Updates and Alerts

State Legislative Update

It remains a busy time in the legislative arena!

Lawmakers concluded a short veto session period – taking action on several important issues and a few veto overrides – and in an unusual move plan to return to Topeka again on Monday, May 23, to continue the veto session, giving lawmakers the opportunity to reconsider any redistricting maps rejected by the Kansas Supreme Court (both the U.S. Congressional and Kansas Senate maps are being challenged.)

See below for a Legislative Update with all the latest information. Coming soon? The 2022 election season!

REDISTRICTING
The Kansas Supreme Court is hearing arguments in the legal challenge to the legislature’s Ad Astra 2 map (SB 355) redrawing boundaries of the state’s four U.S. Congressional Districts. Key questions for the court include 1) whether a state-level legal standard to be applied to a federal redistricting map exists and 2) if so, does *this* specific map violate that standard. A decision is expected soon. If the Court strikes down the map, lawmakers anticipate taking another crack at the apple and state statutes provide for pushing back the 2022 election season’s candidate filing deadline from June 1 to June 10.
A District Court judge in Wyandotte County previously ruled the map was impermissibly gerrymandered. The Attorney General immediately appealed the ruling to the Kansas Supreme Court.
       Opponents to the Ad Astra map allege it is partisan and racially gerrymandered in violation of the state constitution, primarily for its treatment of Wyandotte County and the City of Lawrence. Supporters say state courts don’t have authority to consider federal maps, and even if they do, the map meets all redistricting criteria and is constitutional. Lawmakers passed the map (26-9) and (79-37) (see how senators voted and see how House members voted), Governor Kelly vetoed the map, and lawmakers then voted (27-11) and (85-37) to override her veto (see how senators voted to override and see how House members voted to override.)

Democratic Kansas Senator Tom Holland, D-Baldwin City, has also filed a legal challenge to the  Liberty 3 map (SB 563) redrawing boundaries of the Kansas Senate’s 40 districts (see how senators voted on the map), arguing that if the U.S. Congressional map is unconstitutional then similar principles should apply to the Senate map. Holland was drawn out of his current Senate district and drawn into the same district with another Republican incumbent; Holland would be unlikely to win versus the Republican in the newly-drawn district.
       The same bill also includes the Free State 3F map redrawing boundaries of the Kansas House’s 125 districts (see how House members voted 112-9 on the map), and the Apple 7 map redrawing boundaries of the State Board of Education’s 10 districts (added by conference committee). The redistricting process requires these state maps be reviewed and certified by the Kansas Supreme Court.
       The House passed (83-40) and the Senate passed (29-11) the conference committee report; the Governor signed the measure. See how House members voted. See how senators voted.

TAXATION
The House passed (114-3), Senate passed (39-0), and Governor signed the conference committee report on HB 2106, reducing the state sales tax rate on food and food ingredients from 6.5% to 4.0% beginning January 1, 2023, further reducing it to 2.0% on January 1, 2024, and eliminating it (0.0%) on January 1, 2025. “Food and food ingredients” would be defined to include bottled water, candy, dietary supplements, soft drinks, and food sold through vending machines but would exclude most prepared/restaurant foods, alcoholic beverages, and tobacco. Local sales tax on food would not be impacted. The transfer to the State Highway Fund would be adjusted upward to offset the reduction in state revenues. The low-income food sales tax credit would sunset at the end of Tax Year 2024. According to KDOR, State General Fund receipts would be expected to be reduced by $82 million in upcoming FY2023, $246.2 million in FY2024, $414.5 million in FY2025, and $494.4 million in FY 2026. Read the conference report summary. See how House members voted. See how senators voted.

A budget bill passed by the House and Senate and signed by the Governor (SB 267) included $50 million from federal ARPA funds in upcoming FY 2023 to pay rebates to small businesses shut down during the pandemic. No additional details are known at this time regarding eligibility, amounts, timelines, or claims process.

House and Senate negotiators have agreed to a conference committee report – not yet voted on by either the House nor Senate – on HB 2136, containing three selected provisions from the conference committee report on HB 2597 revising laws related to income, sales, and property tax.  House negotiators pushed for the pared-down bill, a move Senate negotiators strongly resisted. Lawmakers could take up the measure when they return to Topeka on May 23rd. A summary of the HB 2136 conference report is not yet available online, but the provisions pulled into the bill include:

  • Enacting the COVID-19 Retail Storefront Property Tax Relief Act, providing for claims for partial property tax refunds to be paid for Tax Years 2020 and 2021 for eligible claimants that were operationally shut down or restricted at their retail storefront by a COVID-19-related order or action imposed by the State, a local unit of government, or a local health officer.
  • Eliminating a provision requiring retailers with annual sales tax liability in excess of $40,000 to remit estimated payment for the first 15 days of the current month when the tax return for the previous month is filed.
  • Addressing Atchison county sales tax authority

