Senate President Ty Masterson, R-Andover, said he was disappointed with the bipartisan opposition leading to rejection of proposed constitutional amendments limiting state tax increases and altering selection of justices to the Kansas Supreme Court. (Sherman Smith/Kansas Reflector)
TOPEKA — The Kansas Senate voted early Thursday to defeat a proposed constitutional amendment requiring bills raising taxes to earn support of two-thirds majorities in the House and Senate, and the chamber derailed a sales tax exemption for disabled veterans to thwart potential debate on a statewide reduction in the state sales tax on groceries.
The Senate struggled through dozens of bills during a marathon session, including hefty measures on the COVID-19 pandemic and taxation policy, before adjourning for a long weekend.
Senate President Ty Masterson, R-Andover, said he was disappointed Democrats and a sprinkling of Republicans denied Kansas voters an opportunity to decide on an amendment to the Kansas Constitution restraining tax hikes and an unrelated constitutional amendment mandating nominees to the Kansas Supreme Court undergo Senate confirmation.
Both resolutions failed to attract the minimum 27 votes to advance to the House. The tax amendment vote was 25-14, while the judicial amendment was closer at 26-13.
“With prices continually rising and inflation projected to continue for the remainder of the Biden administration, families are feeling the squeeze,” Masterson said. “They deserve to vote on whether it should be harder for the Legislature to take more of the peoples’ money.”
John Wilson, president and chief executive officer of Kansas Action for Children, said the Senate’s rejection of the tax resolution recognized state government ought to be nimble enough to respond to financial challenges threatening core state services.
“This outcome means our state can continue properly funding our public schools, fixing our roads and investing in our state’s future,” Wilson said. “This resolution would have been harmful to Kansas in the long term by locking us into our current unfair tax system by requiring two-thirds of both chambers to vote in favor of any tax increases or new taxes, but not for tax cuts.”
Sen. Tom Holland, D-Baldwin City, tried to amend a GOP-sponsored tax bill with a sales tax exemption on grocery and household items purchases by honorably discharged, 100% disabled veterans. He wanted to add it to a bill containing sales and income tax policy, but Senate Republicans decided inclusion of sales tax policy wasn’t germane to the base bill.
“These are our veterans who are 100% disabled. They have broken their bodies in their duty to America,” Holland said. “If this body can be so cold and calculating and heartless as to not give our veterans a sales tax exemption … I would say our values in this chamber are not germane.”
Masterson, the Senate’s president, said rejection of Holland’s amendment wasn’t about validity of the policy or emotional appeal of the idea.
“We’re a body of order and a body of rules. Otherwise, you have chaos,” he said. “It’s a game of bridges. That’s what the play is.”
In other words, if the Senate leadership allowed a sales tax for veterans on House Bill 2239 then it would be primed for an amendment sought by Democratic Gov. Laura Kelly to eliminate the state’s 6.5% sales tax on groceries. The potential for such a stunning tax shift was elevated by a projected $3 billion surplus in the state government’s budget.
Holland, irritated with lack of action on the unpopular food sales tax, indicated adoption of the tax break for veterans would have been followed by a motion to repeal the state’s sales tax on food. He said he was tired of waiting for the GOP to move a sales tax bill.
“When you don’t allow things to come across the Senate floor in orderly fashion as they ripen and mature from the committees,” he said, “the will, the voices of the people are ignored.”
Sen. Caryn Tyson, the Parker Republican and chairwoman of the Senate Assessment and Taxation Committee, pushed through 36-2 a bill that bundled a property tax freeze on seniors and on disabled veterans. House Bill 2239 also included a 10% increase in the standard deduction on Kansas income tax returns and a tax refund for a former hotel owner that was so narrowly written it applied to only one person.
During Senate debate, Tyson convinced her colleagues to include an amendment preventing the Kansas Department of Revenue from applying state tax to federal economic aid that flowed into Kansas to help businesses in the pandemic.
Sen. Molly Baumgardner, R-Louisburg, inserted into the same bill a potential five-year, $35 million tax credit for donors to community colleges and technical colleges for deferred building maintenance, capital improvements or equipment purchases.
She said the measure would prohibit a single person from donating more than $500,000 annually to a college for this initiative. The maximum a college could accept from all donors through the program would be $1 million per year. Only $7 million annually from 2022 to 2026 could be invested at all of these colleges for a maximum tax incentive of $35 million.
Tyson and Baumgardner also loaded up House Bill 2416, which passed on a vote of 26-11. Tyson gained approval of a potential $7,500 property tax rebate for businesses closed by government mandate at outset of the COVID-19 pandemic.
“It didn’t compensate for all the loss those businesses suffered. It would help under the circumstances,” Tyson said.
Baumgardner’s amendment to that bill established a state law requiring future closures of businesses by government order to include a property tax rebate for businesses.
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