Committee Reports
to the
2007 Kansas Legislature
DEPOSITORY
FEB 2 2007
KANSAS STATE LIBRARY 300 SW lOOi AVE RM 343 TOPEKA, KS 66612-1593
Special Committees; Selected Joint Committees; Other Committees, Commissions, and Task Forces
Kansas Legislative Research Department December 2006 Legislative Coordinating Council
Chairperson
Representative Doug Mays, Speaker of the House
Vice Chairperson
Senator Stephen Morris, President of the Senate
Derek Schmidt, Senate Majority Leader Anthony Hensley, Senate Minority Leader Clay Aurand, House Majority Leader Ray Merrick, Speaker Pro Tem Dennis McKinney, House Minority Leader
Kansas Legislative Research Department 300 SW 10th, Room 545-N, Statehouse Topeka, Kansas 66612-1504
Telephone: (785) 296-3181 FAX: (785) 296-3824 [email protected] http://www.kslegislature.org/klrd STATE LIBRARY OF KANSAS
3 5141 00192607 1
Special Committees; Selected Joint Committees; Other Committees, Commissions, and Task Forces
Agriculture and Natural Resources Assessment and Taxation Judiciary DEPOSITORY Arts and Cultural Resources At-Risk Education Council FEB 2 2007 Children’s Issues Economic Development KANSAS STATE LIBRARY Health Policy Oversight 300 SW 10t.< AVf RM -.43 Information Technology IOPLKA, KS 66612-1593 Kansas Security Legislative Budget Legislative Educational Planning Pensions, Investments, and Benefits State-Tribal Relations 2010 Commission KAN-ED Oversight Committee
Kansas Legislative Research Department 300 SW 10th, Room 545-N, Statehouse Topeka, Kansas 66612-1504 (785) 296-3181 [email protected] http://www.ksleeislature.org/klrd FOREWORD
In the 2006 Interim, the Legislative Coordinating Council appointed four special committees to study some 23 study topics. Legislation recommended by the committees will be available in the Documents Room early in the 2007 Session.
Joint committees created by statute met in the 2006 Interim as provided in the statutes specific to each joint committee. Most of the joint committees have reported on their activities and those reports are contained in this publication. Legislation recommended by these committees will be available in the Documents Room early in the 2007 Session.
This publication also contains reports of other committees, commissions, and task forces which are not special committees created by the Legislative Coordinating Council or joint committees.
Reports of the Special Committee on Utilities, Joint Committee on Corrections and Juvenile Justice Oversight, and the Health Care Stabilization Fund Oversight Committee are not contained in this publication and will be published in a supplement.
The House Investigative Committee on Legislative and Judicial Communications and the Kansas Technical College and Vocational School Commission also are not included in this publication and will be published separately.
The Legislative Compensation Commission did not meet during the 2006 Interim and therefore no report is contained in this publication. The Legislative Coordinating Council assigned the Kansas Health Policy Authority a study on human cloning.
Minutes of the special committees; joint committees; other committees, commissions, and task forces meetings are on file in the Division of Legislative Administrative Services.
A summary of each reporting entity’s conclusions and recommendations may be found on page v.
1 TABLE OF CONTENTS
Page
SPECIAL COMMITTEE ON AGRICULTURE AND NATURAL RESOURCES Dam Inspections ...... 1-3 Licensing and Bonding Requirements for Biodiesel Fuel Production ...... 1-13 Water Monitoring ...... 1-18 Regulation of County F a irs...... 1-25
SPECIAL COMMITTEE ON ASSESSMENT AND TAXATION City Development Excise Taxes ...... 2-3 County Local Sales Tax ...... 2-6 Homestead Expansion ...... 2-9 Motor Fuel Taxation Along the Kansas B ord er...... 2-12 State Board of Tax Appeals Qualifications and Employment...... 2-15 Residential Property Tax Valuation Cap ...... 2-20 State and Local Tax P o licy ...... 2-24 Tax Incidence and Tax Base Erosion...... 2-31 “Truth in Taxation” Local Budget Law ...... 2-34
SPECIAL COMMITTEE ON JUDICIARY Court Docket F e e s ...... 3-3 Eminent D om ain...... 3-5 Enhanced Penalties for Driving Under the Influence of Alcohol or Drugs ...... 3-7 Establishment of Kansas Crime Stoppers Council ...... 3-11 Guardians and Conservators ...... 3-13 Residency and Proximity Restrictions for Sex Offenders ...... 3-15 Revised Uniform Anatomical Gift Act (RUAGA) ...... 3-19 Uniform Child Abduction Prevention Act (UCAPA) ...... 3-21
JOINT COMMITTEE ON ARTS AND CULTURAL RESOURCES Arts and Cultural Life in Kansas ...... 4-3
AT-RISK EDUCATION COUNCIL Report to the 2010 Commission...... 5-3
JOINT COMMITTEE ON CHILDREN S ISSUES Early Childhood Programs ...... 6-3 Review of the State Children’s Health Insurance Program...... 6-5 Services for Young Children with Hearing L o s s ...... 6-7 Miscellaneous T o p ics...... 6-9
ill JOINT COMMITTEE ON ECONOMIC DEVELOPMENT Kansas Center for Entrepreneurship; Animal Health Research in Kansas; Extension Services; Farmaceuticals and Kansas; Workers Compensation and Medical Costs; and Trade Division Development...... 7-3 Rural Business Development Tax Credit Program ...... 7-11 Sales Tax and Revenue (STAR) Bond Program ...... 7-13 Workforce Development...... 7-16
JOINT COMMITTEE ON HEALTH POLICY OVERSIGHT Annual Report...... 8-3
JOINT COMMITTEE ON INFORMATION TECHNOLOGY Statutory S tu d y ...... 9-3
JOINT COMMITTEE ON KANSAS SECURITY Homeland Security Issues ...... 10-3
JOINT COMMITTEE ON LEGISLATIVE BUDGET Homeland Security Funding ...... 11-3 Kansas University Medical Center, Kansas University Hospital, and Missouri-Based Hospitals ...... 11-5 Impaired Provider Program ...... 11-8 Colorado Water Litigation...... 11-10 Public Mental Health System ...... 11-15 Deferred Maintenance...... 11-23 Regional Economic Area Partnership (REAP) ...... 11-25 Public Developmental Disabilities System ...... 11-27 State General F u n d ...... 11-31 State Inspector G eneral...... 11-37 Veterans’ Funding Issues ...... 11-39
LEGISLATIVE EDUCATIONAL PLANNING COMMITTEE Elementary and Secondary Education...... 12-3
JOINT COMMITTEE ON PENSIONS, INVESTMENTS, AND BENEFITS Proposed Alternative Retirement P la n ...... 13-3 State’s Deferred Compensation Plan ...... 13-9 Statutory S tu d y ...... 13-11
JOINT COMMITTEE ON STATE-TRIBAL RELATIONS Yearly Report...... 14-3
2010 COMMISSION 2006 R ep ort...... 15-3
KAN-ED OVERSIGHT COMMITTEE 2006 R ep ort...... 16-3
IV SUMMARY OF CONCLUSIONS AND RECOMMENDATIONS
Special Committee on Agriculture and Natural Resources
Dam Inspections. The Special Committee on Agriculture and Natural Resources recommends one bill which would amend KSA 2-1915 to allow grants from the state for dam rehabilitation, subject to the statutory 80 percent of the total cost of any practice. In addition, the bill would require the State Conservation Commission (SCC) to develop and administer the Kansas Dam Rehabilitation program in cooperation with the Chief Engineer of the Division of Water Resources, subject to appropriations for the program. The SCC would be permitted to cost share on non-permitted structures, but not until the rehabilitation plan for the non-permitted structure meets Division of Water Resources criteria and the owner of the structure has actually been issued a permit by the Division of Water Resources. The bill would require the SCC to promulgate rules and regulations to implement the program. The bill also would provide that cost share would be at 70 percent, with an additional 10 percent for engineering cost to rehabilitate or remove unsafe high and significant hazard dams or low hazard dams that are reclassified to high or significant hazard due to downstream development. The Division of Water Resources would assist the SCC by providing review and priority ranking of dam applications for the program based on the following:
• The highest severity of potential impact should the dam fail; • The greatest risk of failure due to the dams' deficiencies; and • Which deficiencies were caused by downstream development beyond the control of the dam owner.
The Committee also recommends a second bill. This bill would require the SCC to prepare breach inundation maps for all jurisdictional dams that do not have an inundation map already prepared. This responsibility would be subject to appropriations to the SCC to accomplish the task.
Licensing and Bonding Requirements for Biodiesel Fuel Production. The Committee recommends legislation to amend KSA 79-3403 to add language as follows:
No motor vehicle fuels or special fuels manufacturer’s license will be required for any consumer blending motor-vehicle fuel or special fuel purchased for such consumer’s own use, and not for resale from a distributor or retailer who is the holder of a valid, unsuspended and unrevoked motor-vehicle fuels or special fuels distributor’s or retailer’s license.
Water Monitoring. The members of the Committee recommend that the 2007 Legislature consider legislation which would create a mechanism to allocate any moneys received from Nebraska for violation of the Republican River Compact. This legislation would be similar to that which allocates the moneys from Colorado for its violations of the Arkansas River Compact. The Committee asked the staff of the Division of Water Resources of the Kansas Department of Agriculture to draft the language of the bill for consideration during the 2007 Legislative Session.
Regulation of County Fairs. After discussion on the issue, the Committee recommends a bill that would amend KSA 2-131d, so the maximum amount which could be raised annually for fairground buildings and maintenance would be $33,000. The proposal would not contain a minimum amount to be raised and would apply to all counties with fair associations to which KSA 2-131d is applicable.
Kansas Legislative Research Department v 2006 Committee Reports - Recommendations Special Committee on Assessment and Taxation
City Development Excise Taxes. The Committee recommends no further expansion oi city development excise tax authority at this time. The seven cities with the tax authority pursuant to the grandfather clause should continue to report to the League of Kansas Municipalities and the Legislature with respect to what impact the taxes have on growth and development.
Should the issue of extending the authority to additional cities he revisited in the future, the Committee recommends that the Legislature consider provisions similar to those embodied in 2004 legislation that would require reporting of development costs; the rational basis for imposition; and how the revenues are expended.
County Local Sales Tax. The Committee makes no recommendation at this time.
Homestead Expansion. The Committee believes that further expansion of the Homestead Program is warranted. The Committee therefore recommends the introduction of legislation that would reduce “rent constituting property taxes paid” from 20 to 15 percent while simultaneously increasing the maximum refund amount for both home owners and renters from $600 to $700; and would facilitate electronic filing.
The Committee further finds that an asset test would be appropriate and recommends the introduction of legislation that would exclude from the Program persons with assets in excess of $250,000.
The Committee applauds the ongoing administrative efforts of the Department of Revenue and recommends the introduction of legislation that would authorize the denial of claims by certain renters who have failed to adequately document their sources of income.
Motor Fuel Taxation Along the Kansas Border. The Committee recommends a study be conducted as was originally requested of Kansas, Inc. in September 2006, when the Committee Chairperson requested a broad-based examination of fiscal impacts of border zone taxes in general.
State Board of Tax Appeals Qualifications and Employment. The Committee recommends introduction of legislation expanding the Board to five members, from three as currently required, with certain qualifications. The Committee strongly emphasizes that each SBOTA member is currently required by law to devote full time to the duties of his or her office. Finally, because of questions regarding the existence of disciplinary proceedings for SBOTA members, the Committee requests that the Chairman, with the assistance of the First Assistant Revisor, draft a letter requesting an Attorney General Opinion to clarify a number of issues relating to conflicts of interest and the discipline related to such.
Residential Property Tax Valuation Cap. The Committee finds that a residential valuation cap would tend to shift property taxes away from real estate where values are increasing rapidly and on to other real estate where values are not increasing at the rate of the cap. The Committee further finds that a property tax system with a valuation cap could be especially onerous for young families entering the housing market for the first time.
State and Local Tax Policy. The Committee expresses its concern about the recent trend of legislation that would earmark future sales, income, and property tax streams for funds other than the State General Fund (SGF). The Committee recommends that the withholding tax in particular
Kansas Legislative Research Department VI 2006 Committee Reports - Recommendations no longer be allowed to be diverted away from the SGF, except as a last resort relative to retention of an existing business. The Committee further expresses its concern about the erosion of all major tax bases, especially the sales tax base. The Committee strongly recommends that certain specific questions relating to justification of any new exemptions be answered by all parties seeking sales tax exemption legislation. The Committee also strongly recommends that the leadership of the standing tax committees develop rules that would prohibit advancement of any sales tax exemption legislation until these questions have been answered satisfactorily by proponents.
The Committee notes that the top corporation income tax bracket may represent an economic development disincentive and encourages the 2007 Kansas Legislature to consider reducing that rate as part of a broader restructuring of the corporation income tax. That restructuring also should include simplification of the “high performance” income tax credit program be simplified; and the creation of broader availability for investment income tax credits in general. The Committee recommends the repeal of seldom-used income tax credits.
The Committee further recommends a corporation franchise tax exemption for certain assets of subsidiary corporations.
The Committee finds that one of the biggest future challenges involves local governmental service delivery systems and public angst over the property taxes associated therewith.
The Committee asks the Property Valuation Division to conduct a study of townships and report back to the tax and local government committees with respect to how many townships are actively levying property taxes and the range of activities being funded.
The Committee also recommends that the Legislature act as a facilitator to the discussion of local service delivery restructuring by enacting legislation that would repeal any and all statutory barriers to restructuring. The Secretary of Revenue should compile an exhaustive list of all such barriers and submit it to the tax and local government committees during the first week of the 2007 session.
The Committee further recommends that a tool be developed to evaluate the possibility of multi- jurisdictional service-delivery systems by quantifying potential property tax savings associated with such entities. This tool, which would be developed under the auspices of the KACIR, would be made available free-of-charge to local units of government wishing to explore realignment of certain services, including infrastructure maintenance, health, vehicle registration, reappraisal, elections, and deed registration. Access to such information would allow local units of government and their taxpayers to make well-informed decisions about how to proceed.
A second model also should be developed by KACIR that would help estimate the amount of property tax relief that could be provided if the funding of certain public safety functions were to be assumed by the state. One proposal would empower citizens within each of the 31 judicial districts to abolish county attorneys and replace that system with state-funded district attorneys. Data should continue to be compiled prior to the start of the session regarding county attorney budgets and mill levy equivalencies, and the tax and judiciary committees should jointly review the data. Legislation should subsequently be introduced that would allow citizens within the judicial districts to hold elections that would change their prosecutorial model. The model also should continue to be adapted to help quantify property tax relief associated with having additional state funding of other public safety functions, including corrections.
Kansas Legislative Research Department vii 2006 Committee Reports - Recommendations Tax Incidence and Tax Base Erosion. The Committee expresses its concern about the erosion ot all major tax bases, especially the sales tax base. The Committee strongly recommends that certain specific questions relating to justification of any new exemptions be answered by all parties seeking sales tax exemption legislation.
The Committee further strongly recommends that the leadership of the standing tax committees develop rules that would prohibit advancement of any sales tax exemption legislation until these questions have been answered satisfactorily by proponents.
Finally, the Committee recommends that the standing committees consider tax incidence and progressivity-regressivity issues with respect to all major state and local tax policy changes.
“Truth in Taxation” Local Budget Law. The Committee finds that the decision made in 1999 to abolish the tax lid in favor of the truth in taxation lid represented an appropriate choice of no longer seeking to micro-manage local units of government.
The Committee further notes that no report surfaced of any local unit having violated the truth in taxation provisions.
The Committee encourages the Department of Revenue to establish a comprehensive “truth in taxation” website that could make a variety of federal, state, and local tax information available to taxpayers.
Special Committee on Judiciary
Court Docket Fees. The Committee reviewed the various aspects of the court docket fees issue and agreed to introduce a bill that would delete certain funds from district court docket fees as follows:
• Indigents’ Defense Services Fund; • Crime Victims Assistance Fund; • Protection from Abuse Fund; • Kansas Juvenile Delinquency Prevention Trust Fund; • Permanent Families Account in the Family and Children Investment Fund; • Child Exchange and Visitation Centers Fund; • Juvenile Detention Facilities Fund; and • Trauma Fund.
Those funds that would continue to be funded by docket fees include the funds that are related to the functioning of the courts as follows:
• Access to Justice Fund; • Judicial Branch Nonjudicial Salary Initiative Fund; • Judicial Branch Education Fund; • Judicial Technology Fund; • Dispute Resolution Fund; • Judicial Council Fund; and • Judicial Performance Fund.
Kansas Legislative Research Department Vlll 2006 Committee Reports - Recommendations Eminent Domain. After much discussion on the topic of eminent domain and the specific issues involved in urban, as opposed to rural, eminent domain instances, and in consideration of the fact that legislation will be introduced on this topic during the 2007 Legislative Session, the Committee decided to make no recommendations at this time.
Enhanced Penalties for Driving Under the Influence. After discussion of the issue, the Committee believes there is a problem with the statutes regarding those individuals who drive while their license is suspended as evidenced by the increasing number of convictions in this area. The Committee encourages the Legislature to consider statutory changes for driving with a suspended drivers license. Further, the Committee recommends the introduction of a 2007 bill that would implement all of the suggested changes by the Subcommittee regarding 2006 SB 341 as follows:
• Strike new section one of the bill. The Subcommittee felt that this issue was alreadv•/ addressed by the involuntary manslaughter statute;
• Adopt the changes in KSA 8-1567 and include language that would require that the courts follow the alcohol and drug evaluation as it pertains to alcohol and drug safety education programs or treatment programs on first, second and third offenses;
• Allow for the doubling of sentences for those who refuse to take the blood alcohol content (BAC) test or have a BAC of 0.15 or greater;
• Amend KSA 8-1567(h) by allowing the court to impose one month of imprisonment for each child in the vehicle at the time the offense occurred;
• Allow evidence, in KSA 8-1005, of assessment performed by a Drug Recognition Evaluator to be admissible in court to indicate that a person may have been under the influence of something other than alcohol;
• Provide for a one-year suspension of driving privileges, followed by a one year restriction to driving a vehicle with an ignition interlock device on first occurrence test refusal. The same procedure would follow on a second offense (two year suspension, two year ignition interlock), and on a third violation (three year suspension, three year ignition interlock);
• Subject a person under the age of 21 to the same sanctions on a second or subsequent test failure or driving under the influence of alcohol or drugs (DUI) conviction as a person over the age of 21;
• Allow administrative hearings to be held by telephone conference;
• Provide for explanation, oral & written, of enhanced sanction fora 0.15 BAC or greater and new interlock restrictions;
• Allow a search warrant, not to be required if there is any person injured, or a death occurs to another person;
• Provide additional funding to Kansas Department of Health and Environment (KDHE) and Kansas Department of Revenue (KDOR) to address the anticipated increase in litigation;
• Establish a funding source for county sheriffs to address anticipated increased incarceration in county correctional facilities; and
Kansas Legislative Research Department IX 2006 Committee Reports - Recommendations • Encourage the Legislature to be aware that the numbers of those who are driving with a suspended license are increasing, and suggest it look at possible changes to deal with this.
Establishment of Kansas Crime Stoppers Council. The Special Committee on Judiciary makes no recommendation on the topic of establishment of a Kansas Crime Stoppers Council. The Committee believes that there was not an overwhelming need for a statewide council, and there were concerns with the funding of such a council.
Guardians and Conservators. After a review of the issues involved, the Committee has authorized the Chairman of the Committee to draft a request for study of this matter by the Judicial Council. Specifically, the request will ask for a study of 2005 SB 240, balloon amendment version, with emphasis on the following language:
• Page one, lines thirty three through forty three; and • Page two, lines one through three.
In addition, the request will ask the Judicial Council to take testimony on the bill to see whether such a measure is warranted. Such an examination of the measure also should emphasize the education and training needed for a guardian or conservator.
Residency and Proximity Restrictions for Sex Offenders. After extensive testimony on the issues surrounding residency requirements for sex offenders, the Committee expressed an awareness that the Sex Offender Policy Board, created by the 2006 Legislature, is charged with studying these issues and reporting back to the Legislature in 2008.
As a consequence, the Committee:
• Encourages the Legislature to wait and receive the report from the Sex Offender Policy Board before any action is taken on residency requirements;
• Suggests the 2007 Legislature consider the following:
o Creation of safety zones patterned after the Illinois statutes; o Development of more complete risk assessment tools; o Narrowing the scope of application for offenses against children instead of minors; o Preemption of local ordinances from establishing residency restrictions; and o Creation of programs that focus on the dangers that lie within a child’s family.
The Committee encourages the Sex Offender Policy Board to explore the classifications of sex offenders by risk levels, reclassification of the sex offender registry, and to research whether sex offenders would be allowed to go into safety zones if such a statute as the Washington law were enacted.
The Revised Uniform Anatomical Gift Act (RUAGA). After discussion, the Committee voted to introduce a bill patterned after the Revised Uniform Anatomical Gift Act. Concern however, was expressed regarding needed clarity on the following:
Kansas Legislative Research Department x 2006 Committee Reports - Recommendations • Section five (a)(3) regarding a terminal illness of the donor. This section would allow an anatomical gift by any form of communication addressed to at least two adults, one of whom is a disinterested witness; • Donor revocation; • Section nine (8) regarding someone who may make an anatomical gift of decedent’s body or part; • Section ten dealing with the matter of making, amending, or revoking and anatomical gift of decedent’s body or part, which needs more specificity and; • Section eighteen dealing with immunity. This section was discussed as too broad in nature.
The Uniform Child Abduction Prevention Act. The Committee discussed various aspects of the Act and in its deliberations, focused on the standard of proof that would be needed to determine whether a parent is a high risk for abduction of a child. The Committee concluded that a bill should be introduced, modeled after the Act, using a clear and convincing standard of proof of whether a parent is high risk, before adopting any measures that the court can impose such as the following:
• Custody Order
o Basis for court’s jurisdiction; o The manner in which notice and opportunity to be heard were given to the persons entitled to notice of the proceeding; o A detailed description of each party’s custody and visitation rights and residential arrangements for the child; o A provision stating that a violation of the order may subject the party in violation to civil and criminal penalties; and o Identification of the child’s country of habitual residence at the time of the issuance of the order.
• If there is a threat of abduction, the order should be even more specific and include such things as:
o An imposition of travel restrictions that require that a party traveling with the child outside a designated geographical area provide the other party with the following:
- the travel itinerary of the child; - a list of physical addresses and telephone numbers at which the child can be reached at specified times; and - copies of all travel documents;
o A prohibition of the respondent directly or indirectly:
- removing the child from this state, the United States, or another geographic area without permission of the court or the petitioner’s written consent; - removing or retaining the child in violation of a child-custody determination; - removing the child from school or a child-care or similar facility; or - approaching the child at any location other than a site designated for supervised visitation;
Kansas Legislative Research Department xi 2006 Committee Reports - Recommendations • A requirement that a party register the order in another state as a prerequisite to allowing the child to travel to that state;
• With regard to the child's passport:
o a direction that the petitioner place the child’s name in the U.S. Department of States Child Passport Issuance Alert Program;
o a requirement that the respondent surrender to the court or the petitioner s attorney any United States or foreign passport issued in the child’s name, including a passport issued in the name of both the parent and the child; and
o a prohibition upon the respondent from applying on behalf of the child for a new or replacement passport or visa;
• Asa prerequisite to exercising custody or visitation, a requirement that the respondent provide:
o to the U.S. Department of State’s Office of Children’s Issues and the relevant foreign consulate or embassy, an authenticated copy of the order detailing passport and travel restrictions for the child to the court: (I) proof that the respondent has provided the information in subparagraph (A); and
(ii) an acknowledgment in a record from the relevant foreign consulate or embassy that no passport application has been made, or passport issued, on behalf of the child;
o to the petitioner, proof of registration with the United States Embassy or other United States diplomatic presence in the destination country and with the Central Authority for the Hague Convention on the Civil Aspects of International Child Abduction, if that Convention is in effect between the United States and the destination country, unless one of the parties objects; and
o a written waiver under the Privacy Act, 5 U.S.C. Section 552a [as amended], with respect to any document, application, or other information pertaining to the child authorizing its disclosure to the court and the petitioner; and
• Upon the petitioner’s request, a requirement that the respondent obtain an order from the relevant foreign country containing terms identical to the child-custody determination issued in the United States;
• Limit visitation or require that visitation with the child by the respondent be supervised until the court finds that supervision is no longer necessary and order the respondent to pay the costs of supervision;
• Require the respondent to post a bond or provide other security in an amount sufficient to serve as a tinancial deterrent to abduction, the proceeds of which may be used to pay for the reasonable expenses of recovery of the child, including reasonable attorneys fees and costs if there is an abduction; and
• Require the respondent to obtain education on the potentially harmful effects to the child from abduction.
Kansas Legislative Research Department Xll 2006 Committee Reports - Recommendations Joint Committee on Arts and Cultural Resources
Arts and Cultural Life in Kansas. The Joint Committee recommends that:
• The Kansas Department of Commerce include small museums and historic sites on the Kansas Highway Map to enhance attendance rates of these facilities.
• The website of the Department of Commerce be improved by: updating and improving communication with legislators; and by having Destination Marketing Organizations (DMOsJ interact with local legislators to get communities, historic places, and businesses listed on the Department of Commerce’s website.
• The Department of Commerce develop niche marketing to better identify special places that may not have been considered previously.
• The Department of Commerce strive to make its website more user friendly to the general public, including better interface and access to the site from the State of Kansas’ website and clearly identify the links to cities and counties.
• The Department of Commerce review its decision to have Kansas! Magazine published by an out-of-state company. The Committee encourages the Department to consider use of qualified Kansas companies in the future.
• The Department of Commerce review the purpose of the Kansas! Magazine, including whether its principal purpose is to generate revenue by attracting readership and whether a new generation of younger readers will replace the declining cohort of older readers.
• Consider the potential for the Kansas! Magazine perhaps being combined with another related publication such as the Wildlife and Parks publication and then have the Department of Commerce follow up next year on its findings and recommendations.
• The Kansas Department of Transportation policy of “bumping” of existing businesses on highway signs from their sites be reversed through a grandfather provision or policy, as a measure of fairness.
• The Kansas State Historical Society’s planned efforts to keep open the Lecompton Constitution Hall on weekends during the months of December, January, and February is strongly supported. The Committee encourages the Lecompton community to provide volunteers and cash donations to the Society in the Society’s efforts to keep open the facility. The Committee further supports a call number to the Lecompton facility for group appointments. Lastly, the Society should explore any available federal funds for this purpose.
• The suggestion by the Kansas State Historical Society for the creation of a separate fund for small museums be further explored and, should this approach be adopted, identify possible sources of monies for this fund.
• The policy of weighing certain criteria in the award of moneys from the Heritage Trust Fund be further explored.
• A new Department of History and Tourism be created to enhance the visibility and vitality of both subjects. The Committee recommends that the Division of Tourism be taken out of the
Kansas Legislative Research Department Xlll 2006 Committee Reports - Recommendations Kansas Department of Commerce and created as a separate agency. I he Committee believes that, currently, the Department of Commerce is an agency with multiple duties and facets and more attention would further tourism in Kansas.
• A study be undertaken by the Society to determine whether the fundamentals of civics can be incorporated in Kansas history programming for schools.
At-Risk Education Council
Report to the 2010 Commission. The At-Risk Council draws the following conclusions and makes the following recommendations:
Conclusions
• The Council continues to believe that the best state proxy for identifying at-risk students is poverty, whether that be measured by free, or free and reduced price lunches.
• The Council notes that student achievement on state assessments has improved in elementary and middle schools, but little at the high school level. The Council believes that there needs to be a better understanding of the achievement gap at the secondary level to include examination of dropout, graduation, and attendance rates.
• The Council believes that a single tool, such as state assessment scores, is too narrow to determine if a child is at risk.
• The Council believes that the Kansas State Department of Education criteria for serving at-risk youth that are required for school district plans are appropriate, but need periodic adjustment based on new research.
• The Council affirms the work of the Kansas Legislature and Governor in differentiating at-risk funding with the core funding being decided on poverty and the second level of funding which takes density into account. The Council believes that the third level of funding at-risk students based only on student proficiency as determined by the state assessments for those who are not on the free lunch program is an interesting and potentially effective approach that needs further study.
• The Council concludes that at-risk students need the most qualified teachers and that this is not occurring in many schools, especially at the secondary level.
• The Council concludes that there is a teacher shortage in selected subjects and geographic areas and that the problem of recruitment and retention must be addressed.
• The Council supports the state database project being developed by the Kansas State Department of Education to include both student and teacher information.
® The Council concludes that periodic studies of effective at-risk programs and strategies need to be conducted at the recommendation of the 2010 Commission.
Kansas Legislative Research Department xiv 2006 Committee Reports - Recommendations • The Council believes that comprehensive social support is vital to ensure the success of at-risk students and that the statute requiring an integrated social support system must be implemented and maintained in an effective and efficient manner in all districts.
• The Council believes that an evaluation of charter schools is needed to determine lessons learned and areas in need of improvement. A part of the new federal charter school grant recently received by the Kansas State Department of Education requires such an evaluation. Therefore, the Council hopes that the 2010 Commission will utilize the results to identify what has been learned in the operation of charter schools that might be informative for all public schools and to determine needed adjustments in charter school statutes or policies.
• The Council believes that at-risk students should be encouraged to seriously consider continuing education after high school and be provided access to programs that will enable the students to pursue a career path, whether it be vocational, technical, community college or university, which will allow the students to be successful members of society.
Recommendations
• The Council recommends that the second level of funding for at-risk students, which is the high density formula, be based on the prior year's data and implemented using a linear transition calculation. The Council believes that the density formula needs to be reviewed periodically to ensure that it is taking into account all areas of the state and that it is adding value to student learning.
• The Council affirms that the third level of funding, Non-Proficient At-Risk Weighting, be for students who are below proficiency and not on free lunch. Also, the Council recommends that the 2010 Commission study the impact of this provision and the formula which distributes the funding should be simplified if the weighting remains in effect beyond its current statutory termination date of June 30, 2007. Further, the Council notes that the student improvement team practice currently utilized in the schools should be helpful in identifying the results of this initiative.
• The Council recommends the continued support of the data system being developed and implemented by the Kansas State Department of Education as a critical component in the ongoing understanding of the achievement gap of at-risk students. Furthermore, the Council supports the implementation of 2006 SB 549 which requires the State Department of Education to provide performance and financial accountability for the use of at-risk funding. Additionally, the Council recommends that the Kansas State Department of Education be supported in its efforts to be a resource for schools in identifying successful programs of Education and strategies for helping at-risk students.
• The Council recommends that the Department of Education periodically reevaluate the existing criteria for the determination of a student to be in need of at-risk services to include consideration of the use of at-risk funds on specific professional development to serve at-risk students such as behavior management training.
• The Council recommends that the 2010 Commission authorize follow-up studies on early career teachers who leave the profession to determine what factors contribute to their leaving, as well as, successful practices needed to recruit and retain highly qualified teachers.
Kansas Legislative Research Department xv 2006 Committee Reports - Recommendations • The Council recommends that the 2010 Commission authorize a study to determine the factors contributing to the achievement gap and lack of progress in student achievement at the high school level.
Joint Committee on Children’s Issues
Early Childhood Programs. The Committee makes the following conclusions and recommendations regarding early childhood programs:
• The Committee notes that the Early Childhood Comprehensive Systems plan is in its second year of implementation and requests a progress report next year.
• The Committee recommends that newborn screenings, including hearing screenings, be included in the school readiness plan.
• The Committee notes the importance of cognitive and non-cognitive skills and suggests that both should be measured and used to evaluate school readiness. The Committee encourages providers of early childhood services to use the proven school readiness indicators that are used by local school districts and determine how their program can help children reach those goals.
Review of the State Children’s Health Insurance Program. The Committee makes the following conclusions and recommendations regarding the State Children’s Health Insurance Program:
• The Committee notes the changes in managed care organizations for physical health services that will be effective January 1, 2007.
• The Committee recommends a review of the contract renewal for behavioral health services based on concerns expressed to members about the revision of the contract this summer.
• The Committee expresses concern about the low participation by dentists in the HealthWave program. The Committee suggests the Kansas Health Policy Authority (KHPA] find out from the dental association what needs to be done to encourage additional participation and assess the real reasons so many dentists do not participate. The Committee acknowledges the general shortage of dentists in Kansas, particularly in some areas of the state and encourages the KHPA to work with the dental director at the Kansas Department of Health and Environment to see what can be done about improving dental services.
Services for Young Children with Hearing Loss. The Committee notes the testimony it received about the need for a coordinated program for early identification and provision of services to help children acquire language appropriately. In addition, the Committee recommends that the 2007 Legislature appropriate the additional funding requested for a regionalized system to ensure services across the state.
Kansas Legislative Research Department xvi *2006 Committee Reports - Recommendations Miscellaneous Topics. The Committee makes the following conclusions and recommendations:
Committee Membership and Authority
The Committee notes that it has been required to operate as a special committee authorized by the appropriations bill for the 2005 and 2006 Interim sessions because of appointments made in violation of the statute governing membership of the Joint Committee on Children’s Issues.
According to KSA 46-3001 (a) the following committees are to be represented: House Insurance; House Health and Human Services; House Appropriations; Senate Public Health and Welfare; Senate Ways and Means; and Senate Financial Institutions and Insurance.
Members discussed the value of having certain committees represented and determined that the existing representation should remain but that the Judiciary Committees also should he included. After discussion, the Committee concluded that Education Committee representation would not be needed. The Committee notes that its importance is reflected in the number of issues addressed over the years that are not addressed by any other Interim Committee.
Based on the above, the Committee recommends the introduction of legislation for the 2007 session which would: add representation from the Judiciary Committees and give the Committee the authority to introduce legislation.
Adoption Law Changes
The Committee recommends that all suggestions for changes made to the Committee receive further study. The Committee also makes the following comments and recommendations:
• The Committee notes comments it received regarding cases where unknown fathers are not notified of an adoption because of mothers who provide false information regarding paternity. The Committee notes that it received specific language regarding penalties for these mothers.
• The Committee notes it received suggestions for expanding the pool of people who are allowed to perform adoption home studies and changing caseworker qualifications.
• The Committee notes that indigent fathers who contest adoptions are appointed an attorney in order to protect their parental rights. Currently, these costs are assessed against the adoptive parents. The Committee recommends that the Legislature consider changing the statutes so that these costs are paid by the counties in the same way that criminal cases are handled. In addition, these charges should be paid at a bid rate and not at the attorney’s normal fees.
• The Committee notes a proposal it received from the Kansas Children’s Service League for an expanded adoption website. The Committee recommends that the Legislature appropriate funding for this project in order to increase the number of adoptions, particularly for a child in state custody.
• The Committee notes suggestions made to include language clarifying the lack of parental rights of egg donors. Current statutes only speak to sperm donors.
Kansas Legislative Research Department XVII 2006 Committee Reports - Recommendations Scholarships for Children with Disabilities
The Committee notes that it received testimony from persons outside the state and that no state dollars were used to pay expenses associated with these speakers.
The Committee recommends the study of the services autistic children need and determine the level of state involvement.
Case Managers in Family Law Cases
The Committee notes information it received regarding the limited options parents have in addressing problems with case managers assigned to them by the courts in family law matters. Further, the Committee recommends that the Judiciary Committees study this issue further.
Changes to the Child in Need of Care and Juvenile Offender Codes
The Committee recommends that the Judiciary Committees look at the issues pointed out by two conferees.
The Committee notes with concern the information it received that secure care for girls in Sedgwick County will be unavailable after January 1, 2007. The Committee recommends that Department of Social and Rehabilitation Services (SRS) and the Juvenile Justice Authority ensure that these types of services will be available under the new structure being implemented.
Legislative Post Audit Report Regarding Children Being Removed from Their Homes
The Committee makes four recommendations with regard to the audit report:
• The Committee notes information in the Legislative Post Audit Report that child support billing practices were not consistent as to which method of calculation was used to calculate the amount of support owed. The Committee recommends that the system of assessing child support obligations for foster care cases receive further study by the Legislature.
• The Committee recommends that the Legislature study the timely appointment of attorneys for families so that they receive adequate representation.
• The Committee recommends further study on communication issues between SRS and the Kansas Department of Health and Environment cited in the report regarding child care facilities.
• The Committee requests that SRS compile all complaints since the beginning of FY 2006 and report a summary of those complaints to the 2007 Legislature.
Joint Committee on Economic Development
Kansas Center for Entrepreneurship; Animal Health Research in Kansas; Extension Services; Farmaceuticals and Kansas; Workers Compensation and Medical Costs; and Trade Division Development. The Committee recommends that the Revisor of Statutes draft legislation that will provide technical clean up to the statutes dealing with the Center for Entrepreneurship. The
Kansas Legislative Research Department XVlll 2006 Committee Reports - Recommendations Revisor has found that the term “Kansas community entrepreneurship fund” remains in statute when it should refer to Center for Entrepreneurship.
• The Committee recommends that the Revisor of Statutes draft legislation that will remove the term economic development from the mission statement of the extension services and replace the economic development program development committee with community and resource development program committee in statute.
• The Committee wishes to express its appreciation for the work the Greater Kansas City Chamber of Commerce, Kansas State University, Bayer Health Care Animal Health, Kansas City Area Life Sciences Institute, and the Kansas City Area Development Council have done to make Kansas the leader in animal health research. The animal health corridor is showing great promise as an expanding industry for the state. This industry will bring new high paying jobs and economy growth to the state. The Committee looks forward to the presentation next year about the new initiatives put forth by the various institutions and companies involved in this industry.
• The Committee wishes to acknowledge the fine job the Kansas State University Extension Services Program is doing in Kansas. However, the Committee hopes the extension services will not duplicate efforts for economic development in areas of Kansas which already have organizations in place providing economic development services. In addition, the Committee strongly believes it would be to the benefit of the extension services programs to be part of the Center for Entrepreneurship partner programs and be listed as a Network Kansas partner to further both the Center’s and extension programs goals.
