State employees, including those at KU, could face furloughs if budget not resolved soon

? State officials in Kansas are making plans for mass furloughs of tens of thousands of workers – including many at Kansas University — unless lawmakers can pass a budget and a tax plan to fund it within the next week.

That’s because the state will officially run out of legal spending authority on July 1.

However, the first paycheck for state workers to be issued after that date will be for the two-week pay period that begins June 7. And unless lawmakers can agree on a balanced budget by June 6, one week from Saturday, many state workers may be forced to stay home.

So far, officials in Gov. Sam Brownback’s administration are saying little about that looming deadline, except to say they are aware of it.

“We are talking with the secretary of state, legislative staff, Department of Administration, budget office and others to determine the last possible date a budget can be passed before furlough notices would have to be issued,” Brownback’s press secretary Eileen Hawley said in an email statement. “The governor continues to work with legislators on a pro-growth strategy to balance the budget.”

Despite the fact that the Senate on Wednesday rejected one tax package to fill in the state’s $400 million budget hole, and Republican leaders in the House called off a scheduled debate on their own bill for Thursday, Senate GOP leaders said they are confident lawmakers can resolve the tax and budget issues within the next nine days.

“I definitely see a way to get to constitutional majorities. I think we’re going to get it done,” Majority Leader Terry Bruce of Hutchinson said.

Senate President Susan Wagle of Wichita said that technically, lawmakers only need to pass a budget bill by June 6, and they can pass a tax bill to fund it later. But Brownback has reportedly told lawmakers he will not sign a budget bill that is out of balance with revenue projections.

KU officials did not respond to telephone and email requests for comment about possible furloughs.

Lawrence impact

But area legislators said any partial shutdown of state government would have a big impact in Lawrence.

“Incredibly devastating,” is how Sen. Marci Francisco, D-Lawrence, described the potential impact on Lawrence of any type of state government shutdown. “Certainly, we want to consider the university, and summer school has already started. People have signed up for those courses, so we need people to teach them, staff to get the classrooms ready.”

Rep. John Wilson, D-Lawrence, said the impact would also be felt beyond the university.

“We have a (Department of Children and Families) office here,” he said. “We also have a lot of employees who work for other state agencies. It would have a noticeable impact in the lives of those employees. And the longer it goes on … it really affects people’s morale. State employees have been kicked around for quite a while.”

Lawmakers have spent part of this week debating various tax bills to raise in excess of $400 million in additional revenue, an amount they need to fully fund the roughly $6.5 billion general fund budget that House and Senate negotiators have tentatively agreed to.

But officials are also warning lawmakers that if they want higher sales taxes to be part of that mix, they also need to act soon in order for a new tax rate to take effect by July 1.

Sales taxes take time

Both the Senate bill that was debated Wednesday and the House bill that had been scheduled for debate Thursday include raising the state sales tax rate from its current 6.15 percent, while slightly lowering the sales tax rate on food.

Chris Courtwright, principal economist for the Legislature’s non-partisan research department, said that by law, retailers must be given 30 days notice before sales tax rates can be changed.

Furthermore, he said, under the multistate “streamlined sales tax agreement” that allows states to collect sales taxes on internet and mail order sales, new sales tax rates can only take effect on the first day of a fiscal quarter.

So if Kansas misses the deadline for a new tax to take effect July 1, it will have to wait until Oct. 1, which would reduce the amount of revenue the state would get.

“If we’re going to go crashing into the month of June … keep this in mind,” Courtwright told the House Taxation Committee Tuesday.