February 16th, 2009
06:18 PM ET

Kansas budget crisis: State tax refunds on hold

[cnn-photo-caption image=http://i.l.cnn.net/cnn/2008/POLITICS/01/28/sebelius.response/art.sebelius.gi.jpg caption="Kansas Gov. Kathleen Sebelius."]

David Klepper
The Kansas City Star

State tax refunds, Medicaid reimbursements and payments to local schools are all on hold because of a political showdown between Kansas legislative leaders and Gov. Kathleen Sebelius.

The Kansas Finance Council was to meet at 1 p.m. today to vote on whether to borrow $225 million from healthy state funds to cover expected payments to schools, state workers and taxpayers. The state did the same thing last December when it ran into a cash-flow problem.

But Republican leaders said they wouldn’t authorize the new loans until Sebelius, a Democrat, signs legislation designed to erase the state’s current year budget deficit. That bill, passed Thursday, cuts statewide school funding by $32 million and makes millions more in cuts to other state agencies.

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Filed under: Economy • Raw Politics
soundoff (17 Responses)
  1. Michael "C" Lorton, Virginia

    Let's see--–rob from Peter to pay Paul--it a common practice--and even more common in Washington.

    February 17, 2009 at 9:29 am |
  2. gail bullock

    So now, one of the actual industries that has, so far, been recession-proof.....medicine....is going to take a hit, along with the regular tax payers. I bet, if the Kansas governor, or her finacial advisors take ill and need to go to the hospital, their bills will be paid. The question will be, will there be any medical staff there to care for them. Medical people are like evryone else.....we go where the PAYING jobs are...

    February 17, 2009 at 9:00 am |
  3. J.V.Hodgson

    Is it clear that Kansas and California are in a mess. Yes.
    20,000 jobs to be cut in California and Kansas Dems want to support medicare and tax cuts but in both cases Repubilican votes are and continue to be on Partisan based lines.
    Schwarzennegger wants pork for California and Kansas Republicans deny medicare and education spending, all part of Obama's recovery plan. Gee how the American political system and its constitution is open to pure, pure political manipulation rather than what is best at a point in time for voters and the people.
    Please Republicans and Democrats, put Ideology out the window, and help allocate the stimulus economic recovery plan allocate funds where most needed on a national basis not on the basis, of which individual Governor screams loudest .
    I spent years as a CEO agreeing broad investment objectives (the Bill in this case for recovery).
    The most difficult decisions were where and to whom to actually shell out the funds within the global corporate entities needs or in this case the good ole USA .
    QED if it is appropriate give Sebelius her needed funds from central government as a 0.5% interest loan, and california a quick way thru infrastructure or other means of offsetting wherever the 20,000 job losses are planned.
    But watch out for he or her who speaks loudest They are not always right, mostly yes, but not always.
    Much of the stimulus except tax cuts must go to states threatened by the auto industry disaster and related states and others after that?

    February 17, 2009 at 4:47 am |
  4. Gale Remington Smith

    While I don't always agree with the Gov. I applaud her cool in dealing with the stupidity of the Kansas Republican Party. Another example of "what is wrong with Kansas."

    February 17, 2009 at 12:21 am |
  5. Sharon S

    Medicaid well that says it all for me!
    Democrats love to give that handout money to people who don't work are on Welfare and their kids on Medicaid, yes the taxpayers yet again stuck with paying for some kids that do not belong to them!

    Well how about this for a start get those women off Welfare and Medicaid and make them get a JOB! That should take care of the Medicaid part, and then with more working people in your state you might have enough tax money to get by?

    But than again I've been pointing this well known fact to our lovely Government for years to no Avail and especially some Democrat you know how they love to share our wealth, but anytime one party is actually working and another is NOT I call that low lifes living off the working class!

    Can we just do away with the Medicaid crap already! I'm sure I have paid for enough medical bills for kids that DO NOT belong to me already!

    February 16, 2009 at 11:26 pm |

    The Pyramid Scheme of government is now at all levels. Fleece the people in higher taxes, fees, and debt. Borrow and feed yourselves with pay raises, sweet retirement/benefits. Floating bonds, and then floating more bonds to pay the interest on the first bonds, then when the principle is due, float more bonds and debt to pay than. When the economy goes negative, Bingo, the Pyramid/Ponzi scheme of government debt is revealed. Glad to Bernie Madoff's school of Ponzi and Pyramids are practiced at all levels of government.

    Maybe Kansas government tell the poor taxpayers, which backs they have broken, to keep their money, and at the end of the year, tell me what I owe to the Kansas government. I 'll decide whether I will pay taxes for state services I didn't receive or were poor.

    I think we are all getting tired of taxation without representation at all levels of the government scams!

    February 16, 2009 at 11:25 pm |
  7. Stan Miller

    I wish my state were only hung up on whether to take $225 million from one pocket and put in the other. With a deficit approaching 50billion, can you guess where I live? Why is a state being held hostage by 2-3 republican representatives not news on 360? Where is Kansas anyway?

