These are some of the issues in which KPI’s team has played a key role or laid the groundwork.
2016 Legislative Session(s)
1. Introduction of a new school funding formula – the Chairmen of the House and Senate Education Committees introduced a new formula built on many KPI recommendations, including a requirement that schools operate more efficiently, spend down cash reserves, introduced education savings accounts (real school choice for every student) and rewards for improved student outcomes. The plan as written would save money and actually reduce property taxes. House and Senate leadership did not allow the bill to have a hearing but the groundwork is laid for the next session when a new formula must be passed.
2. Prevented an income tax increase – a strong push to increase marginal rates on individuals and to eliminate the exemption on pass-through income of LLCs and other small businesses was defeated. KPI positioning took away the ‘fairness’ argument and our research on state spending showed that a tax increase wasn’t necessary to balance the budget.
3. Property tax reform – with some exceptions (including but not limited to the value of new construction and spending on public safety) cities and counties cannot increase property taxes by more than inflation without voter approval. A version of this bill passed in 2015 but implementation was delayed until 2018; the bill now goes into effect on January 1, 2017. Another property tax bill passed allows tax appeals to be taken to District Court after a full opinion has been rendered by the Board of Tax Appeals. Appeals to the District Court are considered de novo trials with evidentiary hearings during which issues of law and fact will be determined anew. The bill also includes improvements in the valuation of oil and gas leases and there are multiple improvements to the appraisal and appeals process to become more taxpayer-friendly.
4. Performance-based budgeting – This new law will require the state to function as a single enterprise in which priorities can be weighed, effectiveness measures, and calls for new spending considered against other priorities. The bill also included the creation of a budget stabilization plan. The law allows two years for implementation.
5. Medicaid expansion prevented – KPI was part of a coalition that fought off another push to expand Medicaid; our research proved that expansion would cost Kansans over $13 billion in the first 10 years without necessarily improving outcomes.
6. Universities required to publish degree prospectus – state schools must publish a prospectus for degree programs, including the average years and total cost required to complete and the earning potential upon completion.
7. Live streaming of committee hearings – the Senate version of this billed passed in 2015 and it finally made it through the House this year. Votes in committee are rarely recorded, and much good legislation dies in committee. This is a huge transparency win.
8. Union re-certification – over 90% of union members never had a ‘say’ in whether they wanted to be represented by a bargaining unit because existing law requires members to sign a petition asking for a vote, and the intimidation factor stands in the way. The Senate passed a bill requiring secret ballot re-certification votes every three years but House leadership declined to consider the bill. This issue will continue to be a topic of discussion in Topeka.
Previous legislative accomplishments in which KPI played a key role
1. Creation of a new school funding formula – the dysfunctional school funding formula was eliminated and a temporary two-year block grant system was put in place while a new formula is being developed.
2. Income tax reform – historic income tax reform that may ultimately lead to the elimination of the state income tax. KPI paved the way by showing that Kansas was headed for budgetary disaster without tax reform and then showed legislators that spending control is the key to tax reform.
3. Property tax reform – local government must now vote to increase property tax if greater than inflation and can no longer hide behind changes in the mill rate. We also defeated a proposal to exempt privately-owned health clubs from property tax.
4. School Choice – a tax credit scholarship program for low income students is the state’s first real school choice program. Our extensive research showing that student achievement is much lower than media and the education establishment reports convinced legislators that this program is necessary.
5. Collective bargaining reform for school districts – the number of mandatory subjects of bargaining was reduced from 31 to a maximum of eight; each party may select up to three subjects in addition to pay and time worked.
6. Student outcomes are more important than the amount of money spent – many legislators credit our work in this area with influencing the 2014 State Supreme Court on school funding (Gannon v. State of Kansas). KPI discovered that previous court rulings were based on deliberately-skewed research designed to inflate required funding. The Court invalidated the ‘actual cost’ method of measuring adequate funding and adopted outcome criteria (the Rose standards) in its place. The Court also agreed with our position that all funding sources should count. This work paved the way for the elimination of the dysfunctional school funding formula in 2015.
