Legislative update: Tax, vaccine, and child care proposals in the mix

Kansas Action for Children
March 19, 2021

The Kansas Legislature has shifted into overdrive. Kansas Action for Children is paying close attention to multiple bills proposed in both chambers. A few would improve life for children and families in our state. Several would unfortunately make things worse.

Over the next few days and weeks, you will likely be hearing from us more often. We will be sending action alerts that ask you to weigh in and contact legislators. Please know that KAC only does this after carefully analyzing each situation and figuring out where your voice would make a difference. Thanks so much for your support!

FISCAL POLICY: Federal relief can't be used for state tax cuts

On Wednesday, KAC provided testimony in opposition to HB 2421, the “cousin” of SB 22, joined by 11 other opponent conferees. Both bills would divert needed state revenue to higher-income Kansans and multinational corporations. KAC is concerned that the bills' true cost remains unknown, with no estimate of the Paycheck Protection Program loan provision, which we believe could be significant.

In addition, the federal relief bill passed last week specifically prohibits states from using the federal assistance for net tax cuts. States are waiting on guidance from the Treasury Department about what this could mean for bills like HB 2421 and SB 22. The bill includes a provision that determines “for every dollar that a state government spends on net tax cuts, it will lose a dollar of the federal fiscal aid it receives from the Act’s Coronavirus State Fiscal Recovery Fund.” This is good policy, because it discourages states from using one-time federal aid for permanent tax cuts, which could cause problems down the road for state revenue.

We believe the federal legislation is clear that if a state changes its law in a way that reduces net tax revenue any time after March 3, until it spends all the federal funds, it must repay an equivalent amount of the federal aid.  

There has already been a threat of legal action. The Kansas Attorney General joined with other attorneys general in a letter to the Treasury Department that “called for federal officials to clarify that a range of tax scenarios would be allowable, and that the provision will be interpreted only to ban the express use of the federal dollars for direct tax cuts.”

Kansas legislators should not act on HB 2421 or SB 22 until they can ensure the bill will not affect the state’s ability to receive aid from the latest federal relief package.

KAC also provided testimony in support of HB 2395, legislation which would ensure marketplace facilitators collect and remit sales tax. Without these changes, Kansas puts in-state businesses, which are required to collect and remit sales tax, at an economic disadvantage from out-of-state competitors that use marketplace facilitators and avoid having to do so. This is NOT a new tax, but instead changes who is responsible for the collection and remittance of the tax, shifting responsibility from individual Kansans to out-of-state marketplace facilitators.

You can contact Director of Fiscal Policy Emily Fetsch at [email protected].

HEALTH: Don't put vaccines up for votes in the Legislature

First, the not-great news: Another unnecessary vaccine bill – SB 212 – has a hearing in Senate Health next Monday morning at 8:30 a.m. (Audio; check here for video Monday morning). We believe vaccines – a critical tool for the health and well-being of Kansas children – should not be subject to periodic votes in the Legislature. The current process, in which trained medical professionals collaborate to update the lists of required vaccines, is appropriate and necessary. We trust the current process and these professionals. KAC submitted opponent testimony on SB 212. Watch for an action alert to make your voice heard.

We'd like to highlight one bill passage. HB 2248 made it through the House; it could adjust state financial assistance to local health departments for the first time since 1992 (that is not a typo!). May one positive outcome of this pandemic be increased state funding for Kansas’ critical local health departments, which do so much for kids and families.

Where is Medicaid expansion? There are two bills still waiting for hearings to be scheduled, SB 287 and after a slow walk to introduction, HB 2436. Why won’t legislative leadership make expansion a priority, especially with additional federal incentives available?

You can contact Health Policy Advisor Heather Braum at [email protected].

EARLY LEARNING: Child care tax credit bill heard next week

The time has come! HB 2414 – the expansion of the employer child care tax credit – is on the calendar for Wednesday, March 24.

As a reminder, this bill would expand eligibility to any for-profit employer that helps pay for employees’ child care search, or care on-site, off-site, or through a shared services model. If you are interested in supporting the bill, it’s not too late! Just email [email protected] for information, or if you need any help with writing or submitting testimony.

You can contact Early Learning Policy Advisor Mitch Rucker at [email protected].

ONE MORE THING

Finally, as Kansas moves into Phase 3 and 4 next week for the COVID-19 vaccine, we wanted to highlight a great conversation hosted by Kansas State University on how and why the COVID-19 vaccine was developed so rapidly and safely. A panel of Kansans also answered numerous questions that you and your family may have about the vaccine.