Good morning everyone:
Our inconsistent and terribly disappointing college basketball team aside, it was a big week in the SSJ household.
Mrs. SSJ got a big promotion at work and had an “S” word added in front of vice president. It seems in her world everyone is a vice president so this is big deal. We have not had time to celebrate since we are living in two different cities during the week right now – St. Louis for her, Topeka for me. Very proud of her.
It’s also worth noting that Mrs. SSJ finally wrestled me into taking a weeklong vacation in mid-June. It will be the second major trip with Mrs. SSJ since we started our little enterprise back in 2018. On the last trip, we actually took calls outside Cinderella’s castle at Walt Disney World. That will not happen this time. For now, we will keep the location of our trip quiet and fill you in on the details later. But nevertheless for eight days in June, Sunflower State Journal will go dark. News or no news, we are going.
Now on to more important news from last week, including the significant stories we published and the other news you might have missed but need to know…
- A bill exempting streaming services such as Netflix and Hulu from local franchise taxes is nearing passage in the Kansas Legislature.
- A proposal expanding a lucrative tax incentive for landing mega economic development projects similar to Panasonic and Integra is in serious doubt
- A compromise emerged last week that is expected to settle a dispute at the Capitol over limiting Evergy’s ability to recover electric transmission costs from consumers and still save ratepayers millions.
- The mayor of Kansas City, Missouri, is asking Kansas to kick in $5 million to help bring a new direct international route to its newly opened $1.5 billion airport.
- A broad proposal allowing Kansas schoolchildren to use state aid to attend private school was put on the fast track for approval by a House committee last week.
- There’s doubt about whether a bill banning remote drop boxes for mail ballots can get out of the House elections committee.
- For the third consecutive year, the Legislature is sending a bill to the governor that bans transgender female athletes from competing in interscholastic sports for women.
- A proposal intended to keep environmental, social and corporate governance guidelines out of government investing and contracting decisions could cost the state’s pension system $3.6 billion in returns over a decade.
- A House committee added a measure to the higher education budget that would prevent state universities from asking job applicants about diversity, equity and inclusion.
- Attorney General Kris Kobach is asking the Legislature for permission to no longer charge for concealed-carry permits.
- The Kansas House last week passed a compromise bill that would limit the ability of local governments to regulate vacant residential and commercial property.
- A proposal asking Congress to call a constitutional convention to place term limits on members of Congress failed to win approval in the Kansas House last week.
- The Kansas House approved a $17 million yearly sales tax exemption for telecommunications companies with the promise that the money would free up cash for expansion of high-speed internet services in Kansas.
- The Kansas House last week approved a bill requiring the state school board to establish curriculum guidelines for a standardized firearm safety education program that would include a National Rifle Association-crafted gun-safety program.
New development incentive proposed
Kansas lawmakers this week will take up a proposal that would exempt data centers that invest at least $600 million in Kansas from sales taxes.
Last week, the proposal was introduced in the House and was referred to the commerce committee, which has set a hearing for this week on the bill.
The bill is backed by NetChoice, a trade association of online businesses including Amazon, Google, Yahoo, Ebay and Meta, the parent company of Facebook, among others.
“Today, Kansas has no large-scale data centers — and is missing out on those significant investments and new revenue — because the state imposes sales tax on servers and equipment,” said NetChoice President and CEO Steve DelBianco.
“That’s a stark contrast to the sales tax exemption that Kansas has long given to agricultural and manufacturing equipment,” DelBianco said in a statement.
The bill, he said, “would put Kansas into competition with other states who want to attract billion-dollar data centers and the high-tech jobs they create.”
The bill, as worded now, would require the data center to create at least 20 new jobs and the exemption could last from 30 years to indefinitely, depending on the size of the investment.
Data centers are locations where computing and network equipment are stored for processing and distributing large volumes of data.
Data centers are what enables the “cloud” where Americans store their photos, videos and documents.
Two years ago, the city of Kansas City, Missouri, approved $8.2 billion in tax incentives for a data center campus in the Northland for Facebook’s parent company, Meta, which indicated it would invest $40 billion in the project.
Scheduled to open in 2024, the Meta data center will support up to 100 jobs and is the first of its kind in Missouri, according to KMBC news. During construction, the project is anticipated to create 1,300 jobs.
NetChoice reports that 22 states, including Texas, Nebraska and Iowa, have full sales tax exemptions for data centers.