• The Kansas Bioscience Authority has made great strides in its first two years of operations and the Committee is very pleased that Mr. Tom Thornton has been hired as President. However, in the future, the Committee would appreciate an explanation of the criteria employed by the Authority for determining investments and additional information about the companies the Authority has chosen to invest in.
• The Committee found the outline presented about the future of plant grown pharmaceuticals and the potential for profit for Kansas farmers very informative. The Committee requests that KTEC keep the Committee informed as this new industry develops in Kansas.
• The Committee requests that the Department of Labor provide the appropriate House and Senate Committees the report and its recommendation to align fees for workers compensation medical costs with state of Kansas medical fee reimbursements. The Committee believes that this alignment of fees with the state of Kansas medical fee reimbursement should begin with the November 2006 meeting.
• The Committee requests that the Legislative Coordinating Council give a positive consideration to any request made by members of the Joint Committee on Economic Development to attend the 2007 BioConference in Boston, MA.
Rural Business Development Tax Credit Program. The Committee believes that the Rural Business Development Tax Credit Program does require additional time to mature and grow and that three years is not adequate to determine a true test of the success or failure of the program. Therefore, the Committee recommends legislation be introduced that will extend the life of the program through tax year 2009 and that statewide tax credits be $2.0 million for FY 2008 and $2.0
Kansas Legislative Research Department XIX 2006 Committee Reports - Recommendations million for FY 2012. Finally, the Committee is recommending that the annual audit requirement of the seven regional foundations be amended to allow for the use of an audit to coincide with the fiscal year of the foundations.
Sales Tax and Revenue (STAR) Bond Program. The Committee believes that the S I AR Bond Program has been very successful in Wyandotte County and recommends reauthorization of the program until June 30, 2012. In addition, the Committee is recommending that the Revisor of Statutes draft legislation that provides separate sections in law for Tax Increment Financing and STAR bonds. Finally, the Department of Commerce expressed confusion about the Legislature’s intent with regard to the percent of revenue the city or county must commit to repayment of STAR Bonds and the requirement for annual reports and audits of STAR Bond projects. Therefore, the Committee has requested that the Chairman write to the Kansas Department of Commerce and explain that the legislative intent under KSA 12-1774 (a) (1) (H) is the policy that the Department is to follow if either city or county revenue is used to pay back the bonds and that an annual report and audit is required for every STAR Bond project approved by the Kansas Department of Commerce.
Workforce Development. The Committee:
• Requests a letter be sent to the Congressional delegation; National Association of State Legislators (NCSL); The Council of State Governments (CSG); and American Legislative Exchange Council (ALEC) by the Chairman asking for help regarding reauthorization of the federal Workforce Investment Act (WIA) and needed Congressional changes to the Act;
• Directs Secretary Fricke to coordinate with other states' agencies in requesting help for needed Congressional changes to the reauthorization of WIA;
• Requests the bylaws of the State Board for Workforce Investment be modified to include the removal by the Governor of any State Board member after two consecutive absences;
• Requests the Department of Commerce to begin in FY 2008 providing the local boards a marketing and implementation plan and direct the Department to report progress to the standing House and Senate committees during the 2007 Session;
• Requests that staff from the offices of Senator Sam Brownback and Senator Pat Roberts meet with legislators to discuss the problems with the Workforce Investment Act;
• Directs the Department of Commerce to create a framework for training of both local and state board members and staff and report the progress back to the standing House and Senate committees during the 2007 session;
• Directs the Department of Commerce to contact KAN-ED to seek help for local boards in receiving on-line training;
• Directs the Department of Commerce to create a uniform evaluation for local boards to implement for contracts;
• Requests a letter be sent from the Chairman to the Kansas Department of Labor inquiring why a representative from the unemployment office is not co-located in every Local Area One-Stop Center;
Kansas Legislative Research Department xx 2006 Committee Reports - Recommendations • Encourages the local boards for Area III and V obtain an administrative entity other than the Department of Commerce as soon as possible; and
• Asks that Kansas, Inc. report back to the House and Senate committees on its review of the Workforce Investment Act; comparison with other states; and make recommendations for improvement in the present system in Kansas.
Joint Committee on Health Policy Oversight
Annual Report. Based on testimony and Committee deliberations, the Joint Committee on Health Policy Oversight challenged and encouraged the Kansas Health Policy Authority to continue to focus its efforts on ensuring that all health programs in Kansas are working together to improve the health of Kansans and that the health model for Kansas shift from health care to health wellness; that the state’s prevention programs encompass all age groups; that the Authority be innovative as it develops a statewide health policy agenda; that the implementation of programs be tracked to ensure that expectations are met; and that the Authority work with the state’s federal delegation on important health issues. The Joint Committee further encouraged the Authority to consider cost containment strategies; personal accountability with regard to health insurance; the implementation of e-prescribe technology; and the provision of adequate dental care, particularly for Medicaid recipients, the uninsured, and the underinsured.
The Joint Committee also approved a motion that all Memorandum of Understanding entered into by the Authority be presented to the Oversight Committee for review before being implemented. The Oversight Committee further requested the Authority give consideration to the construction and process of future requests for proposal, particularly as they relate to managed care contracts.
Additionally, the Committee commended the efforts of the Authority in the timely transition of responsibilities from the Division of Health Policy and Finance to the Authority. It also commended the Authority’s efforts to communicate openly with the Oversight Committee, with other state agencies, with other health care stakeholders, and with the general public.
Joint Committee on Information Technology
Statutory Study. The Committee recommends:
• The Legislative Coordinating Council (LCC) and other committees should refer information technology (IT) projects to the Committee for further review when issues arise that require additional study.
• The Department of Administration should establish either a central staff attorney position or contract for an attorney to review IT contracts and to insure that all IT contracts contain liquidated damages provisions.
• The Kansas Lottery, when feasible, should share with other state agencies access to contracted resources, such as its communications network.
• The Board of Regents should encourage cooperative ventures between and among institutions, including universities and community colleges that may share IT resources, including hardware, software, and personnel.
Kansas Legislative Research Department xxi 2006 Committee Reports - Recommendations • The House Appropriations Committee and the Senate Ways and Means Committee should review the proposed $98.5 million SRS project which the Committee does not recommend at this time.
Joint Committee on Kansas Security
Homeland Security Issues. The Committee discussed the possibility of introducing legislation providing tuition assistance to Kansas National Guard soldiers and airmen and Kansas Reserve members returning from Iraq or Afghanistan. The Committee discussed the possibility of introducing legislation on this topic early in the 2007 Legislative Session.
The Committee recommends further study of a state Emergency Disaster Relief Fund to provide assistance for victims of a disaster when the disaster does not meet the threshold to qualify for federal assistance. The Committee discussed whether grant funds should he provided to businesses for disaster relief, and, if so, whether an eligibility threshold should be included based on business size. The Committee discussed the possibility of introducing legislation on this topic early in the 2007 Legislative Session.
The Committee recommends further study of the proposal to expand the membership of the Commission on Emergency Planning and Response. The Committee expressed concern that a membership increase may limit the effectiveness of the Commission.
The Committee received information on the number of Mobile Command Vehicles or Trailers across the state. The Committee expressed concern that some counties have no Mobile Command Vehicle or Trailers, while other counties may have two or three owned by various local entities in varying conditions. The Committee recommends further study to insure that resources are adequately distributed across the homeland security regions and the state.
The Committee continues to express concern with the procurement process for homeland security equipment, including the contract with Fisher Scientific.
The Committee recommends further study of Statehouse security.
The Committee recommends further study of hospital credentialing of health care providers in emergency situations.
Joint Committee on Legislative Budget
Expenditures of Federal Homeland Security Funds. The Committee makes no recommendation on the topic of homeland security funding.
Kansas University Medical Center, Kansas University Hospital and Missouri-Based Hospitals. The Committee recommended continued dialogue between the University of Kansas School of Medicine and the University of Kansas Hospital, and that Kansas-based proposals for the Kansas City area be developed jointly by the University of Kansas School of Medicine and the University of Kansas Hospital.
Impaired Provider Services Offered by Regulatory Boards. The Committee reviewed the issue and took no action.
Kansas Legislative Research Department xxi l 2006 Committee Reports - Recommendations Monitor Colorado Water Litigation. The Legislative Budget Committee recommends that the Attorney General's Office present to the Senate Ways and Means and House Appropriations Committees prior to February 1, 2007, an update on the Colorado Water Litigation and Nebraska's potential noncompliance with the Republican River Compact.
Public Mental Health System. The Committee recommends that the Senate Ways and Means and House Appropriations Committees have additional hearings on issues identified relating to persons with a dual diagnosis of developmental disabilities and mental health concerns who demonstrate challenging behaviors in community settings of a nature that puts themselves and others at risk of harm.
The Committee requests:
• That the Department of Social and Rehabilitation Services (SRS) he prepared to provide testimony on the nature of the challenging behavior issues presented to the Committee and the following options be considered:
o Supplemental funding be added to the SRS budget for FY 2007 (amount to be identified by SRS and legislative staff) to support the opening of one 30 bed inpatient unit at Osawatomie State Hospital within the existing and available physical plant with funding added to continue this unit in FY 2008.
o Supplemental funding be added to the SRS budget for FY 2008 (amount would need to be identified by SRS and legislative staff) to allow SRS to enter into contractual arrangements with local hospitals who have the capacity to provide acute care inpatient services with funding added to continue these contracts in FY 2008.
o SRS and mental health stakeholders shall work together to define what the future role of the State Mental Health Hospitals (SMHH) is going to be; to determine what the appropriate number of inpatient beds that is necessary to meet the needs of the citizens of Kansas based on the State’s current population and respective population growth projections (either SMHH beds or a combination of SMHH beds and local acute care inpatient resources); and to propose a plan as part of the agency’s budget hearings in 2007 to the Ways and Means and Appropriations Committees that would support the needs identified in the plan.
• Hearings should be held in the appropriate Legislative committees regarding the liability insurability of community service providers serving persons who have demonstrated behaviors which pose a risk to the safety of those who serve them, those who are served in the same setting, and the community at large, and that such remedies and protections include an examination of State/Community shared liability, including tort claims protections for community service providers.
Regents Deferred Maintenance. The Legislative Budget Committee recommends that a high priority be placed on passage of a five-year comprehensive program to address deferred maintenance at the state universities and community colleges.
Regional Economic Area Partnership. The Committee recommends that there be greater transparency on the part of REAP in the future. Additionally, the Committee noted its concern that REAP had accepted proposals for such a short time frame when formulating the grants for FY 2007. The Committee noted that it was the intent of the Legislature to make this open to multiple
Kansas Legislative Research Department XXlll 2006 Committee Reports - Recommendations entities and that more effort should be made in the future to advertize the request for proposals and that a longer amount of time be allowed to accept the proposals in the future.
State's Developmental Disabilities Program. The Legislative Budget Committee recommends that the Legislature establish a phased-in effort to accomplish the programmatically linked goals of community capacity expansion and the elimination of the waiting list for services from Home and Community Based Services waiver for persons with Developmental Disabilities (HCBS DD). This effort would consist of the following:
• Expand community capacity through rate adjustments to achieve rates which would more closely reflect a parity between community wages and state institutional wages by adding $15 million SGF in FY 2008 and $10 million SGF in FY 2009 and FY 2010; and
• Eliminate the waiting lists for developmental disability (DD) services by adding $10 million from the State General Fund in both FY 2008 and FY 2009, and $15 million in FY 2010.
Additionally, the Committee recommends that the Senate Ways and Means and House Appropriations Committees request information during the 2007 Legislative Session on items including but not limited to the following:
• To assure that all programs are designed to meet the intent of the DD Reform Act for greater emphasis on independence, inclusion, integration and productivity:
• To examine, and replicate if appropriate, models in other states which are better designed to assist families of dependent children, rather than relying solely on the current HCBS DD waiver;
• To establish minimum standards for all persons and entities who provide services to persons with DD;
• To assess current capacity planning at the Department of Social and Rehabilitation Services to upgrade the State’s ability to provide monitoring and oversight for the expanded numbers of community service providers; and
• To propose ways by which to upgrade employment related services for persons with DD, including providing the Legislature with a fiscal estimate on unbundling supported employment services so as to allow providers of such services to build employment service capacity in the community, and therefore be able to reduce reliance on facility-based employment services.
State General Fund. After reviewing several items affecting the state budget, the Committee makes the following observations and conclusions:
• On the topic of tax collections, to increase compliance with sales tax laws, the Committee recommends amending the current sales tax law which would allow the Department of Revenue to revoke or suspend a retailer’s registration certificate if the retailer has not paid the tax due or filed a return for a period of 60 days. Any individual who continues to operate a business after the registration certificate has been suspended or revoked would be guilty of a Class A misdemeanor. The Committee recommends this be introduced as a bill in the Senate during the 2007 Session of the Legislature.
Kansas Legislative Research Department xxiv 2006 Committee Reports - Recommendations • Regarding the earnings limitation for retired nurses, the Committee recommends that the issue be addressed in the 2007 Legislative Session in the appropriate standing committees (Senate Ways and Means and House Appropriations). Items for the standing committees to consider include: allowing nurses that retire and work at state hospitals and veterans' homes to earn up to $20,000 annually, which would be the same as school teachers, or allowing the exemption scheduled to expire at the end of FY 2008 to be continued indefinitely.
• On the topic of the Kansas Aviation Research Initiative in Wichita, the Committee supports the aviation research done in Wichita and the renewal of ongoing support from the Legislature for the aviation industry research.
State Inspector General. The Committee recognizes that progress has been made in defining the role of the Inspector General. The Committee recommends that the current process of stakeholders meeting continue to further define the role and report to the appropriate standing committees during the 2007 Session.
Veterans’ Funding Issues. The Committee noted its concern that the rules and regulations for the Veterans’ Claims Assistance Program were not finalized as of the December meeting. The Committee recommends that the Kansas Commission on Veterans’ Affairs work to expedite the process to allow rules and regulations to be implemented for this program as soon as possible.
Legislative Educational Planning Committee
Elementary and Secondary Education. The Legislative Educational Planning Committee recommends ten bills for introduction during the 2007 Session. The legislation would:
• Extend the Technical College and Vocation School Commission another two years and require that the Commission make annual reports to the Committee.
• Create the English for Speakers of Other Languages Task Force, a nine member entity w'hose charge would include considering how preparing teachers to teach English Language Learners could be incorporated into the basic teacher education curriculum. The Task Force would exist for two years and report annually to the Committee.
• Prohibit a public agency, including the State of Kansas, any department, agency, board, or school district, from spending public money to adopt, implement, or enforce school accreditation guidelines or standards which establish or are based upon a requirement of student performance or student proficiency. In addition, provide that a program begun or expanded with federal funding could be eliminated or reduced if the federal funding is eliminated or reduced.
• Consolidate four existing teacher education programs into the Comprehensive Teacher Scholarship Program, as proposed by the Kansas Board of Regents.
• Create a new program to award grants to state universities for projects that would benefit teachers and teacher preparation.
Kansas Legislative Research Department XXV 2006 Committee Reports - Recommendations • Reconcile a conflict between two enactments of the Legislature to allow state universities both the flexibility to convert their classified staff to University Support Staff and to raise annual leave and discretionary leave for classified staff up to the level offered to unclassified personnel.
• Create the Nurse Educator Scholarship Program by statute, rather than by proviso.
• Give the Kansas Board of Regents and the state universities the authority to transfer property to state university endowment associations or other investing agents.
• Expand current state law that exempts from state construction and contracting laws capital improvements projects using private moneys of $1.0 million or less. The proposed legislation would eliminate the $1.0 million limit and expand the source of revenues exempted to include restricted fees collected by universities for construction and renovation of state educational institutional buildings.
• Increase the monthly stipend for the Medical Student Loan Program from $1,500 to $2,000 and allow third- or fourth-year students to be eligible to participate in the program retroactively.
In addition, the Committee recommends the following:
• Consideration by the Legislature of the creation of a commission or task force to review services for individuals with autism up to the age of adulthood for purposes of identifying the most effective treatment methods and transition services following the completion of school.
• Ongoing monitoring by the Committee of Medicaid payments to school districts for medical services to special education students, including reports from the Kansas Health Policy Authority on its efforts to resolve disputes with the United States Health and Human Services Office of the Inspector General and on its efforts to reduce or eliminate a fee charged school districts by the Authority for its services in administering the reimbursement program.
• General endorsement of the recommendations of the At-Risk Council, including the recommendation that the Non-Proficient At-Risk Weighting be extended beyond its current statutory termination date of June 30, 2007.
• An ongoing effort by the Legislature to make three-year appropriations for general, supplemental general, and special education state aid in order to give school districts a longer planning horizon.
• Consideration by the Legislature of various proposals concerning the mission, governance, and funding of technical education.
• The addition of $34.0 million in FY 2008 and another $34.0 million in FY 2009, for a total of $102.0 million including the existing FY 2007 base of $34.0 million, for postsecondary state aid for technical schools and colleges.
• Support for the Kansas Board of Regents to look at ways teacher education programs at the state universities could be restructured to prepare teachers to meet the needs of a growing number of Kansas students who are English Language Learners.
Kansas Legislative Research Department xxvi 2006 Committee Reports - Recommendations • Encouragement for the appropriate standing committees of the Legislature to review the policies of the Department of Social and Rehabilitation Services (SRS) regarding administrative fees charged to administer various Medicaid reimbursement programs to consider whether the fees could he reduced or eliminated.
• Encouragement for the Joint Committee on State Building Construction, the Senate Ways and Mean Committee, and the House Appropriations Committee to review the Board of Regents’ facilities request and perhaps develop a multi-year plan to address the building needs of the campuses.
Joint Committee on Pensions, Investments, and Benefits
Proposed Alternative Retirement Plan. The Committee recommends legislation to implement an alternative retirement plan for new state, school, and local public employees who begin work on or after July 1, 2009. In addition, the Committee recommends revisions to the present Kansas Public Employees Retirement System (KPERS) plan for current public employees who work for state, school, or local government employers.
Proposed New Plan
• First-day membership. • Five-year vesting. • 1.75 percent defined benefit multiplier. • Final average salary based on five highest years. • Normal retirement at age 65 with five years or age 60 with 30 years of service. • Early retirement at age 55 with 10 years of service. • Automatic 2.0 percent cost-of-living adjustment at age 65. • Employee contribution rate of 6.0 percent. • Employer contribution rate at actuarial level, but not less than employee rate. • Partial lump sum option of 10.0, 20.0 or 30.0 percent at retirement.
Modifications to Current Plan
• First day membership for all state, school, and local members. • Five year vesting, effective July 1, 2009.
In addition, the Committee recommends separate consideration of an automatic cost-of-living adjustment for active public employees who work for state, school, or local government employers covered by KPERS. This item would not impact retired public employees. The proposal would provide:
• An automatic 2.0 percent cost-of-living adjustment at age 65 financed by a 2.0 percent additional employee contribution and by an actuarially determined employer contribution of 0.66 to 0.81 percent.
State’s Deferred Compensation Plan. The Committee recommends:
• Administration of the state’s deferred compensation plan should be transferred from the Department of Administration to the Kansas Public Employees Retirement System (KPERS).
Kansas Legislative Research Department xxvii 2006 Committee Reports - Recommendations Statutory Study. The Committee recommends legislation:
• To void two Department of Revenue notices for taxation of lump sum rollovers from Kansas Public Employees Retirement System (KPERS) and the Regents Retirement Plan ol retirement benefits.
• To allow direct payments from KPERS on behalf of retired public safety officers for health insurance or long-term care providers, as permitted by federal law.
• To update the earnings limitation from $10,000 to $20,000 for certain Kansas Police and Firemen Retirement System members who are disabled but return to other kinds of non-duty work.
• To clarify statutory language for improper withdrawals and portability of service credits between different systems.
Joint Committee on State-Tribal Relations
Yearly Report. The Joint Committee on State-Tribal Relations recommends that:
• A Senate bill, be prefiled, that would require insurance companies to report liability insurance for state police powers on reservations to the Attorney General’s Office. It would establish a cap of two million dollars on the liability insurance, and delete the sunset clause of state police powers as contained in KSA 2005 Supp. 22-2401a.
• The Kansas Legislative Research Department and the Department of Revenue obtain information on resolution of the license plate issue in other states and report that information to Joint Committee members by December 15, 2006.
• The Senate Transportation Committee reach consensus with interested parties to solve the Indian license plate problem and to recommend a bill to accomplish this task during the 2007 Legislative Session.
2010 Commission
2006 Report. The 2010 Commission recognizes that many successful schools improve students’ performance through all-day kindergarten and programming for at-risk four year olds. The Commission recommends that all-day kindergarten expand to include all children eligible to attend. The Commission also recommends that flexibility in school funding continue to allow for the growth of at-risk programming for four year olds. In addition, the Commission recommends that the second level of funding for at-risk students, the high density formula, be based on the prior year’s data and implemented using a linear transition calculation.
The 2010 Commission observed a variety of innovative programs used in schools across the state to improve students’ performance. Two showing great promise are professional learning communities and schools within schools. The Commission recommends that these programs, and others like them, continue to be researched and used in schools across the state.
Kansas Legislative Research Department XXVlll 2006 Committee Reports - Recommendations The Commission acknowledges that much debate and review has taken place regarding how best to identify students at risk of failure. To date, the best method to distribute funding to school districts for at-risk student programming is based upon the numbers of students eligible for the federal free lunch program in each district. As funding for at-risk services increases, the number of students who qualify for the free-lunch program becomes an increasingly important factor in the state’s school finance formula. In light of a recent performance audit on this topic, the Commission recommends that the Legislature review this issue to ensure that at-risk funding is provided to those students for whom it was intended. The Commission does not support any cuts in funding at-risk programming.
The 2010 Commission heard many concerns about English Language Learners (ELL). Issues included problems surrounding the proficiency of ELL students on state assessment tests, lack of teachers with ELL teaching endorsements, and the potential lack of adequate funding for ELL programs because of problems with the school finance bilingual weighting formula. The Commission requests the Legislature send a letter to the U.S. Department of Education requesting that more than one year he allowed between the time an ELL students enters a bilingual program and the time the student must take an assessment test. The Commission also recommends that teacher education in the state be reviewed and a consideration be made to require all teachers receive an ELL endorsement to their teaching certificate. The Commission also recommends that the Legislature continue to review best practices in training ELL students. And, finally, the Commission recommends that the bilingual weighting in the school finance formula be changed from a full-time equivalent weighting with contact hours to headcount and adjusted to 0.2 from the present 0.395.
A second theme heard by the Commission in its tours of the state was the importance of staff. Several programs shown successful in attracting, retaining, and developing staff include enhancement of leadership academies, especially for school principals, mentoring new teachers, and providing improved and increased professional development opportunities for teachers. The Commission recommends expansion of these programs. The Commission recommends that $500,000 of annual and on-going funding be approved for leadership academies, that an additional $1.0 million be added to the state’s Mentor Teacher Program, and the Professional Development (In-service Education) Aid Fund be increased to $4.0 million.
The Commission believes that informing the public of the progress of their schools is vital to ensure confidence in our system of public education. To this end, the Commission recommends that every school make test scores from No Child Left Behind testing available to the local public and all students’ parents. In addition, the Commission applauds the Department’s work in development of the state database project which will include student and teacher information and allow more efficient tracking of student progress.
KAN-ED Oversight Committee
2006 Report. Regarding consolidation of state networks, the Committee concluded that:
• The Board of Regents and the Department of Administration should continue the effort that resulted in the Network Study prepared pursuant to KSA 2006 Supp. 75-7228 and should pursue recommendations made in that report.
• The time line presented by the Board of Regents in its proposal to the Committee is adequate and should guide the effort leading up to the March 1 report to the Legislature.
Kansas Legislative Research Department xxix 2006 Committee Reports - Recommendations • All three networks examined in the Network Study should participate in additional planning and study to ensure establishment and maintenance of a common focus for state networks.
• The three network organizations should create a consolidation plan that, in addition to the issues identified in the Network Study, addresses:
o backbone cost analysis o last mile access o premise equipment and local area networks o public/private partnering o funding source o permissible traffic [i.e., Internet, voice over Internet protocol, video, data) o permissible constituent access (adding additional state agencies and health care institutions) o proposed statutory changes o current commodity Internet pricing
Based on these conclusions, the Committee recommends that:
• The Board of Regents, DISC, and KanREN pursue the recommendations made in the 2005 Network Study as outlined in that report and in the proposal presented to the Committee.
• The Board of Regents, KanREN, and DISC conduct a feasibility study of the three consolidation models presented to the Committee and present a specific recommendation no later than March 1, 2007 to the standing committees on Utilities, Education, Health, Commerce, Ways and Means, and Appropriations; and to the Joint Committee on Information Technology.
The Committee concluded that the Legislature would have an opportunity to consider additional statutory changes necessary to facilitate implementation of KAN-ED’s goals during the 2007 Session after the proposed consolidation plan is presented along with suggested statutory changes.
• The March 1, 2007 report include drafts of any legislation required to implement the recommendations.
In regard to the membership of KAN-ED, the Committee concluded that additional state agencies would benefit from membership. Specifically, the Committee concluded that the Department of Corrections and the Department of Health and Environment would benefit from KAN-ED membership.
• Based on that conclusion, the Committee recommends that the Legislature enact amendments to the KAN-ED Act that would allow the Department of Corrections and the Department of Health and Environment to become members of KAN-ED. The bill containing those amendments accompanies this report.
Kansas Legislative Research Department XXX 2006 Committee Reports - Recommendations Special Committees
Report of the Special Committee on Agriculture and Natural Resources to the 2007 Kansas Legislature
CHAIRPERSON: Senator Mark Taddiken
VlCE-CHAIRPERSON: Representative Dan Johnson
RANKING M inority M em ber: Senator Marci Francisco
OTHER MEMBERS: Senators Carolyn McGinn and Ralph Ostmeyer; and Representatives Richard Carlson, Mitch Holmes, Forrest Knox, Steve Lukert, Larry Powell, and Joshua Svaty
Study T opics
• Dam Inspections
• Licensing and Bonding Requirements for Biodiesel Fuel Production
• Water Monitoring
• Regulation of County Fairs
December 2006 Special Committee on Agriculture and Natural Resources
Dam Inspections
Conclusions and Recommendations
The Special Committee on Agriculture and Natural Resources recommends one bill which would amend KSA 2-1915 to allow grants from the state for dam rehabilitation, subject to the statutory 80 percent of the total cost of any practice. In addition, the bill would require the State Conservation Commission (SCC) to develop and administer the Kansas Dam Rehabilitation program in cooperation with the Chief Engineer of the Division of Water Resources, subject to appropriations for the program. The SCC would be permitted to cost share on non-permitted structures, but not until the rehabilitation plan for the non-permitted structure meets Division of Water Resources criteria and the owner of the structure has actually been issued a permit by the Division of Water Resources. The bill would require the SCC to promulgate rules and regulations to implement the program. The bill also would provide that cost share would be at 70 percent, with an additional 10 percent for engineering cost to rehabilitate or remove unsafe high and significant hazard dams or low hazard dams that are reclassified to high or significant hazard due to downstream development. The Division of Water Resources would assist the SCC by providing review and priority ranking of dam applications for the program based on the following:
• The highest severity of potential impact should the dam fail;
• The greatest risk of failure due to the dams' deficiencies; and
• Which deficiencies were caused by downstream development beyond the control of the dam owner.
The Committee also recommends a second bill. This bill would require the SCC to prepare breach inundation maps for all jurisdictional dams that do not have an inundation map already prepared. This responsibility would be subject to appropriations to the SCC to accomplish the task.
Proposed Legislation: The Committee recommends two bills.
Background State Dam Safety Program. Kansas, with its high number of manmade dams, has long The Special Committee on Agriculture understood the importance of regulating and Natural Resources was charged by the their construction and maintenance. The Legislative Coordinating Council to study Kansas law dates back to 1929. In the 1970s, the classification and reclassification of several dam failures in other parts of the dams, the liability of landowners on which country caused the loss of life and extensive a dam is located, and development practices property damage. These tragedies increased in watershed districts. The following public recognition of the need to inspect provides background and legislative history dams and to develop programs to protect on this topic. public safety. As a result, the National Dam Inspection Act was passed in 1977. The
Kansas Legislative Research Department 1-3 2006 Agriculture 1929 Kansas law was amended in 1978 to Program. In addition to administrative, make the law consistent with the federal clerical, and legal support, these engineers Act. are assisted by additional staff of the Division with field work when possible. In 1981, pursuant to the federal Act, the Action of the legislature during the 2006 Corps of Engineers completed an inventory Session gave the program three additional of potentially hazardous dams in the state. positions, two of them engineers, to help The Corps of Engineers also completed a conduct safety inspections of dams (See detailed inspection of all known high hazard 2006 SB 480, Section 117). dams at that time. After federal funding for inventory and inspections was discontinued, After 1978 the statute subjected dams states were expected to establish their own that held more than 30 acre feet of water to dam safety programs. regulations. In 2002, the standard was changed. Kansas currently has just under Officials with the Division of Water 6.000 dams which meet the state’s current Resources, Department of Agriculture, definition of a jurisdictional dam. These administer the Kansas dam safety program 6.000 dams do not include dams on federal pursuant to authority in the Stream property. Maintenance and operating safety Obstruction Act (KSA 82a-301 et seq.). The of dams or water impoundment structures program includes: on federal property are the responsibility of officials from the federal government. • Review of plans and specifications; 1978 Enactment. The 1978 Legislature • Issuance of permits, if appropriate, for enacted SB 803 which placed into law five the construction, operation, maintenance new statutes providing for the regulation of or modification of dams; the construction, operation and maintenance of certain dams and water obstructions. The • Inspection of important phases of dam Act did not apply to any dam which construction; impounded 30 acre feet of water or less, so these small dams are exempt from • Inspection of newly completed dams to enforcement. determine compliance with approved plans; and Pursuant to this bill, the Chief Engineer of the Division of Water Resources was to • Inspection of existing dams constructed adopt rules and regulations establishing prior to the establishment of the agency’s standards for the construction, modification, program. operation and maintenance of dams and other water obstructions and for the administration and enforcement of the In addition, the Division of Water provisions of the bill. Those regulations Resources inspects structures constructed were promulgated in 1983 and have been under one of the State Conservation amended several times since. Commission (SCC) cost share programs, as the SCC does not release final payment until A new provision in the bill made it the the Division certifies, based on field duty of the Chief Engineer or his authorized inspection, that the dam was built according representative to inspect dams or water to approved plans. obstructions to ensure conformity with rules and regulations and to ensure compliance The Division has had four full-time with the terms, conditions, or restrictions of equivalent engineering positions assigned to consents or permits granted pursuant to the dam safety within the Water Structures provisions of law dealing with stream
Kansas Legislative Research Department 1-4 2006 Agriculture obstructions. The Chief Engineer and his • The unlawful construction, authorized representatives were given the modification, operation or maintenance right of access to private property to carry of any dam or other water obstruction; or out inspections. Costs for any work which may be required by the Chief Engineer, or • The unlawful change or diminution of his representative, prior to or as a result of the course, current or cross section of a an inspection were to be paid by the owner, river or stream. governmental agency or operator of the dam or other water obstruction. Amendments to provisions of law The bill provides that whenever the dealing with stream obstructions make it Chief Engineer finds that: (1) The unlawful (without a permit or consent of the construction, modification, operation or Chief Engineer): maintenance of a dam or other water obstruction is in violation of rules and • To construct any dam or water regulations or of the terms, conditions or obstruction: restrictions of a permit or consent granted by the Chief Engineer, or (2) conditions exist in • To make or construct any change in any the construction, modification, operation or dam or other water obstruction; maintenance of a dam or other water obstruction which may present a hazard to • To make any change in or addition to the public's safety, the Chief Engineer is to any existing water obstruction; or issue an order to require the correction of the violation by the owner or operator of the • To change or diminish the course, dam or water obstruction. If the condition of current or cross section of any stream any dam or water obstruction is so without the prior written consent or dangerous to the safety of life or property as permit of the Chief Engineer of the not to permit time for issuing an order, or if Division of Water Resources. Any imminent floods threaten the safety of any application for a permit or consent is to dam or other water obstruction, the Chief be made in writing. Engineer is to employ any remedial means necessary to protect the safety of life or property, and the Chief Engineer is to The bill became effective on April 11, remain in full charge of the dam or water 1978. obstruction until the dam is safe or until the emergency has ceased. Dam Classification. According to the 1981 Corps of Engineers’ inventory, most of The bill also provided that any person, the dams under regulation of the Division of partnership, association, corporation or Water Resources were classified as having agency or political subdivision of the state, little risk associated with them. However, at who violated any provision of the Act or that time approximately 150 of these dams rules and regulations adopted thereunder or were classified as high hazard dams and 350 an order issued by the Chief Engineer, was were classified as significant hazard. A high to be guilty of a Class C misdemeanor. hazard dam is one which failure would Authority was given to the Chief Engineer to cause the loss of more than a few lives. In request the Attorney General to bring suit in other words more than one residence, a the name of the state in any court of major business development, or a competent jurisdiction to enjoin: transportation facility would be endangered by the failure of the dam. A significant hazard dam is one which failure would cause the loss of less than a few lives. For
Kansas Legislative Research Department 1-5 2006 Agriculture example, clam failure in this case would Division of Emergency Management to cause damage or disruption to property such coordinate any state or local response. as buildings, roads, railroads, water According to agency officials, any dam supplies, or other essential services. found in an unsafe condition is inspected at least once a year until the condition no The Corps of Engineers’ hazard longer exists. classification system has nothing to do with whether the dam or water impoundment Dam Safety—the Issue. During the 1997 structure is safe. Rather, the hazard Legislative Session, the Secretary of classification reflects the risks that arise Agriculture appeared before a legislative should the dam fail. Accordingly, more committee to review the status of the agency stringent design and construction criteria and to comment on several issues which her apply to dams that are constructed where agency would be addressing in the future. there is more risk of damage or where One of the issues raised by the Secretary was conditions downstream change after the issue of the safety of dams and other construction. water impoundment structures in the state.
Unsafe Dams. In 1996, the Division of The Secretary told legislators that staff of Water Resources completed screening the Division of Water Resources were inspections for all known dams with a high inspecting dams and water impoundment or significant hazard rating which had not structures and were encouraging the repair previously been inspected. This information of unsafe structures where necessary. She was used to assess the extent of the safety indicated that personnel of her agency were problems with existing dams and to set working with staff of other agencies to priorities for future actions. explore possible funding proposals to assist owners with the costly repair of unsafe water Of the 500 dams classified at that time as structures. Additionally she asserted that high hazard or significant hazard, the the federal government may also be of Division of Water Resources classified assistance in this area. The Secretary stated several structures as being unsafe. Some of that the Kansas Water Office and the Kansas these structures were considered unsafe Water Authority were in the process of because physical deficiencies exist which studying the dam safety issue and that the may lead to failure. Others have spillways agencies might recommend new inadequate to prevent overtopping of the expenditures from the State Water Plan dam embankment during flooding. Several Fund and relevant statutory changes to the structures were considered to be in an Legislature. emergency unsafe condition and are in imminent danger of failure. Approximately As a result of the Secretary’s comments one-half of the unsafe dams were privately to members of the Legislature, there was a owned by individuals or organizations while request to the Legislative Coordinating the remainder were owned by various Council to charge an interim committee with governmental agencies, such as cities, the task of reviewing this issue and making counties, watershed districts, and the State. appropriate recommendations to the 1998 Legislature. If a dam is found to be in emergency unsafe condition, the Division deals with the 1997 Interim Committee. In 1997, the situation immediately, or as soon as Legislative Coordinating Council created the possible, through the issuance of appropriate Special Committee on Energy and Natural orders or other steps required to resolve the Resources/Environment. That Committee problem. When an emergency exists, the was directed to study Kansas’ current dam Division of Water Resources notifies the safety inspection programs in the audit,
Kansas Legislative Research Department 1-6 2006 Agriculture “Dam and Water Impoundment Structure classified as low hazard primarily because Safety—the State’s Role in the Inspection of of their location in rural areas. Due to the Dam and Other Water Impoundment fact that it is unlikely that development has Structures.” occurred downstream from these structures, these dams are not periodically inspected by The Committee began to study this issue the agency to determine their safety status. by hearing a review of the dam and water impoundment program of the Department of The Special Committee on Energy and Agriculture from the Chief Engineer and his Natural Resources/Environment made no staff from the Division of Water Resources. recommendations regarding the issue of dam The Chief Engineer described the inspection water impoundment structure safety. The program and explained the process his office Committee believed that officials with the follows when an unsafe dam or water Department of Agriculture should handle impoundment structure is found. The this issue and observed that the personnel of Committee learned that much of the criteria the agency have initiated this process used to determine if a dam is unsafe comes through notification to the owners of the 34 from the National Dam Inspection Program. unsafe dams. However, the Committee requested that the Secretary of Agriculture The Chief Engineer identified funding as appear before the House and Senate a problem for the dam inspection program. Agriculture Committees, the House He told the Committee that the limited Environment Committee, and the Senate resources available, coupled with aging Energy and Natural Resources Committee dams, will result in the identification of new during the last part of March 1998 to update hazardous dams before the currently unsafe those Committees with respect to the dams are repaired. The Chief Engineer progress the agency has made in addressing indicated that the Kansas Water Office and water impoundment structures which may the Kansas Water Authority have studied the be a threat to lives and property. The issue and are considering the development Secretary did so. of a new policy section on this issue in the State Water Plan. When asked for 2002 Legislative Action. During the recommendations from the agency, the Chief 2002 Legislative Session the issue of dam Engineer told the Committee that the agency safety and associated fees was addressed. was not prepared to make any proposals at The Legislature enacted SB 436 which the time. created the Water Structures Fund in the State Treasury and provided that moneys During the deliberations on this issue, from fees imposed would be deposited into the Committee reviewed the list of 34 dams the fund. which the Division of Water Resources had classified as unsafe. The Chief Engineer Among other items, the bill instituted explained that owners or operators of all 34 new fees for persons wishing to construct dams have been notified as to the condition fills or levees and distinguished between the of the structure. Further, he explained that type of the project and whether construction agency action with respect to corrective began prior to the approval of the project by action varies from one structure to another the Chief Engineer of the Division of Water depending on the circumstances of each Resources. The construction in progress fee dam. For example, if the structure is is for those projects where construction permitted, officials with the agency may began prior to approval by the Chief seek to revoke the permit. Engineer. These fees are in addition to any other penalty under law for unapproved fill The Chief Engineer stated that the or levee construction. One of the intents of remaining 5,500 structures were originally the legislation was to discourage entities
Kansas Legislative Research Department 1-7 2006 Agriculture from undertaking projects without approval the list. If the licensed professional engineer of the Chief Engineer. Under the bill, the finds that the dam or water obstruction following fees were to he charged. meets the standards of the Department of Agriculture, then those findings are to be Pre- Construction submitted to the agency for review. Once construction in Progress the findings are submitted, the bill required Type Fee Fee the Chief Engineer to grant the consent or permit within 45 days unless the Chief Major $ 500 $ 1,000 Engineer finds to the contrary that the dam Moderate 300 600 or water obstruction does not meet Minor 100 200 departmental standards. The bill required the Chief Engineer to provide the applicant a written explanation of the basis for the In addition, the bill established Chief Engineer’s contrary findings within 15 definition for “dam” to mean any artificial days. harrier including appurtenant works with the ability to impound water, wastewater, or The Chief Engineer’s contrary action is other liquids that has a height of 25 feet or subject to the Kansas Administrative more; or has a height of six feet or greater Procedures Act and the Act for Judicial and also has the capacity to impound 50 or Review of Administrative Actions. Lastly, more acre feet of water. The bill also the applicant pays all costs associated with repealed KSA 82a-304, which had made any the review by the licensed professional dam with a storage capacity of 30 acre feet or engineer. less exempt from regulation by the Division of Water Resources. In addition, new fees were established for dams based upon whether the The bill also allowed persons wishing to construction began prior to approval by the construct a dam or water obstruction to have Chief Engineer. Fees for new dam or dam the application reviewed by a licensed modifications are $200 for preconstruction professional engineer approved by the Chief and $500 for those where construction is in Engineer. The reviewing engineer could not progress. Again, the intent was to encourage be an employee of the applicant. The bill pre-approval of projects. further required the Chief Engineer to maintain a list of licensed professional New fees for stream obstructions or engineers who could conduct the review. channel changes were based upon drainage Licensed professional engineers employed area and the stage of construction and by a local unit of government could be on outlined below.
