1) Legislature Underway; Governor Makes Budget Recommendations

The 2010 Legislature officially got underway on Monday, January 11. With a difficult budget situation and an election year for all House members, most are expecting a challenging year. Monday night, Governor Mark Parkinson delivered his State of the State address and introduced his budget recommendations. At this point, it appears that none of those recommendations has a direct impact on city revenues. However, his recommendations of a 1% sales tax increase and a 55¢ tobacco tax increase are already meeting with some resistance. So, it remains unclear what path the Legislature will take to balance the state budget.

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2) 911 Bill to be Heard

Over the summer and fall, the League of Kansas Municipalities (LKM) and the Kansas Association of Counties (KAC) worked with representatives of the telecommunications industry to develop compromise legislation regarding the future of 911 in Kansas. HB 2423, which represents the compromise that was reached, will be hard next Tuesday in the House Energy and Utilities Committee. Without this legislation, cities and counties will lose millions of dollars as a result of a statutory change that is scheduled for July 1, 2010. This legislation basically holds PSAPs harmless ($1.4 million reduction statewide) and provides a mechanism for maintaining our current 911 system and developing Next Generation technology.

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3) Transportation Update

One of LKM’s 2010 Action Agenda items is to support a new statewide comprehensive transportation program. Both the 1989 and 1999 Comprehensive Transportation plans were extremely successful and the Joint Transportation Committee has advanced two options for funding a new transportation plan. One option is to reduce the motor fuels tax by 5 cents per gallon and repeal the sales tax exemption for motor fuels. Thus, the state and local governments would begin to receive sales tax on gasoline. The other option would increase the motor fuels tax by 7 cents per gallon. Both options would increase vehicle registration fees. Neither funding option would be implemented until 2013.

Economic Lifelines, of which LKM is a member and which is made up of government and industry officials, took action to recommend the Legislature look seriously at both funding options. LKM continues to support a new transportation plan and will watch this issue as it continues to develop.

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4) Worker's Comp Legislation Introduced

HB 2425, a workers compensation bill affecting firefighters, was introduced this week and assigned to the House Commerce and Labor Committee. While it is unclear at this stage of the Legislative session whether or not the bill has enough support to get a hearing and advance, it is not too early to look at the major ramifications it could have for Kansas cities. Any firefighter who suffers death, disability or impairment from a variety of conditions will be presumed to have contracted the condition or disease in the course of his or her employment. The conditions include HIV/AIDS, coronary disease, coronary artery disease, any lung or respiratory condition, cancer, hepatitis and “any other duty-related communicable disease.” The employer could only overcome this presumption with clear and convincing evidence. This is a higher civil standard than usually found in civil cases. Obviously the indirect impact in workers compensation rates would be substantial. For more information, please contact Sandy Jacquot at sjacquot@lkm.org or (785) 354-9565.

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6) City Hall Day

Please join us for LKM's 2010 City Hall Day on Wednesday, February 3. This annual event is designed to bring city officials together with state leaders to discuss issues of importance to city officials. Contact your House and Senate members in advance to schedule meetings to discuss issues of concern to your city along with the LKM Action Agenda.

City Hall Day will be free of charge to all city officials and legislators, but please sign up here so that we can get an accurate headcount. For more information about the day's events, click here.

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7) Spring Sales Tax Questions

The following is an announcement from the Kansas Department of Revenue regarding spring sales tax questions:

As you know, the primary election this spring will be held on April 6th.
There will be cities and counties holding elections to impose a local sales
tax as a result of that election and the question being posed is can they
have a July 1st effective date for their local tax. The question is will we
allow a tax to become effective July 1st that is voted on in April 6th.

The local sales tax statute (KSA 12-191) states a city or county must
provide the state 90 days prior to the effective date of the tax.  The
streamlined sales tax agreement states we must provide at least 60 days
notice to retailers of a rate change.  In the past, we have worked with
cities and counties and granted a little leeway in the 90 day notice.  We
have given them up to a week to get us the required documentation

The department wants to work with cities and counties who have sales tax
questions on the spring ballot by allowing for the tax be effective on July
1st, if that is their wish.  However, they need to do the following:

The department believes this should work well for the cities and counties
and allow them to impose the tax earlier.  It also will provide the
department with information we need to be prepared to issue retailer
notices and meet our 60 day statutory requirement.   Feel free to provide
this information to your members.

If you have any questions, please call.
Steven Brunkan
Office of Policy and Research
Kansas Dept of Revenue
785 291-3580

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8) Sign Up for the January and February MLAs

January's course, Municipal Finance, will be in Holton on January 15 and in Oberlin on January 22. It will provide an overview of financial management, budgeting, accounting, cash management, and fraud protection. To register, please click here.

February's course, Personnel Management, will be in Scott City on February 12, in Augusta on February 13, and in Olathe on February 26. It will cover the basics of personnel management in today's changing municipal workplace. To register, please click here.

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