Provisions from original HB 2597 NOT pulled into HB 2136 include:

  • Beginning in Tax Year 2023, increasing standard deduction amounts annually by the cost-of-living adjustment provided for by Section 1(f)(3) of the Internal Revenue Code.
  • Creating a state income tax deduction allowing taxpayers who carried back federal net operating losses in tax years 2018 through 2020 under the federal CARES Act to subtract such amounts from their income for purposes of determining Kansas adjusted gross income. Taxpayers would be permitted to carry forward such net operating losses for up to 20 years if the amount exceeds the Kansas adjusted gross income of the taxpayer.
  • Creating state income tax exemptions for 25% of the federal deduction disallowances associated with the federal Work Opportunity Tax Credit and the federal Employee Retention Credit.
  • Beginning July 1, 2023, extending to commercial users the state sales and use tax rate of 0.0% (a de facto exemption) on utilities currently already applied to residential and agricultural sales of gas, electricity, heat, propane gas, liquified petroleum gas, coal, wood, and other fuel sources for the production of heat or lighting. It does not impact local sales tax on utilities.

REGULATIONS
The Governor’s veto stood of SB 493, prohibiting cities and counties from regulating plastic bags, straws, and other containers designed for the consumption, transportation or protection of merchandise, food or beverages, after the Senate overrode the veto (27-12) but no attempt was made in the House. In her veto message, the Governor expressed a belief the issue should continue to be determined by local communities.
       Both Wichita and Lawrence have discussed imposing such regulations. Proponents say the measure is aimed at preventing a confusing patchwork of local regulations and increased costs for businesses and consumers, with little positive environmental impact. Opponents say it infringes on local government authority and the ability to address a growing environmental concern. Approaching half of states nationally have regulations preempting local plastic bag controls.
       The Senate had concurred in House changes to the bill (26-12); the House amended the bill to add straws to the measure. The House approved its version of the bill (74-48). The Senate originally passed the measure (27-13). Read a summary of the amended bill. Read the full text of the amended bill. See how senators originally voted. See how House members voted. See how senators voted to concur. See how senators voted to override.

The House passed (73-49), Senate passed (21-13), and Governor signed the conference committee report on SB 84, authorizing sports wagering at the four state-owned casinos (who may also partner with a limited number of retailers for in-person betting), via “interactive sports wagering platforms” such as websites and mobile device apps (but bettors must be physically located in Kansas), and inside designated areas at sporting arenas (such as Children’s Mercy Park and the Kansas Speedway.) The bill would also allow historical horse racing at Wichita’s Greyhound Park if it were to reopen (bettors bet on randomly-generated past horse races, a gaming format believed to minimize the threat of litigation by the casinos versus previously-proposed traditional slot machines.) The state will take a flat 10% cut of all bets, regardless of whether they are placed online or in person (expected to garner $8-10 million a year); the measure includes a provision dedicating 80% of state revenues from sports wagering to paying for a new sports facility for a professional sports team – a provision included in the wake of the Kansas City Chiefs reporting they have considered relocation sites in Kansas. Sports betting infrastructure would be established before the end of the calendar year. More than 30 states already have some form of sports wagering; Missouri does not. Read the conference report summary. See how senators voted. See how House members voted.

The House passed (64-53), the Senate passed (23-17), and the Governor VETOED the conference committee report on SB 34, aimed at mask mandates, quarantine orders, and vaccine passports in response to infectious diseases. The bills says no governmental agency or public official (including schools) can mandate face masks as a response to any infectious or contagious disease (with an exception for certain health care workers) – including such diseases as tuberculosis and whooping cough – nor issue/require vaccine passports or compel law enforcement to assist in the execution or enforcement of any order regarding infectious and contagious diseases (such as a quarantine order.) The bill’s prohibitions do not apply to the private sector. Read the conference report summary. See how House members voted. See how senators voted. It remains to be seen if lawmakers will attempt to override the veto when they return to Topeka; it passed by numbers far short of the 2/3 votes required for an override (84 in the House, 27 in the Senate).

The House passed (91-26) the conference committee report on SB 331, eliminating the prohibition on a surcharge when purchases are made with a credit or debit card, giving retailers the option of passing credit card costs on to the consumer. The Senate has yet to vote on the measure. Kansas is one of only four states that prohibits credit card surcharges, and a recent U.S. Supreme Court decision (Expressions Hair Design v. Schneiderman) struck down such surcharge prohibitions. Read the conference report summary. See how House members voted.

