(Upated to include comments from the governor, the Kansas Chamber of Commerce, House GOP leadership and others with edits throughout.)
The Kansas House on Tuesday came up short of overriding Gov. Laura Kelly’s veto of a Republican tax plan that would have moved the state to a single rate tax structure.
The House voted 81-42 to override the veto, three votes short of the 84 needed to overcome the veto after Republicans lost support from five conservative and moderate lawmakers who voted against the override.
It was marked a defeat for House Republicans who were believed to have the votes for a veto override, although word had been circulating in recent days that some lawmakers had been dropping off from supporting the bill.
The GOP lost Republican state Reps. Mike Dodson of Manhattan, Randy Garber of Sabetha, Mark Schreiber of Emporia, Trevor Jacobs of Fort Scott and Dave Younger of Ulysses.
Former Republican state Rep. Marty Long has already filed to run against Younger because of his votes on taxes. And Democrat Kim Zito is expected to run against Dodson.
Democratic state Rep. Marvin Robinson of Kansas City backed the tax plan.
Robinson already has a primary opponent this year after siding with Republicans on key issues throughout his term.
House GOP leadership – House Speaker Dan Hawkins, Majority Leader Chris Croft and Speaker Pro Tem Blake Carpenter – issued a joint statement after the vote.
“It’s irresponsible and unacceptable that Gov. Kelly and her allies chose to play politics and deny meaningful tax relief to all Kansans,” they said.
“The Democrats’ games are played at the expense of real people who need relief now,” they said.
“House Republicans are committed to putting the people of Kansas before election year
gamesmanship.”
It had generally been believed that the tax plan would have its most difficult time in the Senate, where the flat tax was derailed last year with the help of Republican state Sen. Rob Olson of Olathe and conservative independent Dennis Pyle of Hiawatha.
There had never been much wiggle room for Republicans, who enjoy an 85-seat supermajority in the House, meaning just a couple of defections could upend an attempt to override the veto.
Jacobs voiced concern about whether the tax plan would benefit the middle class.
He said he believed that most of the state’s working class would have to carry a heavier tax burden under the plan rejected Tuesday.
“This is not the last train out,” Jacobs said. “Real work needs to be accomplished for the relief of all Kansans, not just a select few.”
In an interview, Senate President Ty Masterson said he was disappointed by the results, especially since he was floored to see some Republicans opposed to the override.
“It’s tragic that you have a minority of the representatives working together to stop tax relief,” Masterson said.
“But that’s the value of a governor that’s on the wrong side of things,” he said.
“We have a bipartisan near supermajority, and you have a minority working to stop tax relief in Kansas,” he said.
The next step?
“I really don’t know what the next plan is,” Masterson said.
“I’m not sure there is one,” he said. “We’re going to start looking at it.”
Kelly called the failed override vote a “win for working- and middle-class Kansans” who she said would have seen little relief with the Republican plan.
“Now, we should move forward the bipartisan plan I proposed on the first day of legislative session to cut $1 billion in taxes over the next three years, without risking funding for our public schools and roads,” she said.
“Kansans need and deserve significant tax relief now. I urge legislators to work together to cut taxes in a way that continues our economic growth and maintains our solid fiscal foundation while benefitting all Kansans, not just those at the top.”
Elizabeth Patton, state director for Americans for Prosperity, compared the votes cast by Jacobs and Garber on Tuesday to votes cast by Pyle and Olson last year.
“It is especially disheartening today that Reps. Garber and Jacobs would put politics and games over principle in the same way that Senator’s Olson and Pyle did both last year and last month,” Patton said.
“Public service should be solely focused on consistent choices that benefit those who elected you, not driving a personal agenda, selfishness or political career.”
Eric Stafford, lobbyist for the Kansas Chamber of Commerce, shared a similar view.
“The sad truth is these individuals are so desperate for attention that they empowered the same tax-and-spend agenda they decry back home to their constituents,” Stafford said of Garber and Jacobs.
Adam Smith, chair of the House tax committee, said it may be time to return to the drawing board and see what might win support from the caucus.
“I need to have a visit with people,” Smith said. “Do they want less tax relief? Do they want it focused on different areas? We need to figure out what we can get the votes for.”
The Republican plan would have moved the state to a 5.25% flat tax rate that Republicans advocated as an alternative to a proposal offered by the governor that was similar in many ways but without the single tax rate.
The Republican bill also cut property taxes, eliminated taxes on Social Security income, increased the standard deduction and raised the personal tax exemption.
Supporters of the bill said it would have removed from more than 400,000 Kansans from the tax rolls because it exempted low-income earners from income taxes.
The Senate voted 25-11 to pass the bill and was expected to struggle to find the 27 needed for a veto override.
The bill vetoed by the governor would have cost roughly $1.6 billion over three years in all funds compared to the governor’s plan, which would cost about $1.1 billion.
The bill vetoed by the governor would have:
- Exempted all Social Security income from state taxes starting in tax year 2024. The governor’s plan includes this measure.
- Exempted the first $100,000 of taxable property value from the state’s 20-mill property tax levy for schools starting in tax year 2024. The governor’s plan includes this measure.
- Raised the standard deduction based on inflation increases starting in tax year 2024. The governor proposed increasing the standard deduction for single Kansans from $3,500 to $5,000; for those with head of household filing status from $6,000 to $7,500; and for those who are married filing jointly from $8,000 to $10,000.
- Increased by $50 the state’s personal tax exemption of $2,250 starting in tax year 2024. The exemption also would be increased based on inflation starting in tax year 2025. The governor’s plan didn’t include this element.
- Moved the state to a single income tax rate of 5.25% starting in tax year 2025. Single filers earning less than $6,150 and married filers making less than $12,300 would be exempt from the tax. The governor opposes the flat tax component.
- Eliminated the sales tax on groceries starting April 1, 2024. Republican lawmakers originally proposed ending the tax on July 1, but moved it up to April. The governor agrees with this part of the Republican plan.
- Reduced the privilege tax rate for banks to 3.75% from 4.37% and for trusts and savings and loans to 3.85% from 4.5%. The tax cut, which starts in 2025, corresponds with a previous cut in the corporate tax rate. Banks don’t pay corporate taxes. The governor included this in her plan.
