John William Carlin
MESSAGE OF GOVERNOR JOHN CARLIN TO THE KANSAS LEGISLATURE January 23, 1979
Mr. President, Mr. Speaker and Members of the Kansas Legislature, Friends:
It is a privilege to be here today. In years past I was honored to have helped, in some small measure, build the destinies of this legislative body and this state.
I return to you today in a new capacity, invigorated with new prospects for cooperation that I know from experience we can achieve. Many of you were here in 1976 when Legis-50, the Center for Legislative Improvement, honored this assembly as the most improved Legislature in the nation. I do not believe that honor was ever given the proper status by the media that was deserved. In terms of responsibility and response to the needs of Kansans, this Legislature will build on the foundation others prepaid. I know you will do well.
Granted, it is my constitutional duty to address you at this time, but it is also my pleasure to share with you in these moments my thoughts for the future.
I am combining my legislative and budget messages. The Budget Document will be placed on your desk following this message.
The budget I am presenting to you today has many facets. In reality, two administrations laid its foundation. Close scrutiny of this budget and these remarks will indicate to you my feelings--the way I think this government should operate, and the directions I feel we should go. I have had to mold the final touches; make the final preparations, but as those of you who are veterans of this process know, much of the budget is of an ongoing nature.
Each of us represents the same constituency--Kansans. It is their wishes and needs--not political needs, or regional needs--that must take precedence. We may disagree from time to time on the best method to meet those needs and wishes, but we must never forget who we serve.
One of my main roles, as I see it, is pointing out the good things about Kansas. We have an excellent economic base. We cannot, however, assume that Kansas would ride untouched through a national or international economic crisis. Kansas has low unemployment, a citizenry which maintains an old-fashioned standard of working hard for their livelihood.
We have an excellent standard of living, and our people are resourceful. Our independence sets us apart from other areas of this nation which are more troubled by prevailing winds of political and economic misfortune than here on the Great Plains.
But Kansas is not an island. You and I know that. We each recognize that the responsibility and requirements of our positions require that we approach today's problems in a responsible manner so that what is good about living in Kansas can continue.
I am committed fully to the concept of responsible leadership--not only doing what is politically popular. Sometimes the best test of statesmanship is the ability to anticipate the future, and say "no" to the present in order to meet those needs.
This budget is a cautious one, but it is also optimistic. It is a base from which we can build. If responsible leadership means being a cautious optimist, then I am guilty. When planning for state government, the past is not very reliable in predicting the future. The numbers, issues and problems are too diverse for adequate comparison. That is why fundamental mistakes are made by those who say "because we've done it this way in the past, that is the direction we must go now." Kansans know better.
In the few short weeks as I prepared this budget message, one thing stands out: as government officials, we must be constantly aware of sectors of our society where government involvement or regulation is counterproductive. Where possible, government should resist the temptation to regulate or otherwise become involved. This is a fundamental test of a true democracy. The greatest challenge we face in the final quarter of the twentieth century is not finding ways to grow and remain efficient--it is finding ways to remain small and efficient.
It will be a major challenge to this administration to keep state government small and efficient.
The second major challenge of my administration will be the coordination of the executive reorganization that has preceded me. Nothing is accomplished if incoming governors merely rearrange the furniture. It is time that the departments begin to work together, in harness, to serve the common good.
Coordination of programs requires the assistance and oversight of the Legislature. I look forward to your help in this arena. Programs should be coordinated to end duplication and fragmentation of services.
This budget for FY 1980 is a beginning. It is my attempt to share with you my definition of the role and function state government should play, and the state's responsibility to its citizens. We must meet these challenges, not as Republicans and Democrats, but as Kansans.
It is a job that must and should be done together.
RECOMMENDED BUDGET
The first task that I faced as incoming Governor was to design a budget recommendation that provided for the financing of commitments created by the 1978 and prior legislative sessions. These commitments were: (1) the assumption of district court costs and judicial salary increases, (2) increases in county and city revenue sharing, (3) financing the Presidential primary, (4) the additional costs of financing state and local post-retirement benefits, (5) the cost of expanded homestead property tax refunds, (6) the expansion of the Community Corrections Act, (7) the expansion of the tuition grants, scholarship and loans for students at independent institutions, osteopathic students, and the medical scholarship program and (8) staffing and operations of new buildings at the Regents' institutions and particularly of the first full-year cost of the clinical facility. The budget that I am recommending to you from all funds and from the General Fund include the financing of these commitments. The budget that I am recommending holds down the growth of state government to a modest level, provides for the assumption of these additional costs, and makes provision for substantial property tax relief and for increases in the county-city revenue sharing program. It, also, provides for a one-time acceleration of the highway Super 2 program and a one-time pothole program financed from the General Fund.
The total recommended budget from all funds for the fiscal year 1980 is $2,243,918,320, an increase of 7.05 percent. If the additional cost to carry out programs initiated by prior legislative sessions were removed, the budget would be $2,217,556,456, an increase of 5.8 percent. If the reserves for school property tax relief and increases in city-county revenue sharing are removed, the budget would be $2,185,720,456, an increase of only 4.3 percent. If the $5 million reserved for allocation from the General Fund for repairing streets is removed, the budget would be $2,180,720,456, an increase of 4.0 percent.
The same approach has been used for the budget of the General Fund. The total budget of the General Fund for the fiscal year 1980 is $1,090,413,212, an increase of 11.1 percent. If the additional costs of programs initiated by prior session of the Legislature are removed, the budget would be $1,057,301,760, an increase of 7.8 percent. If the recommendations I have made for school property tax relief and increases in county-city revenue sharing are removed, the budget would be $1,025,465,760, an increase of 4.5 percent.
The General Fund as recommended is for all practical purposes in balance between income and outgo in FY 1980. I am recommending the use of $30.8 million of the General Fund balance for reducing the school property tax burden. It is a primary goal of this administration to control the growth of property taxes.
In order to hold the increase, both from all funds and the State General Fund, to this modest level, it was necessary to eliminate most of the new programs proposed by the last administration. In addition, we have tightened the budgets of every state agency. The budget makes adequate provision for ongoing programs that must be continued. The recommendations represent a conservative approach to spending.
In order to accomplish this tightening of the budget I have reduced the agencies requests for positions by 119.4 positions in FY 1979 and by 1,530.5 positions in FY 1980.
Prudent management concepts require adequate reserves against the unforeseen future. This budget as proposed would leave the state with an estimated ending balance at the end of FY 1980 of $121,370,000. This is a figure I believe to be the minimum needed for FY 1980. It represents only ten percent of projected FY 1981 receipts. If for some unforeseen reason revenues were to fall short of estimates by only one percent in the next eighteen months, the balance would be reduced by $16.3 millions. The $121 million revenue reserve is the lowest percentage of the State General Fund budget since FY 1971. It represents the second lowest percentage since FY 1955. A quick history lesson would indicate that past Kansas Governors--faced with such lower percentages of reserves to general fund moneys--raised taxes. And while I'm mindful that there are nearly as many tax refund bills introduced in this Legislature as there are legislators, I doubt that any of you have introduced, nor would you support at this time, a general tax increase should fiscal misfortune fall in Kansas.
With that in mind, I am committed to maintaining adequate reserves to meet the present and future needs of Kansas. The alternatives are unacceptable.
MANAGEMENT OF STATE GOVERNMENT
The main function of the Office of Governor is not preparation of a budget, ribbon cutting, or deciding which bills, if any, are vetoed. The main responsibility of this job is management. The effective use of this office must be directed to th efficient and economic management of state government.
