New revenue estimates project state deficits every year through 2028
Updated fiscal forecasts show Kansas spending hundreds of millions more than it collects for years to come
TOPEKA, Kan. — Kansas will run a deficit every year through 2028, according to updated Consensus Revenue Estimates released Monday that show income tax collections falling below previous predictions and the state spending hundreds of millions more than it collects over the next several years. The new estimates lower revenue collections by $127.4 million for the fiscal year ending June 30, with the state now expected to spend $702.7 million more than it collects this year. The shortfall is projected to continue, with the state on track to spend $407.6 million more than it takes in next year and $427 million in the red for 2028, drawing down the state's $2 billion surplus fund.
The decline is largely driven by cratering income tax collections — down $138 million from November's forecast for this fiscal year and $28 million lower for next year — partially offset by better-than-expected interest earned on idle funds.
Gov. Laura Kelly seized on the projections to criticize the Kansas Legislature for ending its session before the estimates were released, arguing lawmakers missed an opportunity to review the state's latest financial projections before passing a budget. The release of consensus revenue numbers following the legislative session is unusual, as GOP leadership fast-tracked the session to end by mid-April — before the updated estimates were available. Kelly also criticized lawmakers for rejecting a 2.5% pay raise for state employees while approving a 4% raise for themselves and a 10% raise for their own staff.
House Speaker Dan Hawkins, a Wichita Republican running for state insurance commissioner, pushed back on Kelly's characterization. "While some want to have it both ways with talks of spending increases but also warning of poor legislative budget trends, today's numbers prove that the work the Legislature has accomplished is setting up the state for success into the future," Hawkins said. "We're focused on a sustainable future for Kansas that protects taxpayers over the long term."
The estimates are released by a group of economists from two state agencies and three Kansas universities. Forecasters noted several economic risks, including the ongoing Iran military conflict, market volatility, high input prices, interest rates and potential re-acceleration of inflation, but said the Kansas economy appeared "resilient and largely stable." On the upside, economists cited Boeing's reacquisition of Spirit AeroSystems and Panasonic's plans to expand its De Soto vehicle battery plant workforce from 1,400 employees this spring to 4,000 next year.
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