EDUCATION
The House passed (75-45) and Senate passed (24-14) the conference committee report on HB 2567, fully funding K-12 education and making policy changes related to K-12 and higher education. In addition to appropriating funding for K-12 education in accordance with the Gannon case, the bill’s many policy changes include:

  • Authorizing boards of education of school districts to allow students enrolled in grades 6 through 12 to earn course credits through alternative educational opportunities outside the classroom, including at a business, nonprofit organization, or trade association.
  • Establishing an “open borders” transfer system whereby nonresident students may attend school in any school district in the state based upon the student capacity of each district. Concerns have been raised about the impact of this policy on local property taxpayers, whose local property tax burden will increase to pay for nonresident students who may also hasten the need for additional bond issues. Most area school districts oppose the measure saying whether to accept non-resident transfers should remain a local decision based on individual district factors and input from district patrons.
  • Amend the Kansas Promise Scholarship Act, a program passed last session providing last-dollar scholarships for Kansas students who attend postsecondary educational programs that correspond to high-demand, critical need, or high-wage career fields. The bill would clarify the responsibilities of the Board of Regents and post-secondary educational institutions, authorize designation of additional qualifying programs and fields of study, and provide caps and other clarifications.
  • Amending the Johnson County Research Triangle Authority Act, broadening the allowed purposes of the use of funds at the Johnson County campus of Kansas State University.
  • Expanding the Tax Credit for Low Income Students Scholarship Program, which provides state income tax credits for contributions to scholarships for eligible students to attend an eligible private school of their choice, to include children seven years of age or under in the definition of “eligible student.”
  • Requiring KSDE to prepare and submit to the Governor and the Legislature a summary report regarding student achievement.
  • Establishing “Hero Scholarships” for qualifying dependents or spouses of certain first responders and military personnel.

Read the conference report summary. See how House members voted. See how senators voted. The measure now goes to the Governor for her consideration.

ECONOMIC DEVELOPMENT/WORKFORCE DEVELOPMENT
The Senate passed (29-6), the House passed (109-10) and the Governor signed the conference committee report on HB 2466, requiring computer science courses of instruction in secondary K-12 public schools, aimed at increasing the availability of computer science education in Kansas schools to better prepare the state’s future workforce. The bill does not make computer science a graduation requirement as once proposed, addressing a concern about the current preparedness of all schools to fulfill that requirement. The bill would also require the Kansas Department of Education to conduct a survey of high-value credential and standard career and technical educations courses offered to students enrolled in public high schools for the purpose of determining the needs for secondary career technical education credentialing. Read the conference report summary. See how senators voted. See how House members voted.

The House passed (109-12), Senate passed (34-3), and Governor signed the conference committee report on HB 2237, which includes provisions aimed at facilitating workforce development by expanding the child day care services income tax credit to all business-entity taxpayers (not just corporate) and permitting such taxpayers to claim 50% of expenditures paid to an organization providing child care to the taxpayer’s employees. The CCR also includes provisions incentivizing construction of attainable housing in rural and economically distressed areas. Read the conference report summary. See how House members voted. See how senators voted.

LEGAL
The Governor’s veto stood of SB 286, legislation addressing a number of policies related to or exacerbated by the COVID-19 pandemic. Lawmakers did not attempt to override her veto. Provisions of the bill include:

  • Extending the expiration date from March 31, 2022, until January 20, 2023, for provisions related to the COVID-19 pandemic response, including:
    • Immunity from civil liability for COVID-19 claims for businesses in substantial compliance with public health directives;
    • Expanded immunity from civil liability for health care providers related to the COVID-19 public health emergency (expanded immunity would not apply to a medical care facility or its providers who deny healthcare services to a person based solely on such person’s COVID-19 vaccination status);
    • Expansion of telemedicine;
    • Flexibility in use of hospital beds and non-hospital space.
  • Creating the crime of interference with the conduct of a hospital.
  • Increasing the penalty for the crime of battery when committed against a healthcare provider.

In her veto message the Governor had expressed concern about the provision expanding the current COVID-related immunity for health care providers, added by the House, which she says would be overly broad and could extend as far as malpractice. This expanded immunity would still expire in January 2023.
Legislative leaders were not close enough to achieve the 2/3 votes necessary to attempt to override the veto. The conference committee report had passed the House (64-51) and the Senate (24-16), when 84 and 27 votes are necessary. Read the conference report summary. See how senators voted. See how House members voted. It remains to be seen if lawmakers make another attempt .

