Here’s a warning Kansas policymakers shouldn’t ignore.
When Washington recently eliminated federal funding for two nutrition-education positions in Kansas, the Frontier Extension District decided to keep the program. The result? A $192,000 property-tax increase on residents of Anderson, Franklin, and Osage counties.
That’s a small example of a much bigger problem: Kansas can’t assume Washington will keep paying the bills.
Kansas is fortunately less dependent on Washington than most states. According to Pew’s latest Census-based comparison, federal funds accounted for 24.9 percent of Kansas state revenue in FY2024, compared with 34.2 percent nationally. That’s much better than Louisiana, where 50.7 percent came from Washington. But one-fourth of Kansas revenue is still a major exposure.
The Kansas budget provides another perspective. KPI’s 2027 Responsible Kansas Budget reports about $27.8 billion in total FY2026 spending compared with $22.3 billion from state funds. That leaves roughly $5.5 billion tied to federal funding under this different accounting measure.
Now consider where that money originates.
Washington is approaching $40 trillion in gross national debt and is projected to spend about $7.4 trillion while collecting only $5.6 trillion this fiscal year. That’s roughly $1.32 spent for every $1 collected.
And the fiscal gap gets worse.
CBO projects annual deficits approaching $3.1 trillion by 2036. Debt held by the public is projected to rise from about 101 percent of GDP today to 120 percent in 2036 and 175 percent by 2056. Interest costs alone are projected to roughly double to $2.1 trillion annually by 2036.
Something eventually has to give. Federal grants to states will be an obvious place for Washington to look. Kansas should prepare now instead of waiting for Washington to force the issue.
This is also why federalism matters. States shouldn’t become administrative arms of Washington. Federalism keeps government closer to taxpayers and allows states to compete over taxes, spending, regulation, and services. Federal grants blur that accountability because Washington taxes or borrows the money, attaches strings, and sends it back.
When Washington stops paying, state and local taxpayers often get the bill.
Kansas shouldn’t respond by replacing every lost federal dollar with another state or local tax dollar, as in the Anderson County example above. Instead, lawmakers should use program-based budgeting effectively to review what government actually does. Every program should have a clear purpose, measurable outcomes, and regular evaluation. Policymakers should ask whether it works, whether taxpayers should fund it, and whether competition or the private sector could do it better. Kansas has a version of this in a years-old performance-based budget law that is largely ignored by governors and legislators.
For federally supported programs, add another question: Would Kansans choose to fund this themselves if Washington stopped paying? Then put a firm ceiling over the entire process.
Kansas should pass a Responsible Kansas Budget every year while imposing a strict spending limit based on population growth plus inflation. A better Taxpayer Bill of Rights could make that restraint harder to evade, require a supermajority to exceed the limit, and use excess revenue to permanently reduce broad-based income-tax rates.
Program-based budgeting helps lawmakers decide what deserves funding. A spending limit forces them to prioritize among those programs. You need both.
Competition completes the picture. Free markets and competition give providers incentives to innovate, economize, and serve people better. Better results at lower costs mean fewer taxpayer dollars are needed.
Kansas is in a better position to deal with declining federal funds than Louisiana and many other states. But lawmakers should heed the warning now instead of kicking it down the road.
