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A Tale of Two Realities

A few weeks ago, I sent out a newsletter titled “A Matter of Perspective.” The central theme was that much of what happens in the Kansas Legislature is largely due to perspective - a dominant one largely formed by a shared experience of many members.

Or, that too many people who make policy decisions share the same experiences, and same view of how the world works. In the past couple of weeks there has been growing evidence to support this - and it is too obnoxiously clear to not point out.

These competing worlds of the people in power and the people without is so stark, I was tempted to start this newsletter by mirroring the intro to the Charles Dickens classic A Tale of Two Cities.

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way…”

Here in the Kansas Legislature, if you’re a big corporation it’s the best of times, and if you’re a poor working family, it’s the worst of times.

Giant mystery company vs people facing dire circumstances

Earlier this session, the legislature passed out with bipartisan support the vaunted APEX legislation - which creates more than $1 billion in multi-year incentives to attract an advanced manufacturing company. It was hailed as a tool to attract these sorts of mega-projects to Kansas - and those in the know have expressed belief that the project, should we win it, will be transformative for the state. Even though I fundamentally disagree with continuing or expanding the 40-plus year practice of filling the corporate feed trough with taxpayer money, I’m willing to hope the people who believe in this project are right.

But I lose patience for such arguments when the same people who supported a giant tax giveaway to a wealthy corporation can’t bring themselves to support a simple change that would allow Kansas to spend ALREADY ALLOCATED federal money to help the neediest families in the state. Such contrasting votes reveal a great deal - namely that it’s less a matter of money and more a matter of value judgements.

HB2525 would make a few changes to the improperly named HOPE Act - which created a number of changes to the state’s safety net programs. Specifically, it would’ve allowed families - and let’s be honest, children - to access food assistance even if the residential parent refused to help the state collect child support because the other parent was abusive, or otherwise unhealthy for the family. It also would’ve removed a 20-hour per week work requirement for parents attending at least six credit hours of post-secondary education. A key thing about this is that the cost to the state is minimal - it requires only enough state funds to administer the changes. The financing of the benefits themselves come from SNAP and TANF money that has already been allocated to Kansas - but the HOPE Act prevents their deployment.

If you’re keeping score at home - A billion dollar corporate tax giveaway passes the House 80-41, poor people escaping domestic violence and trying to improve their lives fails 53-66.

Here’s an overview of what the changes in 2525 would’ve meant in Kansas:

In Kansas, 1 in 8 people, and 1 in 6 children, face food insecurity. That is 351,090 total Kansans, and 120,090 Kansas kids. Yet, only about 70% of eligible Kansans participate in the food assistance program. According to DCF data, an average of 230 people per month from Aug. 2020 to July 2021 lost food assistance because of non-cooperation with the child support program. That is 230 Kansans each month fighting food insecurity who would have been reached by HB 2525. To qualify for food assistance, a Kansas family of 3 must have a gross income of $2,379 per month or less. The maximum food benefit for these three people, which they would only receive if they had $0 of income, is $658 per month. The national average monthly benefit for this size family is only $520, and the average SNAP benefit is about $1.40 per person, per meal. And remember that 100% of the food assistance benefit is paid for by federal dollars. The state general fund covers any remaining administrative costs of the program. The Department of Children and Families estimates that HB 2525 would have expanded access to the child care assistance program to 238 Kansans per month in FY 2023, and 676 Kansans per month in FY 2024. And remember, the bulk of the funding for the subsidy program comes from the federal government through the Child Care & Development Block Grant (CCDBG). The state actually isn’t drawing down all available federal funds because we haven’t put forth the required match. It’s also important to know that outside of CIF (tobacco dollars) and school finance formula (3 & 4 year old “at-risk” pre-k), there is essentially no state investment in child care.

This last paragraph touches on another loss we realized with this - an opportunity to feed already available dollars into our childcare infrastructure. Throughout the past year, we’ve learned that availability and access to affordable and quality childcare is a barrier to entering the workforce. HB2525 was a chance to help shore up the childcare system, yet the legislature couldn’t find a way to see that as an investment in the same way they saw APEX as an investment.

To illustrate this point, I invite you to listen to a few snippets from the floor debate. This will give you a good sense of how the legislature views giant companies against the way it views people whose lives don’t include a suburban-dream McMansion.

Perhaps most unsettling to me was the comment that “HB2525 provides a get out of jail free card.”