HEALTH CARE
The Governor’s veto stood of SB 199, extending the period for short-term, limited-duration health plans, after being overridden in the Senate (28-9) but no override attempt was made in the House. Under the bill, “short-term, limited-duration” would mean an insurance policy period less than 12 months that offers renewal or extension periods up to a maximum policy period of 36 months total duration. ST/LD plans are not required to comply with Affordable Care Act coverage mandates and typically contain exclusions and limitations, including limits on preexisting condition coverage. The bill’s proposed changes mirror federal guidelines that were revised at the end of 2018.
In her veto message, the Governor reiterated the same concerns she did when she vetoed the issue last year, saying such plans are “junk insurance” and calling instead for expansion of Medicaid. Last year her veto also stood after being overridden in the Senate but not in the House.
       The Senate had concurred (28-11) with House technical changes to the bill. The House passed the amended bill (73-49). The measure originally passed the Senate (27-6) in 2021. See how senators voted to override. Read a summary of the amended bill. Read the full text of the amended bill. See how senators voted to concur. See how House members voted.  See how senators voted in 2021.

The House passed (84-38), the Senate passed (26-12), and the Governor VETOED the conference committee report on HB 2387, delaying the rebidding process on new KanCare Medicaid contracts until after January 31, 2023. The measure effectively bars the Kansas Dept. of Health & Environment (KDHE) from rebidding $4 billion in contracts with private insurance companies that administer the State’s Medicaid program set to expire next year and instead requires the contracts with current companies be extended. Lawmaker proponents say the goal of the policy is to ensure the RFP and renegotiation process – which were set to begin this year – will instead be conducted by the same gubernatorial administration that will take office after the 2022 elections.
Some lawmakers raised questions whether the policy would be an unconstitutional overreach by the legislature into executive powers and sought the Attorney General’s opinion. The AG declared it to be within the legislature’s authority but Governor Kelly has pushed back on that opinion, saying it runs counter to previous AG opinions and Supreme Court rulings and questions the no-bid contract extensions. KDHE and health care providers have also warned the move could endanger Kansas’s federal Medicaid funding if the federal Centers for Medicare and Medicaid Services (CMS) does not approve the change.

The bill also further amends law regarding the powers of the Governor under the Kansas Emergency Management Act (KEMA), limiting a governor’s powers regarding firearms/ammunition and the authority to prohibit attending or conducting religious services. Read the conference report summary. See how House members voted. See how senators voted. It remains to be seen if lawmakers will attempt to override the veto when they return to Topeka; it passed by numbers very close to the 2/3 votes required for an override (84 in the House, 27 in the Senate).

Coming Up
Legislators will return to Topeka on May 23 for a continuation of the “veto session,” a period when lawmakers may reconsider redistricting maps rejected by the Kansas Supreme Court, attempt to override bills vetoed by the Governor, and complete any unfinished business.

“See How They Voted” Lenexa-Area Legislator Guide!

Interested in a bill and want to learn more?  Remember, you can:

 

CHAMBER CO-SPONSORS LEGISLATIVE UPDATE LUNCHEON

Last week the Lenexa Chamber joined with nine other Johnson County chambers to host a Legislative Update Luncheon featuring a panel of six area state legislative leaders.

More than 200 attendees enjoyed networking before hearing an update on the latest from Topeka.

A second joint Legislative Update Luncheon will be held on June 8 – mark your calendar and watch for registration information soon!

 

AREA LEGISLATORS ZOOM WITH CHAMBER

On Friday, January 14, nearly all Lenexa-area state legislators were guests of the Chamber’s Legislative Affairs Committee to talk about issues in Topeka, resulting in good dialogue and good fellowship!

Thanks to Kansas Senate Minority Leader Dinah Sykes and Kansas Reps. Linda Featherston, Jo Ella Hoye, John Resman, Susan Ruiz and Brandon Woodard for taking time to engage with your business constituents.

 

CHAMBER BOARD APPROVES 2022 STATE LEGISLATIVE AGENDA

The Lenexa Chamber Board of Directors has approved a legislative platform to guide our advocacy in the upcoming 2022 state legislative session.  The platform addresses a spectrum of issues important to the business community including pandemic relief and recovery, tax policy, key business costs and regulations, K-12 and higher education, health care, transportation, economic development, and others.

For a summary of the platform, please click here.

Questions or feedback?  Call Ashley Sherard, Vice President and Director of Legislative Affairs, at 913-888-1414 or email asherard@lenexa.org.

Lenexa Chamber on Twitter:

It's time for Happy Town, our annual Leadership Lenexa exercise that gives our group a (fun) glance at what it's like to develop a project in #Lenexa! Special thanks to @ParkUniversity for hosting us today! pic.twitter.com/7OjxWvEuaT

After starting our day at @ParkUniversity hearing from @LenexaChamber President Blake Schreck, Leadership Lenexa is headed out to view economic development projects around the @cityoflenexa! #Lenexa pic.twitter.com/EsppMeK5XO

A beautiful morning for a ribbon cutting at X/O Exteriors and Outdoors! Be sure to check out all the materials they carry for home and biz outdoor projects. Congratulations and welcome to the @cityoflenexa! #Lenexa pic.twitter.com/9pR9dim0rD