11:00 p.m. Sunday
Last week, the Legislature began on a somber note with the unexpected passing of Rep. John Resman (R–Olathe), who represented District 121. Rep. Resman was serving his 10th year in the Kansas Legislature and was remembered as a gentle giant and a true statesman. He will be missed by colleagues on both sides of the aisle, a sentiment reflected during Monday’s House session when official business was postponed so members could pay tribute to his life and service.
Additionally, the Legislature continues to make progress on key issues such as the budget and property tax reform, prioritizing working on them so bills can be delivered to the Governor before first adjournment on March 27. As this deadline approaches, committees continue to work on bills that have passed one chamber to reach compromise through conference committees and move them to final floor action. Below is a review of the top issues that the legislature addressed last week.
CPA Pathway
The CPA Pathway bill, House Bill 2573, will be heard in the Senate Committee on Government Efficiency on Tuesday. The KSCPA and Board of Accountancy will testify in support of the bill.
Budget
The Senate debated its budget bill, Senate Bill 315, on Tuesday. The bill passed on a vote of 21-19 and was amended several times on the Senate floor. Adopted amendments include adding $1 million to special education and deleting a health pilot, establishing a property tax relief fund but not providing funding for it, requiring school districts to hold students accountable if they walk out for political purposes, creation of a pilot program to provide last resort transportation for working disabled Kansans and adding the APEX program to the list of programs reported on the transparency data base at the Kansas Department of Commerce. Now that both chambers have passed their budget, we expect a conference committee to begin meeting and hammering out their differences.
Property Tax
The House Tax Committee held hearings and acted on Senate Concurrent Resolution 1616, which caps property valuation increases at 3% annually, effective with 2022 valuations. Proponents encouraged passage, stating that assessed valuations have increased by 40% statewide over the last four years. Opponents believe this would shift property taxes to agriculture and commercial properties. An amendment was offered but failed to reduce the assessed value for residential property from 11.5% to 9%, which would have caused a fiscal note of $112.9m in FY 28 due to a reduction in collections of the state’s 20 mills. Ultimately, the measure passed the committee with only the base bill language of a 3% assessment cap and will now go to the full House for consideration.
The Senate Assessment and Taxation Committee held hearings on House Bill 2745, which requires cities and other local governments to cap property tax revenue at 3% annually. The Committee began working on the bill on Thursday by maintaining the revenue-neutral rate (RNR) process and making protest petitions the last step. Specifically, if a taxing subdivision proposes a budget exceeding the previous year’s amount, voters may block the increase via a protest petition if signed by at least 10% of qualified electors and submitted to the county clerk by September 15th. The county election officer would have seven days to verify the petition, and the results would accompany the adopted budget. The amendment also extends the deadline for school districts to submit adopted budgets to the state board from September 20 to October 1, amends the RNR statute to include protest petitions, and extends the Taxpayer Notification Tax Fund. A second committee amendment was adopted to add a CPI average for the last three years to the RNR. The Committee will continue working on the bill this week.
Unused Tax Credits
House Bill 2757 was passed by the House Taxation Committee last week. The bill repeals more than 20 unused or rarely used tax credits and amends the HPIP wage standards. The Committee removed the HPIP wage changes, removing concerns over the $150 million fiscal note. An amendment passed that also removes the extension of the aviation and angel tax credits, since they are moving in separate bills and adds back in the environmental tax credit, the Cedar Crest tax credit, and the individual disabled tax credit, since those credits are currently being used. The bill now goes to the full House for consideration.
Sales Tax Apportionment
The House Taxation Committee amended the sales tax distribution formula for cities and counties in H Sub for SB 33. The formula had previously been frozen due to concerns that reducing property taxes could also reduce a city’s share of sales tax revenue, potentially discouraging property tax relief. The new formula relies on assessed valuation, which may create winners and losers across the state. Because commercial property is assessed at a higher rate (25%) than residential property (11.5%), communities experiencing primarily residential growth are placed at a disadvantage. The bill passed the full House on Thursday by a vote of 107–11 and now returns to the Senate for further consideration.
Transportation Program
The House Appropriations Committee held a briefing on the Eisenhower Transportation Program that includes $10 billion in investments and $5 billion in preservation projects. The State Highway Fund's revenues are 20% higher than estimated in 2020, but motor fuels tax revenues have remained flat despite increased system usage. The current projection of project cost is $11.5 billion due to price increases. The IKE program will deliver less than originally planned because of inflation, despite the increased price tag.
Pharmacy Benefit Managers
The House Insurance Committee held an informational briefing on Senate Bill 360, which enacts the Kansas Consumer Prescription Protection and Accountability Act. The bill expands state regulation of pharmacy benefit managers (PBMs), increases reporting and transparency requirements, and includes a mandatory $10.50 dispensing fee. Many businesses and local government groups have expressed concerns regarding the dispensing fee. An actual bill hearing will be held on Wednesday in the House Insurance Committee.