The face of federal spending patterns, I am convinced, is going to change dramatically these next few years. The federal government is finally serious about inflation and spending. Program assistance is going to be affected. We will need to plan well for this coming loss of funds. This is one reason we must guard our reserves in the State General Fund.
Given heightened attempts in Washington to cut back their budget, I would hope--but we cannot be sure--the federal government would not seek to cut back by shifting funding responsibilities to state and local governments through reduced federal matching rates. But we have begun to see it already; certain programs which were matched 90 percent federal dollars to ten percent state or local are now 75 percent to 25 percent, and climbing.
Other attempts to curb federal spending may mean the state makes "up front" payments, and the federal government "reimburses" the state for such payments. This form of financial shifting by the federal government would require significant one-time state payments which must be available for program use. There are possibilities that such financial revamping may occur in some of our social welfare assistance programs, with the initial startup costs anywhere from $16 million to $40 million.
General revenue sharing--especially to state governments--may soon be a thing of the past, with the state assuming the costs of programs which were financed in whole or in part by such funds. The revenue reserves in the State General Fund must be adequate for such an eventuality.
While the National Governors' Association is going to work actively for a reauthorization of federal revenue sharing without change, I think this is one area that the federal government is going to look at closely with the scissors. I understand the National Conference of State Legislatures also is opposing the curtailment of this program, but if our combined efforts are unsuccessful, we must be ready. TRANSITION OF GOVERNORS
At the start of my administration, while the memories of the problems that an incoming governor faces between election and inaugural are fresh, it is appropriate that I make recommendations to you to improve the capabilities of future governors to deal with this critical period. Both my predecessor and I were fortunate to be serving in the Legislature. We had office space, equipment and some staff. Not all incoming governors will be so fortunate.
Kansas has made provision for the incoming Governor to prepare the budget, a progressive step that some states have not taken. But the preparation of the budget is only one of many tasks that face the newly elected governor. The governor must staff and organize the office; must conduct searches for competent people to head the many agencies and divisions of state government (a greater task with a cabinet system than before), must prepare the administrative and legislative programs, must be available to talk with many people, and must confer with the outgoing administration on matters that are pending and that will eventually require action.
With all of the progress that Kansas has made in this regard, it is not adequate.
I recommend that this Legislature make adequate provisions for future transitions. A sum of money, during the appropriate fiscal year, over and above that now provided, should be made available so that the incoming governor can hire staff before assuming office. Provisions should be made for space and equipment and operating expenses.
A major improvement could be made in the process if the Legislature would provide that, in the year of an incoming governor, the Legislature would meet, organize, and recess for at least one month to allow the cabinet appointees of that new administration to review the proposed programs and budgets and be able to give their advice in preparing the budget.
The outgoing administration has given me every cooperation. The recommendation that I have made in no way reflects upon them. But the process can be improved and I encourage you to do so.
STATE SPENDING LID
The strongest state spending lid is legislators and a Governor committed to holding the line on excessive spending--whether planned or unplanned. The California Experiment--Proposition 13-- shows us exactly what happens when state and local officials do not act responsibly. Kansans, though, I think realize that we are better off in this state because Governor Robert Docking decided ten years ago that this state should have a strong property tax lid, and he fought until he had one. When local budgets are allowed to grow only five percent per year, there is no incentive for local governments to double and triple the assessed valuation of property--which was precisely what happened in California to kick off the revolt.
I recommend a law placing a lid on state spending be enacted. But it is also important that any such law have adequate reserves for the fiscal year and for rising costs or fiscal emergencies which may arise. I support a limitation on the growth of overall state agency spending, but in addition I must insist legislation require a minimum ending reserve as a percentage of General Fund receipts at a level that insures sound fiscal integrity.
In establishing a lid on state spending, both the executive and legislative branch must recognize that restraint is necessary in enacting new legislation that forces increases in the cost of state government. All of us who were members of the 1978 Legislature knew that many of the programs that we enacted would increase the state budget in fiscal years 1980 and beyond. Simple percentages do mot make for rational budgeting. While the General Fund budget appears to show an 11.1 percent increase in fiscal year 1980, if the additional costs of implementing programs initiated by legislative sessions are removed, the percentage drops to 7.8 percent and if the additional measures for property tax relief and revenue sharing that I am recommending are removed, the percentage falls to 4.5 percent--a more realistic measure of the growth of the state's General Fund budget. Factors such as these must be taken into account in the design of such a lid.
Revenue over and above the required reserves should not automatically be considered excess revenue and earmarked as tax relief funds. The entire pool of reserves should be considered as a solid reserve which might be held back from year to year in order that at some point in the future when revenues allow, strong and well-coordinated sales and income tax relief could be granted.
STATE EMPLOYEES
These are not easy times to be public servants anywhere. Public employees have to live with rising costs of living just like anyone else. We have a fine tradition in Kansas of public servants doing public service and, in general, our public employees are held in higher esteem than elsewhere.
I have long recognized the need to sustain this tradition of excellence in public service as well as attracting fine men and women to serve fellow Kansans through state government.
In light of my concern that we maintain adequate numbers of competent state employees, I am recommending $20.7 million, of which $12 million is General Fund, be placed in reserve for across-the-board pay increases for all classified state employees effective for the first payroll financed by FY 1980 appropriations. The pay increases will average 6.6 percent during FY 1980. This translates from 8.4 percent at the bottom end of the pay scales to five percent increases in the higher ranges. These increases insure every state employee will be paid at least equivalent to the present federal minimum wage, $2.90 per hour.
I realize that the State Division of Personnel has developed a state pay plan which has been discussed with an interim committee of the Legislature. This modified plan received study for nearly two years after considerable input from many areas. To meet my requirements, however, the plan must provide adequate managerial tools to supervisors, and incentives to employees to make state government service a career.
I have reserved enough revenue to provide first-day KPERS coverage for all state employees. To be consistent with my philosophy against mandating programs, I recommend that first-day coverage be made optional to local units of government. The need for such coverage is just as important the first as it is the 366th day on the job, and I request its enactment.
CAPITAL IMPROVEMENTS
We are all aware of the problems in the management of state building and design contracts for major building construction. I need not itemize those problems.
In an attempt to improve and streamline the process by which capital improvements are planned, budgeted, contracted and implemented, the 1978 Legislature transferred some of the duties of the State Division of Architectural Services to a State Building Advisory Commission and provided for a Legislative Joint Committee on State Building Construction to oversee the planning and budgeting of capital improvements and included procedures through construction.
You will note this budget has few capital improvement commitments. I strongly urge this Legislature to defer decisions on other new capital improvements until state construction and building procedures are "fine tuned" and perceptibly improved.
LOCAL GOVERNMENT
State and local governments serve identical constituencies--Kansans. National and international economic practices have identical impacts on state and local government--inflation. Like it or not, state and local governments are basically in the same boat.
I believe it imperative we explore new ways in which to enhance our respective and cooperative efforts to meet the important public service needs of every Kansan. I invite you and our locally- elected officials to join with me in a new era of state-local relations; one which will be characterized by increased cooperation between our respective levels of government on a number of important fronts.
I have appointed a Special Assistant for Local Governmental Matters to the Governor's staff who will be responsible for maintaining an ongoing dialogue with local officials. Through this aide, the two-way lines of communication will remain open.
I want to reaffirm my commitment to the most fundamental goal of this administration in this area of state-local relations. Quite simply, the state should not impose any new requirements on local governments without careful scrutiny and unless the requirements or mandates are funded with appropriate state financing.
The State Division of Planning and Research recently published an initial inventory of over 700 mandates which state government imposes on local units. Many of these mandates were identified by this study as candidates for elimination or modification. I shall be recommending many such modifications or eliminations in the near future.
