Kelly unveils $26 billion Kansas budget focused on schools, water
Governor's 'People's Budget' proposal seeks to restore fiscal balance amid projected deficits
TOPEKA, Kan. (AP) — Gov. Laura Kelly on Wednesday unveiled her fiscal year 2027 budget proposal, a spending plan she said would restore structural balance to state finances while maintaining full funding for Kansas public schools and addressing long-standing water infrastructure needs.
The Democratic governor's budget would increase state spending by 1.6% over the current fiscal year, with the governor's office projecting tax revenue to grow by the same amount. Kelly called the proposal "The People's Budget," a reference to a statewide listening tour she conducted last fall. The budget comes as state analysts have warned Kansas could face annual deficits of $300 million to $700 million in coming years, a situation Kelly has blamed on tax cuts passed by the Republican-led Legislature over her objections.
Kelly's proposal includes $50.6 million in additional funding for special education, an area where Kansas has consistently fallen short of its legal obligation to cover 92% of districts' excess costs. State data shows Kansas has funded special education at roughly 71%, leaving school districts to cover a $155 million gap from general funds. The budget also allocates $2.5 million to eliminate meal co-pays for 34,400 students currently on reduced-price lunch programs and $8.6 million for the Kansas Blueprint for Literacy.
The proposal addresses water challenges with full funding for the State Water Plan Fund and includes $2.3 million to improve water quality in the Equus Beds Aquifer, which serves as a primary water source for Wichita and surrounding communities. Kelly also seeks $30.9 million for first-year operations of the South Central Regional Mental Health Hospital in Sedgwick County, a 104-bed facility expected to open in early 2027 that will be the state's first new psychiatric hospital in more than a century. State employees would receive a 2.5% pay increase under the plan.
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