Benefit Data Matching
On Thursday, the Senate debated Senate Bill 363, which would require KDHE and DCF to enter into expanded data-matching agreements to verify eligibility for food and medical assistance and mandate monthly data submissions to CMS beginning January 1, 2027. The bill exempts pregnant women, individuals over 65 and HCBS waiver recipients, including the IDD population, from quarterly eligibility redetermination. During floor debate, amendments were offered to remove the quarterly eligibility redetermination requirements for all recipients as well as allow KDHE to grant hardship exemptions; however, both amendments failed. The bill passed the Senate 25-12 and now heads to the House for consideration.
App Store Accountability Act
Senate Bill 372 was heard in the House Federal and State Affairs Committee. The bill regulates app store and developer operations regarding minors and establishes requirements for age verification. Proponents stated the bill would protect children from harmful digital material, while opponents expressed concerns about liability issues and data collection concerns. The committee will act on the bill on Wednesday.
Cellphone Ban
The Senate Education Committee worked on SB 302, which would prohibit the use of electronic devices in schools. The committee amended the bill to apply to schools accredited by KSDE and to exclude home schools and non-KSDE-accredited schools. The contents of the bill were inserted into Senate Sub House Bill 2299 and passed out of committee. On Thursday, the full Senate passed the bill by a vote of 32-4 and sent it back to the House, which will either accept it or refer it to a conference committee.
Data Centers
After passage of the data center tax credit last year, localities placed a moratorium on the location of data centers in certain counties. There has been much discussion on this topic both locally and statewide. The Senate Tax Committee introduced Senate Bill 526 that would require data centers to be built only on land zoned for manufacturing or industrial use on July 1, 2025, to be eligible for sales tax exemptions. The purpose of the bill is to protect residential and commercial areas from data centers, ensuring they are built in appropriate areas. No hearing has been scheduled yet, but additional discussions on data centers will take place this session.
Rural Business Growth Program Act
House Bill 2541, which would enact the Kansas Rural Business Growth Program Act and provide a premium tax credit to incentivize capital investment in rural areas, failed to advance from the House Taxation Committee. The Committee expressed concerns over the funding scheme and the return on investment the program would create.
Technical College Funding Task Force
The Senate Education Committee held a hearing on Senate Bill 437, which would establish a Technical College Funding Task Force charged with designing and recommending a pilot outcomes-based funding model for Kansas technical colleges. The bill ties funding to outcomes of academic progress and completion, dual and concurrent enrollment, attainment of industry credentials and licensure, and workforce entry and retention. Supporters argued the measure would strengthen the state workforce and encourage graduates to remain in Kansas. The Community College Association opposed the bill by asking for any changes to tech ed funding to be coordinated with community colleges, which deliver most of the technical education in Kansas.
By-Right Housing
The House Commerce Committee held a hearing on Senate Bill 418. The bill aims to make it easier to build single-family homes in communities across Kansas. Proponents argue that deregulation will bring down the cost of starter homes and help address the housing shortage. Opponents shared concerns about the erosion of local control for communities. A balloon amendment has been negotiated and will be offered when they work the bill.
No Impact Home-Based Business
The Senate Commerce Committee heard House Bill 2343, which creates the No-Impact Home-Based Business Fairness Act. The measure aims to support the development and growth of home-based businesses by limiting municipalities' regulatory power. The bill is a carry-over bill from the 2025 Legislative Session, where it passed the House. The Committee is expected to work on the bill and hopes to reach a compromise between the parties.
This Week
This week marks the last full week of committee meetings. The deadline for bills to be out of the second house is scheduled for March 20th. Conference Committees will primarily meet the week of March 23rd, with first adjournment scheduled for March 27th. Below is a list of bill hearings scheduled for this week:
Tax Credit for Employer Paid Child Care Expenses - Senate Bill 521, which provides for credits for payment of employees' child-care and contributions to a third party for increased child-care options, will be heard in Senate Assessment and Taxation on Monday.
Paid Family Leave - House Financial Institutions and Insurance will have an informational-only hearing on House Bill 2598, Paid Family Leave, on Monday.
Angel Investor Tax Credit - House Bill 2466 extends the angel investor tax credit to 2031. The bill will be heard in the Senate Commerce Committee on Monday.
Sports Tourism Grants - House Bill 2346, creating a Sports Tourism Grant program, will be heard in the Senate Commerce Committee on Monday.
Kansas Sports Authority - There will be a joint Commerce Committee meeting to hear a bill (no bill number available yet) regarding the Chiefs Sports Authority, which needs to be created to govern ownership of the sports facilities being built for the Kansas City Chiefs' new stadium and training facilities.
Transient Guest Tax - House Bill 2481, changes to the transient guest tax during the two months of the World Cup, will be heard in the Senate Commerce Committee on Thursday.
Freedom From Taxes Fund - House Concurrent Resolution 5034 will be heard in the House Taxation Committee on Thursday, which establishes the Freedom From Taxes Fund. The resolution establishes the Kansas citizens' freedom review board, authorizing the board to review tax exemptions and approve or eliminate them, and eliminating motor vehicle property taxes and fees, state-mandated and state-imposed property taxes, and state-imposed income and privilege taxes.
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