In addition, I propose the following legislative initiatives in the area of local government which meet the goals outlined above: (1) Increase county and city revenue sharing program from 3.5 percent to 4.0 percent of sales and use taxes. I have shown a reserve of $1,036,000 in the General Fund for this purpose.
(2) A reserve of $5 million from the State General Fund will be transferred to the Special City and County Highway Fund for pothole repairs in FY 1980. The winter of 1978-79 already demands this action.
(3) The Local Property Tax Lid must be rewritten. Continued erosion of the original tax lid means no tax lid. I, therefore, am recommending to this Legislature that a uniform lid be enacted omitting all exemptions from the current lid except interest and principal on bonds, no fund warrants, judgments rendered against taxing subdivisions, increases in employer contributions to social security, workers compensation and unemployment compensation payments, and the cost of programs which are specifically mandated or required by state or federal law.
I am recommending this lid apply only to cities and counties, and that the maximum aggregate tax levy under the lid be based upon dollar amounts of taxes raised by local units of government during 1977, 1978 or 1979. These local governments could still expect annual increases in property tax revenues because of new improvements to real estate and increased personal property values which would expand the property tax base. A mandatory vote should be required to exceed the tax lid. This recommendation is one I co-sponsored during my tenure in the Legislature. I believe it to be consistent with the fiscal direction I intend to set for my administration.
REAPPRAISAL OF REAL PROPERTY
The Special Committee on Assessment and Taxation has voted to recommend reappraisal of all real property in Kansas by 1983. Recent studies indicate that if reappraisal occurs, the result will be a drastic shift of tax upon the homeowner and the farmer. I believe that it is grossly unfair to further burden the Kansas homeowner and farmer.
I continue my support of use value appraisal for farmland, however, without protection for the farmer and the homeowner, I will oppose any measure which will begin the reappraisal process or result in reappraisal.
ELECTIONS
The operation of a democracy requires participation of its citizens. Increasing demands upon the time and energy of Kansans in the last half of the 20th century requires a new look at our election laws to insure that artificial roadblocks to participation are not present.
Consistent with this philosophy, I recommend an election law reform dealing with voter registration in order to provide for a wider segment of the people of Kansas to have the opportunity to participate in determining the direction government takes. In November, 64 percent of our voting-age citizens voted, which was high by national standards. Still, more than one of every three persons of voting age did not vote. Many do not register because it is difficult to do so. The voter registration by mail program I propose would allow an individual to request a voter registration application from his or her county clerk. The request could be either in person, in writing, or by telephone. In order to discourage the possibility of voter fraud, I also am proposing that such applications be signed by the applicant under penalty of perjury. County election officials could continue to maintain a system for checking applications.
Since this budget also includes $1.1 million for use by the election officers to set up the Presidential preference primary in 1980, now is the best time for this expansion of the voter registration laws of Kansas--costs can be absorbed by the election officials who will be reworking their systems in preparation for the preference primary.
INITIATIVE
Since 1970 at least 14 resolutions to permit the initiative on the Kansas ballot have been introduced in the Kansas Legislature. While I can appreciate all arguments concerning this issue, I believe the initiative is a means of strengthening control by voters in the operation of their government.
I support the concept of initiative if the number of issues on the ballot is limited and the bill allows for constitutional amendments only. I am also concerned that petitions for initiative issues be signed by a significant number of persons in order to limit the number of issues reaching the ballot.
I call on the Legislature to present the voters of this state a fair and equitable amendment allowing initiative regarding amendments to the Kansas Constitution.
CAMPAIGN FINANCE ACT REFORM
I believe in the laws which the Governmental Ethics Commission administers. I am personally committed to a philosophy of public service requiring government policy to be made without undue influence of powerful special interests.
I am recommending a number of changes in the Campaign Finance Act designed to improve administration, eliminate unnecessary paper work and strengthen disclosure requirements. They are:
(1) The terms of members should be staggered in order to provide more continuity to the Commission's work.
(2) Criteria for the appointment of members should be established to prohibit candidates, treasurers, and chairpersons of candidates and committees from serving on the Commission.
(3) The fourth and fifth reports filed during election years should be combined into a single report. (4) Contributions and expenditures of candidates and committees of less than $25.00 should be reported as lump sums. This change would reduce the size of reports without jeopardizing the public disclosure of financially significant transactions.
(5) Summaries of primary and general election contributions and expenditures should be eliminated since the basic information is already available on the reports.
(6) Requiring notarized treasurer's signatures should be replaced by a signed declaration of the accuracy of the reports. In some areas of the state, it is difficult to find notaries.
(7) Party committees, like candidates and political committees, should be allowed to file affidavits of exemption from reporting in those years when they do not receive or expend over $500.
(8) Eliminate the need for state employees not in policy-level positions to file statements of substantial interests, I recommend raising the filing threshhold from an annual salary of $15,000 to $20,000.
ENERGY
The energy crisis is still with us and may be the single most important and frustrating issue of the last quarter of this century.
Unfortunately, the President's "moral equivalent to war" appears to have turned into a minor police action.
It is not hard to see the consequences of our inattention to energy needs on the lives of our citizens. Not only will prices of energy continue to climb, but wasteful energy practices may mean less gasoline for the farmer, which would mean fewer crops with which to feed the nation and the world. Poor weatherization practices in new and existing structures contribute to the rise in energy consumption. But mostly it is our unwillingness to come to grips with energy-related problems, and our unwillingness can only mean chaos in the end.
What we do about energy in the long run is much more important than what we say about it. My administration will work for greater public awareness of the energy needs of this state and the development of a strong conservation program by our citizens, by our state and local governments and by industry.
It is appropriate that Kansas begins to control its own destiny by addressing these problems of energy. The energy crisis is as much a crisis in governmental policy formulation and implementation as it is a crisis in resource depletion. On the surface it is a crisis in the quantity of public policy making. But it is fundamentally a crisis in the quality of public making. We have faced, and will continue to face, an energy crisis not only because of governmental inaction but also because of counter productive policies, policies which pursue conflicting objectives, and because of a mistaken belief that unguided-private enterprise will be responsive to the larger public interest. Market forces must surely be used and competitive forces strenghtened, but government must take the lead until private enterprise can meet these demands with the necessary supply!
This places the responsibility for developing a sound energy policy squarely on the shoulders of state government, since states have traditionally been the innovators and trend setters in governmental policy. This fact, of course, places an especially important role on energy producing states such as Kansas.
The key feature, which is at the very heart of the democratic process, is the principle of checks and balances. The principle has been applied to every major area of public policy formulation except energy. Because of the importance of energy to our future we must call upon this standard of the democratic process to assist us in finding solutions to long term energy problems. In order to accomplish this we need to strengthen the legislative, executive and legal functions of government in Kansas in each of their attempts individually to address energy problems. Additionally, we need to strengthen the working relationships already developed between existing agencies in the energy area in order to heighten our abilities to address energy problems collectively.
In light of the need to establish an effective system of checks and balances and with the hope of strengthening our energy alternatives, I recommend the following:
(1) I am proposing the creation of the consumer advisory council to the Kansas Corporation Commission as a method of articulating the concerns of consumers of utility services in Kansas and for collecting data pertinent to the execution of the duties of the commission under the public utilities statutes. I would want the council to recommend to the commission changes in its internal operating procedures, regulations and statutes pursuant to which the commission operates. The council will have an advisory capacity only, but the statutory language should not prevent or discourage the council from advising on any subject it feels will aid the Corporation Commission in its regulatory duties.