Construction Drainage Area Category Pre-construction in Progress
Major (greater than 50 sq. mi.) $ 500 $ 1,000 Moderate (area 5 to 50 sq. mi.) 200 400 Minor (area less than 5 sq. mi.) 100 200 General Permit 100 200
Further, the bill required the Chief compliance with law. The bill established Engineer to annually inspect any dam inspection fees for the safety inspection determined to be unsafe until it is in based on the class and size of the dam and
Kansas Legislative Research Department 1-8 2006 Agriculture as provided for by rules and regulations other stream obstructions. The bill required adopted by the Chief Engineer. The the Chief Engineer to consult with counties, inspection fees were established as follows. cities, and other stakeholders as a component of the development of the report. The Chief Engineer is to hold at least two Size of Dam Inspection Fee public meetings. The Secretary and the Chief Engineer are to make Class 1 $ 1,500 recommendations to the Legislature with Class 2 1,500 regard to clarifying the program’s obligations Class 3 2,500 to upstream and downstream landowners. Class 4 4,000 Current Inspection Program. The The bill required each hazard Class C Division of Water Resources’ current goal is dam to have a safety inspection conducted to conduct periodic “follow-up” inspections by a licensed professional engineer qualified of high hazard dams once every three years in design, construction, maintenance, and and significant hazard dams once every five operation of dams once every three years. years. The process of monitoring The same is required of hazard Class B deficiencies is deemed important due to the dams, except the inspection would be potential for changing conditions of aging required every five years. The qualified dams. engineer is required to report within 60 days of inspection to the Chief Engineer. If the The Division of Water Resources notifies inspection does not occur, then a mandatory owners prior to the inspection of their dam inspection is to occur and the costs for the or water impoundment structure and the inspection will be paid for by the owner, in Division provides the inspection results to addition to any other remedies provided for the owner. This notice points out violations of the Act. Failure to file a deficiencies found during the inspections, complete and timely report as required, or along with recommendations and the failure to submit fees is deemed a requirements to correct any problems that violation of the Stream Obstruction Act, and are identified. It is the owner’s responsibility subject to the penalties in KSA 82a-205a. to secure qualified engineering assistance as needed to consider alternatives and design The bill also required the Secretary of an appropriate solution. The Division will Agriculture, on or before January 1, 2003, to review any proposed plans to repair or submit and present a report to the House modify dams and provide assistance to and Senate Agriculture Committees resolve problems. If necessary, the agency summarizing the Department’s efforts to issues formal orders requiring action. affect changes in the Water Structures Program, especially with respect to the 2006 Legislative Action. During the recent performance audit report of the 2006 Legislative Session, three bills were Legislative Division of Post Audit. Regular introduced which would have amended reports have been made to the legislature portions of the provisions of law dealing about this very complex issue. with stream obstructions. Those bills were SB 540, SB 524, and HB 2867. Each of the Finally, the bill required the Secretary of bills had hearings. Both SB 540 and SB 524 Agriculture and the Chief Engineer to died in the Senate Natural Resources evaluate the Department of Agriculture’s Committee. HB 2867, which was adopted by current policies and present a report on or the House, also died in the Senate Natural before January 1, 2003, outlining the Resources Committee. HB 2867 and SB 524 strengths and weaknesses of a watershed were identical at the time of their approach to the permitting of dams and introduction.
Kansas Legislative Research Department 1-9 2006 Agriculture As amended by the House Committee of the bills introduced in the 2006 Session the Whole, HB 2867 would have amended were successful. the section of law dealing with dams and water obstructions to require that safety As noted earlier in this report, the inspections he paid for by the Department of Legislature also gave the water structures Agriculture, Division of Water Resources. program three new positions during the 2006 Session. Two of the three are to be engineers Another provision of the hill would who will conduct dam safety inspections require the Chief Engineer to utilize all maps (See SB 480, Section 117). available from state or federal sources to create breach inundation maps for existing dams in order to facilitate dam safety Committee Activities compliance and conduct accurate dam risk analyses. A provision of the bill would The Committee began it review of this require the Chief Engineer to inspect, but topic by having a spokesperson from the not require the correction of any violation or Kansas Department of Agriculture provide existing condition of a dam, if the only lives an overview on the dam safety program and or property regularly and frequently was told that there was extensive discussion endangered in the breach inundation zone of on this issue during the 2006 Legislative the dam are the lives or property of the dam Session. Committee members were owner or operator, or the immediate family reminded that they allocated funding for of such persons. Owners of these dams three new positions in this program. Two of would be required to inform buyers of the these positions would be engineers who condition of these dams prior to transfer. would conduct the inspections. The New owners would be required to notify the conferee noted that despite the additional Chief Engineer of the transfer. The results of resources that there are and will continue to the inspection would be required to be filed be issues with unsafe dams in Kansas. with the register of deeds in the appropriate county and the results attached to the title of The conferee provided members of the the property affected by the dam. The bill Committee with a list of high and also would require the Chief Engineer to significant hazard dams in the state. The obtain written certification of the dam conferee from the Department of Agriculture owner’s acknowledgment of the risk and the provided members of the Committee with a acceptance of such risk. proposed program to address the issue of inspection of dams, repairing or upgrading This bill was introduced at the request of dams, or both. Part of the proposed program a spokesperson from the Kansas Livestock involves local units of government that have Association. At the hearing on the original the necessary authority under state law to bill, a spokesperson from the Kansas control downstream development. The Livestock Association offered changes to the members of the Committee were told that bill and expressed concern with the cost of prioritization of the dams is necessary in dam inspections and repairs caused by third order to determine eligibility for the cost- party downstream development. Written share program to help owners rehabilitate testimony is support of the bill was received deficient dams. The success of these from the Kansas Farm Bureau. Appearing as proposals requires cooperation among the opponents to the original bill was a Kansas Water Authority, the State representative of the Kansas Society of Conservation Commission, and the Kansas Professional Engineers and the Kansas Department of Agriculture. Department of Agriculture. Written opposition was provided by the Kansas A representative of the State Association of Watershed Districts. None of Conservation Commission presented
Kansas Legislative Research Department 1-10 2006 Agriculture information about the agency's Watershed • Registration of breach inundation maps Dam Construction Program (WDCP). The in the counties and notification of Committee members were given a review of affected landowners; the Kansas Watershed District Act, powers of the districts, general planning, financing, • County floodplain management of and the status of Kansas watershed districts. breach areas; and Also addressed were funding issues, including the rehabilitation and repair of • Keeping the responsibility of regulating these types of structures. the safety of all jurisdiction dams within the Division of Water Resources. A conferee from the Kansas Water Office offered testimony on small dam safety and rehabilitation. The Committee members Another conferee represented the Kansas heard about the policy section of the State Livestock Association (KLA), who indicated Water Plan concerning dam rehabilitation that the organization believes the which had been approved by the Kansas Legislature’s allocation of funds to allow the Water Authority. As a part of this DWR to conduct inspections was good; presentation, the members learned that the however, there are still problems with Kansas Water Authority has approved a repairing high hazard dams. The Committee recommendation in the FY 2008 budget of members learned that the KLA supports the $1,055,000 within the State Conservation KDA’s funding plan for repairing dams. Commission, to be used for watershed dam rehabilitation and construction. A spokesperson from the Kansas Farm Bureau (KFB) suggested that every regulated Another conferee, representing the dam in Kansas should have a breach Kansas Department of Wildlife and Parks inundation zone map and that some state (KDWP), presented comments on the funding be used with other moneys to map maintenance of dams under that agency's breach inundation zones. It was suggested control. He told the members of the that after mapping is completed, an Committee that KDWP is responsible for the inventory of dams needing upgrades could maintenance of 40 state fishing lakes. He be established and prioritized. mentioned specifically the dam at the Leavenworth State Fishing Lake, which Representatives of the Kansas Society of required repairs. He stated that the Division Professional Engineers and the City of Osage of Water Resources (DWR) was involved in City presented comments concerning the the dam repair and its assistance and liability of dam owners and the how the dam cooperation was appreciated. Mr. Koerth safety issue impacts small municipal water stated that the KDWP does not have any systems. The Committee learned that Osage responsibility for maintenance of dams at City has undertaken a dam rehabilitation the federal reservoirs on which the KDWP study that was used for mitigation by the operates state parks. He distributed a list of Division of Water Resources and was urged hazardous dams. to consider municipalities and water quality standards in crafting long-term solutions. The Committee members heard from a spokesperson from the State Association of During the November meeting, the Kansas Watersheds (SAKW), who offered Committee reviewed a proposed bill draft several suggestions to the Committee. The which would have amended KSA 2006 conferee suggested the following: Supp. 2-1915 to allow grant moneys to be made for dam rehabilitation projects and would have required the State Conservation Commission (SCC) to develop and
Kansas Legislative Research Department 1-11 2006 Agriculture administer a dam rehabilitation program in total cost of any practice. In addition, the cooperation with the Chief Engineer of the bill would require the State Conservation Division of Water Resources. The SCC Commission (SCC) to develop and would have been required to adopt the administer the Kansas Dam Rehabilitation necessary rules and regulations to program in cooperation with the Chief administer the program. Engineer of the Division of Water Resources, subject to appropriations for the program. Staff reviewed the proposed bill and The SCC would be permitted to cost share comments were given by a representative of on non-permitted structures, but not until the Kansas Department of Agriculture. The the rehabilitation plan for the non-permitted conferee from the agency reviewed an structure meets Division of Water Resources updated outline of a proposed dam criteria and the owner of the structure has rehabilitation program and stated that the actually been issued a permit by the updated proposal removes the requirement Division of Water Resources. The bill would for zoning to be eligible for dam require the SCC to promulgate rules and rehabilitation and sets the cost share firmly regulations to implement the program. The at 80 percent. bill also would provided that cost share would be at 70 percent, with an additional Others commenting on the issue 10 percent for engineering cost to included the Chief Engineer of the Division rehabilitate or remove unsafe high and of Water Resources; the Assistant Secretary significant hazard dams or low hazard dams of Agriculture; representatives of the Kansas that are reclassified to high or significant Farm Bureau and the Kansas Livestock hazard due to downstream development. Association; the Director of the State The Division of Water Resources would Conservation Commission; the Director of assist the SCC by providing review and the Kansas Water Office; a Chase County priority ranking of dam applications for the rancher; and various other state agency staff. program based on the following:
Testimony from one conferee indicated • The highest severity of potential impact that the first step in resolving this issue is to should the dam fail; establish inundation zone mapping for dams because the mapping will allow the state to • The greatest risk of failure due to the know how much money will be needed to dams' deficiencies; and upgrade all of the dams. • Which deficiencies were caused by The Assistant Secretary of Agriculture downstream development beyond the indicated that the issue of dam deficiencies control of the dam owner. and the breach inundation maps should be addressed as two different issues. The Committee also recommends a second bill. This bill would require the SCC Conclusions and Recommendations to prepare breach inundation maps for all jurisdictional dams that do not have an The Special Committee on Agriculture inundation map already prepared. This and Natural Resources recommends one bill responsibility would be subject to which would amend KSA 2-1915 to allow appropriations to the SCC to accomplish the grants from the state for dam rehabilitation, task. subject to the statutory 80 percent of the
Kansas Legislative Research Department 1-12 2006 Agriculture Special Committee on Agriculture and Natural Resources
Licensing and Bonding Requirements for Biodiesel Fuel Production
Conclusions and Recommendations
The Committee recommends legislation to amend KSA 79-3403 to add language as follows:
No motor vehicle fuels or special fuels manufacturer’s license will be required for any consumer blending motor-vehicle fuel or special fuel purchased for such consumer’s own use, and not for resale from a distributor or retailer who is the holder of a valid, unsuspended and unrevoked motor-vehicle fuels or special fuels distributor’s or retailer’s license.
Proposed Legislation: The Committee recommends one bill.
Background where the Kansas Legislature recently enacted legislation was in the area of Charge. The Legislative Coordinating promoting biodiesel fuel. Similar to Council charged the Special Committee on legislation designed to encourage the Agriculture and Natural Resources to study production of ethanol, the 2006 Legislature the current statutory requirements for enacted the Biodiesel Producer Production certain individuals to have a license and Incentive Program. bond for the production or blending of small quantities of biodiesel fuel. In addition, the Specifically, 2006 SB 388 establishes a Committee was to determine if the current biodiesel fuel producer production incentive requirements are a barrier to those in the amount of $.30 for each gallon of individuals who want to produce or blend biodiesel fuel sold by a Kansas qualified small quantities of biodiesel and to review biodiesel fuel producer, as defined by the the current enforcement practices of the bill. The incentive will be paid to a producer Department of Revenue related to biodiesel from the Kansas Qualified Biodiesel Fuel fuel and determine the possibility of Producer Incentive Fund (Incentive Fund) providing certain exemptions to the which is created by the bill and located in licensing and bonding of small quantity the state treasury. The bill requires the biodiesel fuel production or blending. Director of Accounts and Reports to transfer $437,500 on April 1 , 2007, from the State Legislative Incentive for Biodiesel Economic Development Initiatives Fund Production. Because of the recent (EDIF) to the Incentive Fund. Also, on July 1, developments around the world with regard 2007, and every quarter thereafter, the to energy and its relative short supply, Director of Accounts and Reports is to various efforts have been made to enhance transfer $875,000 from the EDIF to the alternative fuels across the country. Kansas Incentive Fund. The Secretary of Revenue is is not alone in providing incentives to to make the payments to the producers upon promote alternative energy supplies. One a filing by the producer of a form furnished area of incentive for alternative supply by the Department of Revenue. Moneys
Kansas Legislative Research Department 1-13 2006 Agriculture remaining in the Fund upon expiration of Likewise, other definitions establish the the Act are to be credited by the State requirements for those who produce, use, Treasurer to the EDIF. In the event funds sell, or deliver biodiesel in the State of from the EDIF are insufficient, then funds Kansas. The definition of "manufacturer" in will be transferred from the State General KSA 79-3401 (j) includes any person who or Fund. The bill authorizes the Secretary of which produces, refines, prepares, blends, Revenue to adopt rules and regulations distills, manufactures or compounds motor- necessary to administer the provisions of the vehicle fuels or special fuels in the state of bill. Those rules and regulations will include Kansas for such person's own use, or for sale the development of a procedure for the or delivery in the state. payment of the production incentive on a pro rata basis. Finally, the bill provides for KSA 79-3401 defines distributor and a sunset of the incentive program on July 1, manufacturer to mean any person, who: (4) 2016. received and, in any manner, uses, sells or delivers motor-vehicle fuels or special fuels Definitions. Since biodiesel is a fuel in in the state of Kansas on which the tax which there has been increased interest, provided for in this act has not been those interested in the product need to know previously paid. what current laws may apply to the product. Current statutory definitions help to clarify KSA 79-3403 includes the licensing and statutory requirements for the production bonding requirements. This statute makes it and distribution of biodiesel. For example, unlawful for any distributor to use, sell or biodiesel (B100 or any blend) is a special deliver any motor-vehicle fuels or special fuel as defined in KSA 79-3401(s). Kansas fuels within this state unless such statutes define “special fuels” to mean all distributor at the time of such use, sale, or combustible liquids suitable for the delivery, is the holder of a valid, unrevoked generation of power for the propulsion of motor-vehicle-fuels distributor's license or motor vehicles including, but not limited to, special fuels distributor's license issued to diesel fuel, alcohol and such fuels not the distributor in accordance with the defined under the motor-vehicle fuels provisions of this act for each particular definition, hereinafter referred to as motor- place of business at which the distributor vehicle fuel. Since biodiesel meets the shall use, sell or deliver motor-vehicle fuels definition of a “special fuel” it is therefor or special fuels. subject to the Kansas motor fuel tax. The motor fuel tax is imposed at KSA 79-3408 Kansas statutes make it unlawful for any which imposes on (a) A tax per gallon or manufacturer to use, sell or deliver any fraction thereof, at the rate computed as motor-vehicle fuels or special fuels within prescribed in KSA 79-34,141, and this state unless such manufacturer at the amendments thereto, is hereby imposed on time of such use, sale, or delivery is the the use, sale or delivery of all motor-vehicle holder of a valid, unsuspended and fuels or special fuels which are used, sold or unrevoked motor-vehicle fuel delivered in this state for any purpose manufacturer's license or special fuel whatsoever. An exception to this taxation is manufacturer's license issued to such included in KSA 79-3408(c) which provides manufacturer in accordance with the that no tax is to be imposed upon or with provisions of this act for each particular respect to any biodiesel which is dyed in place of business at which such accordance with regulations prescribed by manufacturer shall use, sell or deliver federal law and as long as the fuel is used motor-vehicle fuels or special fuels. only for non-highway purposes.
Kansas Legislative Research Department 1-14 2006 Agriculture Licensing and Bonding Issues. As Taxation, and at the time holding, a valid, Kansas moves into the era of biodiesel unrevoked liquid-fuels carrier's license and production and usage, questions have arisen a certificate for each vehicle in which the concerning the licensing and bonding fuel is transported. In addition, no person is requirements that apply to biodiesel permitted to transport any liquid fuel or production and distribution. This may be of motor fuels in quantities of 3,500 gallons or particular concern since there are efforts to more over any of the public highways of this produce biodiesel on a smaller scale than state from any point of origin other than a other, more common, petroleum products refinery, place of production or manufacture are produced. or pipeline terminal without having first secured from the Director of Taxation, and at According to officials with the Kansas the time holding a valid, unrevoked Department of Revenue, the licensing and certificate of a liquid-fuels carrier's license bonding requirements for biodiesel are the for each vehicle in which the person same as for other types of fuel. Biodiesel transports these fuels. This section shall not producers are required to have a apply to the transportation by any consumer manufacturer’s license, and must post a in the consumer's own vehicle of liquid fuels minimum of average of 3 months tax used exclusively bv the consumer from the liability, or $5,000 cash, escrow or surety place of purchase to the place where it is to bond with the Department. Biodiesel be consumed. distributors are required to have a distributor's license and must post a minimum of an average of 3 months tax Committee Activities liability, or a $1,000 cash, escrow or surety bond with the Department. These The Special Committee on Agriculture requirements are contained in KSA 79-3403. and Natural Resources began its review of A producer who also distributes would need this issue by hearing from a spokesperson both licenses and bonds. from the Kansas Department of Revenue. The spokesperson indicated that the agency Also according to officials with the had already been confronted with a situation Kansas Department of Revenue, as with where an individual was producing other special fuels, biodiesel is subject to biodiesel on his own property for his own motor fuel tax which is contained in KSA use and for the use of neighbors. Thus the 79-3408. Biodiesel that is dyed in question recently arose whether a consumer accordance with federal regulations and is purchasing a 100 percent biodiesel product, used for non-highway purposes is exempt blending it with regular diesel, and from motor fuel tax as provided for in KSA consuming it for the individual's own off 79-3408(c). road use (such as for farming or off-road construction equipment) would be In addition, if a person is transporting considered a "manufacturer" within the their own manufactured biodiesel, the above definition and if so, would the person would be required to have a liquid consumer need to be licensed and bonded as fuel carrier’s license and meet or exceed the a manufacturer. As noted earlier in this limitations in KSA 55-507, which provide report, officials with the Kansas Department that no person shall transport any liquid of Revenue have determined the fuels or motor fuels from any refinery, place requirements under current law. Clearly, if of manufacture or production, or pipeline biodiesel is sold directly to a consumer for terminal, or across the state line, in off-road use, the biodiesel must be dyed in quantities of 120 gallons or more over any of order to be nontaxable, otherwise it is the public highways of this state without subject to tax. The representative stated that having first secured from the Director of dyed biodiesel sold to a consumer for off
Kansas Legislative Research Department 1-15 2006 Agriculture road use would not be subject to motor fuel initial incentive payments base on the 4th tax, and, according to the conferee the quarter FY 07 production and sales. It was agency is not requiring the consumer to be noted that the law states that producers are licensed as a biodiesel manufacturer, even to file quarterly sales reports, starting on July though technically, the consumer may be 1, 2007. The incentive payments would blending the biodiesel with regular diesel continue thereafter, based on production in fuel before use. It was noted that this future quarters and the money available activity falls within the statutory definition from the quarterly deposits made to the of "manufacturing." The Committee fund. members were told that if the biodiesel is sold clear, without dye, in the above Other conferees included representatives circumstances, it will he subject to motor of the Kansas Soybean Association and the fuel tax. Kansas Department of Commerce. The spokesperson from the Kansas Soybean The representative of the Department of Association indicated that the number of Revenue also stated that under Kansas law, retail outlets selling biodiesel has increased. the motor fuel tax is imposed upon the The Committee learned that there is one distributor of first receipt. By the time the commercial facility under construction in fuel has been delivered to the retailer or Goodland and two in the capital raising consumer, the motor fuel tax has already state-one near Hiawatha and one near St. been paid by the distributor, and it is John. The conferee from the Kansas embedded in the retail price. According to Department of Commerce told the members the Department, the distributor reports the of the Committee that there are a number of fuel receipts and remits the motor fuel tax projects in Kansas looking at the idea of on those receipts monthly. Because biodiesel establishing biodiesel plants in the State is not yet readily available at Kansas with most of the facilities being in the 30 terminals and production facilities, officials million gallons per year category. It was with the Kansas Department of Revenue are noted that the agency has provided some allowing biodiesel distributors to report on loan moneys for feasibility studies, business the monthly return the biodiesel received, at plans, and equity drives. Its major focus to the time when it is known whether the date has been to assist communities and biodiesel will be used for an exempt or non individuals in making informed choices to exempt purpose. The Department is in the determine if a project in biofuels should process of discussing with the Petroleum proceed or should stop after the feasibility Marketers and Convenience Store stage. Association of Kansas any legislative changes that may be needed to the motor Written comments were received from an fuel tax statutes relating to biodiesel fuel individual from Burden, who has developed production and sale. his own biodiesel facility. His comments discuss the issues of biofuel subsidies and The conferee also indicated that the technology changes. His suggestions are that agency was seeking clarification of the intent biofuel development be channeled toward contained in 2006 SB 388. The clarification those areas where fuels are exempt and that that was discussed concerns the incentive a regulatory structure be implemented. He money to be transferred to the newly states that there is no good reason for these established incentive fund on April 1, 2007. smaller producers to resist dying their The spokesperson stated that since there is biodiesel and that it might be possible for to be a transfer of $437,500 on April 1, 2007, the state to provide the dye through the and an additional transfer of $875,000 on County Extension Service. July 1, 2007, that the total amount of $1,212,500 would be available for those
Kansas Legislative Research Department 1-16 2006 Agriculture At the November meeting, a Conclusions and Recommendations spokesperson from the Kansas Department of Revenue appeared before the Committee The Committee recommends legislation and suggested amendatory language to amend KSA 79-3403 to add language as regarding biodiesel production and follows: distribution licensing and bonding requirements. The spokesperson from the No motor vehicle fuels or special agency provided specific amendatory fuels manufacturer’s license will he language to KSA 79-3403 which would make required for any consumer blending it clear that no motor-vehicle fuels or special motor-vehicle fuel or special fuel fuels manufacturer’s license would be purchased for such consumer’s own required for any consumer blending motor- use, and not for resale from a vehicle fuels or special fuels purchased for distributor or retailer who is the the consumer’s own use. holder of a valid, unsuspended and unrevoked motor-vehicle fuels or special fuels distributor’s or retailer’s license.
Kansas Legislative Research Department 1-17 2006 Agriculture Special Committee on Agriculture and Natural Resources
Water Monitoring
Conclusions and Recommendations
The members of the Committee recommend that the 2007 Legislature consider legislation which would create a mechanism to allocate any moneys received from Nebraska for violation of the Republican River Compact. This legislation would be similar to that which allocates the moneys from Colorado for its violations of the Arkansas River Compact. The Committee asked the staff of the Division of Water Resources of the Kansas Department of Agriculture to draft the language of the bill for consideration during the 2007 Legislative Session.
Proposed Legislation: None.
Background Arkansas River Compact. The headwaters of the Arkansas River are located Scope of Study. The Legislative in the Rocky Mountains above Leadville, Coordinating Council (LCC) initially charged Colorado and supports agricultural the Special Committee on Agriculture and endeavors in eastern Colorado before Natural Resources to review the current flowing into Kansas. Kansas has long status of the Colorado water litigation case contended that agricultural demands for and to review the remediation efforts as a irrigation in Colorado depleted water coming result of the litigation and the monitoring of into Kansas to the extent that irreparable those efforts (in the future.) injury had been done, particularly to the agricultural interests in the western part of After the initial meeting of the Kansas. The State of Kansas and Kansas Committee, a request was made to expand ditch companies (holders of water rights) the scope of the Committee's study under brought suit against Colorado that was heard this topic. The Committee, therefore before the United States Supreme Court requested and received approval from the several times. In the first half of the last LCC to discuss and make recommendations century two actions brought before the with respect to potential sources of moneys United States Supreme Court were resolved and to couple those moneys with potentially in Colorado’s favor. The two states formed beneficial programs such as the the Arkansas River Compact in 1948 in an Conservation Reserve Enhancement Program effort to resolve ongoing disputes over water, (CREP) and potential irrigation transition particularly after the federal construction of programs (ITAP). In addition, the the John Martin Reservoir in Colorado in Committee sought and was granted the 1946. authority to discuss with representatives of th e Kansas Water Office the The purpose of the Arkansas River recommendations for funding of programs Compact is to resolve water disputes using water settlement proceeds as between Kansas and Colorado, to divide the recommended by the Kansas Water waters of the Arkansas River between the Authority. states equitably, and to apportion water conservation benefits arising from the
Kansas Legislative Research Department 1-18 2006 Agriculture operation of the John Martin Reservoir and Colorado regarding the Arkansas River Project. During the late 1970s and early Compact. 1980s, Kansas became increasingly dissatisfied with the Compact, partly 'file Attorney General announced in June because of specific decisions made by the 2006, than an additional $1.1 million had Compact commissioners and because the been collected from Colorado, representing commission often was hindered by the costs associated with various experts requirement that all of its decisions had to retained by the Attorney General to support be unanimous. Kansas’ claims that Presumptive Evapotransporation (PET) values required an Current Colorado Litigation. In 1983, increase in replacement water flows due the Legislature made its first appropriation Kansas. to the Attorney General for its staff to investigate and prepare litigation against The United States Supreme Court retains Colorado regarding interstate water rights. jurisdiction in the case and probably will for The litigation begun in the 1980s has several more years. The next phase will be extended over two decades. The lawsuit the issuance of a Decree by the Court originally asked the United States Supreme specifying the data, computer modeling, and Court to require that the waters of the engineering analyses necessary to maintain Arkansas River be delivered in accordance compliance in the future with the Compact. with the provisions of the Arkansas River The Special Master will review the results Compact. In 1987, the Court ruled that from the Hydrologic-Institutions (H-I) Model monetary damages could be recovered in for the first ten-year accounting period of water compact enforcement cases and 1997 to 2006 to determine whether Colorado Kansas’ motion was amended to seek has come into compliance with the monetary damages. In 1995, the Court Compact. Because the model has to be found that Colorado diverted water that updated annually with new data and should have gone to Kansas and had violated analyzed, it could be several more years the Arkansas River Compact. In 2001, the before that information is presented to the Court ordered Colorado to pay Kansas for Court. It is expected that the Court will not damages and prejudgment interest. In April release active jurisdiction until it is satisfied 2005, Colorado paid Kansas $34,615,146. Of that Colorado is in compliance with the that amount, $722,108 was used to pay Compact and a process is in place to attorneys who represented the State for work evaluate and monitor compliance for each they already had done, $19,366,401 was succeeding ten-year “running” compliance transferred to the Interstate Water Litigation period, such as 1998 to 2007, and so forth. Account of the State General Fund, $9,684,425 was transferred to the Water How Colorado Water Money Conservation Projects Fund, and $4,842,212 Is To Be Used was transferred to the Water Conservation Project Reserve Account of the State Water Legislation enacted in 1996 (KSA 82a- Plan Fund. The 2005 Legislature placed 1801) specifies how money recovered from restrictions on expenditures from these three Colorado is to be spent. Under that law, an accounts, so that no expenditure can be amount equal to the amount spent on the made except by specific appropriation acts litigation (both money appropriated by the of the Legislature. The 2005 Legislature also Legislature and money spent by ditch appropriated $112,500 from the State companies) is to be credited to the Interstate General Fund to repay ditch irrigation Water Litigation Fund under the jurisdiction companies and individuals who contributed of the Attorney General. Money in the Fund in the early 1980s to initial water litigation is to be used to reimburse the ditch costs involving the dispute between Kansas companies ($112,500) and to pay for:
Kansas Legislative Research Department 1-19 2006 Agriculture • Preparation for or actual water effectively, it was put in a “lock box” and litigation with another state, the could not be spent unless specifically federal government, or an Indian authorized by the Legislature. The Colorado nation; litigation money was apportioned as follows: Kansas received $34,615,146 from Colorado, • Monitoring or enforcing compliance which was credited to the Attorney General’s with an interstate water compact or Interstate Water Litigation Fund. Using KSA water settlement; and 82a-1801 as a guide, an amount equal to the total appropriation from the State General • Ongoing expenses connected with Fund for Colorado water litigation over the Colorado litigation and expenses of years ($20,173,363) was earmarked to be Kansas agencies to monitor the transferred to the Interstate Water Litigation settlement, including expenses of a Reserve Account of the State General Fund. River Master or other official Prior to that transfer taking place, the appointed by the United States Attorney General was authorized to pay Supreme Court. $722,108 to attorneys who had represented the state in the litigation for work they had already done. Payment of this amount Any money recovered from Colorado in owed, plus the fact that revenues from excess of amounts spent on the litigation Colorado had been slightly overestimated, with Colorado would be allocated as follows; resulted in the final transfer from the Interstate Water Litigation Fund to the State • One-third would go to the State Water General Fund account being $19,366,401. Plan Fund for water conservation Of the remaining money from Colorado, projects; and $9,684,425 was transferred to the Water Conservation Projects Fund and $4,842,212 • Two-thirds would go to the Water was transferred to the Water Conservation Conservation Projects Fund for projects Project Reserve Account of the State Water in the Upper Arkansas River Basin Plan Fund. These transfers were made affected by the Arkansas River Compact. pursuant to KSA 82a-1801. However, the 2005 Legislature also placed restrictions on expenditures of these monies so that no Where the Colorado Money Went. expenditure could be made except by When Kansas received $34.6 million from specific appropriation acts of the Legislature. Colorado in April 2005, the 2005 Legislature was nearing adjournment of the regular The 2006 Legislature approved the session and faced a low State General Fund Attorney General’s request to transfer balance. Notwithstanding the provisions of $560,000 from the Interstate Water Litigation KSA 82a-1801 which sets forth how account of the State General Fund (the “lock Colorado water money is to be used (see the box”) to the Interstate Water Litigation Fund box above), the Legislature transferred for ongoing water litigation activities money which had been credited to the involving Colorado. Attorney General’s Interstate Water Litigation Fund to a newly-created account In addition, the Attorney General in the State General Fund to shore up ending announced that of the $1.1 million collected balances for FY 2005. Further, the in June 2006, two-thirds would go to the Legislature placed restrictions on the Water Conservation Projects Fund and one- expenditure of this money so that, third to the State Water Plan Fund.
Kansas Legislative Research Department 1-20 2006 Agriculture The following table reflects State General Fund expenditures for costs related to the Colorado water litigation:
Fiscal Year Amount 1984 $ 96,032 1985 70,424 1986 281,324 1987 651,449 1988 511,045 1989 746,490 1990 1,655,812 1991 3,213,075 1992 1,313,943 1993 655,060 1994 354,457 1995 506,250 1996 1,042,688 1997 921,800 1998 730,715 1999 950,215 2000 1,523,871 2001 878,172 2002 815,120 2003 939,835 2004 695,308 2005 514,208 2006 (Approved) 929,000 2007 (Approved)* ______0 TOTAL $ 19,996,293
* The 2006 Legislature approved the Attorney General’s request to transfer $560,000 from the Interstate Water Litigation account of the State General Fund to the Interstate Water Litigation Fund for ongoing water litigation activities involving Colorado. As such, it is not considered a State General Fund expenditure for FY 2007.
Kansas Legislative Research Department 1-21 2006 Agriculture Committee Activity with the AG’s Office in the Arkansas River and Republican River cases. He also said that The Committee began its review of this his office is crafting out the relationship topic by hearing a review of the issue by an between Kansas and neighboring states into official with the Kansas Department of the future. He noted that Nebraska had made Agriculture (KDA). Much of the information a good faith effort to comply with the covered by the conferee is contained in the Compact, but it is still struggling. background information included above. In addition to the information on the Colorado Mr. Davies commented that water is very case, members of the Committee received important to the Kansas economy. He also information on the state of litigation on the said that Kansas must be vigilant with its Republican River Compact settlement in responsibilities under these compacts. He Kansas v. Nebraska and the fiscal needs of reviewed a timeline of the future events in the KDA to monitor and enforce these these litigations. In the Kansas v. Nebraska compacts. The Committee also received case, potential remedies will be discussed information on potential issues involving the regarding Nebraska’s shortfall of water, and Missouri River and the Ozark Plateau in what kind of remedy will be requested if southeast Kansas. Kansas goes forth in litigation.
Information presented indicated that in He said that Kansas will be negotiating the next few months, a recommendation will with Nebraska and Colorado regarding these be made to the U.S. Supreme Court to adopt litigations. a final decree in the Kansas v. Colorado case. Information as to whether Colorado is in Republican River Compact. Information compliance for the ten-year period (1997- provided by a spokesperson from the Kansas 2006) has yet to be determined. The Department of Agriculture indicated that it is members of the Committee learned that the unlikely that Nebraska and Colorado will funding to monitor Colorado’s water use and achieve compliance with the Republican compliance with the Compact will be shifted River Compact settlement during the first from the Attorney General’s Office to the compliance period. Nebraska has overused KDA. Additional information indicated that its total allocation for the first three years the agency (KDA) will be requesting (2003 - 2005) by 104,195 acre-feet (AF) and continued funding for FY 2008 to monitor Colorado was over its total allocation for compliance and enforce the terms of both three years (2003 - 2005) by 34,600 AF, an compacts (Arkansas and Republican) and average of 11,533 AF per year. Kansas has U.S. Supreme Court decrees. been in compliance with the Republican River Compact for the past three years. David Davies, Kansas Attorney General’s (AG's) Office, responded to the issue of the Missouri River Issues. Committee river master. The conflict regarding the members learned that the U.S. Army Corps of Arkansas River goes back to 1901. Kansas Engineers operates a system of six reservoirs entered into the Compact with Colorado in on the upper basin states (North Dakota, 1948. Colorado has breached the Compact South Dakota, and Montana). One of the ever since. Kansas then requested a special primary issues is that the downstream (river) river master. This request, which was denied states want to maintain flows for navigation by the U.S. Supreme Court, said that Kansas and water supply. Other issues included should seek recourse with the Colorado water dealing with the environmental and courts. Mr. Davies stated that the Division of endangered species impacts. During the Water Resources in the Department of drought in the 1980s, there was controversy Agriculture has been a tremendous partner over the operation of the reservoir system.
