sebelius acknowledged that even if agencies comply with her order, the savings still would not cover the projected deficit.
"I haven't taken anything off the table between now and January," she said. "I'm going to continue to pursue a wide variety of options, some of which may have to wait until the Legislature returns."
- Phil LaCerte
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