(2) I am directing the Kansas Energy Office to develop a broad coordinated energy plan. This energy plan will be prepared by the KEO with the assistance and staff support of the Kansas Corporation Commission, the geological survey and other such agencies as the energy director determines. The energy plan to be developed shall be based upon a clear assessment of needs and problems, and explicit statement of our goals and objectives and the steps necessary to meet those goals.
The energy plan will not solve any problems by itself and it will not save any energy by itself. It will not keep energy prices from rising. All it can do is assist in finding answers to questions that are being raised. The actions which we take based upon the systematic search for answers will be the real solution to our problems.
(3) I recommend elimination of the "grandfather clause" to the current laws concerning siting of utility plants. (4) I recommend combining of the hearing process within the Corporation Commission to include input from the Water Resources Division and the Kansas Energy Office. By allowing these other two divisions to intervene in siting hearings before the Corporation Commission we in essence develop a "one stop permit" policy, eliminating the confusion and difficulty of seeking authority for construction from several state agencies. In return, it is only fair to expect the facilities siting applications to contain alternative sites and that a separate environmental, social and economic impact statement be prepared for all alternatives.
(5) The Corporation Commission should be allowed to consider the "total" plan, the ultimate number of units to be located on a given site, when considering the applications for expansion of utility plants. Presently the site permits are applied for on a unit-by-unit basis. There may be reasons to allow three or four. Once the first unit is approved, however, the Corporation Commission is locked in by economics in approving subsequent units. This current law should be changed.
(6) Applications should be made before costs are incurred by the utilities. Presently, the application needs only to be filed if the power of eminent domain is to be used. Some plans for plants do not use eminent domain but acquire property outright. When that happens, the commission is faced with the fact that the utilities have already plugged in much expense before the application is submitted. This practice of putting the cart before the horse and making the consumer pay for it should be stopped.
(7) The Corporation Commission should be allowed to consider the estimated cost per kilowatt hour when the plant is operating. Presently we consider the cost of construction not the total cost per kilowatt hour delivered.
(8) I would request the Legislature review the Automotic Fuel Adjustment Clause (AFAC) to determine whether this automatic pass-through of costs by utilities should be retained. At present, with the AFAC, the utilities have no incentive to bargain hunt for cheap fuel to provide the necessary services to Kansans because they know they can pass off the higher costs of fuel automatically to their consumers.
(9) I also am recommending that the Corporation Commission be granted additional authority to review the internal management of the organization of utilities. Utilities are quasi-governmental organzations by statute. Public utilities have a legalize monopoly for the provision of the services covered in their franchise. Since there is no free market pressure for competition between utilities, the only pressure for good management that can be exerted is pressure from the Corporation Commission.
(10) This administration, through the Corporation Commission, supports the concept of statewide capacity planning for utilities. At present there is no statewide capacity plan to meet the needs of consumers now and in the future. Without such a plan, perhaps incorporated as part of the overall energy plan outlined above, the utilities are growing at what could be an unnecessary rate, with consumers paying the bill. Such planning concepts would encourage cooperation between the utilities rather than an unchecked expansion of services. Such planning would also have the effect of allowing government to take a better planning look at further expansion of residential and industrial capabilities within the state.
There must be a recognition that commissions have statutory responsibility to balance the interest of consumers and industry and they must do it honestly, objectively, openly and professionally.
This does not mean the commissions and utilities must be adversaries, but it certainly does mean that commissions should not be "puppets" of the regulated. Of course, this new horizon is not for the timid but should also not be viewed as threatening to utilities. Commissions must raise rates only when necessary and fully justified, but also utilities must accept the financial consequence of their own mismanagement and inefficiency and must accept the legislative mandate that there is no guaranteed profit but only the opportunity to earn reasonable profits sufficient to cover reasonable costs and maintain financial integrity with prudent management.
Utility management and the investment community must accept the premise that it is not business as usual nor is it regulation as usual, and hopefully it never will be again.
NATURAL RESOURCES
The fundamental basis for the quality of life Kansans enjoy today is the natural resources this state has provided.
Millions of acres of fertile soils for the production of food and fiber and adequate supplies of clean water are available in most of the areas of the state. The state's air quality is generally good.
It is more crucial than ever that Kansans act wisely in the conservation and use of their natural resources. My life experiences have taught me that wasting natural resources is truly unwise and an irresponsible act that will affect future generations.
I endorse the land resource conservation activities currently being carried out by the State Conservation Commission. I am recommending the continuation of this state's watershed planning and construction program as it currently exists. Through this program the state must expand the total acreage of agricultural lands to come under soil conservation's best management practices. The reduction of soil loss in Kansas due to runoff must be diminished not only for water quality goals but also for soil resource preservation.
The State of Kansas is quickly approaching a point where the diminished availability of water could alter agricultural productivity as well as influence future settlement patterns. Groundwater reserves of the Ogallala Aquifer are being depleted 14 times faster than natural recharge. The consequence of this so-called "water mining" will have repercussions throughout the entire Kansas economy.
To assist in the management of state water resources, I am recommending an expansion of the Division of Water Resources and the continued implementation of the computerization of the state's water right files. This addition will assist the chief engineer of the division in taking appropriate action to manage the remaining supply of groundwater in western Kansas.
Groundwater problems predominate in the western and south central portions of this state, but poor quality of surface water supplies are major problems in other areas. Many small communities are chronically affected by inadequate supplies of water. The state assistance program to rural water districts has assisted in the formation of 17 districts in this state to help solve specific water supply problems. I recommend the continuation of the funding of state assistance for rural water district development at its present level.
I cannot endorse air or water quality plans that have not been presented to the people of Kansas for their participation. Local acceptance of air and water quality plans is essential if they are to be successfully implemented. I will require the cost-benefit aspects of implementing the national water and air quality programs be a main factor in determining the extent to which Kansas should attempt to achieve national goals.
AGRICULTURE
I continue to be very concerned with the plight of the Kansas farmer. An obvious need exists to register our concerns with the President and the Congress. As Governor, it is my intention to emphasize to the federal administration and Congress, as well as the American people, the problems of the Kansas farmer and farming interests. The work in this area has only begun.
We must formulate policies which reflect our support for the Kansas farmer. Fair prices for farm products must be achieved to allow the Kansas farmer not only to recover the cost of production, but realize a reasonable profit as well. This is not an unreachable goal. But the real question is the steps that are to be taken at this time to implement that goal.
We must look beyond the symbols of concern which are so easily embraced, and move to the more difficult task of making decisions which meet our goals for agriculture.
I am concerned about the family farm in Kansas. The greatest support for the family farm in Kansas will come only when a conscious decision is made in the public policy arenas of Washington and Topeka.
I also am stressing the tremendous importance of developing a stable and ongoing agricultural research program at our states universities that will continue to keep Kansans in the forefront of the agricultural community.
I recommend the support of an International Grain Marketing Compact which seeks to establish new markets for our grain. Our efforts, coupled with the efforts of our neighbors in other states, will allow us jointly to enter into ventures that will stimulate foreign grain markets for Kansas grain.
Without chance for reasonable profit, it will be difficult to interest people to enter farming unless they already own land. Because so many people lack the fiscal means to enter farming, the next generation of farmers may be non-owning tenants or agri-business landowners. To help protect the family farm tradition in Kansas, I support legislation which provides Kansas agriculture a strong financial foundation.
During my administration, the Board of Agriculture and agriculture-related agencies of this state will receive a new emphasis. One of the early tasks of this administration will be to plan for adequate office space for the Board of Agriculture.