Kansas Legislative Research Department 1-22 2006 Agriculture The Corps of Engineers published its Final they center around quantity or quality, Environmental Impact Statement (Final EIS) Kansas is both an upstream and downstream on the Special River Master Manual Review state. The members of the Committee in 2004. The State of Missouri has now filed learned that there are a number of a new lawsuit against the Corps. Kansas mechanisms for achieving water quality, chose not to participate in this litigation. primarily through the development of total maximum daily loads (TMDL) for the Ozark Plateau Aquifer. Committee pollutants of concern. The Committee members became informed that the upper members learned of three approaches for Ozark Plateau Aquifer system contains fresh achieving water quality standards: water in southwest Missouri and northeast Oklahoma; however, in Kansas the water • For the two states to meet and come to an quality of the upper system is often poor and agreement without the federal government unfit for domestic use. A moratorium on involvement; new water appropriations from the aquifer system in Kansas was established in 2004, as • A joint state/federal approach where states a permanent regulation. Since that time, a and applicable EPA regions would group (Tri-State Water Resource Coalition) develop the TMDLs; or was formed to evaluate the current demand for water by the members; what demand will • Go back to the federal court system and be in 2050, and the possible source(s) that demand the courts to impose a TMDL or will be available. A study is being conducted demand another state to come to the table. by Black and Veatch, a Kansas City engineering company, and the Little Rock Office of the U.S. Army Corps of Engineers The members of the Committee also on these issues. A final first report will be learned of water quality issues between presented to the Coalition and will be made Colorado and Kansas on the Arkansas River. public in late September of 2006. In this regard, the Committee members learned that the practice of flood irrigation in Southeast Kansas Water Quality Issue. Colorado leaches salts which subsequently During the first meeting on water issues, the enters the Arkansas River in the return flows. Committee was told that not all water issues This conferee stated that the Arkansas River center around the issue of quantity. It was at the Colorado state line has the highest salt noted that there is concern about the content of any stream in Kansas and that the significant contribution of metals coming in elevation of salts in this water supply used from Missouri drainage, coming through for irrigation has reduced crop yields in Kansas, and going into Oklahoma. With this Kansas. The members of Committee were fact before the Committee, one of the told that although the Compact with conferees before the Committee indicated Colorado on the Arkansas River does not that in Southeast Kansas there are some explicitly consider water quality, there is a water quality issues when streams run from requirement for no depletion of “usable Kansas into Oklahoma. In fact, members flows.” This phrase has been interpreted to learned that there is a federal case, Oklahoma mean water quality. v. Arkansas, in which a ruling was made that Oklahoma can enforce its state water quality Colorado Water Money Dispersal. A requirements at the state line. Compounding conferee from the Kansas Water Office some of the interstate cooperation issues is reported on the status of moneys received the fact that Kansas is surrounded by four from the State of Colorado for violations to states and borders three different the Arkansas River Compact. The members Environmental Protection Agency (EPA) of the Committee heard a report on the regions. With regard to water issues, whether background, receipts and how the money has
Kansas Legislative Research Department 1-23 2006 Agriculture been dispensed. The State of Kansas from Colorado. Provisions could be enacted received $34.6 million in 2005 and an to direct settlement funds as follows: additional $1.1 million in 2006. Of these amounts, approximately $20 million was • Lower Republican Water Projects Fund; deposited into the Litigation Reserve Account in the Attorney General’s Office and • Upper Republican Compact Compliance approximately $5 million was deposited into Fund;and the State Water Plan Fund (SWPF). Members were told that the Legislature appropriated $4 million for the Conservation Reserve • Statewide funds for conservation to be Enhancement Program (CREP). In addition, deposited to the State Water Plan Fund. the 2006 Legislature approved $193,036 for reimbursement to ditch irrigation companies which had been original contributors to the Conclusions and Recommendations litigation against Colorado. The 2006 Legislature also approved $552,000 for The members of the Committee engineering feasibility studies of potential recommend that the 2007 Legislature projects. consider legislation which would create a mechanism to allocate any moneys received Republican River Compact Settlement from Nebraska for violation of the Moneys. Members of the Committee heard Republican River Compact. This legislation from the Director of the Kansas Water Office would be similar to that which allocates the on the need for legislation for the Republican moneys from Colorado for its violations of River settlement damage awards. The the Arkansas River Compact. The Committee members were told that what Kansas really asked the staff of the Division of Water wants is the water as required under the Resources of the Kansas Department of Compact agreement, however, testimony Agriculture to draft the language of the bill indicates that there should be consideration for consideration during the 2007 Legislative given to legislation similar to the provisions Session. in KSA 82a-1801, 1802 and 1803. These provisions of law direct the settlement money
Kansas Legislative Research Department 1-24 2006 Agriculture Special Committee on Agriculture and Natural Resources
Regulation of County Fairs
Conclusions and Recommendations
After discussion on the issue, the Committee recommends a bill that would amend KSA 2-131d, so the maximum amount which could be raised annually for fairground buildings and maintenance would be $33,000. The proposal would not contain a minimum amount to be raised and would apply to all counties with fair associations to which KSA 2-131d is applicable.
Proposed Legislation: The Committee recommends one bill.
Background Agriculture Committee but no action was taken. The bill proposed to repeal KSA 2- The Legislative Coordinating Council 131d. This statute authorizes the county to charged the Special Committee on make an annual tax levy for the maintenance Agriculture and Natural Resources to review of fairgrounds and buildings with a limit of 2006 SB 532 which relates to the repeal of the $3,000 annually. The bill did not pass out of limitation of tax levies for fair association Committee because there was a lack of buildings and grounds. The current law information as to howr many fair associations limits the amount of money that a county were affected by the potential repeal of this commission can raise for the purpose of statute. According to the current statute, the purchasing grounds and the erection and fair association has to be recognized by the maintenance of buildings of certain fair Secretary of Agriculture and the maximum associations. The maintenance of a list of amount that could be collected is $3,000. “officially recognized” fair associations is not The number of county fair associations currently available and will require study to which this statute impacts is unknown. determine the current fair associations. In addition, the Committee was charged to A spokesperson from the Kansas study other statutes related to fair Department of Agriculture (KDA) presented associations to determine if such statutes are comments regarding the role the KDA outdated. formerly had in the regulation of county fairs. The members of the Committee learned that Committee Activities from 1929 to 1994, the Kansas State Board of Agriculture’s charge was to provide official The Committee began its study of this recognition to county fair associations and topic by having staff update the Committee county free fairs that met specified criteria. on the regulation of county fairs. The In 1994, the courts ruled that the structure of Committee learned that this particular issue the Board was unconstitutional and among regarding county fairs arises out of SB 532, its powers and duties that were not which was introduced in the 2006 Legislative continued was the maintenance of a list of Session to address difficulties being officially recognized county fairs. experienced in Hodgeman County. The members of the Committee learned that there Senator Janis Lee made comments on the was a hearing on this bill in the Senate topic regarding the regulation of county fairs and stated that the best way to handle this
Kansas Legislative Research Department 1-25 2006 Agriculture situation is to craft legislation specifically for mill. Testimony indicated that the Hodgeman County. Hodgeman County Fair Board has spent much more than the $3,000 by using grant The Hodgeman County Extension Agent money and fund raisers to supplement the raised the issue of county fair regulations amount needed for maintenance of buildings, which resulted in the introduction of SB 532. or the purchase of supplies and equipment. He noted that during discussions of SB 532 it Became evident how it affected Hodgeman County, hut there was uncertainty regarding Conclusions and Recommendations other counties which may be affected. Also appearing from Hodgeman County was the After discussion on the issue, the President of the Hodgeman County Fair Committee recommends a bill that would Board. This conferee asked the members of amend KSA 2-13Id, so the maximum amount the Committee to amend the statute to allow which could be raised annually for an increase the amount of money allowed for fairground buildings and maintenance would maintenance of county fair buildings. He be $33,000. The proposal would not contain noted that KSA 2-131d was adopted in 1951 a minimum amount to be raised and would and since that time set the maximum amount apply to all counties with fair associations to allowed for maintenance set at $3,000. The which KSA 2-131d is applicable. conferee requested that the statute be changed to a minimum of $3,000 up to one
Kansas Legislative Research Department 1-26 2006 Agriculture Special Committees
Report of the Special Committee on Assessment and Taxation to the 2007 Kansas Legislature
CHAIRPERSON: Representative Kenny Wilk
VICE-CHAIRPERSON: Senator Barbara Allen
Ranking M inority M em ber: Representative Tom Thuii
OTHER MEMBERS: Senators Les Donovan, Greta Goodwin, Janis Lee, Roger Pine, Derek Schmidt, and Dennis Wilson; and Representatives Anthony Brown, Barbara Craft, Nile Dillmore, Oletha Faust-Goudeau, John Grange, Jerry Henry, Mitch Holmes, Tim Owens, and Virgil Peck
Study T opics
• City Development Excise Taxes
• County Local Sales Tax
• Homestead Expansion
• Motor Fuel Taxation Along the Kansas Border
• State Board of Tax Appeals Qualifications and Employment
• Residential Property Tax Valuation Cap
• State and Local Tax Policy
• Tax Incidence and Tax Base Erosion
• “Truth in Taxation” Local Budget Law
December 2006 Special Committee on Assessment and Taxation
City Development Excise Taxes
Conclusions and Recommendations
The Committee recommends no further expansion of city development excise tax authority at this time. The seven cities with the tax authority pursuant to the grandfather clause should continue to report to the League of Kansas Municipalities and the Legislature with respect to what impact the taxes have on growth and development.
Should the issue of extending the authority to additional cities be revisited in the future, the Committee recommends that the Legislature consider provisions similar to those embodied in 2004 legislation that would require reporting of development costs; the rational basis for imposition; and how the revenues are expended.
Proposed Legislation: None.
Background “The Committee encourages cities to keep meeting with proponents of HB In the wake of a 1996 Kansas Court of 2834 in order to provide assurances Appeals Decision (Home Builders Ass'n v. about the appropriate use of City of Overland Park), a number of cities development excise taxes. The successfully imposed development excise Committee notes that the use of such taxes, which are generally imposed on the taxes in the future may well be act of platting real property and expressed in restricted or curtailed by the cents per square foot of residential and/or Legislature as it addresses the commercial development. broader questions of uniformity and city taxing authority in general.” Over the next decade, several pieces of legislation were considered but not adopted that would have made the development That restriction ultimately was enacted excise tax authority visible statutorily and in 2006, when SB 55 (which also restored would have imposed certain requirements city sales tax uniformity) prohibited all cities on cities imposing the taxes. The most not levying development excise taxes as of recent of these was considered by the 2004 January 1, 2006, from imposing excise taxes. Legislature, HB 2834, which would have A grandfather clause authorizes any cities required cities to prepare a document that had development excise taxes in effect detailing development costs and the rational on that date to retain the authority. Any basis for the tax and its rate prior to proposed development excise tax rate imposition or modification of an existing tax; increases in the grandfathered cities is now and an annual report detailing revenues subject to a mandatory election requirement. generated and how they are expended. A subcommittee of the House Taxation A July survey by the League of Kansas Committee, as well as the full Committee, Municipalities identified at least seven cities subsequently recommended the issue be which apparently had development excise studied during the 2004 interim. The 2004 taxes in effect as of January 1 and are subject Special Committee noted in its report, to the grandfather provisions: Shawnee,
Kansas Legislative Research Department 2-3 2006 Taxation DeSoto, Basehor, Olathe, Overland Park, At the conclusion of the public hearing, Tonganoxie, and Mulvane. Assuming that the Chair asked both the proponents and these are the only seven cities allowed to opponents to coordinate efforts and report retain or reimpose development excise taxes, back at the October meeting as to what sort the other 620 incorporated cities in the state of other development finance mechanisms are prohibited from doing so. Nevertheless, were being utilized by cities other than a number of other cities recently have excise taxes. The request was to include expressed interest in having development impact fees, as well as, other innovative excise taxes as a potential revenue tool, approaches being utilized by cities in Kansas including Osawatomie, Eudora, Bonner and in other states. Some of the information Springs, Lawrence, and Ottawa. specified in the request included where the money is used (relative to the benefit The conference committee on SB 55 also district); whether annual reports are filed or had asked that the issue of extending the available; what the rates are; what the tax development excise tax authority to all cities base is (whether expressed in cents per be studied during the interim. The square foot like the excise tax); how often Legislative Coordinating Council therefore cities change rates; and whether different approved a request for the Special rates are used for different developments. Committee to study whether the development excise tax authority should be At the October meeting, staff expanded to all cities. The Committee is summarized information received from the charged to recommend whether all cities, League of Kansas Municipalities and Kansas especially those in fast-growing areas, could Building Industry Association about the benefit from having this tax option at their extent to which fees and finance disposal. mechanisms are utilized by cities in Kansas and other states as an alternative to development excise taxes. The traditional Committee Activities methodology in Kansas involves the establishment of special benefit districts At the September meeting, the (pursuant to KSA 12-6a01 et seq) that levy Committee held a public hearing on the special assessments against each new parcel issue. Proponents for expanding the of development with the revenues authority to all cities included the League of earmarked directly for infrastructure within Kansas Muncipalities, the Unified the district. Government of Wyandotte County, Bonner Springs, and Lawrence. The proponents The Committee subsequently approved generally argued that all cities should at a motion to not allow any further expansion least have the option of imposing the tax, of development excise tax authority and provided it would be via a vote of the asked staff to prepare a draft committee people. Opponents of additional city report for review at the November meeting. development excise taxes included the Kansas Building Industry Association, the Kansas City Home Builders’ Association, and Conclusions and Recommendations the Small Business Coalition. The opponents said that residential construction The Committee notes that the was an increasingly important factor in the Legislature, in general and House Tax economy; and that additional excise taxes Committee, in particular have spent a great had the capacity to seriously retard deal of time in recent years discussing the economic growth. development excise tax issue. The
Kansas Legislative Research Department 2-4 2006 Taxation compromise relative to the enactment of the Legislature with respect to what impact 2006 SB 55 and the grandfather clause was the taxes have on growth and development. reached only after a great deal of difficulty. Should the issue of extending the The Committee also finds that the authority to additional cities be revisited in establishment of special benefit districts, the future, the Committee recommends that which provide for the direct earmarking of the Legislature consider provisions similar to special assessments, has served cities well as those embodied in 2004 legislation that an effective infrastructure finance tool. would require reporting of development costs; the rational basis for imposition; and The Committee, therefore, recommends how the revenues are expended. In the no further expansion of city development meantime, cities are encouraged to keep excise tax authority at this time. The seven working with developers and the building cities with the tax authority pursuant to the industry on other innovative infrastructure grandfather clause should continue to report finance mechanisms. to the League of Kansas Municipalities and
Kansas Legislative Research Department 2-5 2006 Taxation Special Committee on Assessment and Taxation
County Local Sales Tax
Conclusions and Recommendations
The Committee makes no recommendation at this time.
Proposed Legislation: None.
Background Court rendered the Entire Local Sales Tax Act nonuniform for cities. Since cities’ County Tax Rates constitutional home rule authority allows them to opt out of statutory requirements In 1970, the Legislature granted local that are not uniform,2 several cities chose to sales tax authority to cities and counties. impose additional sales taxes. Counties do Since that time, and prior to 1996, cities and not possess the same constitutional home counties maintained the same general level rule authority; therefore, they remained of taxing authority. Cities and counties were subject to existing statutory requirements. authorized to levy a tax up to a normal maximum of 2.0 percent, subject to several Because of the 1996 Court of Appeals ruling exceptions. Sales taxes of up to 1.0 percent and the subsequent decisions of several were to be used for general purposes, but the cities to opt out of statutory sales tax limits, additional special taxing authority (up to 1.0 the 2006 Legislature passed SB 55. The 2006 percent) normally was required to be used bill was designed to restore uniformity to only for the financing of “health care local sales tax provisions relating to cities by services.” A city could impose a special tax reducing the number of classes of cities to earmarked for health care only if the county one. In response to the cities that had had no such tax. Moreover, any such special enacted sales tax provisions in excess of city tax expired immediately upon the those allowed statutorily, city sales tax imposition of a county health care sales tax. limitations also were increased and made In addition to the special health care tax, applicable to all cities. All cities in the new, some counties were authorized individually single class were granted authority to levy to impose a special sales tax for roads or jails sales taxes of up to 2 percent for general or other county facilities or specific purposes purposes and up to 1 percent for special such as economic development. purposes (for a maximum rate of 3 percent).
The change in 1996 was not a statutory one. During that year, the Kansas Court of Appeals ruled, in Home Builders Association v. City of Overland Park,] that the local A constitutional amendment adopted in retailers’ sales tax (KSA 12-187 et seq.) was 1960 (Article 12, Section 5) explicitly a nonuniform enactment. In so doing, the granted the Legislature the power to uniformly limit or prohibit taxation by cities and to establish up to four classes of cities for that purpose. As indicated in the text, Home Builders Association of Greater local sales taxes subsequently were not Kansas City, et al., v. City of Overland Park, authorized by the Legislature until the early Kansas, 22 Kan. App. 2d 649, 921 P.2d 234. 1970s.
Kansas Legislative Research Department 2-6 2006 Taxation Any special purpose taxes levied would be Tax Distribution required to sunset after 10 years. As part of its general charge to review During the SB 55 debate and discussion, county local sales taxes, the Special the issue of county local sales taxes was Committee on Assessment and Taxation has raised. Ultimately, however, the county the option to consider the issue of tax sales taxes were not addressed in the bill. distribution. The Special Committee on Assessment and Taxation has been charged to review the role KSA 12-192 provides for the distribution of local sales taxes play in financing county countvwide retailers’ sales tax. The statute governments and make any generally requires counties to share recommendations deemed appropriate. countywide sales tax revenues with the cities located within their boundaries, if The following table provides summary these revenues derive from a general information regarding sales tax rates for all countywide tax. purposes—including general as well as special or dedicated purposes, such as The regular distribution formula for health care—among the 85 Kansas counties general sales tax is proportional, based on that impose a tax. Twenty counties do not population and actual tax dollars levied. impose a sales tax. Several exceptions to this formula exist within the same statute, including one that Total Number of authorizes specific counties to retain all the County Rate Counties revenues (and not share with cities) when the tax is a special one earmarked for the 2.25 1* construction of county roads or jails or other 2.00 6 county facilities or for specific programs or 1.75 1 services. A countywide health care tax may be used for city health care facilities as well 3 1.50 as county ones. 1.40 1 1.25 5 The issue of distribution can generate controversy. In 2006, the Legislature 1.15 3 considered HB 2983, which would have 1.10 1 allowed Johnson County to impose an 1.0 54 additional one-half-cent special countywide .75 1 tax for public infrastructure. As a special tax, all revenues would have stayed with the .50 7 county. The proposed tax would have been .25 1 permanent. The bill passed the House .15 ^ * Committee on Taxation with technical amendments but was stricken from the Sherman County has the highest tax House Calendar, thus receiving no further rate. action. A separate public hearing on the ** Hodgeman County has the lowest matter in the Senate Assessment and rate. The county’s tax is imposed Taxation Committee resulted in no countywide, but all revenues are resolution of continuing differences of dedicated to the Horsethief Reservoir opinion with respect to how an alternative project. distribution formula might be crafted.
Kansas Legislative Research Department 2-7 2006 Taxation Committee Activities of county commissioners to make this determination and notify voters of its At the September meeting, staff briefed decision in the authorizing resolution the Committee on the history of county and containing the ballot question. city local sales tax authority and distribution in Kansas. Randall Allen, Executive Director At the November meeting, the of the Kansas Association of Counties, asked Committee reviewed policy options. the Committee to consider recommending legislation to raise the total cap on countywide sales tax authority to a higher Conclusions and Recommendations level, such as 3.0 percent for both general and special purposes. He further The Committee has no recommendations recommended this legislation address the at this time. allocation of revenue generated by any new countywide sales tax by requiring the board
Kansas Legislative Research Department 2-8 2006 Taxation Special Committee on Assessment and Taxation
Homestead Expansion
Conclusions and Recommendations
The Committee believes that further expansion of the Homestead Program is warranted. The Committee therefore recommends the introduction of legislation that would reduce “rent constituting property taxes paid’’ from 20 to 15 percent while simultaneously increasing the maximum refund amount for both home owners and renters from $600 to $700; and would facilitate electronic filing.
The Committee further finds that an asset test would be appropriate and recommends the introduction of legislation that would exclude from the Program persons with assets in excess of $250,000.
The Committee applauds the ongoing administrative efforts of the Department of Revenue and recommends the introduction of legislation that would authorize the denial of claims by certain renters who have failed to adequately document their sources of income.
Proposed Legislation: The Committee recommends the introduction of three bills on this topic.
Background participate in the programs (based on the assumption that landlords are passing Kansas in 1970 enacted the Homestead increased property taxes along in the form of Property Tax Refund Act, KSA 79-4501 et higher rent). seq, which is best characterized as the "circuit-breaker" style of property tax relief The current Kansas program requires program. A "circuit breaker" is a form of participants to meet both an income and a property tax relief in which the benefit is demographic test. The former test requires dependent on income or other criteria and that household income be not more than the amount of property taxes paid. The $27,600; the latter requires that at least one moniker developed as analogy to the device person in the household be (1) age 55 or that breaks an electrical circuit during an above; (2) a dependent under age 18; (3) overload, just as the property tax relief blind; or (4) otherwise disabled. Renters are benefit begins to accrue once a person's eligible based on the statutory assumption property taxes have become overloaded that 20 percent of their rent is equivalent to relative to his or her income. property taxes paid.
The first property tax circuit breaker was The program was recently expanded in enacted by Wisconsin in 1964. Kansas 2006 HB 2583, a bill which also provided a became the sixth state with such a program property tax exemption for most new in 1970. According to the National acquisitions of commercial and industrial Conference of State Legislatures (NCSL), 34 machinery and equipment. An amendment states currently have some form of circuit approved by the Kansas House earlier in the breaker program. Of these states, 27 2006 session would have provided for an (including Kansas) also allow renters to even larger expansion of the Homestead Act.
Kansas Legislative Research Department 2-9 2006 Taxation Several legislators requested an interim be entitled to a refund of $528 ($408 study following the conclusion of the 2006 under pre-2006 law). session. The Legislative Coordinating Council subsequently approved the request The maximum refund available under for the Special Committee to review the need any circumstances to a claimant is $600, and to further expand the Homestead Property the minimum refund is $30. Tax Refund Program. The Committee is charged with specifically recommending whether fixed-income seniors need Committee Activities additional property tax relief as a result of tax shifts brought about by faster annual At the September meeting, staff briefed residential valuation increases attributed to the Committee on the background of the the more rapid economic growth expected as Homestead Property Tax Refund Act, which a result of the recently enacted machinery enacted in 1970. Staff also distributed and equipment exemption. As part of the materials on how property tax relief study, the Department of Revenue also has programs are structured in all 50 states. asked to present several administrative issues with respect to the program for the Bruce Larkin, Department of Revenue, Committee to consider. presented a number of statistics for the Homestead Program and reviewed a number of administrative issues of concern, Impact of 2006 Expansion including the extent to which certain large refunds are made available to renters. The The Kansas Department of Revenue Committee subsequently asked for various reports that during calendar year 2005, it hill drafts and fiscal impact estimates to be processed and paid 76,097 Homestead prepared regarding the Department of claims totaling $17,119 million, or an Revenue’s suggestions. average of about $225 per refund. The 2006 amendments expanding the program are At the October meeting, Mr. Larkin anticipated to increase its size by $3.5 returned with those fiscal impact estimates million, or about $20.6 million per year. and bill drafts. One proposal, which is revenue-neutral, would reduce “rent The Department also indicates that the constituting property taxes paid” for renters new law will have the following impact on from 20 to 15 percent while simultaneously the following three hypothetical taxpayers: increasing the maximum refund amount available for both home owners and renters (1) Elderly couple with $23,000 in from $600 to $650. A second proposal household income and $1,100 property would expand the size of the program by tax liability. This claimant will now be $1.4 million by increasing the maximum entitled to a refund of $150 ($72 under refund amount for only home owners (but pre-2006 law). not renters) from $600 to $700. A third proposal would eliminate a requirement that (2) Single mom with two young children a statement be provided from the county and $16,000 in household income and treasurer showing property taxes levied $750 in property tax liability. This (unless so requested by the Department of claimant will now be entitled to a refund Revenue) so as to facilitate the electronic of $360 ($240 under pre-2006 law).3 filing of claims. A fourth proposal would provide an asset test such that persons who (3) Disabled renter with $9,000 in own or control assets in excess of $250,000 household income and paying $450 per would not be eligible for the program. A month in rent. This claimant will now fifth proposal would authorize the
Kansas Legislative Research Department 2-10 2006 Taxation Department of Revenue to deny claims of reduce “rent constituting property taxes taxpayers who are renters reporting income paid” from 20 to 15 percent while that is 150 percent or less of their annual simultaneously increasing the maximum gross rental amount when such income refund amount for both home owners and amounts have not been verified. renters from $600 to $700; and would facilitate electronic filing by eliminating, A conferee representing AARP said that under most circumstances, a requirement the Homestead Program should be modified that a statement be provided from county to restore and preserve the value of its treasurer showing property taxes levied. refunds, since refund amounts had not been growing as fast as the property tax burden on The Committee further finds that an senior citizens. asset test would be appropriate to assure that the Homestead Program is targeted to those A conferee representing Kansas Action Kansans otherwise lacking in the means to for Children also supported further pay their property taxes. expansion, provided that the additional benefits were also made available to The Committee, therefore, recommends households with children under age 18. the introduction of legislation that would exclude from the program persons with At the November meeting, the assets in excess of $250,000. The Committee Committee reviewed its work at the previous notes that the definition of “assets” will need two meetings and made final policy to be debated by the 2007 Legislature, decisions. including the possibility of excluding from the asset test the equity in the taxpayer’s principal place of residence. Conclusions and Recommendations Finally, the Committee further applauds The Committee believes that further the efforts of the Department of Revenue to expansion of the Homestead Program is assure that Homestead refunds are paid to warranted. But the Committee expresses its only those who are entitled and in only the concern that, based on data provided by the appropriate amounts. Department of Revenue, the statutory assumption that 20 percent of rent is The Committee, therefore, recommends equivalent to property taxes paid appears to the introduction of legislation that would be overstated. The Committee also wishes to authorize the Department to deny claims of help facilitate the electronic filing of claims. taxpayers who are renters reporting income that is 150 percent or less of their annual The Committee, therefore, recommends gross rental amount, unless additional the introduction of legislation that would information is provided by the taxpayers.
Kansas Legislative Research Department 2-11 2006 Taxation Special Committee on Assessment and Taxation
Motor Fuel Taxation Along the Kansas Border
Conclusions and Recommendations
The Committee recommends a study be conducted as was originally requested of Kansas, Inc. in September 2006, when the Committee Chairperson requested a broad-based examination of fiscal impacts of border zone taxes in general.
Proposed Legislation: None.
Background Gas/Gasohol Diesel State Rate Rate The Legislative Coordinating Council has Kansas $0.24* $0.2600 Missouri $0.1755 $0.1755 authorized the Committee to review the Oklahoma $0.1700 $0.1400 concept for those retailers or communities Colorado $0.2200 $0.2050 along the state border of imposing a motor Nebraska $0.2700 $0.2700 fuels tax that is no more than $0.01 above Kansas E85 tax rate as of January 1, 2007 - the motor fuel tax in the adjoining state; $0.17 (pursuant to Laws 2006, Ch. 81, study recent similar legislation in Arkansas Sec. 2). and 2006 HB 2822; and study the economic impact of encouraging the purchase of motor Source: Federation of Tax Administrators, fuels in Kansas as opposed to those “Motor Fuel Excise Tax Rates: January 1, purchases being made in adjoining states. 2006."
Comparison of Motor Fuel Legislative Efforts: 2006 HB 2822; Tax Rates: Kansas and Other States Neighboring States The 2006 Legislative Session saw the In Kansas communities that border other introduction of HB 2822, which would have states, some business owners have allowed an alternative motor fuel tax rate at complained that motor fuel business is lost retailers in border communities that meet because prices at the pump are lower in the the following requirements: bordering states. A primary reason for this cost differential is a difference in motor fuel • The retailer must be located within 3,000 tax rates. feet of a state line; or • The retailer must be located within the A review of state motor fuel tax rates in city limits of a Kansas city that adjoins and around Kansas shows Kansas’ rates are the state line. higher than three of its four border states. The following table depicts these states’ (Note: The bill's sponsor had drafted an motor fuel tax rates as of January 1, 2006. amendment to allow also those retailers located within the city limits of a Kansas city if the city limits are within 3,000 feet of the state line. The amendment also would have controlled for annexation with respect to cities near the state line.)
Kansas Legislative Research Department 2-12 2006 Taxation The alternative tax rate would have been Committee Activities 0.1 cent per gallon above the lawful rate charged in the adjoining state on motor- At the September meeting, staff provided vehicle fuel or special fuels, not to exceed a background briefing on the issue. the regular Kansas rate. It would have Representatives of Kansas’ motor fuels applied only to retail sales to actual retailing industry, who lived near the border consumers. The bill as drafted included of a state with lower motor fuels taxes, diesel as well as gasoline products. testified in favor of HB 2822. An official from the Arkansas Oil Marketers Association HB 2822, which was heard in the House provided information about the Arkansas Transportation Committee but went no law and its implementation. The Secretaries further, was modeled generally after an of Revenue and Transportation appeared in existing law in Arkansas. The Arkansas law, opposition to the bill. The Committee which has been in existence for at least 28 discussed the potential effects of a motor years, allows a lower tax rate on gasoline fuels border tax, as well as border tax sold in “cities, incorporated towns, or differentials for other items such as planned communities” that border on a state cigarettes and food. The Committee line, sold within 800 feet of the shore line of Chairperson requested that Kansas, Inc. a navigable lake where the opposite shore develop a scope statement to study the line is beyond the Arkansas state line, or broader issue of border taxes in general. sold within 800 feet of the Arkansas terminal of a bridge, tbe center of which is the state At the October meeting, the First line. The lower tax rate cannot be more than Assistant Re visor summarized the 0.1 cent per gallon above the adjoining constitutional issues involved in the motor state’s rate. fuels border tax issue. His comments included the following: Allowing alternative motor fuel tax rates at a state’s borders appears to be uncommon. • A border tax law which provides for a The Federation of Tax Administrators (FTA) lower motor fuel tax rate for fuel sold in conducted an electronic-mail survey of the border zone, in some relationship to states in August 2006. In that survey, the motor fuel sold across the border, raises states were asked whether they possessed a several constitutional questions in different motor vehicle fuel or special fuel relation to retailers in the home state tax rate along their borders. Of the 22 states, whose businesses lie outside the border plus Quebec, that responded to the survey as zones. Arkansas has long had such a of the end of August, only one state law. The Arkansas Supreme Court (Arkansas) and Quebec reported having a upheld the constitutionality of the law. border zone tax. The other states responding Arguments were raised as to violations of include Alaska, California, Colorado, the equal protection, due process, and Florida, Georgia, Idaho, Illinois, Louisiana, abridgement of the privilege and Maryland, Mississippi, Missouri, Montana, immunities provisions in the Arkansas Nebraska, Nevada, New Jersey, New York, and United States Constitutions. If the North Carolina, Texas, West Virginia’, Kansas border tax law were written in a Wisconsin, and Wyoming. manner largely similar to the Arkansas law, and if the Arkansas Supreme Court decision would be valid precedent upon which the Kansas Supreme Court could rely in an action challenging a Kansas border tax law on similar grounds, the A similar proposal was reportedly border tax law would be upheld. introduced in a recent West Virginia However, any determination of legislative session, but it did not pass.
Kansas Legislative Research Department 2-13 2006 Taxation constitutional issues in Kansas would Virgil Peck, voiced his preference for a pilot first involve an analysis of the specific program for a gasoline border tax, and he language proposed and involve the offered the two pilot locations of Coffeyville specifics of Kansas Constitutional law, and Atchison. case law and statutory law. Finally, testimony on potential • In addition, an additional Kansas administrative and legal issues was supplied Constitutional issue of an unlawful by Richard Cram, Director of Policy and delegation of legislative authority would Research for the Kansas Department of be raised with regard to any automatic Revenue. changes in Kansas motor fuel tax rates which do not involve a specific At the November meeting, the legislative action by the Kansas Committee discussed policy options and Legislature. HB 2822 contemplated such recommendations. automatic changes but could be written in a different manner to avoid such constitutional concerns at the expense of Conclusions and Recommendations a slower response in motor fuel tax rates in Kansas when the motor fuel tax rate of The Committee recommends that a study the adjoining state is changed. be conducted as broadly as was originally requested of Kansas, Inc. in September 2006. The study should determine (a) the fiscal Also at the October meeting, staff impacts related to border communities, and provided a copy of the letter that had been Kansas communities near the border written to Kansas, Inc. on behalf of the communities, if a border tax were authorized Committee Chairperson, as well as the initial in Kansas border communities; and (b) the response provided by Kansas, Inc., which state’s current and future tax revenue reported the organization’s progress to date collections if a border zone tax were on the scope statement and projected a scope authorized. The study is to cover not only statement completion date in November (for motor fuels taxes, but rather address all such the final Committee meeting). The President border taxes, including those for cigarettes of Kansas, Inc. appeared and responded to and food sales. The Committee recommends questions and concerns. During the the Secretary of Revenue continue to work discussion, some members noted their with Kansas, Inc. on how best to accomplish concern that the study was too broad as the study. The Secretary of Revenue is originally conceived. The Committee requested to report the entities’ progress to Chairperson revised the request for the the House Committee on Taxation in scope statement to include only studying the January 2007. issue of gasoline tax at the border. The original sponsor of HB 2822, Representative
Kansas Legislative Research Department 2-14 2006 Taxation Special Committee on Assessment and Taxation
State Board of Tax Appeals Qualifications and Employment
Conclusions and Recommendations
The Committee recommends introduction oflegislation expanding the Board to five members, from three as currently required, with certain qualifications. The Committee strongly emphasizes that each SBOTA member is currently required by law to devote full time to the duties of his or her office. Finally, because of questions regarding the existence of disciplinary proceedings for SBOTA members, the Committee requests that the Chairman, with the assistance of the First Assistant Revisor, draft a letter requesting an Attorney General Opinion to clarify a number of issues relating to conflicts of interest and the discipline related to such.
Proposed Legislation: The Committee proposes one bill.
Background examined.
Pursuant to the Legislative Coordinating In 1995, the Special Committee on Council, the Special Committee on Assessment and Taxation rejected the idea of Assessment and Taxation is charged with replacing the Board with a state tax court. reviewing the existing statutory This proposal was first broached in 1995 SB requirements regarding qualifications of 40, which would have established the tax State Board of Tax Appeals (SBOTA) court as an independent agency within the members; and the appropriateness of executive branch. The court’s functions allowing SBOTA members to retain other would have been divided into three employment in areas that could create the divisions, including a small claims division, potential for conflicts of interest. a property tax appeals board (ptab), and the regular tax court division. A taxpayer’s History of SBOTA Membership choice of venue among these divisions and Qualifications would affect the ability of the taxpayer to appeal a decision. Although SB 40 did not The Kansas State Board of Tax Appeals pass, the Legislature, in 1995 SB 19, (SBOTA) was created in 1957. At that time, tightened SBOTA membership qualifications it was a three-member board. In 1969, the and granted the Governor the authority to appoint the chairperson. Board was expanded to five members. In 2003, HB 2005 reduced the Board’s membership from five to three members. The Special Committee on Assessment and Taxation studied the subject again in 1997. The interim study was sandwiched The number of SBOTA members is but between two sets of bills; sparked by two one aspect of the issue of handling tax bills from 1997 and resulting in another bill appeals in Kansas. SBOTA and tax appeals in 1998. issues have long been the subject of debate and study. The Legislature has examined The two 1997 bills would have changed the possibility of restructuring SBOTA at SBOTA, its structure and its functions. SB least twice in the past 12 years. At the 348 from that year would have abolished the center of this effort, structure, function, and Board and transferred all of its powers, membership qualifications have been
Kansas Legislative Research Department 2-15 2006 Taxation duties, functions, property, and personnel to engaged in active Kansas practice, and one a new Kansas Tax Review Commission. SB must be a certified public accountant 161 from 1997 would have made a number engaged in active practice. The third of changes in the property valuation appeals member has no specific qualification process, including replacing locally- requirements. All three members must, appointed hearing officers (authorized at the however, have legal, accounting or appraisal time) with SBOTA hearing officers and training or experience and must he “selected requiring certain appeals (including those with special reference to training and involving multi-family residential and experience for the duties imposed by the agricultural land) to go directly to the full act.” Additionally, all three are subject to SBOTA. the Supreme Court rules of judicial conduct applicable to all judges of the district court. In response to the two 1997 bills, the Special Committee on Assessment and Taxation was charged with reviewing the Outside Employment and Governor’s proposal to abolish SBOTA and Conflicts of Interest transfer its powers, duties, functions, property, and personnel to a new Kansas KSA 74-2433 does not contain specific Tax Appeals Commission (TAC), which employment limitations. However, as would include a small claims division. The mentioned previously, SBOTA members are Committee agreed to introduce the subject to the Code of Judicial Conduct Governor’s proposal “without contained in the Supreme Court Rules. recommendation.” The Code of Judicial Conduct contains a The 1998 bill (HB 2602) died, but number of broad statements (canons), under changes were legislated in HB 2684 to which are specific requirements (rules). The tighten SBOTA membership qualifications, Canons are as follows: make its members subject to the Code of Judicial Conduct, and make published • Canon 1 directs judges to uphold the decisions of Kansas appellate courts binding integrity and independence of the on the Board. judiciary.