    February 16, 2009 at 10:33 pm |
  8. Jason Colby

    I live in the state of Kansas and I've paid all of my taxes. I just found out that I'm not getting my refund, and everything that I once thought was safe is being taken away from me. I don't care who is at fault. It could be Republicans or Democrats. The only thing I know is that they are messing with people's lives. The politicans will still have a paycheck, so why do they care about the little people!

    February 16, 2009 at 10:13 pm |
  9. Luis

    You still Keep paying taxes Kansas residents?

    California and Kansas are the perfect examples of how government is bad when it comes to money. California democrats are truing to raise taxes. Can you believe this? Oregon is raising taxes on cigarettes and alcohol. I want to see the breaking point of when people start revolting violently or march in protest.

    Dont buy any municipal, state bonds. Give them a message, that we ain't going to take this anymore.

    Our government on all levels suck.

    February 16, 2009 at 10:12 pm |
  10. Timothy Gibson

    It is a sad reality that not only Kansas but other states as well face a budget short fall due to irresponsible government spending and have no intention of changing their ways even in this current economic crisis as both sides fight over control and who wears the bigger pants in the house. Situtations such as this are not only a visual picture to the world of the short comings of an American democracy as they call it, but of a power struggle that threatens to cripple our nation for many years to come.

    February 16, 2009 at 9:11 pm |
  11. Jesssica Blackwell

    SO Our Kansas government decided to get a loan from Kansas tax payers and essentially blow the money and get themselves deeper into debt, then turn around at tax time and say WAOH Kansas is broke and guess what were not going to make good on our loan agreement .
    Ok so tell me what if somebody was to owe Kansas money cant they be like No I can't pay you this month because were in the red...But once we get caught up on our bills then maybe We will get around to paying you..... just a thought lol

    February 16, 2009 at 8:23 pm |
  12. Annie Kate

    Seems like everybody and everything is going broke. The fallout from the bad loans and the housing crisis just doesn't seem to end. I'm sure if this state is having trouble the others are too. I'd like to hear about some states who are doing ok – if there are any – and what they have done to stay that way. We know what doesn't work; lets' analyze what does so we might have a common sense approach on how to go forward.

    February 16, 2009 at 8:09 pm |
  13. Paulasue Sawyers

    I naive in thinking like this? Just heard on CNN that Kansas won't be sending tax refunds out. (I was raised in KS) OMG. My daughter gave me the news that one of her closest friends has been laid off from IBM in Vermont after 23 years of superior work (she is in her 40's). IBM layoffs are big in our community (Vermont). The main thing I resent is the lack of bipartisan cooperation in Congress in this time of economic crisis. Aren't Members of Congress paid enough to read the legislation or have an aide (paid or otherwise) read it and study it overnight to put "talking points" together for our valued individual in Congress? And if they would have been working in a bartisen way, they wouldn't have to read it, they would know it verbatim. Are these the same individuals who forget to pay taxes, and who go a few miles in a limo to attend a fund raiser in their honor, and don't have to pay for health care? The lack of corporation in Congress is making me sick. I have a friend-who HATES DEMOCRATS. Come on, the lack of working together, an "old boy rule" HAS GOT TO STOP before it is too late. Who said, “It's the economy stupid”!? And now our economy is in great crisis. Work together Members of Congress and support our President. What a surprise that would be and I would welcome. psue in Vermont

    February 16, 2009 at 7:12 pm |
  14. Lori Hillis-Jerome , Shaunavon SK

    So, because of a mess up in political savvy, ie: spending money, children, doctors and taxpayers get nothing?? How pathetic is that? Holding hostage the very things that people need. Income tax refunds that would help to spur spending, medicaid payments that would go to doctors treating the ill, can decide to decline medicaid patients, and schools will start cutting programs for children. Does any of this make sense???

    February 16, 2009 at 7:01 pm |
  15. Richard

    You would think that after 2 consecutive years of cash flow problems, that the current legislation would have an idea as to how the problem can be fixed. Republicans shouldn't be so quick to blame one democrat on the hill for the state's issues. They all play a vital part when bills are passed, and should take the responsibility for their actions; as ALL of us are expected to do.

    February 16, 2009 at 6:59 pm |
  16. m ryan

    for the first time in decades it seems the american people have a president who genuinely wants to help middle and lower class people. however, this president has his grassy knoll as well. in the form of the republican party . they would rather sit back and be part of the problem as opposed to part of the economic solution . the repulican party had no problem spending god knows how much on war in the middle east . now the time has come to help the american people in the form of stimulus spending and they are a no show.

    February 16, 2009 at 6:59 pm |
  17. truelib

    Seems like the pattern is clear. Democrats bankrupt any entity they get involved with. They can't seem to get a grasp on reality. Thinking that they are doing "good" they always seem to hurt people.
    Forcing banks to loan to people that can't repay didn't do the banking industry any good. Governments spending beyond their means doesn't seem to do them any good either.

    February 16, 2009 at 6:23 pm |