ECONOMIC DEVELOPMENT
An expanded industrial and business base means more jobs and the ability of our private sector to insure that every Kansan who wants a job has one. I will ask my Secretary of Economic Development to review the programs and organization of the Department. It is not my intent for anyone to perceive that new directions shall emerge from this review. The past two administrations have created a Department which is ongoing and vital to the success of other state government programs. I intend this Department to play a vital role in my administration. I am especially interested in the Department determining what actions state government should take to reduce a scarcity in needed occupational skills for the Kansas job market. There are many reasons for this scarcity and perhaps some are not able to be met by state action. However, through the use of vocational-technical schools and community junior colleges, KDED can help firms to begin or expand their operations in Kansas and provide for them the needed occupational skills. I have questioned the need for the state to become involved in its own industrial training program. If the state is to assist employers in training employees, I believe there is a more cost efficient way of doing so than using funds directly from the General Fund.
LABOR AND INDUSTRY
The relationship between the worker and the employer has never been healthier. This is evidenced by the fact that changes in the workers' compensation program were unanimously endorsed by the six representatives of labor and management that comprise the Workers' Compensation Joint Advisory Committee. I support these changes.
Our employment insurance fund is among the soundest in the nation. This fund is in such a solid financial status that we can safely make adjustments in it to the benefit of the worker and the employer. Therefore, I ask you to increase the weekly benefit paid to the worker and reduce the taxes paid by the employer.
To be able to recommend these changes is truly indicative of a healthy worker-employer relationship.
There is, however, one major problem facing the Kansas employment picture--a shortage of skilled workers. This is especially true in Wichita and the southeastern and southwestern areas of Kansas. Not only are skilled workers at a premium, recruiting workers from other states is hampered by housing shortages in these same areas. Thus, the task of training unemployed and underemployed Kansans becomes crucial to the future economic development of this state. If we can upgrade the skills of the Kansas work force, both labor and industry will benefit. The Secretary of Human Resources is developing a plan to reduce the severity of the shortage of skilled workers that will include the use of new CETA funds for employer-run training programs and intensifying recruitment efforts of Job Service Centers and Unemployment Insurance Offices. As well, the Secretary is working with the Secretary of Economic Development and the Commissioner of Education to pool the resources of these departments to relieve skill shortages in these areas. Given the resources of these agencies, I am optimistic of their success in this endeavor.
AGING
Older Kansans have made contributions to their families and communities yet too many of them face the bleak future of living alone amidst poverty, inflation and isolation. Our obligation must be to insure an environment that is free of isolation and financially secure.
The population of Kansans aged 60 and over is now estimated at nearly 45,000, approximately 20 percent of the state's population. This figure has been increasing by nearly one percent each year and will continue to increase at this rate for the next five years. As to their needs, the elderly are more likely to be poor and 22 percent, or nearly 100,000, older Kansans live on incomes below the poverty level. They are more likely to need public transportation (due to handicaps and poverty). They are more likely to need income from jobs, yet many suffer discrimination in the labor market. They are more likely to need nutritional assistance as they must spend approximately 30 percent of their income on food as compared to 16 percent of other age groups. Their housing tends to be older and more in need of insulation and repair. And when they are ill, they are too often placed in nursing homes because the services needed to support them in their own homes are nonexistent or require a significant waiting period.
These needs are great and will increase as the aged population increases. Thus, the immediate task must be to expand those programs that are most needed, including transportation, nutrition, weatherization and the prevention of institutionalization.
I recommend that the state licensing fee from nutrition programs for the elderly be eliminated. All nutrition programs must pay a licensing fee for their inspection by the Bureau of Food and Lodging or their designated agents. Inspection of these programs is vital as the food is usually prepared by volunteers who are often unaware of food handling methods and need the assistance that is provided by the inspection staff. While inspection should continue, I propose exempting nutrition sites from the inspection fee. This exemption will allow 5,400 additional meals to be served annually.
I shall instruct the Department of Transportation to develop a rural transportation program. With the passage of the Surface Transportation Assistance Act, Kansas became eligible for approximately $1.2 million in federal funds. These funds can be used for vehicle acquisition and operating subsidies. It is my desire that we use these federal funds to the fullest in developing a comprehensive transportation network for rural Kansas.
It is my desire to increase the planning and administrative capability of the Department on Aging. I have recommended one additional position to the staff of the Department. When a permanent secretary has been selected, the entire program of the Department will be evaluated. In addition, the budget provides for a needs assessment of the elderly population. If we are to plan effectively to meet the needs of this group we must identify them so that our programs can be directed effectively.
There are various sources of federal funding for weatherization programs and differing rules governing the use of those funds. The Community Services Administration provides funds for weatherization, limits eligibility to individuals meeting federal poverty guidelines and places a limit on the proportion of funds to be spent on labor as contrasted to materials. The Department of Energy prohibits use of any funds for labor and limits eligibility to individuals meeting 125 percent of the federal poverty guidelines. Both federal agencies urge the use of CETA funds for labor yet CETA has guidelines on who can be hired, salary levels, etc., and these programs are controlled by various sets of governmental officials. Area agencies on aging sometimes use aging funds for weatherization. Finally, local governments can use their community development revenue sharing funds for weatherization.
The problems of different funding sources and guidelines have not been addressed effectively by an agency of state government. Indeed, some counties are not being served by any weatherization program. The State Economic Opportunity Office in SRS attempted to coordinate these funding sources but did not have the staff nor the authority to make the state administered programs work together. The federal government makes the coordination extremely difficult; nevertheless, some progress can be made by state government.
While each of these funding sources have some restriction, there appears to be enough flexibility to provide the labor necessary to install the weatherization materials. To the extent that federal regulation permit, I will commit the labor necessary to weatherize maximum number of Kansas homes through CETA funds available to the Governor.
Many groups of senior citizens have suggested that the state eliminate the $20 food sales tax refund for the elderly and that the same amounts be made available for programs that would have a greater benefit to the elderly. While I have budgeted funds for continuing the food sales tax refund, I would support the reallocation of the same amount from this program to other programs that would be acceptable to the Legislature and to these senior citizens. Expansion of home health care, congregate meals and meals-on-wheels, adult day care centers, provisions for eyeglasses and denture care, and other similar programs should be considered.
HEALTH CARE
Kansans enjoy a level of health that is higher than most Americans. This is attributable to many assets we enjoy in our state: strong economy, healthy environment, high level of excellent health facilities, and many dedicated and competent health care providers.
While the overall health of our citizens is strong, there remain some nagging problems which require our attention. I intend to concentrate on these issues with a small number of programs which have a high probability of success. During the last several weeks, I have discussed health issues with many well informed individuals. In addition, I have reviewed health programs and policies proposed by several agencies including the departments on Aging, SRS, Health and Environment, and the State-Wide Health Coordinating Council. Several key issues have been identified repeatedly and I have concluded that the major needs are:
- Reduction in the rate of health care costs increases
- Early screening and treatment for children, especially disadvantaged families
- Increased emphasis on health education and promotion in order to lessen the need for costly services.
There are no easy steps for reaching these objectives. In fact, the best we can hope for in some instances is to alleviate a problem even though it cannot be completely resolved. The legislation and programs I am proposing are not based upon the notion that problems will go away if we throw enough money at them. Rather we have developed approaches that will be productive but not unrealistically expensive. Some in fact, will require the appropriation of little or no money but only the application of considerable commitment, imagination, and effort.
Health Care Costs Containment
Health care costs are continuing to increase rapidly. These costs are placing a great burden on Kansans, who must pay for them through increased taxes, increased insurance premiums, and out of pocket expenditures. State government must take reasonable and affirmative steps to contain unnecessary increases in health care costs.
