A top legislative priority for House Republicans got out of a committee Tuesday with the panel approving a bill that would cut the state property tax levy for schools by 1.5-mills.
The House tax committee amended the bill to ensure that the revenue loss from cutting the 20-mill tax levy would be backfilled with revenue from the state general fund.
The proposal is estimated to cost about $823 million over five years.
Revenue analysts said the bill could cost about $67.4 million in fiscal year in 2026, $113.8
million in 2027, $162.4 million in 2028, $213.3 million in 2029 and $266.7 million in 2030.
The cost rises because the mill levy will continue dropping over time as property values grow across the state.
Lawmakers are trying to keep the property tax rate “revenue neutral” so that the state doesn’t reap a revenue windfall from rising property values, something they have criticized local governments for doing in the past.
The bill also was amended to increase the residential exemption for the 20-mill levy to $100,000 from $75,000.
Last year the Legislature increased it to $75,000 from about $42,000 in the tax bill signed into law.
“That would provide some additional property tax relief to nearly every homeowner in the state,” said Democratic state Rep. Tom Sawyer, the sponsor of the amendment.
He said his amendment would cost $42.8 million in the first year, growing to about $44 million by 2030.
“It’s pretty stable,” he said.
Public school advocates, including the Kansas Association of School Boards, the Kansas National Education Association, Topeka Public Schools and United School Administrators were neutral on the bill before it was acted on in committee Tuesday.
The bill had support from the Kansas Farm Bureau, the Kansas Livestock Association, the Kansas Association of Realtors and the National Federation of Independent Business.
Meanwhile on Wednesday, the Senate will take up a bill on final approval that would eliminate another 1.5 mills in property taxes.
Those taxes now go toward rehabbing and repairing buildings at state universities and for maintaining state hospitals, veterans homes and the schools for the deaf and blind.
One mill of that tax goes to state universities, and the half mill goes to state hospitals, veterans homes and the schools for the deaf and blind.
The bill calls for transferring $56 million from the state general fund starting July 1, 2026, to cover the revenue loss attributable to cutting the 1-mill property tax.
The amount related to the 1 mill would be adjusted in future years to reflect the average percentage change in taxable value of all property in the state for the preceding 10 years.
Meanwhile, the state would take $25 million from the state general fund to offset the revenue loss from cutting the half mill tax.
The amount related to the half mill would increase by 2% in each future year.