As mentioned previously, the 2003 • Canon 2 requires a judge to avoid Legislature reduced SBOTA membership impropriety and the appearance of from five to three members as part of a impropriety. budget savings package. The Legislature also revised member qualifications to reflect • Canon 3 directs a judge to perform the current law. duties of judicial office impartially and diligently. Current Membership and Qualifications • Canon 4 requires a judge to conduct the judge’s extra-judicial activities so as to KSA 74-2433 delineates membership minimize the risk of conflict with qualifications and requirements for the judicial obligations. board. The statute is outlined in matrix format in Attachment A. • Canon 5 requires a judge to refrain from inappropriate political activity. As shown in that attachment, the Board now consists of three members, two of whom have specific, individual qualifications. One must be a lawyer
Kansas Legislative Research Department 2-16 2006 Taxation Committee Activities Article 12, dealing with forfeiture of public office. They discussed the issue of whether At the October meeting, staff provided a any member would he required to divest background briefing on SBOTA membership himself or herself from currently held and qualifications as well as laws addressing interests that may•/ he construed to be, or SBOTA members’ outside employment. appear to be, a conflict of interest vis a vis Rebecca Crotty, SBOTA chairperson, SBOTA duties. Finally, they questioned testified, the agency had recently eliminated whether the Board of Accountancy has its case backlog. She also stated the current authority to discipline certified public three-member board was preferable to accountant members for SBOTA-related having five members, as State law had violations. required from 1969 to 2003. Committee members questioned SBOTA officials regarding complaints of alleged conflicts of Conclusions and Recommendations interest and lack of full-time service on the part of one SBOTA member, and whether The Committee expresses concern, increasing membership from three to five regarding the potential that violations of members would help the Board avoid certain SBOTA requirements dealing with potential conflicts of interest as well as full-time employment and conflicts of maintain efficiency. The SBOTA interest may have existed, by issuing the chairperson stated that the SBOTA member following recommendations: in question had resigned his post. A draft scope statement for a Legislative Post Audit The Committee recommends was distributed, as requested by the introduction of legislation expanding the Chairperson and Vice-Chairperson of the Board to five members, from three, as Special Committee on Assessment and currently required. The legislation should Taxation. The scope statement outlined a he drafted to include requirements regarding study to examine the facts related to the Congressional district representation and complaint allegations. The Secretary of other requirements that approximate the law Revenue also appeared to support SBOTA as it existed when it previously required a and its function. Others testified in favor of five-member board. The Committee maintaining the requirement that one recommends this legislation begin in the member be a certified public accountant. Senate.
At the November meeting, the The Committee strongly emphasizes that Committee centered its concern and each SBOTA member is currently required discussion largely around the issue of what by law to devote full time to the duties of his could be construed as a conflict of interest or her office. with respect to SBOTA. Committee members discussed KSA 74-2434, which Because of questions regarding the requires SBOTA members to “devote full existence of disciplinary proceedings for time” to their duties. The Committee SBOTA members, the Committee requests questioned whether mechanisms exist for that the Chairman, with the assistance of the dealing with violations of the law regarding First Assistant Revisor, draft a letter items such as conflicts of interest in general, requesting an Attorney General Opinion to and specifically regarding outside clarify the following: employment that could be construed as a conflict of interest. Members questioned • The mechanism(s) under which a whether non-lawyer members of SBOTA SBOTA member may be disciplined for could be disciplined under the Code of violations related to full-time Judicial Conduct or under KSA Chapter 60, employment and conflicts of interest.
Kansas Legislative Research Department 2-17 2006 Taxation These may include, but are not o Laws governing SBOTA members necessarily limited to, the following: who are also members of the State Board of Accountancy. o Whether the Kansas Supreme Court Code of Judicial Conduct can be o Removal for cause by the Governor applied only to lawyer members. pursuant to KSA 74-2433.
o KSA Chapter 60, Article 12, dealing • To the extent the requirements of the with forfeiture of public office. Code of Judicial Conduct may be enforced upon any particular member, whether the canons of the Code require a member to divest himself or herself from interests that relate to his or her SBOTA duties.
Kansas Legislative Research Department 2-18 2006 Taxation
stare ATTACHMENT A m / General Requirements General limited to published decisions of an the the district court. function until confirmed by the Senate. Subject to the Supreme Court rules of judicial conduct applicable to all judges of Board is bound by the doctrine of (*To abide by, or adhere to, decided cases Cannot exercise any SBOTA power, duty, or (expire on January 15 of the last year unless Source: Black's Law Dictionary) otherwise provided). decisis* appellate court other than a district court. Terms of four years and until their successors are appointed and confirmed requirements. Same Same Complete specified appraisal course General Qualifications General Kansas resident. Selected with special reference to training and experience for the Individuals with legal, accounting Same Not Not more than two of the same political party. duties imposed by the act. or appraisal training and experience. appointed from any one Kansas Same No No more than one member Congressional district. KSA 74-2433 SBOTA Membership Qualifications and Requirements Specific Qualifications Specific Engaged Engaged for at least five years in None active practice as a CPA. law law in Kansas. Engaged Engaged for at least five years in active law practice as a lawyer or judge in any Kansas court. Regularly admitted to practice Certified Public Accountant (CPA) Third member Lawyer
Kansas Legislative Research Department 2-19 2006 Taxation Special Committee on Assessment and Taxation
Residential Property Tax Valuation Cap
Conclusions and Recommendations
The Committee finds that a residential valuation cap would tend to shift property taxes away from real estate where values are increasing rapidly and on to other real estate where values are not increasing at the rate of the cap. The Committee further finds that a property tax system with a valuation cap could be especially onerous for young families entering the housing market for the first time.
Proposed Legislation: None.
Background expressed by the adoption of fair market value in valuation of property for tax Among the constitutional amendments purposes. Exceptions to this uniform and under consideration by the House Taxation equal basis of valuation must be contained Committee in 2006 was HCR 5027, a in the Constitution. Attempts by the measure that would have limited the annual Legislature to provide exceptions to the property valuation increases for most uniform and equal basis of valuation residential parcels to the rate of inflation. through statutory means would likely be The House Committee and Chairperson Wilk constitutionally invalid. The Constitution asked the Legislative Coordinating Council does provide for exceptions to such basis of (LCC) to refer the issue for further study. valuation and grants the authority of the Legislature to provide for exceptions to such The LCC subsequently charged the valuation basis for recreational vehicles, Special Committee with reviewing the policy motor vehicles, mineral products, money, implications of 2006 HCR 5027 and making mortgages, notes and other evidence of debt, whatever recommendations are deemed and grain. appropriate to the 2007 Legislature. Specifically, the Special Committee is asked Specified limitations on valuation to recommend whether the proposed growth or the grant of authority for the amendment or something similar should be Legislature to prescribe limitations on reintroduced for consideration in 2007. valuation growth need to be contained in amendments to the Constitution. Any such Property Tax Constitutional propositions to amend the Constitution Amendments Since 2000 should be expressed as exceptions to the uniform and equal basis of valuation and are Section 1 of Article 11 of the Kansas often expressed as exceptions to fair market Constitution directs the Legislature to value. Numerous such proposed provide for a uniform and equal basis of constitutional amendments have been valuation and rate of taxation of all property introduced in the Senate and House, subject to taxation. Decisions of the Kansas especially since 2000. Supreme Court have equated this taxation provision with the equal protection doctrine These proposed amendments may be contained in our Bill of Rights. In this state, grouped into two basic categories. The first uniform and equal basis of valuation is category involves general authority granted
Kansas Legislative Research Department 2-20 2006 Taxation to the Legislature to exercise such authority property with a valuation of < $250,000 upon its own volition; and the second when owned and the principal residence category involves a constitutional directive of a Kansas resident 65 years of age or to the Legislature to enact legislation with older on January 1 of any tax year. The some specificity written into the Legislature is granted authority to enact Constitution. adjustments in the age and valuation requirements (2004 HCR 5032 by With regard to the first category, these Tafanelli, Wilk and others). A similar propositions would add language to the variation places the residence valuation Constitution to grant the Legislature limitation at < $100,000 and is authority to statutorily limit increases in otherwise identical (2005 HCR 5008 by valuation of property. (No specific Huff and others). Finally, a 2005 SCR limitations would be written into the contained the same provisions as 2004 Constitution.) Examples in this category are: HCR 5032, except there was no valuation ceiling. Residential property of any (1) Authority for the Legislature to place value would qualify for the valuation limitations upon increases in valuation limitation. This proposed constitutional of any class or subclass of real property. amendment did require that the (2000 HCR 5031 by Tanner and others; residential property owner must have 2001 HCR 5026 by Glasscock and others; owned the subject property for at least and 2002 HCR 5045 by Edmonds); and 10 years (2005 SCR 1605 by Haley).
(2) Authority for the Legislature to place (2) There were two variations of limitations upon increases in valuation constitutional limitations of specific of real property used for residential increases in valuation. Rather than purposes. (2004 HCR 5031 by Gatewood prescribing a percentage expressed in the and Faber; 2004 SCR 1620 by Umbarger Constitution or requiring the percentage and others). to be provided by statute, such limitations are to be measured against consumer price indexes. The first The second category of proposed proposed amendment limited percentage amendments provide specific language to he increases in valuation of all real property written into the Constitution that would to the increase in the consumer price require the Legislature to enact legislation to: index - real estate (2000 HCR 5035 by provide limitations on increases of valuation House Committee on Federal and State of certain property owned by certain Affairs). The other proposed taxpayers; provide limitations on increases amendment limited percentage increases of valuation measured against various in valuation of real property used for consumer price indexes; or specify residential purposes to the average requirements as to determination of increase of the consumer price index - valuation of certain real property. To a large urban (2006 HCR 5027 by House extent, all of these constitutional Committee on Taxation). amendments constitute exceptions to the uniform and equal basis of valuation (3) There were two proposed constitutional through modification of the fair market amendments that provided that the value standard contained in law. Examples Legislature shall enact legislation to in this category are: 1 require that the appraised valuation of real property used for residential (1) Amendments to require the Legislature purposes is to be adjusted to an amount to provide by law to limit the increase in equal to the average of the appraised valuation of single-family residential real value of such real property when sold
Kansas Legislative Research Department 2-21 2006 Taxation and the sales price of such real property 2006 HCR 5027 when sold (2004 HCR 5042 by House Committee on Taxation; 2005 HCR 5009 As mentioned previously, HCR 5027 by F. Miller). would have limited the annual property valuation increases for most residential Other Approaches to Property Tax Relief parcels to the rate of inflation. Exceptions would have been provided for new or newly The Legislature in recent years also has improved residential real property (which analyzed a number of other mechanisms would have been valued in the initial year designed to provide property tax relief to based upon the valuation of similar certain classes of property or targeted at properties); and for residential real property selected groups of taxpayers. Among the which had been sold in the previous year other forms of property tax relief discussed (which would have been valued at the sales include increased state aid to local units of price). government (restoration of demand transfers); expansion of Homestead Property If adopted by the voters, the amendment Tax Refund Program (subject of another would have had an indeterminate fiscal 2006 interim study); whether some form of impact to the state to the extent that less the tax lid law should be reimposed on local revenues would have been raised by the 21.5 units of government (subject of another 2006 mills in state property tax levies. interim study); property tax deferral programs; and whether the $20,000 A similar proposal was last studied by “homestead” exemption from the mandatory the Special Committee in 1999. That Special school district general fund property tax levy Committee declined to recommend a should be expanded or extended to all constitutional amendment limiting growth property taxes. in assessed valuation, noting that such a proposal could cause; As to the latter two issues, the National Conference of State Legislatures (NCSL) • a tax shift away from real estate where reports that 24 states and the District of values are increasing rapidly and on to Columbia have property tax deferral other real estate where values are not programs, with many of them targeted increasing at the rate of the cap; specifically to benefit elderly taxpayers. Legislation was approved by the Kansas • a tax shift which could increase the tax House but not the Senate in 1990 that would burden borne by young families entering have established a Kansas deferral program the housing market for the first time; and for certain low income taxpayers who were age 65 and above. The issue was • a tax shift away from real estate and on subsequently studied by the 1990 Special to personal property, especially oil and Committee on Assessment and Taxation, gas and commercial and industrial which made no recommendations on the machinery and equipment. proposal. NCSL also reports that 33 states (including Kansas) and the District of Columbia have some form of “homestead” HCR 5027 would have been placed on program wherein a portion of the valuation the November 7, 2006, general election of certain residential properties is exempt ballot, had it been approved by the from property taxation. necessary two-thirds majority of both legislative chambers. Had it been subsequently adopted by the voters, it would have been effective beginning in tax year 2007. One set of policy decisions the
Kansas Legislative Research Department 2-22 2006 Taxation Committee would need to consider before reintroduction of HCR 5027. Opponents reintroducing a similar amendment would included the League of Kansas relate to the revised date of election and Municipalities and Kansas Association of potential implementation date. Counties.
Committee Activities Conclusions and Recommendations
At the October meeting, staff reviewed a The Committee finds that a residential number of constitutional amendments valuation cap such as the one proposed in considered since 2000 that would have 2006 HCR 5027 would tend to shift property provided exceptions to uniform and equal taxes away from real estate where values are valuation of certain real estate. increasing rapidly and on to other real estate where values are not increasing at the rate of Staff also compared and contrasted those the cap. The Committee further finds that a proposals with HCR 5027 and with other property tax system with a valuation cap property tax relief mechanisms under could be especially onerous for young consideration in Kansas and in other states. families entering the housing market for the first time. The Director of Property Valuation explained to the Committee how local The Committee notes that these property taxes and budgets are set; and how conclusions are strikingly similar to those property taxes tend to shift when the tax made by the 1999 Special Committee on base is narrowed or when certain classes or Assessment and Taxation. subclasses of property are granted tax- favored treatment. The Committee therefore declines to reintroduce a proposed valuation cap During the public hearing, no constitutional amendment for consideration proponents appeared to request the in 2007.
Kansas Legislative Research Department 2-23 2006 Taxation Special Committee on Assessment and Taxation
State and Local Tax Policy
Conclusions and Recommendations
The Committee expresses its concern about the recent trend of legislation that would earmark future sales, income, and property tax streams for funds other than the State General Fund (SGF). The Committee recommends that the withholding tax in particular no longer be allowed to be diverted away from the SGF, except as a last resort relative to retention of an existing business. The Committee further expresses its concern about the erosion of all major tax bases, especially the sales tax base. The Committee strongly recommends that certain specific questions relating to justification of any new exemptions be answered by all parties seeking sales tax exemption legislation. The Committee also strongly recommends that the leadership of the standing tax committees develop rules that would prohibit advancement of any sales tax exemption legislation until these questions have been answered satisfactorily by proponents.
The Committee notes that the top corporation income tax bracket may represent an economic development disincentive and encourages the 2007 Kansas Legislature to consider reducing that rate as part of a broader restructuring of the corporation income tax. That restructuring also should include simplification of the “high performance” income tax credit program be simplified; and the creation of broader availability for investment income tax credits in general. The Committee recommends the repeal of seldom-used income tax credits.
The Committee further recommends a corporation franchise tax exemption for certain assets of subsidiary corporations.
The Committee finds that one of the biggest future challenges involves local governmental service delivery systems and public angst over the property taxes associated therewith.
The Committee asks the Property Valuation Division to conduct a study of townships and report back to the tax and local government committees with respect to how many townships are actively levying property taxes and the range of activities being funded.
The Committee also recommends that the Legislature act as a facilitator to the discussion of local service delivery restructuring by enacting legislation that would repeal any and all statutory barriers to restructuring. The Secretary of Revenue should compile an exhaustive list of all such barriers and submit it to the tax and local government committees during the first week of the 2007 session.
The Committee further recommends that a tool be developed to evaluate the possibility of multi-jurisdictional service-delivery systems by quantifying potential property tax savings associated with such entities. This tool, which would be developed under the auspices of the KACIR, would be made available free-of-charge to local units of government wishing to explore realignment of certain services, including infrastructure maintenance, health, vehicle registration, reappraisal, elections, and deed registration. Access to such information would allow local units of government and their taxpayers to make well-informed decisions about how to proceed.
Kansas Legislative Research Department 2-24 2006 Taxation A second model should also be developed by KACIR that would help estimate the amount of property tax relief that could be provided if the funding of certain public safety functions were to be assumed by the state. One proposal would empower citizens within each of the 31 judicial districts to abolish county attorneys and replace that system with state-funded district attorneys. Data should continue to be compiled prior to the start of the session regarding county attorney budgets and mill levy equivalencies, and the tax and judiciary committees should jointly review the data. Legislation should subsequently he introduced that would allow citizens within the judicial districts to hold elections that would change their prosecutorial model. The model also should continue to be adapted to help quantify property tax relief associated with having additional state funding of other public safety functions, including corrections.
Proposed Legislation: None.
Background would improve Kansas’ competitiveness with other states. The 2005 Special Committee on Assessment and Taxation, as part of a broad Other 2005 Recommendations topic entitled, “Analysis of State and Local Tax Policy,” received a report from Secretary In addition to recommending that a new Wagnon on a number of studies that had study he empaneled to receive the studies been commissioned by the Department of being prepared by the Department of Revenue and the Kansas Advisory Revenue and KACIR, the 2005 Special Commission on Intergovernmental Relations Committee made a number of other findings (KACIR), including studies of sales and and recommendations in three areas - state property tax base erosion; tax incidence; and and local tax policy linkage; long-run growth the rapid expansion of state and local and the SGF; and business tax governmental debt. That Committee recommendations. anticipated “the importance of the need to give these reports in-depth review and State and Local Tax Policy Linkage therefore requests that the Legislative Coordinating Council (LCC) again approve a • The Committee recommended that the Special Committee on Assessment and context within which the Legislature Taxation to study the same state and local views state tax policy and potential tax policy topic during the summer and fall changes should always include of 2006.” consideration of the implications on local tax policy, especially property The LCC subsequently agreed to renew taxes. the broad-based state and local tax study, charging the 2006 Special Committee with • The Committee strongly encouraged the studying and projecting the future of Kansas 2006 Legislature to provide property tax tax policy for the next 10 to 20 years. As a relief by authorizing the restoration of follow-up to a 2005 interim study, the 2006 sales tax demand transfers to local units Committee was further asked to review the of government. If it was determined that current state and local tax structure, the demand transfer program needed to focusing on the shifts in reliance on sales, be restructured, the Committee property, and income taxes since 1990. The recommended that special emphasis be Committee was asked to review which tax placed on providing additional funds for structure components would be most local units in rural areas. equitable to the taxpayers of Kansas; and
Kansas Legislative Research Department 2-25 2006 Taxation • The Committee also asked that the Business Tax Recommendations standing tax committees monitor the implications of the growing regional • The Committee expressed its concern differences in local sales tax rates. about the volatility of corporation income tax receipts over the last decade. The Committee therefore recommended Long-Run Growth and the SGF that the Department of Revenue report to the standing tax committees on policy • The Committee made a finding that the options regarding modernization and overall elasticity of tax receipts, structural changes to the tax that would especially SGF tax receipts, appeared to help assure that it continues to be a be declining to the point that the ability viable revenue source well into the of the state to fund ongoing and future. necessary expenditures without periodic tax increases has been imperilled. The • The Committee recommended that the Committee expressed its concern about Legislature attempt to provide a property the recent trend of legislation to earmark tax exemption for commercial and future sales, income, and property tax industrial machinery and equipment and revenue streams from specific industries notes that options under consideration or businesses, including legislation would include a full statutory associated with the development of exemption; expansion of the existing sales-tax-and revenue bonds and the income tax credit to 100 percent; or a neighborhood revitalization program. constitutional amendment authorizing the Legislature to phase in a full • The Committee, therefore, recommended exemption over a period of years. that a more rigorous fiscal review be applied to future legislation seeking to earmark revenues historically placed in Committee Activities the SGF and asked that all such bills be referred to the standing tax committees. At the September meeting, the Committee received the KACIR studies, • Because of the proliferation of legislation which were conducted by the Kansas Public associated with the diversion of Finance Center, a part of the Hugo Wall revenues, the Committee asked that the School of Urban and Public Affairs at standing tax and appropriations Wichita State University. committees’ work with staff at the Division of Budget and the Legislative Dr. John Wong presented a study on tax Research Department to develop a new incidence. Among the principal findings monthly receipts report that was a conclusion that the Kansas individual disaggregates taxes and other receipts income tax is modestly progressive; and that relative to the amount placed in the SGF such progressivity does not completely offset compared to the amount placed in all the regressivity of the other major tax other funds. • sources.
• Also because of the concern over long- Dr. Wong then presented a study on sales run state revenue growth issues, the tax base erosion, noting that economic and Committee further recommended that technological changes in recent years had the 2006 Legislature memorialize joined legislatively enacted exemptions as Congress to minimize all federal the major sources of erosion. He said that preemption of state taxing authority. one study had estimated that extending the tax to all ‘readily taxable” services could
Kansas Legislative Research Department 2-26 2006 Taxation increase revenue by over $500 million. He At the October meeting, Secretary added that the main arguments for inclusion Wagnon delivered her perspective on the of additional services in the sales tax base past, present, and future of Kansas state and included: local tax policy. She said that if the Legislature continued to allow erosion of the • the sales tax should be as broadly major tax bases, there would be higher tax applicable to consumer expenditures as rates; less equity among various groups of possible; taxpayers; less competitiveness and more taxpayer discontent; and more special • taxation of services would reduce the interest groups’ requesting exemptions - regressivity of the sales tax; creating a vicious cycle.
• revenues would be more responsive to She said that the KACIR studies had rising levels of personal income; and indicated that Kansas state and local tax policy faces a number of serious challenges • administration of the tax would be in addition to tax base erosion, including simplified if the tax were extended to over-reliance on the property tax; declining those services entered in conjunction elasticity of major tax sources; and with the sales of tangible personal increasing demands on state and local property. governmental services.
Dr. Glenn Fisher presented a study on Secretary Wagnon said that tax base property tax base erosion, stating that the erosion had been occurring because of the Kansas property tax is evolving largely into enactment of a number of exemptions and a real estate tax, due at least in part to the tax credits; and because of economic shifts increased propensity of the Legislature to in consumption and business practices, exempt personal property. He said that given many relating to new technologies. She also the importance of the tax for local said that the authorization of sales tax and government revenue, any major changes in revenue (STAR) bonds and the propensity of the property tax system would likely be the Legislature to earmark future revenue controversial and potentially painful. streams threatened the elasticity of tax receipts relative to the State General Fund Dr. Bart Hildreth presented a study on (SGF). She said that once a special practice the extent to which Kansas local government or tax treatment had been established, it was debt has been increasing over the last 15 often difficult for the Legislature to years. He said that policy choices for those backtrack and stop that process. Faced with concerned about the mounting local debt a similar situation more than three decades burden included enacting tighter limits; ago, the “Hodge Committee” in the early promoting debt coordination; and enhancing 1970s formed a special commission to transparency to enable taxpayer review tax policies and make decisions on “comparison” shopping. which special exemptions, exceptions, and credits should be restructured or totally The Chair subsequently offered an eliminated. invitation to all communities across Kansas to attend the October meeting and outline The Secretary said that she hoped the their service deliveries and revenue needs in Committee would strongly recommend that their respective regions. Communities were the Legislature, in the future, protect the invited to determine how an ideal local withholding tax and not allow any other funding package might look and to bring any circumstances wherein major tax sources and all innovative approaches forward to the could be diverted from the SGF. The Committee. Secretary subsequently outlined a variety of
Kansas Legislative Research Department 2-27 2006 Taxation policy options for the Committee to Following a discussion of local revenue consider, including modernizing the needs, the Committee began an extensive corporation income tax structure by discussion of local and regional service adjusting the rate structure and the delivery structures. The Chair stated that apportionment formula; simplifying various the number of local units of government in business-related tax credits and repealing Kansas was the highest in the nation in per those which are seldom used; developing capita terms and wondered aloud whether criteria for evaluating future sales tax the more than 4,000 taxing entities in the exemption requests; eliminating the state represented the most efficient structure franchise tax imposed on the assets of for delivering services. Representative Jerry certain subsidiary corporations; and Henry suggested that one of the universities continuing the discussion about or the KACIR attempt to build a model for restructuring local government finance. analyzing a multi-county service delivery system with an emphasis on efficiency and Conferees representing AARP and not on politics. The Chair said that he Kansas Action for Children said that Kansas would try to have Secretary Wagnon, prior should consider a number of equity issues, to the November meeting, coordinate including the ability to pay, when looking at discussions about that idea with local units major tax structure issues. of government and other stakeholders. Secretary Wagnon said that she would bring The Executive Director of the League of the topic up for discussion on November 1 at Kansas Municipalities said that cities could the KACIR summit in Salina. Senator Derek reduce reliance on property taxes if they Schmidt and Senator Greta Goodwin also were granted additional authority to levy volunteered to establish a working group local income, earnings, motor fuel, and that would explore the possibility of excise taxes. He also said that the relieving local property taxpayers of the Legislature could remove impediments that burden of supporting most public safety discourage local units from combining for functions by moving most funding for such the purpose of streamlining the delivery of functions to the state level. local governmental services. At the November meeting, the A conferee representing the Kansas Committee reviewed its work at the previous Association of Counties agreed, stating that two meetings and made final policy all levels of government needed to nurture a decisions. culture of cross-jurisdictional collaboration.
A representative of the Unified Conclusions and Recommendations Government of Wyandotte County and Kansas City, Kansas, said that the entity Long-Run Growth and SGF Receipts strongly supported a local option earnings tax which could be used to further reduce The Committee again expresses its property taxes. concern (just as it did in 2005) about the recent trend of legislation that would A conferee representing the Kansas earmark future sales, income, and property Chamber of Commerce and Industry stated tax streams for funds other than the SGF. that the business machinery and equipment property tax exemption was extremely The Committee recommends that the helpful to many Kansas businesses; and that withholding tax, in particular, no longer be some form of corporation franchise tax relief allowed to be diverted away from the SGF, would continue to help those businesses except as a last resort relative to retention of stimulate the economy. an existing business. The Committee
Kansas Legislative Research Department 2-28 2006 Taxation encourages the Legislature to first attempt to the next decade involves local and regional utilize any and all other tools at its disposal governmental service delivery systems and in business retention or business attraction public angst over the property taxes efforts. associated with those services and systems.
The Committee further expresses its The Committee notes that townships by concern about the erosion of all major tax far appear to represent the largest number of bases, especially the sales tax base. The taxing subdivisions in the state. The Committee strongly recommends that Committee asks the Property Valuation certain specific questions relating to Division to conduct a study of townships justification of any new exemptions he and report back to the tax and local answered by all parties seeking sales tax government committees with respect to how exemption legislation (see Tax Incidence many townships are actively levying and Tax Base Erosion topic for more details). property taxes and how many are not; and what are the range of activities being funded The Committee also strongly by the townships. recommends that the leadership of the standing tax committees develop rules that The Committee also recommends that would prohibit advancement of any sales tax the debate regarding potential restructuring exemption legislation until these questions of local service delivery systems be driven have been answered satisfactorily by by local needs and local issues and not by proponents. state mandates. The Legislature may best act as a facilitator to this discussion by enacting Business Tax Recommendations legislation that would repeal any and all statutory barriers and impediments to local The Committee notes that the top governmental service restructuring. The corporation income tax bracket of 7.35 Secretary of Revenue, in conjunction with percent may well represent an economic the League of Kansas Municipalities and development disincentive and, therefore, Kansas Association of Counties, should encourages the 2007 Kansas Legislature to compile an exhaustive list of all such consider reducing that rate as part of a statutory impediments and submit it to the broader restructuring of the corporation tax and local government committees during income tax. As part of that restructuring, the the first week of the 2007 Legislative Committee also recommends that the “high Session. performance” income tax credit program be simplified; and that the availability of The Committee further recommends that investment income tax credits in general be a tool be developed to evaluate the broadened. The Committee recommends the possibility of multi-jurisdictional service- repeal of seldom-used income tax credits. delivery systems by quantifying potential property tax savings and budget reductions The Committee further recommends a associated with such entities. This tool, corporation franchise tax exemption for which would be developed under the certain assets of subsidiary corporations auspices of the KACIR by the Hugo Wall which have been subject to taxation School of Urban and Public Affairs at previously as assets of parent corporations. Wichita State University in conjunction with input from the Kansas Association of Local Governmental Service Delivery Counties and League of Kansas and Property Taxes Municipalities, would be made available free-of-charge to local units of government The Committee finds that one of the wishing to explore realignment of certain biggest challenges facing policymakers over local services.
Kansas Legislative Research Department 2-29 2006 Taxation As part of the development of the funding of certain public safety functions aforementioned tool, the KACIR should seek were to be assumed by the state. One the capacity to compare and contrast proposal discussed during the interim would potential changes in Kansas with other empower citizens within each of the 31 successful examples of local service judicial districts to abolish county attorneys realignments from around the nation. and replace that system with state-funded district attorneys. Data should continue to Local services and functions that be compiled prior to the start of the 2007 potentially could be reviewed would include session regarding county attorney budgets infrastructure maintenance, health, vehicle and mill levy equivalencies, and the tax and registration, reappraisal, elections, and deed judiciary committees should jointly review registration. Access to such information the data. Legislation should subsequently be would allow local units of government and introduced that would allow citizens within their taxpayers to make their own well- the judicial districts to hold elections that informed decisions about how to proceed would change their prosecutorial model in with the discussion. this manner. The model also should continue to be adapted to help quantify the A second model also should be potential property tax relief associated with developed by KACIR and the Hugo Wall having additional state funding of other School of Urban and Public Affairs that public safety functions, including would help estimate the amount of property corrections. tax relief that could be provided if the
Kansas Legislative Research Department 2-30 2006 Taxation Special Committee on Assessment and Taxation
Tax Incidence and Tax Base Erosion
Conclusions and Recommendations
The Committee expresses its concern about the erosion of all major tax bases, especially the sales tax base. The Committee strongly recommends that certain specific questions relating to justification of any new exemptions be answered by all parties seeking sales tax exemption legislation.
The Committee further strongly recommends that the leadership of the standing tax committees develop rules that would prohibit advancement of any sales tax exemption legislation until these questions have been answered satisfactorily by proponents.
Finally, the Committee recommends that the standing committees consider tax incidence and progressivity-regressivity issues with respect to all major state and local tax policy changes.
Proposed Legislation: None.
Background Committee Activities
The 2005 Special Committee on At the September meeting, the Assessment and Taxation, as part of a broad Committee received the KACIR studies, topic entitled, “Analysis of State and Local which were conducted by the Kansas Public Tax Policy,” received a report from Secretary Finance Center, a part of the Hugo Wall Wagnon on a number of studies that had School of Urban and Public Affairs at been commissioned by the Department of Wichita State University. Revenue and the Kansas Advisory Commission on Intergovernmental Relations Dr. John Wong presented a study on tax (KACIR), including studies of sales and incidence. Among the principal findings property tax base erosion; and on tax was a conclusion that the Kansas individual incidence. That Committee anticipated “the income tax is modestly progressive; and that importance of the need to give these reports such progressivity does not completely offset in-depth review” and requested that the the regressivity of the other major tax reports be submitted and reviewed by sources. another Special Committee established by the Legislative Coordinating Council (LCC) Dr. Wong then presented a study on sales during the summer and fall of 2006. tax base erosion, noting that economic and technological changes in recent years had The LCC subsequently agreed and joined legislatively enacted exemptions as charged the 2006 Special Committee with the major sources of erosion. He said that reviewing the latest research on tax one study had estimated that extending the incidence of the major tax sources, including tax to all “readily taxable” services could the policy considerations of moving to a flat- increase revenue by over $500 million. He rate income tax. The Committee also was added that the main arguments for inclusion asked to study erosion of sales and property of additional services in the sales tax base tax bases as part of the review of tax included: incidence.
Kansas Legislative Research Department 2-31 2006 Taxation • the sales tax should be as broadly (SGF). She said that once a special practice applicable to consumer expenditures as or tax treatment had been established, it was possible; often difficult for the Legislature to backtrack and stop that process. Faced with • taxation of services would reduce the a similar situation more than three decades regressivity of the sales tax; ago, the “Hodge Committee” in the early 1970s formed a special commission to • revenues would be more responsive to review tax policies and make decisions on rising levels of personal income; and which special exemptions, exceptions, and credits should be restructured or totally • administration of the tax would be eliminated. simplified if the tax were extended to those services rendered in conjunction The Secretary suggested that the with the sales of tangible personal following criteria be considered when property. evaluating future sales tax exemption requests:
Dr. Glenn Fisher presented a study on (1) Does this exemption help maintain the property tax base erosion, stating that the sales tax as a final tax on consumption? Kansas property tax is evolving largely into a real estate tax, due at least in part to the (2) Does this exemption help make the tax increased propensity of the Legislature to more easily administered, or would it exempt personal property. He said that lead to confusion over why one given the importance of the tax for local organization or entity is taxed while government revenue, any major changes in another is not? the property tax system would likely be controversial and potentially painful. (3) Who is the principal beneficiary? What would be lost if the exemption were not At the October meeting, Secretary to be granted? Wagnon made a number of comments with respect to tax base erosion. She (4) Does this exemption establish an unfair said that if the Legislature continued to competitive advantage for one entity allow erosion of the major tax bases, there over another? would be higher tax rates; less equity among various groups of taxpayers; less (5) Is this exemption targeted to a broad competitiveness and more taxpayer class of taxpayers or a narrow group? If discontent; and more special interest groups’ the latter, why should all members of the requesting exemptions—creating a vicious broad class not be included? If the cycle. exemption were to be granted, what other groups would look at the precedent She also said that tax base erosion had and asked to be added to the exemption? been occurring because of the enactment of a number of exemptions and tax credits; and (6) What is the public benefit for granting because of economic shifts in consumption the exemption? Does it outweigh the and business practices, many relating to new loss of revenue for the general activities technologies. She also said that the of the state? authorization of sales tax and revenue (STAR) bonds and the propensity of the Conferees representing AARP and Legislature to earmark future revenue Kansas Action for Children agreed that streams threatened the elasticity of tax erosion of the major tax bases needed to receipts relative to the State General Fund stop; and said that a number of exemptions
Kansas Legislative Research Department 2-32 2006 Taxation enacted in recent years had made the overall (1) Does this exemption help maintain the state and local tax structure more regressive. sales tax as a final tax on consumption?
Also at the October meeting, the (2) Does this exemption help make the tax Committee received information from the more easily administered, or would it Department of Revenue on the potential lead to confusion over why one impact on certain taxpayers of moving to a organization or entity is taxed while revenue-neutral single income tax (“flat”) another is not? rate income tax structure. Replacing the current individual income tax rates with a (3) Who is the principal beneficiary? What 5.10 percent rate would in the aggregate be would be lost if the exemption were not revenue-neutral, according to the to be granted? information. The following table summarizes the average impact per return (4) Does this exemption establish an unfair for taxpayers in various Kansas adjusted competitive advantage for one entity gross income (KAGI) brackets: over another?
Average (5) Is this exemption targeted to a broad KAGI Brackets Dollar Change class of taxpayers or a narrow group? If the latter, why should all members of the $ 0 $ 10,000 $ 15.39 broad class not be included? If the 10,000 20.000 83.26 exemption were to be granted, what 20,000 30,000 126.29 30.000 50,000 206.89 other groups would look at the precedent 50,000 75,000 166.19 and asked to be added to the exemption? 75,000 100,000 (45.84) 100,000 200,000 (562.79) (6) What is the public benefit for granting $ 200,000 Over $ (3,915.13) the exemption? Does it outweigh the loss of revenue for the general activities of the state? At the November meeting, the Committee reviewed its work at the previous two' meetings and made final policy The Committee further recommends that decisions. the leadership of the Senate Assessment and Taxation Committee and the House Taxation Committee develop committee rules that Conclusions and Recommendations would prohibit advancement of any sales tax exemption legislation until these questions The Committee expresses its concern have been answered satisfactorily by about the erosion of all major tax bases, proponents of such legislation. especially the sales tax base. The Committee strongly recommends that the following Finally, the Committee recommends that questions be asked of and answered by all the standing tax committees consider tax parties seeking sales tax exemption incidence and progressivity-regressivity legislation: issues with respect to all major state and local tax policy changes.
Kansas Legislative Research Department 2-33 2006 Taxation Special Committee on Assessment and Taxation
“Truth in Taxation” Local Budget Law
Conclusions and Recommendations
The Committee finds that the decision made in 1999 to abolish the tax lid in favor of the truth in taxation lid represented an appropriate choice of no longer seeking to micro-manage local units of government.
The Committee further notes that no report surfaced of any local unit having violated the truth in taxation provisions.
The Committee encourages the Department of Revenue to establish a comprehensive “truth in taxation” website that could make a variety of federal, state, and local tax information available to taxpayers.
Proposed Legislation: None.