While the causes of increasing medical costs are complex, numerous studies have documented the lack of incentives for cost containment in the presence of incentives that result in cost escalation. In Kansas, both the State Health Coordinating Council and the Legislature Health Care Cost Commission have studied this issue at length and recommended establishing a public program to set hospital rates. I concur with these recommendations and will support such legislation in this session if the proposal includes certain basic measures:
- A uniform system for cost accounting and reporting
- Rate setting based on prospective budgeting
- Effective linkage with existing health care programs
Third parties have become the dominant financing methods in health sector to the extent that they pay for more than two-thirds of all personal health care and more than 90 percent of all hospital care. With the consumer relying so heavily on insurance to finance his health care and with the escalating costs of such insurance coverage, it is not an overstatement to say that the old adage of years ago, that we can't afford to get sick, should be revised because now the point has come where we can't afford health insurance. In an effort to promote the well being of the public, we must intervene to introduce greater incentives for the management, efficiency, and financial accountability in the health insurance sector. In an effort to make insurance more readily available I recommend that you enact a statutory prohibition that will preclude insurance companies from refusing to insure any risk because of age, sex, marital status, geographic location, and similar unjustifiable reasons. Equity and social conscious demands that artificial barriers to insurance availability be eliminated.
In addition, when we are considering insurance availability, we cannot forget those citizens who need but cannot obtain accident and sickness insurance coverage that will help pay the tremendous costs associated with serious, extended illness. No one individual should be forced to deplete their savings, lose their home, their dignity, and self respect simply because they have the misfortune of becoming ill. As a first step toward helping our fellow Kansans who find themselves in this situation, I recommend that you enact legislation that will make catastrophic health insurance coverage available to all residents of this state.
The health insurance programs which are most valuable provide for losses that are both unpredictable and are large relative to the financial resources of the insured. A standard method to avoid covering small health care expenses has been the imposition of a deductible. For the deductible to be effective, however, it must be high enough so that small medical expenses which can and should be accommodated in the family budget, is not covered by the insurance. At the same time, however, the deductible should not be so high that a financial barrier is imposed in obtaining needed medical care. The purchase of private health insurance often encourages the unnecessary and inefficient use of health care services which in turn tends to increase even more the severe escalation to which the health care delivery system is prone. This undesirable and damaging impact can be significantly reduced by encouraging the greater use of deductibles and other co-payment features. I suggest that this session and those that follow should weigh very carefully both individual costs ramifications and the general economic impact of any health insurance issues you are asked to consider.
Our health care and health insurance concerns must also include a critical review of mutual, non- profit hospital service and non-profit medical service corporations otherwise known as Blue Cross and Blue Shield organizations. These organizations have been established and have been accorded unique operating characteristics by specific legislative actions. The wisdom of your predecessors has been confirmed by the services and benefits the people of this state have enjoyed through the existence of these legislatively created quasi-public institutions. Nevertheless, the time has come when their organizational structure and public responsibility should be re-evaluated. I therefore recommend that you consider fundamental changes in the statutes governing Blue Cross and Blue Shield organizations including:
- Consolidating the Blue Cross and Blue Shield organizations into a single, manageable corporation.
- Require that a majority of the board of directors of this corporation be representatives of the public.
- Provide the Insurance Commissioner the additional authority to review cost containment measures of the corporation. Health Maintenance Organizations
Health maintenance organizations offer potential for market price competition with traditional fee for service systems. They also tend to utilize significantly fewer in-patient days of hospital care than the number of days experienced by conventional plans. Thus, health maintenance organizations represent one approach to introducing price competition in the medical market and to decreasing costly over-utilization of hospitals.
I support the proposal to provide state employees the option of choosing health maintenance organization coverage or traditional insurance coverage. This will directly encourage health maintenance organization development efforts in those areas and improve the range of benefits available to state employees. If new legislative proves necessary to implement this option, I will support it in the current session.
At the same time, my administration will promote efforts to plan and develop health maintenance organizations by assisting qualified applicants in obtaining federal funding and developmental grants.
Health Promotion
There is widespread recognition among many Kansans that a shift in emphasis in health education and disease prevention is an appropriate way to reduce unnecessary disease and premature death and ultimately the need for costly health care. Now we are becoming aware of the need of individuals to assume added responsibility for their health by avoiding a new set of disease causing "germs" such as obesity, lack of exercise, poor nutrition, smoking, and alcohol.
During the next few months, I intend to establish a Governor's Council on Fitness. Council members will be selected on the basis of their special interests, knowledge, and leadership abilities. The Council will be expected to plan, develop, and promote the implementation of innovative and effective programs designed to assist Kansans in improving their lifestyles.
In order to assure that the Council has adequate resources to help carry out its important mission, the Department of Health and Environment will be directed to provide all staff and other services the Council requires to conduct its business.
Immediately upon its formation, the Governor's Council on Fitness will be asked to assume the leadership role in carrying out a program to assist employees in Kansas business and industry. PROJECT PLUS (Program to lower the utilization of services) is currently being developed by the Department of Health and Environment.
Several corporations throughout the country have already started these programs and many are reporting excellent results in terms of employee participation, decreases in absenteeism, and lower utilization of health insurance benefits. Many Kansas businesses have expressed a strong interest in this concept and I am confident that it will be productive in the near future. The third program deals with perhaps the most important area of health care, that of our younger Kansans. I support an expanded program for child health assessments and more detailed recommendations will be forthcoming.
In an effort to improve the health care of our elderly and in an effort to divert as many of our elderly and infirmed Kansans as possible from nursing homes and hospitals, I am proposing the expansions of home health care agencies. These agencies bring services to the ill and infirmed in 50 Kansas counties at the present time and at least 55 will benefit from such services by the end of fiscal year 1979. This means that homebound patients in these counties can receive nursing care and physical, occupational, and speech therapy as the doctor orders without leaving their homes to enter expensive nursing homes or hospitals. The psychological benefits of such a program are many, particularly for the elderly who wish to remain in their homes, and the costs are far lower than those of hospitalization.
I also am recommending that the state expand the program of seed grants to home agencies in the coming years to make these services available to all Kansans. For fiscal year 1980, I am requesting $229,000 to be appropriated to begin six new agencies to cover eight additional counties as well as to maintain the beginning efforts of those agencies who have just begun to provide services and need additional financial support before they can assume an independent status. This request will enable the expansion of needed home health services to 62 counties.
SOCIAL WELFARE
There has been no increase in state assistance to the poor for a number of years and the buying power of allowances for food, clothing and shelter has been shrinking alongside the growing cost for these items. I am recommending that the Legislature appropriate funds for a five percent increase in the basic welfare standard. I am also recommending that adjustment be made in shelter grants to reduce statewide inequities and to increase shelter support in areas where the cost of living is particularly high. Both of these measures will provide more realistic assistance to those truly in need.
The Department of Social and Rehabilitation Services has carried out a program in recent years to locate absent parents and make them financially responsible for support of their children. This location and support program has collected considerable amounts of money for a relatively small investment on behalf of the state. In Kansas, the return has been nearly eight dollars for every one dollar spent on this activity. There is every indication that further investment will continue to repay our efforts generously. For these reasons, I am requesting an increase in the number of positions in the SRS Location and Support Unit for fiscal year 1980.
In order to hold down welfare cost and to insure that the state is not being victimized by the unscrupulous, I am also requesting the addition of fraud investigators to two area offices of SRS. Fraud must be stopped so that funds are not spent illegally, by-passing those who desperately need them.
