Friday was shocking in the Statehouse.
Yes, government and us folks who hang out under the Dome had heard the group of university economists called the Consensus Revenue Estimate Group (CRE) estimate just what the state’s revenues are going to be for the next 14 months, the end of this fiscal year and the year that starts July 1.
And when those CRE estimates predict millions of dollars of revenue shortfalls they are usually due to tax cuts, but not often a change in the entire landscape of the state, businesses shutting down, Kansans ordered to stay at their homes unless they had to grocery shop or pick up prescriptions or something “essential.”
Those CRE estimates were just that – estimates.
Well, Friday at about noon the Kansas Department of Revenue released its report on just how much in taxes the state received in April – first month of the real social and economic thunderstorm caused by the coronavirus pandemic – and those economists were right with their April 20, semi-annual estimate. Chillingly right.
Nearly every tax source that the state depends on to provide the services we all want from our state, ranging from highways to law enforcement to prisons to education for our children and the relatively grown-up university students, and social services so the poor have the food and housing and health-care that we want them to have, was shaken.
That Friday shockwave showed that the state took in $574.8 million in taxes in April. Last year in April, before all the economic effects of the pandemic, Kansas took in $1.18 billion. Yes, billion. That’s $612 million less this April than last. That shook the building. It meant that the economists, who we suppose spend most of their time reading the small type in the Wall Street Journal and economic newsletters, actually had the clear view of just what Kansans staying at home, closing nonessential businesses, seeing thousands of layoffs, having their tax payments delayed, would cause.
That put a whole new dollars-and-cents face on the coronavirus, and its effect on the economy and the state budget that is now law that is likely to be about $1.2 billion short of what it was based on when it was passed by lawmakers and signed into law by Gov. Laura Kelly in March. Again, before the fiscal effects of the virus had been translated into dollars and cents.
Now, it’s waiting to see just how the Legislature responds to that shockwave, which has both fiscal and political fallout for Kansas where every member of the Legislature stands for re-election this year.
The GOP-controlled Legislative Coordinating Council will meet this week to decide whether to reconvene lawmakers – with a myriad of social-distancing issues that will probably make it as uncomfortable as a bad prom date – to deal with the real dollars and cents of the budget.
And you gotta wonder how many Kansas voters are going to see the real numbers and decide if the people who don’t want to fix it now will be going back to the Legislature next session.
Will legislative leaders decide in the wake of those hard-dollar April revenue losses that they can’t delay until next January the fiscal problems that will lead to an unconstitutional budget deficit? Or will they decide it is still too dangerous to convene a mass of legislators from across the state? Or will voters want this budget fire controlled now, before a possible second-round of economic damage to the state if the pandemic spikes this fall?
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