Missouri is one of three states with limited exemptions.
Missouri’s program provides for a 100% exemption for state and local sales taxes over 15 years for new facilities that invest at least $25 million and create at least 10 new jobs.
The state incentive was worth about $1.8 billion to Meta’s project in Kansas City, according to published reports.
A report by the U.S. Chamber of Commerce’s Technology Engagement Center found that “the average data center adds $32.5 million in economic activity to its local community.”
According to the report, data centers on average employ 1,688 local workers during construction and provide $77.7 million in wages during that time.
“During its yearly operation, a typical large data center supports another 157 local jobs and $7.8 million in wages at the data center and along the supply chain,” the report says.
However, other studies have questioned the value of the incentives.
A 2016 report by Good Jobs First examined 11 data center “megadeals” in which more than $2 billion in state and local incentives were awarded.
The study found the deals cost $1.95 million per job.
Forbes looked at 15 projects started since 2015 and found that their total $9.9 billion in value was offset by an estimated $811 million in tax breaks.
In testimony supporting comparable legislation in Kentucky, DelBianco pointed to a study by Oxford Economics that reviewed six Google data centers in Iowa, Oklahoma, Oregon, South Carolina, Georgia, and North Carolina.
He told lawmakers the study found that those data centers generated $750 million in labor income and $1.3 billion in economic activity.
He also pointed to a fiscal note for legislation that Idaho enacted that provides a sales tax exemption for a $250 million investment that would create no fewer than 30 jobs within two years of staring operation.
Prepared by a lawmaker supporting the Idaho bill, the fiscal note said the legislation would have a “positive impact on the general fund.”
“Though this bill allows a sales and use tax exemption, this legislation is prospective and is intended to attract business investment not already present in the state of Idaho,” the fiscal note said.
“Business investment of $250 million or more will create new jobs, not only to directly support the data centers, but also in construction jobs and indirect jobs.”
DelBianco told Kentucky lawmakers that their state would not land a data center without the incentive.
“Allow me to repeat, over the past seven years, no enterprise data center has located in states that impose sales tax burdens on data center server equipment,” he said in written testimony in 2021.
“We would hate for Kentucky to lose a significant opportunity for investment, economic advancement, and industry diversification,” he said.
Kelly’s inaugural
Gov. Laura Kelly’s inaugural cost more than a half-million dollars, which was covered by donations and ticket sales.
A report filed last week showed expenses of $549,000, including nearly $185,600 to rent out the Stormont Vail Events Center.
Another $95,000 was spent for event rentals, including tables, plates, linens and such.
The report filed with the state showed that the inaugural raised $246,000 in donations for the event and another $334,000 in ticket sales.
As of Feb. 28, the inaugural still had about $30,700 in the bank. There is still one final report due to be filed June 30.
By comparison at this time in 2019, Kelly reported that her inaugural had cost about $290,000 with total expenses reaching about $360,000 after the second report came in.
At this time in 2015, former Gov. Sam Brownback reported his inaugural had cost $298,000 with the final bill coming in just short of $300,000.
And in 2010, the Brownback inaugural reported almost $393,000 in expenses.
He reported having about $151,000 in cash on hand after the 2010 event and gave a lot of of it to charity, including $50,000 to the Kansas Association for the Medically Underserved and $35,000 combined to rescue missions in Salina, Wichita, Topeka and Emporia.
Gold sponsorships to the Kelly inaugural cost $4,800 and included a $2,000 contribution to the inaugural and a $2,500 ticket package.
The gold-level included a premium ball table with 10 seats and six admissions to a VIP reception before the event with a photo opportunity with the governor.
A silver sponsorship cost $3,700, including a $1,000 contribution to the inaugural and a $2,500 ticket package.
The silver level also included a select ball table with 10 seats and four admissions to the VIP reception with a photo opportunity with the governor.
A bronze sponsorship cost $3,100, including a $500 contribution to the inaugural and a $2,500 ticket package.
New child advocate
House members will get to work this week deciding what the new office of child advocate might look like in the future.
Lawmakers want to write the position into statute after Gov. Laura Kelly signed an executive order creating the office, something that the Legislature had been unable to accomplish in recent years.
The Senate has already unanimously passed a bill establishing the office that calls for the child advocate to be appointed by the governor and confirmed by the Senate.
The Senate bill calls for the child advocate to serve five years or until a successor is appointed. The pay would be equal to a district judge, who earns $171,000 a year.