I’m not sure what that’s supposed to mean - but I’ll hazard a guess that a single mother who’s decided her children’s father is abusive, exploitative, or otherwise unsafe doesn’t feel much at all that she’s gotten a get out for free card on anything. To the contrary - their situation is so toxic, so filled with fear and worry, they’re willing to forgo financial support to keep their children safe. And we punish that decision by denying them access to federal funds they could get to keep their children healthy. Let’s further be clear: This policy doesn’t punish the “deadbeat Dad” or a non-compliant mother. Ultimately, it’s the children that suffer the wrath of our social expectations and demands. It would take an entirely different column to dive into the bigger social and financial costs we incur when we fail to take care of children - but a few highlights include increased risk for substance misuse, low academic achievement, higher teen pregnancy rates, lower lifetime earnings, and higher rates of criminal prosecution.

We can have discussions about what our safety net programs should include, how robust they should or shouldn’t be, or what we hope to achieve with them. But it’s clear that when we dole out money to corporations, we view it as an investment - no matter the expense. When we dole it out to families in need, we view it as an entitlement.

But it’s not just poor families - it’s costing you too

At the start of the session, there was widespread support for getting rid of the state’s sales tax on food - which at 6.5 percent is the second highest in the country.

As soon as APEX came up, the conversation quickly shifted to how, now, we simply can’t afford to eliminate the state sales tax on food for every single resident of Kansas. Suddenly people became very concerned about the “out” years in the budget should we stay the course on elimination of the food tax. If only that foresight was present back in 2012 when some of the same people shouted from the rooftops that eliminating the income tax on the richest companies and earners wouldn’t hurt the budget - and in fact would energize our revenues with a sunshiny shot of adrenaline.

But we can still afford this. We have excess revenues - even with the cost of APEX, and notwithstanding economic instability that might be created by Vladimir Putin’s aggression in Ukraine - all indications are that tax receipts will continue to exceed expectations for the near future.

Here’s the post-APEX budget projections. Note: This is the latest information I have, and I know that some of the numbers are being adjusted, so this isn’t the final version.

That’s not all. We’re still entertaining, debating, and voting on more and new tax cuts for companies, all while considering not axing the food tax, or at best lowering it slowly over the next several years.

Some of these provisions are for individuals - such as an increase to the standard deduction, while some are very business specific. But the point I want to drive home is that we have some flex in the state budget - and if we don’t eliminate the sales tax on food, it won’t be because we can’t afford it. It will be because the legislature decided it had priorities it favored over cutting taxes on groceries.

For a little additional context, I’ll include the Kansas Department of Revenue’s 2020 Tax Expenditure Report, which details the ways in which the state gives away would-be tax revenue.

Here’s the summary:

That’s roughly $10.7 billion dollars of tax money not collected in 2020. I’m not saying that’s all bad - some of those numbers when broken down are quite small, and arguably do some good. The point, though, is we give up tax revenue all the time and we add new giveaways every year. The conversation shouldn’t focus on whether we can or can’t, or whether we should or shouldn’t, but on whom additional tax cuts should go to.

In a year with strong revenue collections, I think there’s a healthy argument that we owe the families of Kansas some significant tax relief after a generation or more of consistently bowing to the demands of the wealthiest companies in the state.

Every session, the Kansas Legislature makes decisions that reflect its values, beliefs, and perspectives. The legislature decides who pays taxes, who gets tax breaks, and what “investments” best meet the legislature’s goals for the future.

We can’t afford Medicaid Expansion, even though doing so will bring millions of dollars into our state budget.

We can’t afford elimination of the state sales tax on food, but we’ll entertain any other tax cut idea that industry brings to our doorsteps.

We can’t afford to allow the federal government to give a couple hundred dollars to some of the poorest children in the state, but we can exempt $10 billion a year in taxes.

We debate every year whether we can afford to invest in the future of our children, and in the process we eviscerate teachers and the very concept of public education. Yet we work tirelessly finding creative ways to move public tax dollars into the hands of private institutions.

For those with the shared experience and uninterrupted perspective of perpetual prosperity, it is the best of times. For those born without resources, connections, or a solid base from which to launch dreams and goals, it is the worst of times.

And it will continue until enough people with a different perspective engage the system in a way that changes the overall perspective and produces policy that more accurately reflects the life experiences of most of our state’s residents.


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