Background property taxes levied for special purposes. Property taxes levied as a result of new Property Tax Lid: 1989-1999 improvements to real estate and added personal property were exempt from the The Legislature in 1985 enacted an computation, as were taxes levied as a result aggregate property tax limitation (tax lid) of added territory or a service that had been that was effective beginning with tax year transferred from another governmental unit. 1989 so as to coincide with the Other exemptions from the formula included implementation of property tax reappraisal property taxes levied for public building and classification (see KSA 79-5021 et seq). commissions: judgments, settlements and Because of the significant expansion in expenses for protection against liability; statewide assessed valuation anticipated as employer contributions for workers a result of reappraisal, the Legislature compensation, unemployment insurance, wanted a limitation on overall property taxes health care costs, employee benefit plans, imposed by taxing subdivisions (many of and employee retirement and pension whom otherwise could have received a programs: district court operations: payment windfall if mill levy rates were not rolled of out-district tuition to community colleges back). Numerous individual statutory fund and Washburn: certain juvenile delinquency levy limits, therefore, were suspended and and crime prevention programs; rebates replaced with the aggregate tax lid granted to property owners in conjunction mechanism (see KSA 79-5022), which was with neighborhood revitalization programs; applied to total property tax dollars levied in expenses necessary to interface with the lieu of the mill levy rates. state criminal justice information system; certain mental health services; and revenues The tax lid provided generally prohibited to replace reductions in motor vehicle taxes. local units from levying property taxes in greater amounts than a “base” year (choice of Local units seeking to levy more in taxes either 1988 or 1989), subject to a number of beyond amounts not authorized by the exemptions and exceptions relative to aforementioned exemptions and exceptions
Kansas Legislative Research Department 2-34 2006 Taxation had authority pursuant to KSA 79-5036 to The provisions of the truth in taxation exempt themselves from all or a portion of lid, enacted in SB 45, provide that taxing the remaining restrictions of the tax lid by subdivisions (defined more narrowly than approving charter ordinances or resolutions. the 1989 tax lid to exclude unified school Such ordinances or resolutions were then districts and community colleges) are subject to various publication and protest prohibited, absent adoption of a resolution petition requirements, under which a certain or ordinance so acknowledging, from percentage of the electorate could force an approving appropriations or budgets funded election on the question of the proposed tax from property tax increases, except with lid exemptions (and efforts to increase regard to increases attributable to new property taxes beyond a certain point). improvements to real estate; certain added personal property valuation; property The tax lid was extended a number of located within added jurisdictional territory; times throughout the 1990s, with the last property which has changed in use; and for extension coming in 1997 (see 1997 SB 7). payment of principal and interest upon Under that legislation, the tax lid was bonded indebtedness, temporary notes, and extended for an additional two years — until no-fund warrants (see KSA 79-2925b). July 1, 1999—at which time it was allowed to expire (see KSA 79-5038). Local units of The acknowledgment resolutions and government traditionally opposed re ordinances are not subject to protest petition extension of the tax lid, generally arguing but instead represent an official record for that local officials with authority to levy the benefit of the press and the public of property taxes were elected just like certain property tax increases approved by members of the Legislature; that local units local governing bodies, notwithstanding of government had a better idea of the what may be happening with mill levies. demand for local services from the public and did not need to be micro-managed by The legislation also finally repealed the statewide legislation; and that the tax lid many of hundreds of different statutory fund appeared somewhat hypocritical in that its levy limits. (Absent this provision, the provisions did not apply to the state mill individual fund levy limits which had been levies for building funds and school district suspended since 1989 would have been general funds. reactivated once the aggregate lid sunset on July 1, 1999.) Truth in Taxation Lid: 1999-Present The truth in taxation provisions have not Cognizant of the imminent expiration of been modified since they were enacted in the aggregate tax lid, the 1999 Legislature 1999. sought to replace it with a different mechanism known as “truth in taxation.” 2006 Interim Study The legislation was crafted amid ongoing concerns over confusion regarding the extent Because of ongoing concerns over to which local units may or may not have increased property taxes, interim study been increasing property taxes. The fact that requests were received from Rep. Wilk, mill levy rates in and of themselves did not Senator Allen, and Senator Brownlee to necessarily represent an accurate measure review the truth in taxation provisions and for annual changes in property taxes (the determine whether they were functioning other big variable being changes in assessed adequately as a replacement mechanism for valuation) caused the legislation to be the old tax lid law. drafted with an emphasis on requiring local units to acknowledge to the press and the The Legislative Coordinating Council public when taxes were being increased. subsequently approved the request and
Kansas Legislative Research Department 2-35 2006 Taxation charged the Special Committee to study the The Committee also discussed asking current “truth in taxation” property tax law Secretary Wagnon to explore the feasibility that local governments have operated under of establishing a comprehensive “truth in since the late 1990's. The Committee is taxation” website that could make a variety asked further to determine if local of federal, state, and local tax information governments are complying with the “truth available to taxpayers. in taxation” provisions and if the provisions should be modified; or whether portions of At the November meeting, the the previous local government property tax Committee reviewed its work at the previous lid law should be revived. two meetings and made final policy decisions.
Committee Activities Conclusions and Recommendations At the October meeting, staff briefed the Committee on the history of the property tax The Committee finds that the decision lid and the truth in taxation lid provisions. made in 1999 to abolish the tax lid in favor of the truth in taxation lid represented an No conferees appeared to advocate any appropriate choice of no longer seeking to changes in the current truth in taxation micro-manage local units of government provisions or a restoration of the property from the Statehouse. tax lid. Representatives of the League of Kansas Municipalities and the Kansas The Committee further notes that no Association of Counties appeared in report surfaced of any local unit having opposition to restoration of the property tax violated the truth in taxation provisions over lid. Both conferees said that the current the past seven years. truth in taxation provisions appeared to be working well. T h e Committee makes no recommendation, at this time, regarding the During discussion, a number of issue of whether, as an alternative to, or in Committee members noted that the public addition to, publication in official might be more aware of the acknowledgment newspapers, local acknowledgment resolutions passed by local governing bodies resolutions and ordinances should be if they were posted on the Internet instead of published on the Internet. being published in official newspapers. The Chair said that the Division of Property Finally, the Committee encourages the Valuation might be a logical agency to Department of Revenue to establish a maintain a website that granted public comprehensive “truth in taxation” website access to information about local budgets that could make a variety of federal, state, and property tax increase resolutions. and local tax information available to taxpayers.
Kansas Legislative Research Department 2-36 2006 Taxation Special Committees
Report of the Special Committee on Judiciary to the 2007 Kansas Legislature
CHAIRPERSON: Representative Lance Kinzer
VICE-CHAIRPERSON: Senator John Vratil
Ranking M inority MEMBER: Representative Harold Lane
OTHER MEMBERS: Senators Terry Bruce, Greta Goodwin, Vicki Schmidt, and Ruth Teichman; and Representatives Tom Burroughs, Delia Garcia, Kasha Kelley, Charlie Roth, Jason Watkins, and Kevin Yoder
Study T opics
• Court Docket Fees
• Eminent Domain
• Enhanced Penalties for Driving Under the Influence of Alcohol or Drugs
• Establishment of Kansas Crime Stoppers Council
• Guardians and Conservators
• Residency and Proximity Restrictions for Sex Offenders
• Revised Uniform Anatomical Gift Act (RUAGA)
• Uniform Child Abduction Prevention Act (UCAPA)
December 2006 Special Committee on Judiciary
Court Docket Fees
Conclusions and Recommendations
The Committee reviewed the various aspects of the court docket fees issue and agreed to introduce a bill that would delete certain funds from district court docket fees as follows:
• Indigents’ Defense Services Fund; • Crime Victims Assistance Fund; • Protection from Abuse Fund; • Kansas Juvenile Delinquency Prevention Trust Fund; • Permanent Families Account in the Family and Children Investment Fund; • Child Exchange and Visitation Centers Fund; • Juvenile Detention Facilities Fund; and • Trauma Fund.
Those funds that would continue to he funded by docket fees include the funds that are related to the functioning of the courts as follows:
• Access to Justice Fund; • Judicial Branch Nonjudicial Salary Initiative Fund; • Judicial Branch Education Fund; • Judicial Technology Fund; • Dispute Resolution Fund; • Judicial Council Fund; and • Judicial Performance Fund.
Proposed Legislation: The Committee recommends one bill to be introduced in the Senate.
Background Committee Activities
The Special Committee on Judiciary was The Committee held a hearing on the charged to review the amount of each docket issue of docket fees on November 16, 2006. fee; how Kansas docket fees compare to Conferees included Alicia Lange, Grants those of other states; the impact on litigants Administrator, Attorney General’s Office; and our judicial system of increasing or Randy Hearrell, Judicial Council; Richard decreasing docket fees; whether docket fee Hayse, Kansas Bar Association; Don Jordan, revenue should be used solely for funding Commissioner, Juvenile Justice Authority; the Judicial Branch; whether non-judicial Lee Woodard, Sedgwick County Law recipients of docket fee revenue should be Library; John Pickett, Johnson County Law required to annually justify their receipt of Library; Dick Morrissey, Deputy Director, that revenue; and the impact on non-judicial Kansas Department of Health and docket fee recipients of submitting their Environment; Joyce Grover and Dodie annual revenue request to the Wellschear, Kansas Coalition Against Sexual appropriations process. and Domestic Violence; and Marilyn Harp, Kansas Legal Services.
Kansas Legislative Research Department 3-3 2006 Judiciary Carolyn Rampey, Kansas Legislative infrastructure for a statewide trauma system. Research Department, provided an overview of the disposition of district court docket Marilyn Harp supported continuation of fees along with the distribution breakdown docket fee funds for the Access to Justice of which funds receive docket fees, the Fund and the need for certain legal services percentage they receive and the dollar to be available for those who cannot afford amounts they will receive in FY 2007. it.
Alicia Lange addressed the mechanisms The Kansas Trial Lawyers Association of the five funds that the Attorney General’s submitted written testimony encouraging the Office oversees. The conferee stated that Legislature to require programs that receive individuals from each of the funds has to docket fees to go through the budget process. reapply every year for a grant. The Attorney General holds a percentage of docket fee funds out each month to make sure there are Conclusions and Recommendations enough funds to last throughout the year. The Committee reviewed the various Randy Hearrell explained the aspects of the court docket fees issue and mechanism of the Judicial Council’s funding agreed to introduce a bill that would delete process. Part of the Judicial Council’s certain funds from district court docket fees operating expenses come from the sale of its as follows: publications. In addition, the Judicial Council does receive some State General • Indigents’ Defense Services Fund; Funds. • Crime Victims Assistance Fund; • Protection from Abuse Fund; Rich Hayse supported uniform docket • Kansas Juvenile Delinquency Prevention fees but stated a belief that only court related Trust Fund; activities should receive docket fee funding. • Permanent Families Account in the Family and Children Investment Fund; Don Jordan stated that, whatever the • Child Exchange and Visitation Centers source, juvenile justice programs need to be Fund; adequately funded. In addition, written • Juvenile Detention Facilities Fund; and testimony was provided by J. Russell • Trauma Fund. Dennings regarding funding for regional juvenile detention centers. Those funds that would continue to be Lee Woodard and John Pickett addressed funded by docket fees include the funds that the funding of their respective county law are related to the functioning of the courts as libraries. Each library charges a registration follows: fee to attorneys. • Access to Justice Fund; Joyce Grover focused on funding for • Judicial Branch Nonjudicial Salary sexual and domestic battery programs that Initiative Fund; are funded through the Attorney General’s • Judicial Branch Education Fund; Office. Application for funding needs to be • Judicial Technology Fund; made each year. • Dispute Resolution Fund; • Judicial Council Fund; and Dick Morrissey explained the need for • Judicial Performance Fund. funding to establish and maintain the
Kansas Legislative Research Department 3-4 2006 Judiciary Special Committee on Judiciary
Eminent Domain
Conclusions and Recommendations
After much discussion on the topic of eminent domain and the specific issues involved in urban, as opposed to rural, eminent domain instances, and in consideration of the fact that legislation will be introduced on this topic during the 2007 Legislative Session, the Committee decided to make no recommendations at this time.
Proposed Legislation: None.
Background Brad Harrelson and Brent Haden expressed support for SB 323 and urged no The Committee was directed to study the changes. Mr. Haden expressed a need for current status of eminent domain and caution in any redraft of the definition of monitor the implementation of 2006 SB 323, blight which, according to the conferee, including a review for any needed should be restricted to urban blight. The modifications. citizen conferee addressed her situation in an unsatisfactory eminent domain instance.
Committee Activities Sandy Jacquot expressed concern with SB 323. According to the conferee, these The Committee held a hearing on the concerns primarily involve the inability of topic of eminent domain on December 13, cities to remediate private properties without 2006. Conferees included Brad Harrelson, the consent of the Legislature and the Kansas Farm Bureau; Brent Haden, Kansas requirement that the Legislature give Livestock Association; Jill Benson, citizen; consent to projects not enumerated in the Sandy Jacquot, League of Kansas bill. Municipalities; Mike Taylor, Unified Government of Wyandotte County; Cindy Mike Taylor stated support for the use of Cash, Kansas City, Kansas Chamber of eminent domain for economic development Commerce; Ashley Jones, Greater Kansas projects. He emphasized the difference City, Local Initiatives Support Corporation between urban eminent domain and (LISC); Kevin Morris, Community Housing, agricultural eminent domain. Wyandotte County; and Reid Holbrook, Indian Springs Business Park. Cindy Cash spoke on behalf of three entities to state that she supports the use of Written testimony was received from eminent domain but SB 323 went too far in Christy Caldwell, Greater Topeka Chamber its application of limitations on the use of of Commerce; and Ashley Sherard, Lenexa eminent domain. Chamber of Commerce. Ashley Jones and Kevin Morris expressed After staff review of the topic, the strong support for the use of eminent Committee took testimony from the domain in dealing with blighted conferees. neighborhoods and for revitalization and
Kansas Legislative Research Department 3-5 2006 Judiciary redevelopment purposes. Restrictions imposed by SB 323 would hamper the Conclusions and Recommendations governmental units' efforts. After much discussion on the topic of Reid Holbrook addressed an incident eminent domain and the specific issues contrary to the intent of SB 323. involved in urban, as opposed to rural, eminent domain instances, and in Christy Caldwell and Ashley Sherard consideration of the fact that legislation will provided written testimony to urge a be introduced on this topic during the 2007 reinstatement of local control for eminent Legislative session, the Committee decided domain purposes, a redefinition of blight or to make no recommendations at this time. blighted areas, and the need for another entity to approve eminent domain when the Legislature is not in session.
Kansas Legislative Research Department 3-6 2006 Judiciary Special Committee on Judiciary
Enhanced Penalties for Driving Under the Influence of Alcohol or Drugs
Conclusions and Recommendations
After discussion of the issue, the Committee believes there is a problem with the statutes regarding those individuals who drive while their license is suspended as evidenced by the increasing number of convictions in this area. The Committee encourages the Legislature to consider statutory changes for driving with a suspended drivers license. Further, the Committee recommends the introduction of a 2007 bill that would implement all of the suggested changes by the Subcommittee regarding 2006 SB 341 as follows:
• Strike new section one of the bill. The Subcommittee felt that this issue was already addressed by the involuntary manslaughter statute;
• Adopt the changes in KSA 8-1567 and include language that would require that the courts follow the alcohol and drug evaluation as it pertains to alcohol and drug safety education programs or treatment programs on first, second and third offenses;
• Allow for the doubling of sentences for those who refuse to take the blood alcohol content (BAC) test or have a BAC of 0.15 or greater;
• Amend KSA 8-1567(h) by allowing the court to impose one month of imprisonment for each child in the vehicle at the time the offense occurred;
• Allow evidence, in KSA 8-1005, of assessment performed by a Drug Recognition Evaluator to be admissible in court to indicate that a person may have been under the influence of something other than alcohol;
• Provide for a one-year suspension of driving privileges, followed by a one-year restriction to driving a vehicle with an ignition interlock device on first occurrence test refusal. The same procedure would follow on a second offense (two-year suspension, two-year ignition interlock), and on a third violation (three-year suspension, three-year ignition interlock);
• Subject a person under the age of 21 to the same sanctions on a second or subsequent test failure or driving under the influence of alcohol or drugs (DUI) conviction as a person over the age of 21;
• Allow administrative hearings to be held by telephone conference;
• Provide for explanation, oral and written, of enhanced sanction for a 0.15 BAC or greater and new interlock restrictions; •
• Allow a search warrant, not to be required if there is any person injured, or a death occurs to another person;
Kansas Legislative Research Department 3-7 2006 judiciary • Provide additional funding to Kansas Department of Health and Environment (KDHE) and Kansas Department of Revenue (KDOR) to address the anticipated increase in litigation;
• Establish a funding source for county sheriffs to address anticipated increased incarceration in county correctional facilities; and
• Encourage the Legislature to be aware that the numbers of those who are driving with a suspended license are increasing, and suggest it look at possible changes to deal with this.
Proposed Legislation: The Committee recommends one bill to be introduced in the House.
Background • Considered factors that a judge should weigh in sentencing a person could The Special Committee was charged to include the level of alcohol consumed, study and review the changes in penalties whether the DUI resulted in an injury for driving under the influence of alcohol as accident, passengers in the car at the proposed in 2006 SB 341. time of the DUI, passengers in the car who were children, and level of erratic driving displayed, among other factors. Committee Activities
The Committee held a hearing on the Judge Tatum also suggested changes to issue of enhanced DUI penalties on KSA 8-1567 and that, for a fourth or September 20, 2006. Conferees included subsequent DUI, a person would have to Karen Wittman, Senior Assistant District serve the entire sentence imposed and then Attorney, Shawnee County District go to the Department of Corrections (DOC) Attorney’s Office; Richard Howard, KDHE; for the twelve-month post release, including Lieutenant David Weed, Kansas Highway substance abuse counseling and treatment. Patrol (KHP); Major Mark Goodloe, KHP; Terri Roberts, Kansas State Nurses Representative Owens’ comments Association (KSNA); James Keller, KDR; and primarily concerned third and subsequent Mike Clarke, Attorney. DUI offenders. He suggested that anyone with a third time offense and who fails twice Written testimony was received on in the alcohol and drug treatment program, behalf of Representative Tim Owens, District would be incarcerated for not less than 18 Chief Judge Stephen R. Tatum, Tenth months unless the treatment program could Judicial District, Olathe, Kansas, and Randy be completed in less time than the 18 Rogers with the Kansas Sheriff s Association months, as certified by treatment (KSA). professionals.
Chief Judge Stephen Tatum provided the Karen Wittman, prosecutor, expressed following written comments on proposed support for the provisions of SB 341 as a new legislation: step in the right direction.
• Enhanced penalties would probably Richard Howard, KDHE, spoke in result in more intoxilizer refusals. • support of SB 341 and stated that KDHE provides support for the law through the • Responses to different levels of alcohol Breath Alcohol Testing Program. will differ among individuals depending on a number of variables.
Kansas Legislative Research Department 3-8 2006 Judiciary Major Mark Goodloe, KHP, stated the Conclusions and Recommendations Patrol supports the intent of SB 341, but there is concern that penalties may be less After discussion of the issue, the for offenders who refuse to take the BAC Committee believes there is a problem with test, and therefore, more offenders will soon the statutes regarding those individuals who refuse to submit to testing. Another concern drive while their license is suspended as is the likelihood of increased litigation. evidenced by the increasing number of convictions in this area. The Committee Terri Roberts, KSNA, stated that SB 341 encourages the Legislature to consider had a number of provisions that need to be statutory changes for driving while tweaked, rewritten, or added to, to be a truly suspended situations. Further, the enhanced BAC law. She provided Committee recommends the introduction of information on the level of consumption it a 2007 bill that would implement all of the takes to reach a BAC of 0.15. Additional suggested changes by the Subcommittee as information was offered about other states follows: with different sanctions for persons with a higher BAC than Kansas. • Strike New Section 1 of 2006 SB 341. The Subcommittee felt that this issue James Keller, DHR, addressed the was already addressed by the problem of enacted sanctions for those with involuntary manslaughter statute; an alcohol level of double the current 0.08 level who choose to drive, without creating • Adopt the changes in KSA 8-1567 and new issues that could reduce the include language that would require that effectiveness of laws intended to combat the courts follow the alcohol and drug drunk driving. Other problems for the evaluation as it pertains to alcohol and agency charged with administering the drug safety education programs or drivers’ license suspensions were treatment programs on first, second and enumerated. third offenses;
Randy Rogers, KSA, in his written • Allow for the doubling of sentences for comments, spoke about the main concern of those who refuse to take the BAC test or sheriffs across the state, which is the length have a BAC of 0.15 or greater; of incarceration. County jails, he stated, are intended to hold prisoners for short times • Amend KSA 8-1567(h) by allowing the only. By doubling the sentence of 0.16 DUI court to impose one month of offenders, many sheriffs have concerns of imprisonment for each child in the overcrowding. vehicle at the time the offense occurred;
Interested conferees held separate • Allow evidence, in KSA 8-1005, of meetings in order to resolve the various assessment performed by a Drug approaches to the merits and concerns Recognition Evaluator to be admissible regarding SB 341. Recommendations from in court to indicate that a person may this subcommittee group were presented to have been under the influence of the Committee at the November 16 meeting something other than alcohol; by Karen Wittman of the Shawnee County District Attorney’s Office, a member of the • Provide for a one-year suspension of Subcommittee. driving privileges, followed by a one- year restriction to driving a vehicle with an ignition interlock device on first occurrence test refusal. The same procedure would follow on a second
Kansas Legislative Research Department 2006 Judiciary offense (two-year suspension, two-year • Allow a search warrant not to be ignition interlock), and on a third required if there is any person injured, or violation (three-year suspension, three- a death occurs to another person; year ignition interlock); • Provide additional funding to KDHE and • Subject a person under the age of 21 to KDR to address the anticipated increase the same sanctions on a second or in litigation; subsequent test failure or DUI conviction as a person over the age of 21; • Establish a funding source for county sheriffs to address anticipated increased • Allow administrative hearings to be held incarceration in county correctional by telephone conference; facilities; and
• Provide for explanation, oral and • Encourage the Legislature to be aware written, of enhanced sanction for a 0.15 that the numbers of those who are BAC or greater and new interlock driving with a suspended license are restrictions; increasing, and suggest it look at possible changes to deal with this issue.
Kansas Legislative Research Department 3-10 2006 Judiciary Special Committee on Judiciary
Establishment of Kansas Crime Stoppers Council
Conclusions and Recommendations:
The Special Committee on Judiciary makes no recommendation on the topic of establishment of a Kansas Crime Stoppers Council. The Committee believes that there was not an overwhelming need for a statewide council, and there were concerns with the funding of such a council.
Proposed Legislation: None.
Background
The Committee was charged with the • Helped law enforcement agencies detect responsibility to study 2006 HB 2992, which and combat crime by increasing the flow would provide for the establishment and of information to and between law funding of a Kansas Crime Stoppers Council. enforcement agencies; HB 2992 was introduced by and referred to the House Federal and State Affairs • Assessed training needs for local crime Committee. The bill died in Committee. stoppers programs and provided support and training to all programs within the The bill would have created the Kansas state; Crime Stoppers Council within the Attorney General’s Office and would have been • Assisted local crime stoppers programs comprised of two people appointed by the in acquiring resources needed to keep Attorney General and the board of directors and report statistical data and to of the Kansas Crime Stoppers Association, communicate between local programs, Inc. The Council would have performed the law enforcement agencies, other crime following, when resources were available: stoppers programs, and other agencies; and • Advised and assisted in creating local crime stoppers programs; • Provided other appropriate assistance to enhance public safety in Kansas. • Promoted the detection of crime and encouraged people to report information about criminal acts; The Council’s activities would have been financed through a $35 fee collected from • Encouraged news and other media to offenders placed on probation, community promote local crime stoppers programs corrections or diversion and deposited into and to inform the public about the the Crime Stoppers Trust Fund created by functions of the Council; • the bill.
• Assisted local crime stoppers programs The bill would have created a new class in forwarding information about A nonperson misdemeanor, for a member or criminal acts to the appropriate law employee of the Council, or a person who enforcement agencies; accepts a report of a criminal activity on
Kansas Legislative Research Department 3-11 2006 Special Committee on Judiciary behalf of a local crime stoppers program, to Stoppers Board. Also appearing in support intentionally or knowingly give the of the bill was Terry Symonds, Police information to a person who is not employed Coordinator of Crime Stoppers of Topeka, by a law enforcement agency. A person Inc. convicted of this crime would not he eligible for state employment for five years after the There were no conferees appearing in conviction is final. opposition to creating a Kansas Crime Stoppers Council.
Committee Activities Conclusions and Recommendations The Committee held a hearing on September 20, 2006. The Special Committee on Judiciary makes no recommendation on the topic of Those conferees who testified in support establishment of Kansas Crime Stoppers of creating a Kansas Crime Stoppers Council Council. The Committee believes that there included Kevin Graham, Attorney General’s was not an overwhelming need for a Office; Debra Billingsley, Board Member of statewide council and there were concerns Crime Stoppers of Topeka, Inc.; and Kyle with the funding of such a council. Smith, Legal Counsel to Kansas Crime
Kansas Legislative Research Department 3-12 2006 Special Committee on Judiciary Special Committee on Judiciary
Guardians and Conservators
Conclusions and Recommendations
After a review of the issues involved, the Committee has authorized the Chairman of the Committee to draft a request for study of this matter by the Judicial Council. Specifically, the request will ask for a study of 2005 SB 240, balloon amendment version, with emphasis on the following language:
• Page one, lines thirty three through forty three; and • Page two, lines one through three.
In addition, the request will ask the Judicial Council to take testimony on the bill to see whether such a measure is warranted. Such an examination of the measure also should emphasize the education and training needed for a guardian or conservator.
Proposed Legislation: None.
Background much power over people with disabilities with the potential to put people with The Special Committee was charged to disabilities at risk of abuse, neglect, and study possible conflicts of interest and the exploitation. The Committee was urged to need for oversight and training with regard recommend a bill similar to 2005 SB 240, to guardians or conservators. balloon amendment version. The bill dealt with the appointment of guardians or conservators. Committee Activities David Hollis and Representative Bonnie The Committee held a hearing on the Huy reviewed a case example that illustrated topic of guardians and conservators on abusive behavior on the part of a non-family December 13, 2006. Conferees included guardian as well as inter-family struggles. Judge Sam Bruner, Chairperson of the Kansas Judicial Council Guardianship and Conservatorship Advisory Committee; Rocky Conclusions and Recommendations Nichols, Executive Director of the Disability Rights Center; David Hollis, citizen; and After a review of the issues involved, the Representative Bonnie Huy. Committee has authorized the Chairman of the Committee to draft a request for study of Judge Bruner reviewed the pertinent this matter by the Judicial Council. statutes regarding guardians and Specifically, the request will ask for a study conservators. Rocky Nichols spoke about of 2005 SB 240, balloon amendment version, specific parts of Kansas law that allow with emphasis on the following language: conflicts of interest between a guardian and a ward. Another problem area cited by the • Page one, lines thirty three through forty conferee is that, under Kansas law, three; and guardians or conservators are allowed too • Page two, lines one through three.
Kansas Legislative Research Department 3-13 2006 Judiciary In addition, the request will ask the should emphasize the education and Judicial Council to take testimony on the bill training needed for a guardian or to see whether such a measure is warranted. conservator. Such an examination of the measure also
Kansas Legislative Research Department 3-14 2006 Judiciary Special Committee on Judiciary
Residency and Proximity Restrictions for Sex Offenders
Conclusions and Recommendations
After extensive testimony on the issues surrounding residency requirements for sex offenders, the Committee expressed an awareness that the Sex Offender Policy Board, created by the 2006 Legislature, is charged with studying these issues and reporting back to the Legislature in 2008.
As a consequence, the Committee:
• Encourages the Legislature to wait and receive the report from the Sex Offender Policy Board before any action is taken on residency requirements:
• Suggests the 2007 Legislature consider the following:
o Creation of safety zones patterned after the Illinois statutes; o Development of more complete risk assessment tools; o Narrowing the scope of application for offenses against children instead of minors; o Preemption of local ordinances from establishing residency restrictions; and o Creation of programs that focus on the dangers that lie within a child’s family.
The Committee encourages the Sex Offender Policy Board to explore the classifications of sex offenders by risk levels, reclassification of the sex offender registry, and to research whether sex offenders would be allowed to go into safety zones if such a statute as the Washington law were enacted.
Proposed Legislation: None.
Background was heard in conjunction with the Sex Offender Policy Board, which was created by The Special Committee was charged to a provision in 2006 SB 506. Members of the study actions by other states and local Sex Offender Policy Board include the jurisdictions regarding residency and following: Commissioner Don Jordan, Chair, proximity restrictions for sex offenders to Juvenile Justice Authority; Secretary Roger discover any serious unintended Werholtz, Department of Corrections; consequences and identify actions Kansas Secretary Gary Daniels, Social and might take that actually achieve the Rehabilitation Services; Director Larry intended outcome of increasing public Welch, Kansas Bureau of Investigation; safety. Justice Tyler Lockett, Retired, Designee for Chief Justice of the Supreme Court; Scott Jackson, Executive Director, Family Life Committee Activities Center, Inc.; and Sandra Barnett, Executive Director, Kansas Coalition Against Sexual The Committee held a hearing on and Domestic Violence. November 15, 2006, on sex offender restrictions. This interim committee topic
Kansas Legislative Research Department 3-15 2006 Judiciary Conferees included Professor Jeffrey T. • If the offender has already established Walker, University of Arkansas who residency before a school, daycare presented information about a 1997-1998 center, or park is built or opened, does study he conducted that found: that offender have to move?
• Forty eight percent of child sex offenders The number one priority of the Iowa lived within the one buffer zone and County Attorneys Association is to have the over one-third lived within multiple statute repealed. Their research shows that buffer zones; there is no direct correlation between • Sex offenders acquire their victims from residency restrictions and reducing sex their family or close friends; offenses against children. They believe it • Governments cannot control the creates a false sense of security because 80- locations for potential targets; 90 percent of sex crimes against children are • There is a definite convergence of committed by a relative or acquaintance. potentially motivated child sex offenders living in close proximity to Ms. Dettman proposed the following concentrations of potential victims; solutions: • There is no evidence that attempts to limit where sex offenders live has been • Create safety zones patterned after successful; Illinois statutes; • Government and police must work • Do more complete risk assessments; together to increase the effectiveness of • Narrow the scope of application to sex offender registration and notification; offenses against children not minors; • Efforts must be made to increase the • Preempt local ordinances; and successful registration and tracking of • Create programs that focus on dangers sex offenders so that their living that lie within a child’s family. arrangements are always known; • Residency requirements are not effective; • Cities need to look for capable guardians Mary Richards, Iowa Coalition Against to prevent child sex crimes from Sexual Assault, provided the Committee happening; and with a statement sheet from the Iowa County • The study did uncover that sex offenders Attorneys’ Association reiterating the above who offend against children are more testimony. Ms. Richards also provided a likely to offend against children again report entitled National Trends in Sex and only two percent of those who Offender Legislation and written testimony offend against adults will offend against from Elizabeth Barnhill, Executive Director a child. of the Iowa Coalition Against Sexual Assault.
Pamela Dettman, County Attorney’s Christopher Lobanov-Rostovsky, Office, Des Moines County, Iowa, informed Program Director, Colorado Department of the Committee about concerns with the Iowa Public Safety reviewed a report on safety Sex Offender Residency Law that went into issues raised by living arrangements call effect in July 2002. A few of the concerns “shared living arrangement” (SLA) in which were: • two or three sex offenders live together in one residence with no supervision on the • The statute uses the word “committed” premises, although there is supervision with rather than “convicted”; home visits, tracking, schedule monitoring • There are not guidelines as to how 2,000 and phone call check in. Mr. Lobanov- feet would be measured; and Rostovsky’s study recommended the following:
Kansas Legislative Research Department 3-16 2006 Judiciary • All living arrangements need appropriate Legislature to ban child sex offenders from supervision; property where children congregate by • Court service officers should make giving the child sex offenders a written individualized case decisions on the notice to leave. If the offender returns after offenders’ living arrangements; receiving a written notice to leave, he or she • Positive, informed support is a key could be charged with criminal trespass aspect of offenders’ living arrangements; against a child, sentenced up to a year and • SLA’s can be a beneficial sex offender fined $10,000. management strategy for high risk sex offenders; and Doug Vance, Executive Director, Kansas • Residency restrictions may not deter sex Recreation and Parks Association, expressed offender recidivism. support for the City of Wichita's proposed measures.
Dr. Jill Levenson, Lynn University, Melissa Alley, citizen, related her story testified via conference call to indicate that about a convicted sex offender living across legislatures need to look at the most feasible the street from her five-year-old son’s school. ways to protect citizens such as the She supports residency restrictions. following:
• Create a risk assessment tool that allows Conclusions and Recommendations screening of offenders into relative risk categories and applies the most After extensive testimony on the issues restrictive and intensive interventions to surrounding residency requirements for sex the most dangerous sex offenders; offenders, the Committee expressed an • Approach and evaluate individual awareness that the Sex Offender Policy offender’s risks and needs, reinforce Board, created by the 2006 Legislature, is their strengths, and facilitate support charged with studying these issues and systems; reporting hack to the Legislature in 2008. • Adapt global positioning monitoring (GPS) that can be a useful tracking tool As a consequence, the Committee; for high risk or predatory offenders, even though it is only able to detect where • Encourages the Legislature to wait and someone is, not what they are doing; receive the report from the Sex Offender • Educate parents, teachers, and child care Policy Board before any action is taken workers so they are aware of the signs on residency requirements; and symptoms of child sexual abuse, and the common types of grooming patterns • Suggests the 2007 Legislature consider used by perpetrators who gain access to the following: victims via their positions of trust or authority; and o Creation of safety zones patterned • Reallocate money spent on residency after the Illinois statutes; requirements, which takes money away o Development of more complete risk from funding for victim services. assessment tools; Investing in treatment and social o Narrowing the scope of application services for abused children is the best for offenses against children instead strategy for preventing potential victims of minors; in the future. o Preemption of local ordinances from establishing residency restrictions; Representative Nile Dillmore indicated and the City of Wichita will ask the 2007
Kansas Legislative Research Department 3-17 2006 Judiciary o Creation of programs that focus on classifications of sex offenders by risk levels, the dangers that lie within a child’s reclassification of the sex offender registry, family. and to research whether sex offenders would be allowed to go into safety zones if such a The Committee encourages the Sex statute as the Washington law were enacted. Offender Policy Board to explore the
Kansas Legislative Research Department 3-18 2006 Judiciary Special Committee on Judiciary
Revised Uniform Anatomical Gift Act
Conclusions and Recommendations
After discussion, the Committee voted to introduce a bill substantially in conformance with the Revised Uniform Anatomical Gift Act. Concern, however, was expressed regarding needed clarity on the following:
• Section five (a)(3) regarding a terminal illness of the donor. This section would allow an anatomical gift by any form of communication addressed to at least two adults, one of whom is a disinterested witness; • Donor revocation; • Section nine (8) regarding someone who may make an anatomical gift of a decedent’s body or body parts; • Section ten dealing with the matter of making, amending, or revoking an anatomical gift of a decedent’s body or body parts, which needs more specificity and; • Section eighteen dealing with immunity. This section was discussed as too broad in nature.
Proposed Legislation: The Committee recommends one bill to be introduced in the House.
Background RUAGA. She noted the original Act was adopted in 1968 to provide standard The Special Committee was charged to methods for organ, eye, and tissue donations study and review the recent proposal by the after death for the purposes of National Conference of Commissioners on transplantation, therapy, research, or Uniform State Laws which in 2006 adopted education. In 1987, some twenty-six states the Revised Uniform Anatomical Gift Act adopted a new version of the Act; however, (RUAGA). The first Act, adopted in 1968, because the other states did not adopt the was passed in Kansas. changes, the Act was no longer considered uniform. The National Conference of Commissioners on Uniform State Laws Committee Activities developed the proposed RUAGA in an effort to resolve any inconsistencies between the The Committee held a hearing on states and to make the system effective. November 16, 2006. Conferees included Dean Gail Agrawal, Kansas University Dean Agrawal outlined some of the key School of Law; Michele Clayton, National provisions of the RUAGA as follows: Conference of Commissioners on Uniform State Laws; Ron Hein, National Kidney • Insures that individual choice regarding Foundation and Midwest Transplant organ donation will be respected by Network; and Rob Linderer, Midwest barring persons from amending or Transplant Network. revoking the anatomical gift; • Allows for an individual to refuse to Dean Agrawal, Kansas University School make an anatomical gift; of Law, provided an overview of the • Facilitates cooperation between the
Kansas Legislative Research Department 3-19 2006 Judiciary coroners and medical examiners; need to update the existing state law to make • Permits emancipated minors and minors it consistent with changes that have eligible to apply for driver’s licenses to occurred with national transplant make an anatomical gift. If an procurement and allocation policies and to unemancipated minor dies before the age achieve uniformity across the states in order of 18, the parent or guardian would be to facilitate and support the frequent permitted to revoke the gift; interactions between transplant and • Expands those who are permitted to procurement organizations. The revision make an anatomical gift on behalf of will accomplish these goals and also help others; and advocate and promote the donation of • Expands methods for making an organs. anatomical gift, i.e., donor registries, state identification cards, donor cards, driver’s licenses, and also allows for oral Conclusion and Recommendations gifts. After discussion, the Committee voted to introduce a bill substantially in conformance Michele Clayton, National Conference of with the Revised Uniform Anatomical Gift Commissioners of Uniform State Laws, Act. Concern, however, was expressed informed members that the RUAGA regarding needed clarity on the following: encourages donor registries and provides standards for its operation, but currently half • Section five (a)(3) regarding a terminal of the states do not have an organ donor illness of the donor. This section would registry. The Act also gives priority to the allow an anatomical gift by any form of transplant of organs over research or communication addressed to at least two education. adults, one of whom is a disinterested witness; Ron Hein, National Kidney Foundation • Donor revocation; and Midwest Transplant Network, relayed • Section nine (8) regarding someone who the story of his kidney transplant ten years may make an anatomical gift of a ago and the need for another one within the decedent’s body or body parts; next few years. There are approximately • Section ten dealing with the matter of 1,000 Kansans waiting for an organ to be making, amending, or revoking an donated. Nationwide, there are over 83,000 anatomical gift of a decedent’s body or awaiting transplants. On average, 17 people body parts, which needs more specificity per day and 6,205 people per year die due to and; a lack of available organs. • Section eighteen dealing with immunity. This section was discussed as too broad Rob Linderer, Midwest Transplant in nature. Network, stated that there is a compelling
Kansas Legislative Research Department 3-20 2006 Judiciary Special Committee on Judiciary
Uniform Child Abduction Prevention Act
Conclusions and Recommendations
The Committee discussed various aspects of the Act and, in its deliberations, focused on the standard of proof that would be needed to determine whether a parent is a high risk for abduction of a child. The Committee concluded that a bill should be introduced, substantially in conformance with the Act. Specific issues in the Act include the following:
• Custody Order
o Basis for court’s jurisdiction; o The manner in which notice and opportunity to he heard were given to the persons entitled to notice of the proceeding; o A detailed description of each party’s custody and visitation rights and residential arrangements for the child; o A provision stating that a violation of the order may subject the party in violation to civil and criminal penalties; and o Identification of the child’s country of habitual residence at the time of the issuance of the order.