Because of the importance of social services, I am recommending that additional Title XX Funds be freed in fiscal year 1980 to produce services in Kansas communities. I am proposing that a larger portion of SRS administrative costs be borne by the state rather than being paid for with federal funds. This will allow an additional allocation of $2 million for the purchase of social services.
Also in the SRS budget is a pilot program to allow needy persons who obtain and utilize food stamps to use those food stamps in participating restaurants. Many elderly who qualify for the stamp program also participate in nutrition centers, where they can get one good meal five days per week. This enlargement of the food stamp program allows those persons access to a good hot meal on weekends too, adding to their general health and well-being. This program can be started without any significant fiscal effect. The results of this pilot program will be studied for possible statewide implementation.
ELEMENTARY AND SECONDARY EDUCATION
Few programs offer more of an opportunity for elected officials to become involved in a primary function of state government than does the funding and leadership of the elementary-secondary education program in Kansas.
This commitment to education is a considerable tax burden and much of the burden falls upon the local property tax. As operating costs of the local school districts increase, so do local property taxes. For FY 1980, the statewide total of the local school districts' general fund budgets is estimated at $722.1 million, of which approximately 40.7 percent or $294.2 million would be financed by state funds--$246,400,000 of general state aid to finance the school equalization formula and $47,750,000 for income tax rebates to the local school districts. For the current fiscal year, the percentage of state aid is 43 percent, and the primary reason for the reduction is an anticipated substantial increase in district wealth statewide. If no additional state aid is provided and the current school finance formula remains unchanged, local property taxes will increase statewide by approximately $60 million. This is based upon budget controls of five and fifteen percent.
To prevent this increase, I have included in my recommendations a State General Fund reserve of $30.8 million for additional state aid as direct property tax relief. This will result in approximately 45 percent of the statewide total of the local districts' general fund budgets being financed by state funds. An appropriate adjustment will be necessary in the local effort rate. With this additional amount of state aid, the statewide increase in local property taxes can be held to approximately $20 million. However, assuming an increase of five percent in the assessed valuation statewide, which is not unreasonable in light of past increases, the state average mill rate for general operating expenses should remain at approximately the current level.
My recommendations continue the state commitment to special education. As local school districts comply with the mandate for special education services, it is estimated that state aid to the local school districts for special education services will increase from $22.5 million in FY 1979 to $25.9 million in FY 1980. Both amounts are included in my budget recommendations.
Many youth learn work skills in the vocational-technical schools and community junior colleges. While vo-tech schools receive considerable aid for operations, the schools do not always have the tax base for the purchase of high cost equipment or for the construction or remodeling of facilities. The 1977 Legislature started a three-year capital outlay program of $2 million per year that would vocational technical schools to replace outmoded equipment and facilities. I am recommending that this program be continued for fiscal year 1980 and have recommended $2 million for the program.
My predecessor brought Kansas into the arena of programs for the prevention of child abuse, for which he deserves much credit. One part of that emphasis included a Governor's Commission on Education for Parenthood, which was a representation of more than 20 educational and health related agencies and organizations which met regularly to attempt to develop a positive caring attitude by children toward themselves and others. The objective of this commission was a long- term attempt to confront the issue of child abuse by parents with little or no concept of how to be a parent. The program has merits from the preventive side of handling the child abuse problem.
Education for parenting in our public schools would be a logical step in the prevention of child abuse and neglect and the program will receive the support of this administration. Consequently, the budget of the Department of Education reflects an additional position for the Parenthood Education Resources Center Coordinator.
HIGHER EDUCATION
The extensive system of public and private colleges and universities in Kansas has brought the state many benefits. These institutions have served Kansans and their communities well.
Because of the "baby boom", these institutions have experienced a high rate of growth during the past 15 years, and our commitment to these institutions has been great. However, the years of growth are coming to an end as high school graduates diminish in number. Although much has been said about the increasing number of older students who are now enrolling in "continuing education" courses, it does not appear they will substitute for the declining enrollments of younger students in the foreseeable future.
For these reasons, I recommend that our policy toward state institutions of higher education shift from increasing our financial commitment with the funding of new programs to one of maintaining and improving the quality of existing programs at our universities.
Therefore, I am recommending merit salary increases averaging seven percent for unclassified personnel at the universities. This increase should be used to reward those who make the highest contributions to quality programs within the institutions. The amount is in line with President Carter's inflation guidelines.
I am also recommending that funds for student employees at regents institutions be increased nine and one-half percent and that the state finance the rental of certain student union space so that this cost does not remain an unseen burden on students and the activity fees they pay.
I also recommend that other operating expenses of the institutions be increased by six percent to meet inflationary demands. I do not recommend the full adoption of "formula budgeting" for universities. This concept provides for funding based on comparisons with peer institutions around the country.
This system presents an unusual problem because the comparison universities alter their priorities in a manner over which we have no control. The major weakness is our institutions would constantly be "chasing the average" of other schools--never quite catching up. Formula funding is a useful tool for comparison, however, and the budgets of each institution reflect my consideration of the formula funding approach as a "benchmark".
Within the Board of Regents budget, I recommend the state scholarship program be continued at the authorized level, $740,000, and the Tuition Grant Program be funded at a level of $3.85 million, which includes $175,000 for the second year cost of increasing the maximum grant award from $1,000 to $1,200, which was authorized by the 1978 Legislature.
At the University of Kansas Medical Center, the 350-bed clinical facility will be occupied in phases over the first six months of calendar year 1979. Had it not been for the new positions necessary to operate this facility, there would have been a decrease in the number of total state positions in FY 1980.
I am recommending that the state continue to fund last year's enrichment of aid to both the community colleges and Washburn University. As an additional help to the community colleges, I recommend that utility costs be removed from the five percent budget lid in FY 1980 and that utility costs may be budgeted at the level of actual costs. This will have the effect actually of raising the budget limitation from the level of seven to seven and one-half percent for these institutions.
Public television is a growing area of state involvement. Public television has become a valued cultural resource in Kansas where it is available. However, at present, only major urban areas have access to public TV facilities. I recommend in this budget a prudent program of expanding public television into unserved areas across the state while at the same time maintaining the support of existing services. Kansans have shown a strong desire to share in this resource and have worked to marshal community support for public television. I recommend that the work in Hays continue for the opening of the station in 1980, and that efforts at Garden City and Chanute be supported as they prepare to enter the licensing cycle associated with the construction of a new station.
In this way we can gradually make it possible for more Kansans to take advantage of the many practical and pleasurable uses of public television.
The commitment this administration has to quality higher education is one I intend to keep throughout my administration. A close examination of this budget will indicate an overall plan to reduce the costs at state universities and colleges, yet keep quality high. I invite your help and support.
PUBLIC SAFETY One of our essential state responsibilities is public safety which includes the protection of citizens from crime, maintaining a correctional system and the treatment of problem youth.
Since it has been nearly a year and one-half since the Department of Corrections has had a permanent secretary, I will make the selection of a new secretary a top public safety priority.
Last year we passed legislation giving the Department of Corrections new direction and the courts an alternative to incarceration. I strongly supported passage of the Community Corrections Act. However, after months of living with the Community Corrections Act, I feel that we need to review the chargeback against the grant entitlements to insure further participation by the counties. I will direct the Secretary of Corrections to review the chargeback process and report to the Legislature on any areas where revisions are required.