The Senate bill sets out that no former or current executive or manager of any program overseen by the office could be appointed to the position within six months of leaving their job.
The House bill, which was heard in committee last week, is a little bit different.
It creates a child advocate advisory board, which would appoint the child advocate who would be subject to Senate confirmation.
The board would have up to 12 members who would have experience in child welfare policy or system expertise.
The board would include appointments made by the chief justice of the state Supreme Court, the governor, the president and minority leader of the Senate as well as the speaker and minority leader in the House.
The board would appoint the child advocate by Dec. 1 and would be responsible for evaluating their performance.
It would have the power to fire the child advocate for “good cause” with a two-thirds vote. The House bill says the child advocate would serve four years.
The child advocate, under the House bill, also would be required to have a current relevant license authorizing them to work as a licensed professional case manager, behavioral health professional or an attorney for a child in need of care or seven years of experience.
The House bill has a similar prohibition on hiring someone who works within the child welfare system currently, although it extends to 12 months after leaving their current position.
Mike Fonkert of Kansas Appleseed said the fact that the Senate and House have different bills gives lawmakers an opportunity to pass quality legislation.
“We believe that a collaborative effort to analyze both bills and determine which provisions from either bill make the office most capable of robustly acting as an advocate…gives this legislature the opportunity to craft monumental legislation,” he said in written testimony.
The governor signed the executive order in 2021 after a legislative session where lawmakers couldn’t agree on a bill creating a child advocacy office.
A House committee recommended a bill where the child advocate would have been jointly appointed by the governor and the chief justice of the Kansas Supreme Court, subject to confirmation by the Senate, for a term of six years.
The Senate later approved a bill creating an office that would have been overseen by the Kansas attorney general’s office.
Critics said the Senate bill vested too much control in an elected state official and gave the attorney general too much authority over the office.
Homeless bill runs out of steam – for now
The chair of the House welfare reform committee said last week he doesn’t plan to work a controversial bill that would make it illegal for homeless people to sleep or camp on public property.
Republican state Rep. Francis Awerkamp of St. Marys told the committee that he doesn’t plan to work the bill this year and instead have some type of roundtable discussion on the topic. Bills that don’t advance this year are still alive for next year.
He said he would like to bring in some experts and others who have worked in the field and have a general discussion about the issue with the committee.
“We’re not going to work the bill this year,” Awerkamp said. “But it may prep some ideas for next year.”
The bill, which generated a wave of opposition, would have fined anyone sleeping or camping on public property $1.
The bill also would prohibit local governments from not enforcing policies that discourage public camping or sleeping.
The attorney general also would have the power, under the bill, to bring a civil action against any local government violating the law.
Any local government with a higher per-capita rate of homelessness than the state average that is also violating the new law could lose state funding designated for the purposed of addressing homelessness.
The bill was backed by the Cicero Institute, a group based in Austin, Texas, that says it fights “for policies that apply the principles of a free society and solve problems at the state level, impacting millions of Americans.”
Children’s advocacy group unionizes
The staff at the nonprofut Kansas Action for Children announced last week that it formed a union and will be joining the Communication Workers of America Local 6400.
Erin Melton, food security policy adviser at KAC, is the new union steward.
“We look forward to working to model the importance and purpose of unions in nonprofit and advocacy organizations,” Melton said in a statement.
“I have worked in nonprofits for most of my adult life and am proud that staff has decided to live out its mission internally as much as we do externally,” she said.
“I know that unionizing will benefit current and future staff and their families, and that it will make KAC staff even stronger advocates for Kansas children and families. ”
Hannah Allison-Natale, vice present of CWA Local 6400, welcomed the organization into the union fold.
“For over 40 years, KAC has been advocating for policies to improve the lives of working class Kansas families, and that’s what our union is all about,” Allison-Natale said.
KAC management agreed to voluntarily recognize the union
Abortion bill
Last week, a House committee passed out a bill that would create a statewide program to promote childbirth over abortion. The taxpayer-funded program would offer a range of services that would include counseling and mentoring, coordination of prenatal services, and providing educational materials and information about pregnancy and parenting and referrals to county and social service programs. The bill also would create a public awareness program to promote alternatives to abortion. The bill is projected to cost $1.8 million year, according to a fiscal analysis prepared by the budget office. The Legislature, however, could opt to appropriate what it wants for the program. Here’s coverage of last week’s hearing from the Capital-Journal’s Jason Tidd.