• If there is a threat of abduction, the order should be even more specific and include such things as:
o An imposition of travel restrictions that require that a party traveling with the child outside a designated geographical area provide the other party with the following:
- the travel itinerary of the child; - a list of physical addresses and telephone numbers at which the child can be reached at specified times; and - copies of all travel documents;
o A prohibition of the respondent directly or indirectly:
- removing the child from this state, the United States, or another geographic area without permission of the court or the petitioner’s written consent; - removing or retaining the child in violation of a child-custody determination; - removing the child from school or a child-care or similar facility; or - approaching the child at any location other than a site designated for supervised visitation; •
• A requirement that a party register the order in another state as a prerequisite to allowing the child to travel to that state;
Kansas Legislative Research Department 3-21 2006 Judiciary • With regard to the child’s passport:
o a direction that the petitioner place the child’s name in the U.S. Department of State’s Child Passport Issuance Alert Program;
o a requirement that the respondent surrender to the court or the petitioner’s attorney any United States or foreign passport issued in the child’s name, including a passport issued in the name of both the parent and the child; and
o a prohibition upon the respondent from applying on behalf of the child for a new or replacement passport or visa;
• As a prerequisite to exercising custody or visitation, a requirement that the respondent provide:
o to the U.S. Department of State’s Office of Children’s Issues and the relevant foreign consulate or embassy, an authenticated copy of the order detailing passport and travel restrictions for the child to the court: (I) proof that the respondent has provided the information in subparagraph (A); and
(ii) an acknowledgment in a record from the relevant foreign consulate or embassy that no passport application has been made, or passport issued, on behalf of the child;
o to the petitioner, proof of registration with the United States Embassy or other United States diplomatic presence in the destination country and with the Central Authority for the Hague Convention on the Civil Aspects of International Child Abduction, if that Convention is in effect between the United States and the destination country, unless one of the parties objects; and
o a written waiver under the Privacy Act, 5 U.S.C. Section 552a [as amended], with respect to any document, application, or other information pertaining to the child authorizing its disclosure to the court and the petitioner; and
• Upon the petitioner’s request, a requirement that the respondent obtain an order from the relevant foreign country containing terms identical to the child-custody determination issued in the United States;
• Limit visitation or require that visitation with the child by the respondent be supervised until the court finds that supervision is no longer necessary and order the respondent to pay the costs of supervision;
• Require the respondent to post a bond or provide other security in an amount sufficient to serve as a financial deterrent to abduction, the proceeds of which may be used to pay for the reasonable expenses of recovery of the child, including reasonable attorneys fees and costs if there is an abduction; and
• Require the respondent to obtain education on the potentially harmful effects to the child from abduction.
Proposed Legislation: The Committee recommends one bill to be introduced in the Senate.
Kansas Legislative Research Department 3-22 2006 Judiciary Background If the court determines the parent to be “high risk” the court may impose many The Uniform Child Abduction different restrictions on parenting time, such Prevention Act (UCAPA) was adopted this as restricting travel. year by the National Conference of Commissioners on Uniform State Laws. The charge to the Committee was to study Conclusions and Recommendations UCAPA as a matter that is important for legislators. The Committee discussed various aspects of the Act and, in its deliberations, focused on the standard of proof that would Committee Activities be needed to determine whether a parent is a high risk for abduction of a child. The The Committee held a hearing on the Committee concluded that a bill should be UCAPA on November 15, 2006. Conferees introduced, substantially in conformance included Michele Clayton, National with the Act. Specific issues in the Act Conference of Commissioners on Uniform include the following: State Laws, who stated that the Office of Juvenile Justice and Delinquency Prevention • Custody Order estimates that 262,100 children were abducted in 1999, with a majority (78 o Basis for court’s jurisdiction; percent) of the abductions being perpetrated o The manner in which notice and by family members. According to the opportunity to be heard were given conferee, most states have laws that address to the persons entitled to notice of custody issues and criminal prosecution of the proceeding; child abductions, but not prevention o A detailed description of each party’s mechanisms. The proposed uniform law custody and visitation rights and would allow courts to determine whether residential arrangements for the there is a credible risk and order measures to child; prevent an abduction. o A provision stating that a violation of the order may subject the party in Professor Linda Elrod, Washburn University violation to civil and criminal School of Law, explained that UCAPA would penalties; and enact the following steps for courts to use o Identification of the child’s country when determining whether a parent is high of habitual residence at the time of risk:• the issuance of the order.
• Prior custody visitations; • Parent without emotional or financial • If there is a threat of abduction, the order ties to the area; should be even more specific and • Parent has divulged plans to abduct and include such things as: has the resources to survive in hiding; • Threats of abduction; o An imposition of travel restrictions • Unemployed parent; that require that a party traveling • Parent has liquidated assets; with the child outside a designated • History of domestic violence; and geographical area provide the other • Parent with close ties to another country party with the following: whose laws may be prejudiced against a parent based on gender or a non-citizen. - the travel itinerary of the child; - a list of physical addresses and telephone numbers at which the
Kansas Legislative Research Department 3-23 2006 Judiciary child can be reached at specified o to the U.S. Department of State’s times; and Office of Children’s Issues and the - copies of all travel documents; relevant foreign consulate or embassy, an authenticated copy of o A prohibition of the respondent the order detailing passport and directly or indirectly: travel restrictions for the child to the court: removing the child from this (I) proof that the respondent has state, the United States, or provided the information in another geographic area without subparagraph (A); and permission of the court or the petitioner’s written consent; (ii) an acknowledgment in a record - removing or retaining the child from the relevant foreign in violation of a child-custody consulate or embassy that no determination; passport application has been removing the child from school made, or passport issued, on or a child-care or similar facility; behalf of the child; or - approaching the child at any o to the petitioner, proof of registration location other than a site with the United States Embassy or designated for supervised other United States diplomatic visitation; presence in the destination country and with the Central Authority for • A requirement that a party register the the Hague Convention on the Civil order in another state as a prerequisite to Aspects of International Child allowing the child to travel to that state; Abduction, if that Convention is in effect between the United States and • With regard to the child’s passport: the destination country, unless one of the parties objects; and o a direction that the petitioner place the child’s name in the U.S. o a written waiver under the Privacy Department of State’s Child Passport Act, 5 U.S.C. Section 552a [as Issuance Alert Program; amended], with respect to any document, application, or other o a requirement that the respondent information pertaining to the child surrender to the court or the authorizing its disclosure to the court petitioner’s attorney any United and the petitioner; and States or foreign passport issued in the child’s name, including a • Upon the petitioner’s request, a passport issued in the name of both requirement that the respondent obtain the parent and the child; and an order from the relevant foreign country containing terms identical to the o a prohibition upon the respondent child-custody determination issued in from applying on behalf of the child the United States; for a new or replacement passport or visa; • • Limit visitation or require that visitation with the child by the respondent be supervised until the court finds that • Asa prerequisite to exercising custody or supervision is no longer necessary and visitation, a requirement that the order the respondent to pay the costs of respondent provide: supervision;
Kansas Legislative Research Department 3-24 2006 Judiciary • Require the respondent to post a bond or including reasonable attorneys fees and provide other security in an amount costs if there is an abduction; and sufficient to serve as a financial deterrent to abduction, the proceeds of which may • Require the respondent to obtain be used to pay for the reasonable education on the potentially harmful expenses of recovery of the child, effects to the child from abduction.
Kansas Legislative Research Department 3-25 2006 Judiciary Joint Committees
Report of the Joint Committee on Arts and Cultural Resources to the 2007 Kansas Legislature
CHAIRPERSON: Senator Peggy Palmer
VlCE-CHAIRPERSON: Representative Deena Horst
OTHER MEMBERS: Senators Marci Francisco, Jean Schodorf, Chris Steineger, and Dennis Wilson; and Representatives Delia Garcia, Lana Gordon, Jo Ann Pottorff, and Candy Ruff
Study T opics
The Committee is mandated to study, investigate, and analyze: goals appropriate to the future of the arts and cultural life in Kansas; the role that the state government and the Kansas Legislature should play in the realization of these goals; art legislation in other states and at the federal level; the budget and programs of the Kansas Arts Commission and other state supported arts and cultural programs; the status of arts education in Kansas; and the impact of arts and culture on the economy of the state.
December 2006 Joint Committee on Arts and Cultural Resources
Arts and Cultural Life in Kansas
Conclusions and Recommendations
The Joint Committee recommends that:
• The Kansas Department of Commerce include small museums and historic sites on the Kansas Highway Map to enhance attendance rates of these facilities.
• The website of the Department of Commerce be improved by: updating and improving communication with legislators: and by having Destination Marketing Organizations (DMOs) interact with local legislators to get communities, historic places, and businesses listed on the Department of Commerce’s website.
• The Department of Commerce develop niche marketing to better identify special places that may not have been considered previously.
• The Department of Commerce strive to make its website more user friendly to the general public, including better interface and access to the site from the State of Kansas’ website and clearly identify the links to cities and counties.
• The Department of Commerce review its decision to have Kansas! Magazine published bv an out-of-state company. The Committee encourages the Department to consider use of qualified Kansas companies in the future.
• The Department of Commerce review the purpose of the Kansas! Magazine, including whether its principal purpose is to generate revenue by attracting readership and whether a new generation of younger readers will replace the declining cohort of older readers.
• Consider the potential for the Kansas! Magazine perhaps being combined with another related publication such as the Wildlife and Parks publication and then have the Department of Commerce follow up next year on its findings and recommendations.
• The Kansas Department of Transportation policy of “bumping” of existing businesses on highway signs from their sites be reversed through a grandfather provision or policy, as a measure of fairness.
• The Kansas State Historical Society’s planned efforts to keep open the Lecompton Constitution Hall on weekends during the months of December, January, and February is strongly supported. The Committee encourages the Lecompton community to provide volunteers and cash donations to the Society in the Society’s efforts to keep open the facility. The Committee further supports a call number to the Lecompton facility for group appointments. Lastly, the Society should explore any available federal funds for this purpose. •
• The suggestion by the Kansas State Historical Society for the creation of a separate fund for small museums be further explored and, should this approach be adopted, identify possible sources of monies for this fund.
Kansas Legislative Research Department 4-3 2006 Arts and Cultural Resources • The policy of weighing certain criteria in the award of moneys from the Heritage Trust Fund be further explored.
• A new Department of History and Tourism be created to enhance the visibility and vitality of both subjects. The Committee recommends that the Division of Tourism be taken out of the Kansas Department of Commerce and created as a separate agency. The Committee believes that, currently, the Department of Commerce is an agency with multiple duties and facets and more attention would further tourism in Kansas.
• A study be undertaken by the Society to determine whether the fundamentals of civics can be incorporated in Kansas history programming for schools.
Proposed Legislation: None.
Background courthouse. The group was informed that the city had received multiple grants to The Joint Committee on Arts and improve various city attractions. The Cultural Resources was established by the Committee also heard from speakers of 1989 Legislature. KSA 46-1801 directs the Frontier Refining and of Butler County Committee to study the arts and cultural life Community College. At Burns, the in Kansas, and the role the Legislature and Committee visited the Walters’ Pumpkin state government should play in the Patch and heard about the various grants realization of these goals. It also directs the available for agritourism businesses. The Committee to study arts legislation in other Committee then traveled to El Dorado State states and at the federal level; review the Lake where it learned about one of the major budget and programs of the Kansas Arts projects undertaken by the Friends of El Commission and other state-supported arts Dorado Lake, a nonprofit organization. and cultural programs and agencies; review Issues of concern included lower visitation, the status of arts education in Kansas; and higher gasoline prices, and the lack of study the impact of the arts and cultural available protection during inclement programs on the Kansas economy. weather.
At Eureka, Kansas, the Committee Committee Activities visited Eureka Downs, Kansas’ Oldest Race Track where it was informed about the The Joint Committee began its activities Track’s benefits to the Flint Hills region. with a two-day tour on September 7-8, 2006. The Committee then visited Elk Falls Pottery The sites chosen this year included: and received a demonstration of pottery communities in a four-county region of making. On the way to its next stop, the Butler, Greenwood, Elk, and Chatauqua Committee was shown decorated outhouses, counties. which were decorated as part of the Outhouse Festival. The Committee then September 7 viewed an 1893 Iron Truss Bridge near the waterfalls on Elk River. A cooperative effort The Committee began its tour at El among the Friends of Elk Falls, the Kansas Dorado, where it visited the Kansas Oil Department of Wildlife and Parks, Museum/Butler County History Center, Americorp, and the funding from the toured downtown El Dorado, and viewed the Heritage Trust Fund replaced the rotting restored train depot and 14 sculptures wood deck of a bridge. At its next downtown and the veterans’ memorial and destination, Sedan, Kansas, the group toured the downtown district of Sedan. Area
Kansas Legislative Research Department 4 ‘4 2006 Arts and Cultural Resources attractions included the “World’s Longest Kansas Humanities Council; the Executive Yellow Brick Road” and restored historic Director of the Kansas Arts Commission; the buildings. The Committee also toured the Director of the Kansas Film Commission; Emmett Kelly Museum, the Red Buffalo Gift and the Fine Arts Educational Consultant, Shop, and the Tallgrass Beef Headquarters. Kansas State Department of Education. The The Committee learned that among the following is a summary of their testimony. grants received by the City of Sedan was a Kansas Department of Transportation grant The Manager of the Beaumont Hotel, and a Kansas Department of Commerce Beaumont, Kansas. The manager of The grant to the Sedan Area Foundation for the Beaumont Hotel appeared before the Bradford Hotel. At Fall River, Kansas, the Committee to discuss, among other things, group toured the Flint Oaks Hunting Resort signage problems. He stated that the where it watched a demonstration by the directional sign to the Beaumont Hotel is resorts’ bird hunting dogs. about one mile off the highway and cannot be seen by highway traffic. He added that September 8 the sign faces north on an east-west highway and as a result cannot be seen until a driver The Committee also traveled to the Otter is at the turn into Beaumont. He stated that Creek Ranch. The group was told of some of the Kansas Department of Transportation the environmental challenges that face the restrictions limit Beaumont from attracting hills in the future. The Committee also drivers into the city to visit the historic viewed paintings by members of The Prairie Beaumont Hotel. He proposed to the Artists Group. The next place of interest Committee that he be allowed to make the was Augusta, Kansas. Here the group toured sign a two-sided sign so that it faces east and the Augusta Historical Museum, the C.N. west to make more visible traffic. In James Log Cabin, the Augusta Historic response to this issue, KDOT officials agreed Theater and learned about Augusta’s Main to meet with Hotel officials along with local Street project and its efforts to continue the officials to propose the most appropriate sign restoration of the theater. The Committee for the area. also viewed Henry’s Sculpture Hill and viewed the artist’s workshop and several Kansas Department of Transportation. metal sculptures designed and built by the The representative of KDOT appeared before artist. At its next destination, the group the Committee to discuss roadway signs traveled to the Elk River Wind Farm, where dealing with cultural, historical, travel and it received a brief overview of the farm’s tourism sites. He revisited 2006 SB 253, operations and capacity. which, among other things, requires KDOT to compile and maintain a current listing of Committee Testimony all roadway and outdoor advertising signs that are available for the purposes of On November 30 and December 1, the increasing tourism or economic Committee convened at the State Capitol to development. The law also provides a discuss various arts and humanities description of the program and the programs. Presenters included the manager requirements for obtaining a sign under the of the Beaumont Hotel in Beaumont, Kansas; program. It also requires that this representatives of the Kansas Department of information be reported annually. The Transportation; representatives of the KDOT conferee also reviewed documents Kansas Department of Commerce; the that discuss the following topics: Roadway President of the Lecompton Territorial and Outdoor Advertising Signs that Promote Capital Museum; the Executive Director of Economic Development and Tourism; the the Kansas State Historical Society; a Kansas Tourism Attraction Signage representative of the Kansas Department of Application Kit; and the Kansas Logos Revenue; the Executive Director of the Signing Program. One issue that was raised
Kansas Legislative Research Department 4-5 2006 Arts and Cultural Resources was the so-called “bumping” policy of KDOT listed are accurate and advise KDOT if any that permits a sign owner who has changes are needed. Another Department of contracted with KDOT for the erection of a Commerce official spoke to the Committee sign to be “bumped” off by another sign about the Kansas! Magazine She said the owner wiiose establishment is located closer primary purpose of the magazine was to to the roadway intersection; the conferee provide content that supports the state’s told the Committee that the Department tourism market, encourage travel to and would review this policy. KDOT officials within Kansas, and provide revenue to also will meet with Beaumont Hotel personal support other marketing initiatives for the and Butler County officials to develop the Division of Travel and Tourism. She also most appropriate sign for the area. said that:
Another KDOT conferee appeared before • The publication has experienced a the Committee to review the State Highway steady decline in circulation and Map and the signation of historic and revenue-16 percent in the last six years. cultural sites. He informed the Committee that: • The magazine marketing strategy has not fulfilled the niche marketing priorities as • The State of Kansas prints the Official determined by Department research. Transportation Map biennially under suggested guidelines of the Federal • The past management structure of the Highway Administration. magazine lacked collaboration, as four contractors were employed to produce • KDOT consults with numerous partners the publication. such as the Kansas Department of Commerce, the Kansas Department of • The Division has begun to assess all Wildlife and Parks, and the Kansas State aspects of the publication and Historical Society. implement changes such as: better alignment of editorial content with • The Department of Commerce selects overall marketing objectives for Kansas; historic and cultural sites for inclusion stabilization and increase in circulation; in the map and then works with KDOT and the creation of a more efficient to determine the best solution for management structure. display. • After bidding process and review of 23 • The Department of Commerce different proposals, Midwest Living from distributes about 80 percent of the Iowa was chosen to provide editorial, printed maps. layout and design and printing functions.
Kansas Department of Commerce. The • The Division believes that the selection Kansas Department of Commerce of Midwest will help to move Kansas! representative indicated that part of her Magazine in a new direction. duties were to act as liaison between KDOT and the Travel and Tourism Division to help Some Committee members expressed produce the official state map. She added concern that there were no Kansas that the Division has historically been companies that offered to bid on the project. assigned the creative process for nine panels, It was noted that Kansas companies ought to including the cover on the reverse side of the be given optimal consideration. One map. She noted that the Division proofs the member of the Division replied that one map with respect to tourism attractions and Kansas company did reply but it did so after checks the map to ensure that the attractions the bidding deadline. Another conferee of
Kansas Legislative Research Department 4-6 2006 Arts and Cultural Resources the Department of Commerce updated the December, January, and February. In Committee on Tourism website issues. He response to this concern, the Executive stated, among other things, that: Director of the Kansas State Historical Society appeared to reply to the issue raised • In late Spring 2005, a Request For by the President of the Lecompton facility. Proposal was written to develop a new The Director noted that there is variation in site. the opening hours of state historical sites, but that in general sites are open during the • Prior to the new site training documents months of December-Fehruary during were sent and a series of teleconferences seasonal hours either by appointment or for were held with the Destination special events. She added that current goals Marketing Organization (DMOs) and for the state historical sites are to: increase individuals on how to administer their visitation; increase operational efficiency; listings. Currently, there are over 170 increase community financial support for DMOs. the sites; and increase school visitation by creating Standard-based curriculum • The site is backed by a database with programs at the sites. over 5,000 listings. The Executive Director also provided • The listings are maintained by industry data on attendance, non-state community partners who are able to log into the support for the operation of state historical back-end administrative area and make sites, and a comparison with the National adjustments to their listings. Parks Service attendance in Kansas. The data indicated that in FY 2006 a total of • The new tourism site was successfully 95,016 people attended 17 state historical launched April 1, 2006. sites. In terms of non-state communitv support for the operation of state historical • Visitors to the site are able to search a sites, the information indicated that the John number of ways including keywords, Brown facility generated the most total cash destinations, and events. support of $54,531, while the William Allen White home generated $50,201. With regard • Previous monthly traffic to the site to the comparative data of the National Park average just under 32,000 sessions. Service, Fort Larned generated the most Since the new site went live, monthly visitors with 28, 390 followed by Nicodemus traffic now averages 51,000 sessions. with 28,065 visitors. Other attendance information showed that the lowest attendance rates occurred during the months This conferee also noted that future of December, January, and February. Other plans include blogs, photo blogs, podcast, information provided showed that: and video casts. The plans include one-stop system for the industry to maintain their • Other cultural institutions were not listings and order Visitor Guides, KDOT opened the entire year and most were maps, events calendars, and expanded seasonally closed. newsrooms.
Kansas State Historical Society and the • It would cost $1.1 million to keep all Lecompton Territorial Constitution Hall state historical sites open to avoid Issue. The President of Lecompton seasonal hours. Historical Society main purpose to appear before the Committee was to express The Executive Director also presented a concern that Constitution Hall will be not be projected affect of seasonal hours as it opened to the public during the months of pertained to Constitution Hall. She
Kansas Legislative Research Department 2006 Arts and Cultural Resources indicated that visitors who did not pay • Kansas law allows a tax credit for a admission would not be affected because qualified taxpayer that makes qualified they come as a part of a pre-scheduled group expenditures to restore or preserve a visit to participate in the site through qualified historic structure according to programming. a qualified rehabilitation plan.
As part of its deliberations, the • The amount of the credit is 25 percent of Committee reviewed the statutes pertaining qualified expenditures when the total the Heritage Trust Fund and Preservation of amount of the expenditures equal $5,000 Historic Grants. KSA 70-3107b addresses or more. the portion of fees remitted to state treasurer for the fund. It provides that the county • If the credit exceeds the tax liability of treasurer must pay quarterly to state the year in which the qualified treasurer .01 of each $.26 paid to the county rehabilitation plan is placed into service, treasurer during the preceding calendar the excess credit may be carried forward quarter from the mortgage registration fees. to the next succeeding years or until the The other statute KSA 75-2729, pertains to total credit has been used except that no the historic preservation grants. Among credit may be carried over for deduction other things, it requires that all moneys after the 10th taxable year succeeding the deposited in heritage trust fund be used for year in which the rehabilitation plan was the purpose of awarding grants to assist placed into service. historic preservation projects involving property included in the National Register or • For tax year 2005, $3.3 million was the historic places or the State Register of amount of credit allowed. historic places, excluding property owned by the state of federal government. The statute Kansas Humanities Council. The also requires that at least 50 percent of the Executive Director reviewed the FY 2008 amount awarded annually in grants be used state funding request. She expressed for the preservation of eligible properties support for the Governor’s FY 08 owned by county and local governments, recommendation of $81,830 in support of county and local historical societies and by public humanities programs. She said that a private nonprofit organization. the KHC requested the Governor to include $201,830 for public humanities programs, In response to tax credits, the Executive which continues the base allocation of Director of the Society furnished $81,830 and provides additional funding in information that included a state and federal the amount of $120,000 for two special tax credit program. The federal program initiatives: Kansas Tell Their Stories fosters private sector rehabilitation of ($70,000), and Family Reading Programs historic buildings and promotes economic ($50,000). She noted that the KHC receives revitalization. The state program pertains to far less funding than other cultural agencies, qualified buildings that have been placed on yet serves the entire state. She added that in the National Register, the Register of Historic 2005 the KHC supported 700 programs in Kansas Places, or have been deemed 150 communities, serving close to 500,000 contributors to a National or State Register Kansans. She noted that the KHC does not Historic District. The information also ask the state to provide all its funding but provided a state tax credit database of actively seeks other sources. She added that various projects such as churches, old the KHC has successfully matched state homes, and other similar structures. funds with private or federal dollars.
Kansas Department of Revenue. This Kansas Arts Commission. The Executive conferee summarized Kansas law regarding Director of the Kansas Arts Commission, tax credits. She noted that: discussed, among other thing, the agency’s
Kansas Legislative Research Department 4-8 2006 Arts and Cultural Resources grant guideline changes and its strategic She said that if this budget cut were planning. According to the Executive implemented in FY 2008, State General Director, the agency completed an extensive Funds appropriated to the Commission review of its grant guidelines in the fall of would be $1,472,227. Funding at this level 2006 and is implementing a number of would reflect a 5 percent cut from the changes for FY 2008. These changes appropriated FY 2008 State General Funds. simplify and clarify the guidelines. With She said that a total of $100,000 of State regard to strategic planning, the Commission General Funds was requested to augment the will conduct focus groups and interviews agency’s art programs to make for federal and initiate community meetings from funds that will note be available for FY 2008. January through April 2007. From these If this enhancement is approved funds will meetings the Commission will create goals allow agency grant funds to remain and strategies. Other new projects will relatively level to grant funding in FY 2007. include a Poetry Out Loud program in partnership with the National Endowment Kansas State Historical Society. The for the Arts and the Poetry Foundation. The Executive Director, KSHS, also appeared to Executive Director also noted that: address three issues raised by the Committee: Seasonal hours at historic sites, • A new Poet Laureate of Kansas has been the Heritage Trust Fund; and assistance to appointed. small historical museums. The Executive Director indicated she would contact the • Kansas is the site of the National President of the museum at Lecompton and Symphony Orchestra’s fourteenth ask if the community would be willing to national residency. provide support for the opening the site on weekends during the winter months. She • The Kansas Arts Commission has said support could be in the form of cash received an additional grant of $55,000 donations or volunteer assistance. If the from the National Endowment for the community can assist the Society with Art’s American Masterpieces program. support, then the Hall will be open regular hours on the weekends December through • The Kansas Arts Commission was a part February. She also said she would ask the of the Governor’s Council on the Arts site administrator at Lecompton to work and Culture which planned and with the community to start a Friends of produced the first Kansas Book Festival. Constitution Hall, a not-for-profit organization that can assist the Society in finding the resources for the site. The Executive Director’s testimony also discussed future projects and hopes to On the subject of the Heritage Fund, the increase the number of organizations and Executive Director said she would ask staff artists served by the agency. She indicated to review the weighing of criteria on the that KAC has contracted with the Americans Heritage Trust Fund application and develop for the Arts to do an economic impact study a proposal to address the concerns expressed of the arts throughout Kansas. by the Committee. She added that the agency will work with the Kansas Preservation Alliance and the state Certified In terms of the KAC’s budget, the Local Governments to make them aware of Executive Director’s testimony indicated that the concerns to get their feedback. She also the FY 2007 Revised Budget Request was will share Committee concerns with the $2,245,717 and FY 2008 Budget Request was State Historic Sites Board of Review. $2,082,948. She added that the Division of Finally, the Executive Director said she Budget issued a Reduced Resource Target for would work with the Chairperson to develop the Kansas Arts Commission of $77,486. a proposed grant program to assist small and
Kansas Legislative Research Department 4-9 2006 Arts and Cultural Resources rural historical museums that are open to The Executive Director then divided the public to improve their facilities, KSHS’s budget needs into one-time programming, and administration. expenditures and recurring expenditures. Included in the one-time expenditures were: The Executive Director then proceeded replacement of an aging telephone system to review the agency’s funding requests. and three motor vehicles; restoration of the Some of the FY 2006 highlights included: exterior of the Goodnow House; and the funds received to address delayed replacement of the steam humidification maintenance; the distribution of $150,000 system at the Kansas Museum of History. in grants to communities across the state to The recurring expenditures pertained to the collect oral histories of World War II replacement of IT (Information Technology) veterans; raising more than $1,000,000 in equipment. The last item she reviewed was non-state funds, to rehabilitate and the need for expenditures to make capital reinterpret Shawnee Indian Mission State improvements to the William Allen White Historic Site in Fairway. The Executive State Historic Site. She explained that an Director also cited a variety of activities Attorney General’s Opinion on a law undertaken by the Society. Among them restricts the Society from expending state included an increase of 52 properties added funds to operate or make capital to the National Register of Historic Places improvements on the property. She said and seven properties to the Register of that legislation like the one introduced in Historic Kansas Places. It also was noted 2001 would allow the agency to receive that the Society received national awards of states funds for the historic site at Emporia. achievement for special exhibits and publications. Kansas Film Commission. The Director informed the Committee that the In terms of future plans, the Executive Commission is funded entirely by the Director said the agency plans to: Economic Development Initiatives Fund which covers expenses for two full time • Increase private contributions to KSHS employees and an operating budget of by 15 percent. $100,000 for their activities in marketing Kansas and assisting film production in the • Decrease utility usage by 5 percent. state. He stated that during FY 2006, film production dollars spent in Kansas totaled • Carry out a statewide survey of an estimated $33.0 million for a return on agricultural properties in Kansas investment of approximately 167 to 1. The resulting in a multiple property Director also cited various assistance the nomination. Commission provided several filmmakers to assist film productions. He noted that the • Partner with educational organizations Commission seeks to increase dollars spent to provide standards-based teacher in Kansas by filmmakers not only by training in the area of Kansas history. promoting Kansas as an attractive film site, but also by elevating national awareness of • Reinterpret Fort Hays Guardhouse, indigenous talent and resources through Grinter Place, Hollenburg Station, and events and programs designed to draw Kaw Mission State Historic Sites. international attention and by providing free resources to aid their efforts to produce films • Launch Kansas Memory, a virtual locally. Finally, he said that The Kansas repository of the agency’s collection. • Film Industry Task Force findings and recommendations were forwarded to the • Complete 150 artifact histories on the Governor. These strategies are: developing web for the state’s sesquicentennial in and deploying investments of state financial 2011. resources that are held accountable based
Kansas Legislative Research Department 4-10 2006 Arts and Cultural Resources upon quantitative date and reporting members of Congress to ensure high success; establishing a cooperative quality, ongoing K-12 arts educations for educational structure that employs class- America’s students. work, internships, certification programs and transferable credits across various state • The Impact of the Latest Federal institutions to achieve a technically skilled Education Legislation on the Arts in 2007, and creative workforce in film production; outlines the successes, challenges, and and reorganizing and refocusing the Kansas ways advocates are making a difference Film Commission to facilitate the synergistic for the arts in the nation’s public assets of Kansas that will he critical to the schools. creation of a successful and sustainable film
industry.m / In terms of national research, the Fine Arts Educational Consultant, consultant cited the recently released Kansas Department of Education. This Critical Links Learning in the Arts and conferee discussed four topics: curricular Student Academic and Social Development. standards for visual arts education; the arts This is a compendium of research and in Kansas Schools; the No Child Left Behind studies addressing academic and social law; and national research as it pertains to effects of learning in the arts. She also cited arts and student learning. With regard to other studies pertaining to dance, drama, state standards, she informed the Committee multi-arts, music, and the benefits of the arts that they are being revised. The changes on elementary school children. will include improved clarity and consistency among standards, benchmarks, and indicators. In addition, teacher Conclusions and Recommendations resources will include lesson plans for each of the standards. She added that curricular Based on Committee testimony and standards for media literacy and forensics extensive discussion, the Committee have been developed and approved by the recommends that: Kansas Board of Education. These standards address film production and understanding. • The website of the Department of With regard to arts in Kansas schools, this Commerce be improved by: updating conferee explained that standard training and improving communication with workshops will he offered for teachers legislators; and by having Destination addressing the revisions made during the Marketing Organizations (DMOs) Visual Arts standards revision process. interact with local legislators to get Similar training is presently being offered communities, historic places, and regarding the Media Literacy and Forensics businesses listed on the Department of standards. Also, workshops are being Commerce’s website. planned for the summer focusing on Music portfolio and assessment. • The Department of Commerce develop niche marketing to better identify special On the topic of No Child Left Behind, the places that may not have been consultant said that: considered previously.
• In 2007, Congress will begin the • The Department of Commerce strive to reauthorization process for another five make its website more user friendly to years. • the general public, including better interface and access to the site from the • Nationally, the arts education State of Kansas’ website and clearly community is currently working to identify the links to cities and counties. gather support and develop requests to
Kansas Legislative Research Department 4-11 2006 Arts and Cultural Resources • The Department of Commerce review its to provide volunteers and cash donations decision to have Kansas! Magazine to the Society in the Society’s efforts to published by an out-of-state company. keep open the facility. The Committee The Committee encourages the further supports a call number to the Department to consider use of qualified Lecompton facility for group Kansas companies in the future. appointments. Lastly, the Society should explore any available federal • The Department of Commerce review the funds for this purpose. purpose of the Kansas! Magazine, including whether its principal purpose • The suggestion by the Kansas State is to generate revenue by attracting Historical Society for the creation of a readership and whether a new separate fund for small museums be generation of younger readers will further explored and, should this replace the declining cohort of older approach be adopted, identify possible readers. sources of monies for this fund.
• Consider the potential for the Kansas! • The policy of weighing certain criteria in Magazine perhaps being combined with the award of moneys from the Heritage another related publication such as the Trust Fund be further explored. Wildlife and Parks publication and then have the Department of Commerce • A new Department of History and follow up next year on its findings and Tourism be created to enhance the recommendations. visibility and vitality of both subjects. The Committee recommends that the • T he Kansas Department of Division of Tourism be taken out of the Transportation policy of “bumping” of Kansas Department of Commerce and existing businesses on highway signs created as a separate agency. The from their sites be reversed through a Committee believes that, currently, the grandfather provision or policy, as a Department of Commerce is an agency measure of fairness. • with multiple duties and facets and more attention would further tourism in • The Kansas State Historical Society’s Kansas. planned efforts to keep open the Lecompton Constitution Hall on • A study be undertaken by the Society to weekends during the months of determine whether the fundamentals of December, January, and February is civics can be incorporated in Kansas strongly supported. The Committee history programming for schools. encourages the Lecompton community
Kansas Legislative Research Department 4-12 2006 Arts and Cultural Resources Councils
Report of the At-Risk Education Council to the 2007 Kansas Legislature
CHAIRPERSON: Dr. Andy Tompkins
OTHER MEMBERS: Mr. Dale Cushinberry, Ms. Deloyce McKee, Mr. Bud Moore, Mr. Dave Self, and Mr. Bob Corkins
Stu d y T o pics
The Council is to:
• Identify those conditions or circumstances that contribute to making a student at-risk of not succeeding in school;
• Develop and recommend public school programs and services which meet the needs of at-risk students and help close the achievement gap;
• Develop and recommend tools to assess and evaluate the effectiveness of approved at-risk programs;
• Recommend funding alternatives for approved at-risk programs; and
• Make a report on its activities to the Governor and to the 2010 Commission by October 1, 2006. The Council must make a final report, including recommendations, to the Governor and the 2010 Commission by October 1 , 2007. The Council will terminate June 30, 2007.
• Review new at-risk weighting added by 2006 Legislature.
December 2006 At-Risk Council
Report to the 2010 Commission
Conclusions and Recommendations
The At-Risk Council draws the following conclusions and makes the following recommendations:
Conclusions
• The Council continues to believe that the best state proxy for identifying at-risk students is poverty, whether that be measured by free, or free and reduced price lunches.
• The Council notes that student achievement on state assessments has improved in elementary and middle schools, but little at the high school level. The Council believes that there needs to be a better understanding of the achievement gap at the secondary level to include examination of dropout, graduation, and attendance rates.
• The Council believes that a single tool, such as state assessment scores, is too narrow to determine if a child is at risk.
• The Council believes that the Kansas State Department of Education criteria for serving at- risk youth that are required for school district plans are appropriate, but need periodic adjustment based on new research.
• The Council affirms the work of the Kansas Legislature and Governor in differentiating at- risk funding with the core funding being decided on poverty and the second level of funding which takes density into account. The Council believes that the third level of funding at- risk students based only on student proficiency as determined by the state assessments for those who are not on the free lunch program is an interesting and potentially effective approach that needs further study.
• The Council concludes that at-risk students need the most qualified teachers and that this is not occurring in many schools, especially at the secondary level.
• The Council concludes that there is a teacher shortage in selected subjects and geographic areas and that the problem of recruitment and retention must be addressed.
• The Council supports the state database project being developed by the Kansas State Department of Education to include both student and teacher information.
• The Council concludes that periodic studies of effective at-risk programs and strategies need to be conducted at the recommendation of the 2010 Commission. •
• The Council believes that comprehensive social support is vital to ensure the success of at- risk students and that the statute requiring an integrated social support system must be implemented and maintained in an effective and efficient manner in all districts.
Kansas Legislative Research Department 5-3 2006 At-Risk Council • The Council believes that an evaluation of charter schools is needed to determine lessons learned and areas in need of improvement. A part of the new federal charter school grant recently received by the Kansas State Department of Education requires such an evaluation. Therefore, the Council hopes that the 2010 Commission will utilize the results to identify what has been learned in the operation of charter schools that might he informative for all public schools and to determine needed adjustments in charter school statutes or policies.
• The Council believes that at-risk students should be encouraged to seriously consider continuing education after high school and be provided access to programs that will enable the students to pursue a career path, whether it be vocational, technical, community college or university, which will allow the students to be successful members of society.
Recommendations
• The Council recommends that the second level of funding for at-risk students, which is the high density formula, be based on the prior year's data and implemented using a linear transition calculation. The Council believes that the density formula needs to be reviewed periodically to ensure that it is taking into account all areas of the state and that it is adding value to student learning.
• The Council affirms that the third level of funding, Non-Proficient At-Risk Weighting, be for students who are below proficiency and not on free lunch. Also, the Council recommends that the 2010 Commission study the impact of this provision and the formula which distributes the funding should be simplified if the weighting remains in effect beyond its current statutory termination date of June 30, 2007. Further, the Council notes that the student improvement team practice currently utilized in the schools should be helpful in identifying the results of this initiative.
• The Council recommends the continued support of the data system being developed and implemented by the Kansas State Department of Education as a critical component in the ongoing understanding of the achievement gap of at-risk students. Furthermore, the Council supports the implementation of 2006 SB 549 which requires the State Department of Education to provide performance and financial accountability for the use of at-risk funding. Additionally, the Council recommends that the Kansas State Department of Education be supported in its efforts to be a resource for schools in identifying successful programs of Education and strategies for helping at-risk students.
• The Council recommends that the Department of Education periodically reevaluate the existing criteria for the determination of a student to be in need of at-risk services to include consideration of the use of at-risk funds on specific professional development to serve at-risk students such as behavior management training.
• The Council recommends that the 2010 Commission authorize follow-up studies on early career teachers who leave the profession to determine what factors contribute to their leaving, as well as, successful practices needed to recruit and retain highly qualified teachers.
• The Council recommends that the 2010 Commission authorize a study to determine the factors contributing to the achievement gap and lack of progress in student achievement at the high school level.
Proposed Legislation: None.