Since the loss of the license tag factory in 1975, the profit margin for the Industries program has declined annually. The program currently operates at the State Penitentiary and the State Industrial Reformatory with a combined employment of only 200 inmates or approximately nine percent of the two prison populations. I will instruct the Department actively to seek increased employment and vocation opportunities for inmates. Objectives planned for the improvement of the employment program include improving the quality of currently produced products, expanding the volume of current sales, and encouraging private investors to contract for inmate labor. I will also direct the Division of Purchasing to produce state specifications for various office products heavily used by state agencies. Correctional Industries will make products to meet these state specifications, and the Division of Purchasing will require state agencies to purchase these products, as mandated by K. S. A. 75-5276. Because state agencies will be purchasing cheaper office products, the state will spend less, and will be reducing the idleness in our correctional institutions with the employment of more inmates.
A recurrent complaint of inmates is the inconsistency of the Kansas Adult Authority in determining when to grant parole. Written parole guidelines based on the severity of the act and the public danger would reduce this inconsistency and also allow for better protected Kansas' communities. I will recommend to the new secretary that the Department of Corrections and the Adult Authority work closely together in developing such guidelines.
Among Kansans, there is a growing concern about the problems of our youth, and reasonably so. An increasing number of young Kansans have severe alcohol and drug problems, family instability, undetected health problems and poor school performance, and more and more juveniles are committing serious acts of crime. As a result, the state has experienced a sizeable increase in the number of juveniles who are placed in its custody by the courts. For instance, the average daily population at state youth centers has increased by 30 percent in the last four years. We must seek ways to improve our effectiveness in helping problem youth become responsible adults. We must find solutions to the inadequate number of beds in placement facilities, and more importantly, we must begin to address the prevention of these problems.
The Task Force on the Problems of Youth studied these problems and recently has published a report. As well, the Legislature's Special Committee on Juvenile Facilities and Programs studied these problems during the 1978 interim. I am presently reviewing both reports and recommendations will be forthcoming.
Since the enactment of the Crime Victims Reparations Act, funds have already been awarded to persons to whom victimization has caused serious financial need. The intent in 1978 House Bill No. 2163 was that the court fee collected would offset the costs of this board and the payments of claims. Because the Attorney General concluded that this one dollar court assessment is unconstitutional, the courts were instructed by the Judicial Administrator for the Supreme Court not to collect the fees. Thus, the board is being supported with general revenue and no assessments are offsetting its costs. I recommend that the Legislature correct the legislation and establish a separate budgetary fund for the court fees from which the Crime Victims Reparations Board will receive its operating expenses and funds for the payment of claims.
TRANSPORTATION
When the constitution of the state was adopted in 1859 the organizers felt it was essential to provide assurances that the state would not compete with private interests in the actual physical development of the state. For that reason, Article 11, Section 9 of the Kansas Constitution specifically forbids state involvement in any works of "internal improvement" except for the construction and the maintenance of the state system of highways, flood control works, and conservation projects or development of water resources.
While I support the basic thoughts of the state's founding fathers, times do change. A number of developments in recent years present a need to consider an additional exception in this constitutional clause.
I strongly recommend that a referendum be presented to the voters of Kansas in the 1980 general election which would authorize the pass-through of federally appropriated funds for internal improvements such as rail and airport improvements, mine-land reclamation, and other purposes specified by federal law.
There are considerable federal funds available to the state of Kansas which cannot now be utilized for purposes of developing our rail and air transportation systems because of this internal improvement prohibition. The Legislature through its budget oversight will be able to control the amount of funds appropriated in these areas if the exemption were allowed from the internal improvements prohibition.
Secondly, there are federal funds which could be used to maintain and restore private buildings which have a historical value. The Columbian Building in Topeka is a good example. But because these federal funds would pass through the state budget and into what is essentially a private concern, it is our position that such would constitute an internal improvement and therefore would not be allowed. There are several buildings of historical value owned by private individuals for which federal funds are available but no pass through can be allowed currently.
The Federal Aviation Administration, for example, will not even consider alloting funds to state government for local airport development in the absence of specific legal authority to administer the grant program. Likewise, since 1976 the Kansas Department of Transportation has not had authority to apply for any of the $1.2 million in rail line improvement funds that have been allotted to Kansas by the Federal Rail Administration. Each year the funds originally allocated to Kansas go to other states because of our constitutional restriction.
Because we are a state that produces a volume of agricultural products far in excess of our own needs, it is absolutely essential that we seize every opportunity to improve, or at least maintain, our farm-to-market transportation system. Continued economic prosperity depends on it. I recommend the Legislature reexamine the constitutional prohibition in terms of specific exemption so that rail and air development may begin and the Legislature discuss the feasibility of expanding this exemption to include restoration of private buildings which are on the National Historic Register.
This administration will reprioritize highway construction factors which are use to determine what roads are built or maintained and which are not. The appropriate balance between safety and traffic count as well as other factors must be maintained if the resources available to the Department of Transportation are to be used most wisely. Accordingly, the recommended FY 1980 budget reduces the number of maintenance positions in the Department by 32 and reallocates these positions to the capital improvement activity to assist in the proposed fiscal year 1980 construction program.
In 1974, a program for establishing a Super 2 program for highway improvement was proposed and subsequently the Department of Transportation adopted a similar program. The purpose of this program was to maintain the high level of investment the state has in its roads and highways. Capital improvement expenditures for fiscal year 1980 include $16.6 million for statewide Super 2 projects. In addition, however, I am recommending a one-time transfer of $15 million from the State General Fund reserves to the Super 2 program in order that highways in great need of repair can receive prompt attention during fiscal year 1980.
The Super 2 program allows the state the financial flexibility to keep good two-lane roads in repair, and can meet new construction requirements simply through design changes. With highway construction costs rising much faster than the national inflation rate these past few years, four-lane freeway systems cannot be as feasible as they once were. The Super 2 concept is a better alternative.
Using existing right-of-ways and construction techniques of surfaced shoulders as well as controlled access, Super 2 highways can be as safe and effective as their four-lane counterparts, especially with the 55 mile per hour speed limit.
I am opposed at this time to a tax increase in the State Highway Fund. Only when Kansans are convinced that their tax dollars are used wisely are they willing to consider whether their tax dollars constitute enough revenue for the program. We have not reached this point in our highway program and therefore a tax increase at this time is unwarranted.
The major problem Kansas soon will face in the areas of highway construction priorities is the simple phrase "you get what you pay for." Unfortunately, there is no cheap way out. This administration will provide leadership in the area of transportation needs in the state and make those decisions necessary to continue the long history of excellent transportation systems in the State of Kansas.
CONCLUSION
This message outlines the beginning of a new administration--its goals, its ideas, its projections and its requests. It is a process vital to the beginning of a legislative session and the future of Kansas.
You can, and, indeed, must participate in this process. Those of you who are veterans of this process know--and the freshmen will soon learn--that any glamour of public service in the Legislature is often outweighed by the hard work and long hours.
Having sat where you sit for eight previous sessions, I know that this message now places the bulk of the decision-making process in your committees, with your deliberations, and upon your shoulders.
How well we carry this responsibility will be the final measure of the 1979 Legislature.
Kansans expect us to work together for their common good. I know from experience that regardless of political party preference, or regionalism, or philosophy, the welfare of our constituents remains uppermost in our minds. It can and must guide our decisions.
It will be hard work. But, as the Reverend Jesse Jackson once said, "The storm really doesn't begin to matter until the storm begins to get you down."
The storm of competing interests and decisions is now fully upon us. The manner in which we attempt to weather it--and whether we triumph--is in our own hands.
Transcribed from: The Governor's Legislative Message and Budget Report, 1979. [S.l. : s.n.], 1979. Transcription by Rita Troxel. Editing and html work by Victoria A. Wolf, State Library of Kansas, December, 2005