14 September 2021 | Tax and budget

The American Rescue Plan Act: What does it mean for Kansas?

Emily Fetsch & Karuva Kaseke
September 14, 2021

Kansas Lawmakers Can Make the Most of Federal Relief or Miss out on a Prosperous Future 

The American Rescue Plan Act, a monumental piece of federal legislation, was signed by President Joe Biden on March 11, 2021. The act delivers vital cash payments to families, as well as noteworthy investments in child care and health. In addition, the legislation provides economic assistance to states and localities in addressing COVID-related challenges.

Now it is up to state lawmakers to leverage this historic opportunity to build a strong future for every Kansan. Our lawmakers can lay the foundations for that future by targeting federal relief to the Kansans who need it most, ensuring those individuals can access the services they need, and creating fairer tax policies.

Many Kansas children and families struggled before the pandemic, but federal relief offers historic opportunity

Short-sighted tax policy during much of the last decade left state agencies, programs, and services underfunded and struggling to make up lost ground, even before COVID-19 hit. Policy barriers, created by the legislature, made it difficult for eligible families experiencing poverty and low pay to receive economic supports to help them thrive. Once COVID-19 arrived, it became even more clear why the state needs to move in a different direction and build an economy that works for people of all backgrounds. However, the Kansas Legislature responded to COVID-19 by prioritizing tax cuts for the wealthy and corporations over investments in our state’s residents.

Fortunately, the federal relief doesn’t just provide a reset; it offers Kansas a historic opportunity to build a stronger, more equitable economy in which we share in prosperity — regardless of who we are, where we live, or where we come from. State lawmakers must make investments in child care, health care access, and strengthening economic supports to address Kansans’ immediate needs and guide the state to a prosperous future. Making the right choices can help us build upon the federal relief package for the benefit of every Kansan.

State lawmakers must target federal funds to the Kansas families and programs that need them most

Months after many businesses have begun reopening, many families and communities continue to struggle. The pandemic has illuminated longstanding economic inequality and racial and ethnic disparities. While many higher-income workers (who are more likely to be white) could work safely from home, frontline workers (who are disproportionately people of color, immigrants, and women) were put in harm’s way. For people of color — who faced the biggest economic and health effects of the pandemic — the recovery will take longer.

Federal changes to programs like the child tax credit and the earned income tax credit could help many of these families, workers, and communities make ends meet. Unfortunately, those changes are not permanent. Congress must make permanent the act’s temporary expansions of both programs, which would cut child poverty by nearly half (47 percent in Kansas) and boost incomes for workers with low-paying jobs.

But Kansas shouldn’t limit itself to positive changes made by the federal government. State lawmakers should use federal funds to prioritize those most affected by the COVID-19 crisis, including frontline and essential workers, families with low incomes, and communities of color. These funds should also address the challenges facing families, including child care, health risks, and infrastructure essentials like broadband, to help Kansans get back to work. Robust investments in these policy areas will address immediate needs and can advance equitable policies that drive long-term, positive results for every Kansas family.

The American Recovery Plan Act is a great start, but Kansans need and deserve better tax policy

Wealthy people and well-connected special interests have successfully manipulated Kansas’s tax code for decades. And when wealthy people do pay taxes, they often pay less than their fair share because of loopholes and tax breaks. While the American Rescue Plan Act is a much-needed response to the COVID-19 crisis, it cannot address the unfair tax code and other structural disparities that have continued to disadvantage communities of color and those with low incomes.

Kansas lawmakers must end tax cuts for wealthy households and corporations and commit to tax and program policies that will build a stronger future for our entire state, including:

  • Create a fourth individual income tax bracket for Kansas’ highest income filers so that everyone, including those at the top, pays their fair share; 
  • Support more working families by expanding the Earned Income Tax Credit to all tax filers, including those who do not have a Social Security number; and
  • Remove state-imposed barriers to federal programs so eligible families can enroll in programs that we know move Kansas families out of poverty through cash, food, and child care assistance. 

These policies will keep families in their homes, keep workers employed, and keep businesses open. Together, we can build a Kansas that allows every single child and family to thrive.

ARPA Fact Sheet

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