Keystone pipeline development
Kansas News Service’s Celia Llopis-Jepsen last week reported that the U.S. Department of Transportation is getting tougher with the operator of the Keystone pipeline because oil spills are becoming a more frequent occurrence. KNS reports the agency ordered the operator to lower the pressure for crude oil flowing through the pipeline. It also ordered a review of how the company handles geological dangers.
Quality cops
Kansas News Service takes a look at a piece of legislation that’s intended ensure quality policing. The bill would would require law enforcement agencies to share information used on job applications and share details about why candidates were turned down. KNS reports that under existing law there are no assurances that a law enforcement agency can see background checks from other departments where someone applied.
Glenn Beck takes on chamber, bankers
Conservative radio talk show host Glenn Beck’s not happy with Kansas right now.
He’s particularly displeased that a bill that would blacklist state wealth managers who engage in ideological boycotts based on environmental, social and governance principles doesn’t seem to be going anywhere.
Beck hosted Republican state Rep. Michael Murphy of Sylvia on his radio show last week and threw his support for the lawmaker’s ESG ideological boycott bill, which would require the state to keep a registry of finance companies that engage in that type of boycott.
The bill also would require the state to divest from financial companies that engage in ideological boycotts.
Beck unloaded on the Kansas Chamber of Commerce and the Kansas Bankers Association, which have urged lawmakers to take a careful approach to how they regulate businesses that might employ environmental, social and governance investing guidelines.
They have cautioned against overreacting to all the anger over ESG investing by imposing more mandates based on how those businesses choose to operate.
Beck saw that as a kind of betrayal of conservative principles.
“If you belong to the chamber of commerce, get out of the chamber of commerce,” Beck told his listeners on 300 radio stations. “They are not your small-business friend.”
He didn’t stop there.
“The bankers association is in bed with ESG,” he said.
Beck urged his listeners to “burn up the phone lines” calling Kansas lawmakers to support the boycott bill, which he described as “the most comprehensive” anti-ESG bill in the country.
“I am telling you, the Kansas Bankers Association and the chamber of commerce — and this is in every state — they are putting pressure on and doing dog-and-pony shows like you would not believe to make sure that ESG stands in your state.”
Murphy added that listeners should call the House speaker’s office and the Senate president’s office as well.
The chamber stood its ground.
“Standing up for consistency of free markets is essential,” chamber spokesperson Sherienne Jones-Sontag said in a email.
“If ESG proves to be a poor investment decision, the market will correct itself, and investors who followed that path will learn their lessons the hard way,” she said.
“No matter the level, government should not mandate what businesses should or should not do.”
The bankers association shared a similar view.
“The Kansas Bankers Association is not focused on outside influences on this issue,” said Alex Orel, senior vice president of government relations for the KBA.
“The KBA remains focused on working with state lawmakers and other stakeholders to develop state-level policies regarding environmental, social and governance matters that will protect our free-market system and limit government interference on private sector banking and business.
“We strongly believe that government should not mandate what private industry can or cannot do.”
The chamber and bankers are neutral on a House bill — separate from Murphy’s bill — that would bar state and local governments from showing favoritism toward ESG.
The House bill would bar state and local governments from favoring ESG, which includes making investment or contracting decisions based on whether a business is oriented to fossil fuels, mining or nuclear energy, among others.
It also would ban state and local governments from making contracting decisions with businesses based on their policies helping employees access abortion or gender reassignment services as well as whether they make or distribute guns and ammunition.
Lawmakers want to ensure that governments are only making decisions based on finances and not discriminating against a business because of their political proclivities.
Gayle Mollenkamp: 1929 – 2023
Former longtime state Rep. Gayle Mollenkamp from Logan County died last week at his home in Bartlesville, Oklahoma. He was 93. He represented the 118th District in the Kansas House from 1985 to 2000.
“Gayle enjoyed representing the concerns of those in his district, working hard for less big government and more local control,” he was remembered in his obituary. Mollenkamp was a member of the Russell Springs School Board for a number of years and a Logan County commissioner for 15 years.
He is survived by his wife, Judy; three children and eight grandchildren; 17 great-grandchildren; and three great-great-grandchildren. A celebration of life will be 11 a.m. March 18 at Gateway Fellowship Church in Oakley, Kansas.