7. School Spending Transparency – school districts are now required to post a one-page budget summary (designed by KPI) on the home page of their web sites and distribute it at every local school board meeting.
8. State Education Aid Transparency – last year KPI discovered that $570 million in state-mandated property tax was being recorded as Local aid instead of State aid. Beginning this year, that money must be sent to the state for distribution so it is properly recorded as State aid.
9. Equal access for non-union teacher organizations – prior to the enactment of this 2013 law, most school districts would only permit a union to have access to teachers. Since passage, the non-union Association of American Educators has seen membership surge and several small school districts have de-certified from their union.
10. Alternative licensing for teachers – people with degrees or professional certification in science, technology, engineering, and vocational fields will no longer be required to have an education degree to teach in high school. Instead, a new law trusts local boards of education and school administrators to make hiring decisions in these subjects.
11. K-12 Efficiency and Student Performance Commission – KPI helped write the legislation to create a study commission that spent six months in 2014 exploring a variety of efficiency opportunities, including the consolidation of non-classroom functions across district lines. KPI president Dave Trabert was appointed to the Commission and co-authored the Minority Report, which highlighted many important findings, including:
a. School districts do not know how to define or measure performance against the Rose standards, which the Supreme Court now says is the litmus test for funding adequacy; if schools cannot measure Rose, they have no legal basis for claiming to lack funding to achieve the Rose standards.
b. School districts acknowledged that they choose to operate inefficiently.
c. School districts want collective bargaining reform to dramatically reduce the number of mandatory subjects of bargaining.
12. School District Cash Reserves Now Accessible – KPI discovered that school districts were diverting education dollars to build large cash reserves, while claiming to be underfunded. Legislation was passed to remove restrictions on the use of carryover cash reserves in 2011. Legislators are considering making partial use of excess funds mandatory.
13. Mandatory reporting of cash reserves to local school boards – school districts must annually provide a detailed report of the unencumbered cash balance in every fund to local school board members.
14. Medicaid Expansion under Obamacare Prevented – our 2011 study showing the enormous cost to Kansas taxpayers of Obamacare was instrumental in convincing elected officials to resist creating a state exchange and to not expand Medicaid.
15. Public Pension Reform – multiple studies showing the true nature of the unfunded liabilities in the Kansas Public Employees Retirement System (KPERS) led to 2013 reform that puts new and unvested employees into a hybrid cash balance plan instead of the defined benefit plan. KPI continues to be the driving force for ending the defined benefit plan for all employees and putting everyone into a defined contribution / 401(k) plan.
Additional successes with KPI’s supporting help
16. Innovative School Districts – our work on school choice led to legislation that allows for entire districts to, effectively, be de-regulated at the state level, being exempt from many state regulations and some collective bargaining restrictions. Up to 28 districts may participate without restriction and another 28 districts with low student achievement may apply for innovative district status.
17. Paycheck protection for union employees – our recommendation to the Governor’s Efficiency Task Force for collective bargaining reform led to 2013 legislation prohibiting the deduction of union dues from government employee paychecks for the purpose of political activity. Our statewide public opinion poll also showed overwhelming support for the concept, including among union members.
18. Renewable Energy Mandate made voluntary – the fear of losing a lifetime property tax exemption for the renewable energy industry prompted negotiation to eliminate the mandate in exchange for keeping a 10-year tax exemption
19. Court of Tax Appeals (COTA) – our efforts on property tax reform also were instrumental in many changes to the appeals process that created a more taxpayer-friendly environment. COTA was changed to a Board of Tax Appeals, taxpayers will receive information needed to file appeals on a timelier basis, valuations on victorious appeals must remain in place for two years and the Board may no longer make arbitrary decisions on who may represent taxpayers on their behalf.
20. Uniform School Accounting System – our work on school funding drove legislation requiring school districts to use a standard accounting and reporting system and annually post spending information on their web sites.-