Kansas Legislative Research Department 5-4 2006 At-Risk Council Background school finance litigation in Kansas goes back to the 1970s, when the prior school finance The 2005 Legislature created the At-Risk act, the School District Equalization Act Council, which is composed of six members, (SDEA), was enacted in 1973, in response to five appointed by legislative leadership and a district court decision which found the the Commissioner of Education. The prior act deficient because the state had not statutory duties of the Council include: provided enough aid to offset disparities among school districts in taxing efforts and • Identifying those conditions or per-pupil expenditures. circumstances which contribute to making a student at-risk for not The SDEA was challenged in 1990 and succeeding in school; 1991, in lawsuits that were consolidated in Shawnee County District Court before Judge • Developing and recommending programs Terry Bullock. Judge Bullock announced a and services which meet the needs of at- series of principles he would apply in risk students: deciding the pending case and the legislature responded bv enacting a new school finance • Developing and recommending programs act in 1992, the current School District and services which help close the Finance and Quality Performance Act. achievement gap; The new law was immediately • Developing and recommending tools to challenged and, in an opinion issued in assess and evaluate the effectiveness of December 1993, by Shawnee County District at-risk programs; and Court Judge Marla Luckert, was found to have two constitutional infirmities: • Recommending funding alternatives for at-risk programs. • The uniform school district general fund tax levy was construed to be a state The Council is to submit a report on its property tax and, as such, subject to a activities to the 2010 Commission and the constitutional provision which limits Governor on or before October 1, 2006, and such levies to two years in durations; its final report is due on or before October 1, and 2007. • The low enrollment weight was found constitutionally deficient because it Committee Activities perpetuated inequities caused by the previous school finance law and the The Council began meeting during the enrollment eligibility was set at too high 2005 Interim and continued through the a level. 2006 Session. All items considered by the Council during the 2005 and 2006 meetings are reviewed in the following material, along The decision was appealed to the Kansas with Council conclusions and Supreme Court, which, in December 1994, recommendations. overruled Judge Luckert’s finding that the low enrollment weight was constitutionally History of the Recent Kansas deficient and upheld the constitutionality of Supreme Court Ruling the act. (The property tax provision had been corrected by the legislature, which, in Staff briefed the Council on the recent 1994, began the practice of subjecting the tax school finance litigation case before the to renewal every two years.) Kansas Supreme Court. Recent history of
Kansas Legislative Research Department 2006 At-Risk Council With regard to the most recent litigation, critical factors for the legislature to consider staff told the Council that the cases had been in achieving a suitable formula for financing brought by essentially the same parties and education were the equity with which the are represented by the same attorney as in funds are distributed and the actual costs of the previous 1990 and 1991 lawsuits. The education. Without specifically directing federal case, Robinson, et. al v. State o f the legislature how to do so, the Court gave Kansas, et. al, was filed May 21, 1999, by 32 the legislature until April 12, 2005, to cure students from USD 305 (Salina) and USD the defects in the law. 443 (Dodge City) who represented protected groups. They argued that mid-size school During the regular session of 2005, the districts do not receive the same amount of legislature passed House Bill No. 2247 and school funding per student as the smaller Senate Bill No. 43 which increased the enrollment school districts, a fact that has a amount of the base state aid per pupil, discriminatory impact on minority and increased the at-risk and bilingual disabled students in larger districts. weightings, increased the local option budget authority, increased funding for The state court case, Montoy, et. al v. special education, created additional local State of Kansas, et. al, was filed December funding authority, directed the Legislative 14, 1999, by USD 305 (Salina) and USD 443 Division of Post Audit to conduct a cost (Dodge City) and by 31 students from those study, created a school district audit team districts who represent various protected within Post Audit, and created the 2010 classes, including African-American, Commission. Hispanic, Asian-American, students with disabilities, and those of non-United States On June 3, 2005, the Supreme Court origin. The plaintiffs brought all of their issued a supplemental opinion to its January claims under the Constitution of the State of decision citing a “continuing lack of Kansas, including a challenge as to whether constitutionally adequate funding” and the legislature has made, “suitable provision “inequity-producing local property tax for finance of the educational interests of the measurers.” The Court told the legislature state as required by Article 6.” that it had until July 1, 2005, to increase the $143 million in funding already When Montoy first reached the court, appropriated for school year 2005-2006 by Judge Bullock determined that there was no an additional $142 million. The amount was issue for the court to decide, because equal to one-third of the estimated $853 educational interests properly were in the million cost of implementing the jurisdiction of the legislature and the State recommendations of the 2002 Augenblick Board of Education. The Kansas Supreme and Myers study which the Court stated was Court disagreed and remanded the case to “the only analysis resembling a legitimate him. Judge Bullock found for the plaintiffs cost study before us.” and the case was appealed to the Kansas Supreme Court. On January 3, 2005, the The Court stated that funding beyond the Kansas Supreme Court rendered its opinion 2005-2006 school year would be contingent in which it held that the legislature had upon the results of the cost study done by failed to “make suitable provision for the Legislative Division of Post Audit. The finance” of the public school system as court also stated that the cost study would required by the Kansas Constitution. As have to include the determination of the funded, the statutory formula failed to costs of outcomes required by rules and provide adequate funding to middle-sized regulations adopted by the State Board of and large districts with a high proportion of Education which requires achievement of minority, at-risk and special education measurable standards of student proficiency. districts as an increased funding should be required. The Court stated among the
Kansas Legislative Research Department 5-6 2006 At-Risk Council During the Special Session that was KSA 72-6407 defines “at-risk pupils” as called in response to the June 3 decision, the pupils who are eligible for free meals under Legislature passed Senate Bill No. 3. The the National School Lunch Act and for bill addressed the specific concerns of the whom a district maintains an approved at- Court with the local option budget and the risk pupil assistance plan. While the extraordinary declining enrollment by number of pupils who qualify for free lunch equalizing them and by expanding which determines the additional dollars a school districts could qualify for what is now called district receives, the school district must the declining enrollment weighting. have a plan in place that has been approved by the State board of Education identifying Senate Bill No. 3 also increased the which at-risk students will be served and the amount of base state aid per pupil, increased services they will receive. According to the at-risk weighting, created the At-Risk guidelines established by the State Board of Council, increased funding for special Education, an at-risk student can be defined education, provided for capital outlay state by one or more criteria. Predominantly, a aid, reinstated the correlation weighting, student who is not working on grade level in allowed for the appointment of a legislative either reading or mathematics is the major to education counsel to represent the determine an at-risk student definition. An legislature in school finance litigation, at-risk student is one who exhibits one or required Post Audit to provide for an input more of the following characteristics: cost study and an outcome-based cost study and established a policy goal that at least 65 • Is not working on grade level in percent of the moneys provided by the state mathematics or reading or both; be used for the classroom or for instructional • Is not meeting the requirements purposes. Additional state aid in the necessary for promotion to the next amount of $148.4 million was provided by grade; the bill. On July 8, 2005, the Supreme Court • Is failing subjects or courses of study; ruled that Senate Bill No. 3 was in • Is not meeting the requirements substantial compliance with its June 3rd necessary for graduation from high Order and approved it for interim purposes. school and is a potential dropout; • Has insufficient mastery of skills or is At-Risk Students In Kansas not meeting state standards; • Has been retained; Dale Dennis, Deputy Commissioner of • Has a high rate of absenteeism; Education, explained that students who face • Has repeated suspensions or expulsions certain conditions such as not working on from school; grade level, having a high rate of • Is homeless or migrant or both; or absenteeism, having repeated suspensions or • Is identified as an English Language expulsions, or being identified as an English Learner. Language learner are defined as at-risk because, statistically, students in these Services provided by school districts categories are more likely to be among the with at-risk pupil funds include tutoring lowest achievement groups or drop out of services, alternative schools or classes, school altogether. In Kansas, as evidenced programs designed for make-up courses or by the 2005 state assessments results, there credits, additional instructional services for continues to be a significant achievement reading and math, extended day and year gap between advantaged and disadvantaged programs, English as a Second Language, students, majority and minority students, and counseling services. and English proficient students and English language learners. Mr. Dennis pointed out that during the 2003-2004 school year, at-risk programs served 142,778 students across the state.
Kansas Legislative Research Department 5-7 2006 At-Risk Council These programs have made a significant difference in the lives of students by helping 2005 Trends in Kansas Education them improve their grades, obtain graduation credits, stay in school, attend Dr. Alexa Posny, Assistant school regularly, and improve their chances Commissioner, State Department of for success in life. Education, says Kansas is a state:
Four-Year-Old At-Risk Program • Scoring second highest in the nation in math on the National Assessment of The four-year-old at-risk program was Education Progress (NAEP) for 4th established approximately nine years ago to graders; help students prepare for entering kindergarten, according to Mr. Dennis. The • Scoring 10th highest in the nation on program is half-day and is patterned on the math on the NAEP for 8th graders; three- and four-year-old Head Start Program. • Scoring a grade of 99 for the proportion In prior years, the Legislature placed a of students who go on to college, the 2nd limit on the number of students that could highest score in the country; be served by the program. The 2005 Legislature amended the law to eliminate the • Being one of the top six states in the cap and make it subject to appropriation. percentage of high school graduates During the 2005-2006 school year the going on to college; estimate is that 5,603 students will be funded for the program. The number of • Being one of the top nine states in the students that remain to be served would proportion of high school graduates with probably not exceed 897 additional students. scores in the top 20 percent nationally on either the ACT or SAT; Mr. Dennis listed some of the advantages of the program as follows: • Rising ACT college entrance examination scores since 1994, five • At-risk students, and in many cases times faster than the national average; students living in poverty, begin school behind and never catch up. This • Having the 8th highest average program gives those students a much Advanced Placement (AP) exam scores better advantage to be successful. in the nation;
• By funding this program it saves school • Having 70 percent of public high school districts and society money in the long students taking AP exams earning a run. The savings comes about in a score high enough to qualify for college reduced need for special education as credit; well as increasing the chances of a student’s success. • Improving graduation rates (87 percent);
• The at-risk students who participate in • Decreasing dropout rates (2 percent or this program have had higher test scores, less); are absent from school less often, and are more likely to be promoted to the first • Increasing significantly the number of grade. • students taking advanced mathematics and science classes; • Investing in early childhood education has a positive impact on the students as • Sustaining high attendance rates (95 well as economic development. percent);
Kansas Legislative Research Department 5-8 2006 At-Risk Council • Increasing “dramatically” the number of state average in 2005. However, the 11th schools reaching the standard of grade reading scores were approximately excellence; and half of the state average in 2004 and 2005.
• Narrowing the achievement gap, especially in the last five years. Legislative Post Audit Cost Study Analysis of Elementary and Secondary Education in Kansas: Estimating the Costs of K-12 Kansas Charter Schools Education Using Two Approaches
Dr. Tom Foster, Kansas State Department Barbara Hinton, Legislative Post Auditor, of Education, provided the following Legislative Division of Post Audit, reviewed information from the 2004-2005 Kansas the at-risk sections of the report for the Charter School Annual Report. Council. She reported that beginning with the 2005-06 school year, the Department of There were 27 charter schools in Kansas Education’s guidelines require districts to during the 2004-2005 school year. They use some form of diagnostic assessment or were distributed geographically throughout evidence-based educational criteria to the state; however, they are located identify at-risk students. These could be primarily in rural settings spanning grades things such as results of state or local K-12. Of the 27 charter schools operating in assessment tests, or records of academic 2004-2005, only 25 will continue operations performance. In addition, special education in 2005-2006 school year and two new students became eligible that year for at-risk charter schools were approved by the State services, so long as those services are not the Board in March of 2005. However, only one same services being funded with special of the new approved charter schools began education funds. The 2005 Legislature operation. Almost 2,000 students attended increased the at-risk weighting from 0.1 to Kansas charter schools during the 2004-2005 0.193 for school year 2005-06 and this school year. The demographics for the additional funding means that the weighting population attending were: 48 percent generated approximately $822 in state female, 17 percent minority, 34 percent low funding for each free lunch pupil or socio-economic status (federally defined approximately doubled the total funding for term), 9 percent disabled; and 3 percent the program between the 2004-05 school English Language Learners. year and the 2005-06 school year from $52.0 million to $110.7 million. According to the annual report, charter schools provide educational opportunities The at-risk portion of the study focusing on academics. The use of employed a sample of 11 school districts: individualized instruction and technology is USD 326 Logan, USD 217 Rolla, USD 349 incorporated in the majority of the schools. Stafford, USD 404 Riverton, USD 253 The grade division of charter schools was: 18 Emporia, USD 480 Liberal, USD 457 high schools; 13 middle schools; and 11 Garden City, USD 512 Shawnee Mission, elementary schools. In addition, 83 percent USD 443 Dodge City, USD 500 Kansas City, of charter high schools are alternative or and USD 259 Wichita which were reviewed credit recovery programs and low socio in detail. The findings by Legislative Post economic status students in charter high Audit were as follows: schools is almost double the state average. Reading scores for 5th grade were higher • Districts have not reported the number than the state average in 2004, and equal in of students served in a uniform, 2005. Reading scores for the 8th grade in consistent basis. According to the study, charter schools were higher than the state some reported the number of students average in 2004, and slightly higher than the eligible for free lunch, others reported
Kansas Legislative Research Department 2006 At-Risk Council students participating in state funded at- • The report found that the sample risk programs only, and others reported districts spent much more than they students participating in all at-risk received in state at-risk funding, in programs. providing at-risk services. Approximately 93 percent of at-risk • The state’s basis for funding at-risk expenditures reported to the State services has little relationship to the Department were labeled as salaries and number of students who receive at-risk benefits and most of the sample districts services. According to the study, poverty indicated that they would spend any serves as the basis for funding; however, additional at-risk funding they received lack of academic progress is the basis for to initiate or expand current at-risk receiving services and during 2003-04, services. 129,885 students were eligible for free lunches, while 143,000 at-risk students The study states that the current funding were served. The study found that small formula is set at 0.193 and the cost function districts in its sample provided at-risk analysis performed by consultants hired by services to far fewer students than the Post Audit to assist in the study was set at number of students counted for funding 0.484. In addition, the consultants’ analysis purposes, and they tended not to be the added a new weighting for urban-poverty same students. Several of the larger weight to meet an estimate of the districts identified all students who significantly higher costs incurred by high- qualify for free lunches as being eligible poverty, inner-city school districts, which for and receiving at-risk services. would apply to Kansas City, Kansas City- Turner, Topeka, and Wichita districts, set at • Variations in at-risk services provided 0.242 for a total for those four districts of also occurred within the sample districts 0.726 for school year 2006-07. reviewed. The most common types of at- risk services included after-school activities, special reading and math Closing the Gap for At-Risk Students programs, alternative school settings, and counseling services. However, there Dr. Alexa Posny, Assistant were unique services being provided by Commissioner, explained that the gap the sample districts, such as the between the academic achievement of Therapeutic Education Center which students who are disadvantaged and serves at-risk students before and after a students who are not disadvantaged has stay at Larned State Hospital; Kid Zone been decreasing at the elementary and in Kansas City, for children that have no middle school level in Kansas; however, at safe place to go before and after school; the secondary level, the gap remains the transportation for migrant students to same. While Kansas students have made and from after-school programs held at “tremendous gains” over the past five years, El Centro, in Kansas City; free lunch lower scores for disadvantaged students at during the summer for children in the high school level reflect either a decline Stafford whether or not they are enrolled in their scores or a rise in affluent students’ in school; and junior ROTC in Wichita scores. In all subjects and at all grade levels, which is described as a character- students who are disadvantaged perform building and leadership program. Some behind others. districts also used at-risk moneys to serve all students in school buildings A paper prepared by the National Center with a significant number of students for Education Statistics (NCES) entitled, considered to be at-risk. Two major “Understanding the Learning Gap of examples of such programs are class-size Disadvantaged Students: Findings from reduction and full-day kindergarten. National Survey Research Studies,”
Kansas Legislative Research Department 5-10 2006 At-Risk Council highlights effective strategies to close the controlled for the effects of poverty, race achievement gap. NCES found that many and gender. Four teaching practices home environments of disadvantaged were linked with higher student students did not contain books or places to achievement in reading, science, and study and that parents tended to have less math. The more often these practices participation in educational activities as well occurred in classrooms, the higher as lower expectations for educational students' scores on the assessment. The achievement. In terms of school following curricular and instructional environments, the report pointed out that practices were recommended: every child must be ensured access to the best educational opportunities including o Amount and quality of work needed being held to high challenging standards, to earn an A or B on assignments was having quality teachers, and being held clearly specified; teachers who accountable for their achievement. provided specific guidelines for assignments and examples of quality The study points to a series of work, translated content standards straightforward strategies schools can and into concrete performance standards should use to close the gap. While these for students. strategies include most of the programs already offered in Kansas schools - early o High standards for students were learning opportunities, professional expected and included help in development, extended time - important meeting these standards. complexities and pitfalls sometimes curtail their overall effectiveness and none is easy o Subject and content are known well to carry out. Some are more costly than and teachers are “always asking others, and many others require changes in about the how’s and whys. These knowledge, skills, and ways of thinking that teachers ask students to compare and are hard to bring about, especially on the contrast and they challenge...,” the scale of a whole state’s education system. content of courses is challenging, accurate and up-to-date. The following are examples of recommendations from the NCES study to o The curriculum prepares learners for school districts to close the achievement the future. gap:
• High quality early childhood programs • Dr. Posny pointed out that for over the that focus on academic preparation for past 20 years, research has shown that school can reduce the gap sharply, and teachers form expectations for students’ their effects last well into the schooling achievement that influences the actual process. One of the primary achievement of individual students, recommendations in the report, calls for including the decision to drop out of expanding and improving preschool school. The nature and degree of this programs for 3- and 4-year-old children. effect are likely to vary based on “Affluent families typically provide teachers’ beliefs about teaching and preschool learning opportunities for learning as well as specific their children. This advantage must be characteristics of the teacher and his or provided to all children who typically her students. Searching for students’ under-perform in school.” • talents and strengths, for reasons to regard every student as a valuable • The Southern Regional Educational person, enables students to tap into more Board (SREB) analyzed teaching of their potential. The following are practices using a statistical model that some effective examples:
Kansas Legislative Research Department 5-11 2006 At-Risk Council o High performing schools have higher o Learner outcomes are specified and expectations for all students and they form the basis for assessment. have leaders who listen to what students and teachers say about their o Outcomes are consistent with the schools, raise expectations, and vision and goals of the school. understand how effective instructional practices and deeper o Outcomes are developed with broad knowledge of content can improve community involvement and refer to student achievement. the skills students needs to succeed in college, at work, or other post- o High performing schools have and secondary endeavors. use knowledge of human development and cultural norms and o Outcomes include a combination of traditions, learner-centered practices, intellectual processes, skills and cultural socialization, and learning content knowledge that provide a styles. clear framework within which assessment can occur. o High performing schools use the unique abilities, skills, talents, and o Outcomes are cumulative throughout strengths of all students to expand a child’s education, from and extend their learning and kindergarten though graduation. achievement, used in culturally Benchmarks provide the acceptable appropriate ways questioning ranges of performance at various strategies, critical thinking, and the ages. application of knowledge. • Good school level leadership is the • Accountability is needed for both common thread found in a successful students and schools. Both school school turnaround in performance. accountability and student Good leadership shares the accountability programs must be responsibility, holds everyone mutually instructionally relevant and used to responsible, has a set of common goals change practice. Schools can be held for the good of the organization, and accountable by taking a snapshot of a enables and sustains organizational subgroup’s or school’s percent of change. Slightly more than half of students at proficient or above at one teachers in high performing schools, as point in time and comparing that percent compared to only one-third of low with an established target. Progress is performing schools, say their schools’ defined by the percentage of students at goals and priorities are clear. proficient or above and whether the group met or did not meet the target. Additionally:
Student accountability can be based on o In high performing schools, teachers tracking the achievement scores of and school administrators work individual students or students in the together to improve the achievement same group such as grade level from one of students in their schools. year to the next or over multiple years to determine if the students have made o Leaders in high performing schools progress. The change in scores is encourage teachers to teach more usually compared to a standard of rigorous content and maintain a expected growth. The following demanding yet supportive characteristics are often part of a well environment that pushes students to developed accountability system: do their best.
Kansas Legislative Research Department 5-12 2006 At-Risk Council o Teachers in high performing schools group, and class are among the identified report that their principal consults major historical barriers to effective with them before making decisions family involvement. that affect teaching and learning. • Students who are at-risk often come to Teachers are also encouraged to school academically behind their peers. experiment with teaching practices Students must be provided more time to that engage more students in be taught what they have not already learning. learned. Several choices exist: provide extended time programs once the students are in school-such as before or • Schools that have been successful at after school time, summer school, or reducing the achievement gap have even weekend school-and/or preventive several practices in common, including programs such as early childhood, four- such practices as being developmentally year old at-risk, preschool or other responsive and focusing on small daycare programs that enable each child learning communities. Additionally, to enter kindergarten literate and ready staff members have stable, close and to learn. Finally, time should be viewed respectful relationships amongst as a variable with the expectations and themselves as well as with students and standards for all students the constant. provide comprehensive guidance Effective practices include such services. Finally, successful schools strategies as there are no grade levels; ensure that students talk with counselors students progress at their own pace; several times about which classes to take schools open at varying times; to ensure they reach their future goals graduation is based on academic and provide teacher mentors who assist attainment not course credit; there are students in determining their longer and varied blocks of instructional educational goals and educational plans time; and there are transitional years of for high school and beyond. schooling.
• Successful school have all children being taught by able, well-prepared, Funding Systems of At-Risk Programs in experienced teachers. The quality of Other States teachers assigned to students may be the most powerful influence on student Dale Dennis presented the following achievement. Yet minority and information about how other states fund at- disadvantaged students are regularly risk programs. The information was assigned less qualified, less experienced complied by the Education Commission of teachers than are white or more affluent the States. The following tables describe the students. Some studies suggest that funding systems of at-risk programs in 19 equalizing teacher assignment patterns randomly selected states. The data in the could eliminate nearly all of the gap not first table indicate if a state includes funding attributable to poverty and its correlates. • for at-risk programs in the state's foundation formula and how students are identified. • Involving families in school has a The second table lists the various programs positive effect on student achievement in these states, the level of funding and how and the research for effective ways to students are deemed eligible. involve families is ongoing. Race, ethnic
Kansas Legislative Research Department 5-13 2006 At-Risk Council At-Risk Student Funding Systems in Selected States State Categorical Aid
Slate Program Name Categorical Funding Identification for Categorical Level Funding
California Economic Impact Aid $426,928,000 Children age 5-17 receiving AFDC and LEP Students
Florida Supplemental $662,632,143 Funds for projects targeted to Academic Instruction "help students gain at least a year of knowledge for each year in school"
Georgia Special Instructional This program was K-3 students likely to have Assistance Program discontinued problems in maintaining grade-level performance.
Georgia Remedial Education $71,447,992 Students in grades 2-5 and Program 9-12 who are deficient in reading, math or writing.
Indiana Early Intervention $3,990,000 Provides grants to school Program districts to fund reading programs for students who are at risk of not learning to read.
Massachusetts Essential Skills Grants $0 Students from families on AFDC
Massachusetts Academic Support $18,930,700 Students with low test scores Grants
Michigan At-Risk Pupils $304,000,000 Students receiving free/reduced lunch
Missouri Children At-Risk in $333,000,000 Students receiving Education free/reduced lunch
Missouri Remedial Reading $11,096,925 Students with low test scores
New York Extraordinary Needs $677,700,000 Students receiving Aid free/reduced lunch or students with low test scores (grades 3 and 6)
New York Educationally Related $70,900,000 Students are referred for Support Services Aid services by school building administrator
New York Aid for Summer $35,100,000 The program must provide School Programs help to students in required academic subjects or on the Regents exam
New York Attendance $55,500,000 Districts with attendance in the Improvement/ bottom decile for the state Dropout Prevention
Kansas Legislative Research Department 5-14 2006 At-Risk Council New York Compensatory $262,500,000 Districts that are in the top Education quartile of need, based on state testing
North Carolina At-Risk Student $186,313,299 Students in treatment, poverty Services and ADM
North Carolina Improving Student $39,015,255 Students with low test scores Account. (grades 3-8)
North Dakota None NA NA
Ohio Disadvantaged Pupil $305,367,571 Students with families enrolled Impact Aid in the "Ohio Works First" (the stale's welfare program)
Oregon None NA NA
Pennsylvania None NA NA
South Dakota None NA NA
Tennessee None NA NA
Texas Compensatory and $9,600,000 Low academic achievement, Accelerated pregnant/parent, LEP and Instruction abused
Washington Learning Assistance $62,276,834 Students with low test scores Program (grades 4 and 8 based on a five-year average)
Kansas Legislative Research Department 5-15 2006 At-Risk Council At-Risk Student Funding Systems in Selected States State Foundation Formulas
State At-Risk Funding in the Identification for Distribution for Base Foundation Formula Foundation Formulas Funding
California None NA NA
Florida None NA NA
Georgia Yes Students in remedial Identified students are education programs provided with an extra .2918 weight
Illinois Yes Percent of students in Per-student funding poverty living in the ranges from $800 to district $2,050 based on the percentage of students living in poverty
Indiana Yes Families with children Funded at $3,522 per below poverty level, student single-parent families and adults who are high school drop-outs
Massachusetts Yes Per-student based on Additional per-student free and reduced lunch funding of $2,228 -elementary, $1,794-high school
Michigan None NA NA
Missouri Yes Per-student based on $655 per identified free and reduced lunch student
New York Yes Percentage of students Identified students are below minimum provided with an extra competency on 3rd .25 weight and 6th grade test
North Carolina None NA NA
North Dakota None NA NA
Ohio None NA NA
Oregon Yes Pregnant and Additional weights: parenting, students in P&P (1.00), S in P (.25), poverty, neglected and N&D (.25) and S in FH delinquent and (.25) max weight 2.0 students in foster homes all receive additional weights
Kansas Legislative Research Department 5-16 2006 At-Risk Council Pennsylvania Yes If more than 10% of $50 per AFDC student students age 5-17 are on AFDC
South Dakota None NA NA
Tennessee None NA NA
Texas None NA NA
Washington None NA NA
Prepared by Michael Griffith. ECS policy analyst.
© Copyright 2002 by the Education Commission of the States (ECS). All rights reserved.
Public Comments funding; however, the endorsement was contingent on retaining the current method The At-Risk Council took public based on qualification for free lunch and comments about the Council’s then adding other students who are in need responsibilities at the April 2006 meeting. of at-risk services. A representative of USD Senator John Vratil quoted the Legislative 259, Wichita, encouraged support for the Post Audit study that quested the Post Audit Report on at-risk relationship between funding and services, recommendations; requested expansion of and the finding that the state’s basis for the current definition to include reduced funding at-risk services has little lunch students; and requested maintenance relationship to the number of students who of the current weighted driven distribution receive at-risk services. Senator Vratil of funds. explained that he believes the definition of at-risk students should be changed to one The Superintendent of USD 305, Salina, who is not proficient in either reading or noted that there is a high correlation math, which would be an objective standard. between the economic status of a child and his or her academic success. He also stated A representative of rural Kansas schools that the current at-risk programs are yielding pointed out that all the districts cited by solid results; however, they need to be Legislative Post Audit were spending more expanded, not reduced. An Associate on at-risk students than the state provided in Superintendent of USD 501, Topeka, noted at-risk funding. In addition, the that it is known that there are failing representative requested that rural schools students everywhere; however, there is a not be penalized but that larger districts be higher rate of failure in those schools and helped to close the achievement gap. districts with a predominance of students on free and reduced lunch. A representative of USD 500, Kansas City, Kansas, mentioned that it is a A representative of the Kansas disturbing fact that the State of Kansas is Association of School Boards provided the currently not adequately meeting the following list of recommendations: education needs of larger numbers of poor children. Implementation of the Post Audit • Include funding for all-day kindergarten Report would result in thousands of Kansas in the finance formula; kids realizing their individual potential. The representative explained that the district • Significantly increase funding for at-risk supports a broadening of the definition of an programs, to a weighting of at least 0.25; at-risk child for the purpose of securing state
Kansas Legislative Research Department 5-17 2006 At-Risk Council • Broaden the criteria for providing at-risk students is poverty, whether that be funding to factors in addition to poverty; measured by free, or free and reduced price lunches. • Allow greater flexibility in using at-risk funds, as long as acceptable outcomes • The Council notes that student are met; achievement on state assessments has improved in elementary and middle • Base accountability on results; schools, but little at the high school level. The Council believes that there • Support professional development for needs to be a better understanding of the teachers, administrators, and school achievement gap at the secondary level board members; to include examination of dropout, graduation, and attendance rates. • Repeal the “65% for instruction” state goal; • The Council believes that a single tool, such as state assessment scores, is too • Encourage best practices and innovation; narrow to determine if a child is at risk. and • The Council believes that the Kansas • Encourage outstanding teachers to work State Department of Education criteria with at-risk students. for serving at-risk youth that are required for school district plans are appropriate, but need periodic adjustment based on Additional Information new research.
At the Council's May meeting, • The Council affirms the work of the Commissioner Corkins indicated that he Kansas Legislature and Governor in would be sending information relating to differentiating at-risk funding with the charter schools as a good delivery system for core funding being decided on poverty serving at-risk students. The Commissioner and the second level of funding which submitted a report that included information takes density into account. The Council from the U.S. Department of Education believes that the third level of funding describing the purpose of charter schools, at-risk students based only on student the focus that many charters provide in proficiency as determined by the state serving at-risk students, and the rubric used assessments for those who are not on the by the U.S. Department of Education in free lunch program is an interesting and evaluating the effectiveness of charter potentially effective approach that needs schools. Finally, he included tables and further study. graphs describing the status of Kansas charter school funding with some context • The Council concludes that at-risk explanations. students need the most qualified teachers and that this is not occurring in Conclusions and Recommendations many schools, especially at the secondary level. The At-Risk Council draws the following conclusions and makes the following • The Council concludes that there is a recommendations: teacher shortage in selected subjects and geographic areas and that the problem of Conclusions recruitment and retention must be addressed. • The Council continues to believe that the best state proxy for identifying at-risk
Kansas Legislative Research Department 5-18 2006 At-Risk Council • The Council supports the state database formula, be based on the prior year's data project being developed by the Kansas and implemented using a linear State Department of Education to transition calculation. The Council include both student and teacher believes that the density formula needs information. to be reviewed periodically to ensure that it is taking into account all areas of • The Council concludes that periodic the state and that it is adding value to studies of effective at-risk programs and student learning. strategies need to be conducted at the recommendation of the 2010 • The Council affirms that the third level Commission. of funding, Non-Proficient At-Risk Weighting, be for students who are • The Council believes that below proficiency and not on free lunch. comprehensive social support is vital to Also, the Council recommends that the ensure the success of at-risk students 2010 Commission study the impact of and that the statute requiring an this provision and the formula which integrated social support system must be distributes the funding should be implemented and maintained in an simplified if the weighting remains in effective and efficient manner in all effect beyond its current statutory districts. termination date of June 30, 2007. Further, the Council notes that the • The Council believes that an evaluation student improvement team practice of charter schools is needed to determine currently utilized in the schools should lessons learned and areas in need of be helpful in identifying the results of improvement. A part of the new federal this initiative. charter school grant recently received by the Kansas State Department of • The Council recommends the continued Education requires such an evaluation. support of the data system being Therefore, the Council hopes that the developed and implemented by the 2010 Commission will utilize the results Kansas State Department of Education as to identify what has been learned in the a critical component in the ongoing operation of charter schools that might understanding of the achievement gap of be informative for all public schools and at-risk students. Furthermore, the to determine needed adjustments in Council supports the implementation of charter school statutes or policies. • 2006 SB 549 which requires the State Department of Education to provide • The Council believes that at-risk performance and financial accountability students should be encouraged to for the use of at-risk funding. seriously consider continuing education Additionally, the Council recommends after high school and be provided access that the Kansas State Department of to programs that will enable the students Education be supported in its efforts to to pursue a career path, whether it be be a resource for schools in identifying vocational, technical, community college successful programs of Education and or university, which will allow the strategies for helping at-risk students. students to be successful members of society. • The Council recommends that the Department of Education periodically Recommendations reevaluate the existing criteria for the determination of a student to be in need • The Council recommends that the of at-risk services to include second level of funding for at-risk consideration of the use of at-risk funds students, which is the high density on specific professional development to
Kansas Legislative Research Department 5-19 2006 At-Risk Council serve at-risk students such as behavior successful practices needed to recruit management training. and retain highly qualified teachers.
• The Council recommends that the 2010 • The Council recommends that the 2010 Commission authorize follow-up studies Commission authorize a study to on early career teachers who leave the determine the factors contributing to the profession to determine what factors achievement gap and lack of progress in contribute to their leaving, as well as student achievement at the high school level.
Kansas Legislative Research Department 5-20 2006 At-Risk Council Joint Committees
Report of the Joint Committee on Children’s Issues to the 2007 Kansas Legislature
CHAIRPERSON: Senator Kay O’Connor
VlCE-CHAIRPERSON: Representative Willa DeCastro
RANKING M inority M em ber: Representative Sue Storm
OTHER MEMBERS: Senators David Haley, Laura Kelly, Roger Reitz, Susan Wagle, and Julia Lynn (replaced Senator O’Connor on December 20, 2006); and Representatives Marti Crow, Bonnie Huy, and Frank Miller
Study T opics
• Early Childhood Programs
• Review of the State Children’s Health Insurance Program
• Services for Young Children with Hearing Loss
• Miscellaneous Topics
December 2006 Joint Committee on Children’s Issues
Early Childhood Programs
Conclusions and Recommendations
The Committee makes the following conclusions and recommendations regarding early childhood programs:
• The Committee notes that the Early Childhood Comprehensive Systems plan is in its second year of implementation and requests a progress report next year.
• The Committee recommends that newborn screenings, including hearing screenings, be included in the school readiness plan.
• The Committee notes the importance of cognitive and non-cognitive skills and suggests that both should be measured and used to evaluate school readiness. The Committee encourages providers of early childhood services to use the proven school readiness indicators that are used by local school districts and determine how their program can help children reach those goals.
Proposed Legislation: None.
Background The Legislative Coordinating Council directed the Committee to discuss current The Joint Committee on Children’s early childhood programs and funding Issues was created in 1998 as part of sources for children from birth to age five. legislation enacting the state children’s In particular, the Committee was to review health insurance program, known as the existing programs for potential HealthWave in Kansas. As specified in KSA duplications or deficiencies. In addition, the 46-3001, the Committee is responsible for Committee was to suggest the most efficient overseeing the implementation and use of the current resources dedicated to operation of the children’s health insurance these programs to have the greatest benefit program, including a review of measurable to very young Kansans. outcomes for contractors. The statute also gives the Committee authority to address other children’s issues as it deems necessary. Committee Activities
For the 2006 Interim, the Committee The Committee heard testimony from the operated as the Special Committee on Kansas Children’s Cabinet and other Children’s Issues pursuant to the provisions member of the Kansas Early Learning of 2006 Section 2(b) of HB 2968. This action Coordinating Council. was necessary because House members appointed to the Joint Committee on The Committee was provided with an Children’s Issues for the 2006 Interim did introduction to the evaluation activities not meet statutory requirements for undertaken by the Children’s Cabinet over membership. the last year. According to the testimony, the Cabinet has been evaluating the
Kansas Legislative Research Department 6-3 2006 Children’s Issues Children’s Initiatives Fund (CIF) dollars that coordinating committee members exchange are used in state and community programs. information. The conferees commented that An accountability framework has been put the website is also being utilized by people in place in cooperation with the University across the country accessing information of Kansas to determine whether or not the about the KECCS project. monies spent are in accordance with the Cabinet’s priorities. Agencies using CIF dollars are to be told that unless they are Conclusions and Recommendations following the guidelines and meeting the designated outcomes, the Cabinet will The Committee makes the following recommend the CIF dollars be withdrawn conclusions and recommendations regarding and the programs will need to find other early childhood programs: sources of funding. • The Committee notes that the Early Early Learning Coordinating Council Childhood Comprehensive Systems plan members presented information regarding is in its second year of implementation the Kansas Early Childhood Comprehensive and requests a progress report next year. Systems (KECCS) plan. The vision of the KECCS project is to coordinate information, • The Committee recommends that resources and services to ensure that Kansas newborn screenings, including hearing children are fully equipped to enter school. screenings, be included in the school Kansas received a $50,000 federal grant to readiness plan. organize efforts in early childhood development. The goals of the KECCS plan • The Committee notes the importance of cover five areas: health insurance and cognitive and non-cognitive skills and medical homes; mental health and socio- suggests that both should be measured emotional development; early care and and used to evaluate school readiness. education services; parent education; and The Committee encourages providers of family support. Within each of these major early childhood services to use the goals are baseline outcomes and process proven school readiness indicators that indicators with individual goals. are used by local school districts and determine how their program can help Finally, the Committee was updated on children reach those goals. the website that has been developed to help
Kansas Legislative Research Department 6-4 2006 Children’s Issues Joint Committee on Children’s Issues
Review of the State Children’s Health Insurance Program
Conclusions and Recommendations
The Committee makes the following conclusions and recommendations regarding the State Children’s Health Insurance Program:
• The Committee notes the changes in managed care organizations for physical health services that will be effective January 1, 2007.
• The Committee recommends a review of the contract renewal for behavioral health services based on concerns expressed to members about the revision of the contract this summer.
• The Committee expresses concern about the low participation by dentists in the HealthWave program. The Committee suggests the Kansas Health Policy Authority (KHPA) find out from the dental association what needs to be done to encourage additional participation and assess the real reasons so many dentists do not participate. The Committee acknowledges the general shortage of dentists in Kansas, particularly in some areas of the state and encourages the KHPA to work with the dental director at the Kansas Department of Health and Environment to see what can be done about improving dental services.
Proposed Legislation: None.
Background not meet statutory requirements for membership. The Joint Committee on Children’s Issues was created in 1998 as part of Committee Activities legislation enacting the state children's health insurance program, known as The Committee heard testimony from the HealthWave in Kansas. As specified in KSA KHPA, the two new physical health 46-3001, the Committee is responsible for managed care organizations, the behavioral overseeing the implementation and health services contractor and the operation of the children’s health insurance HealthWave Clearinghouse project program, including a review of measurable contractor. outcomes for contractors. The statute also gives the Committee authority to address The KHPA updated the Committee other children’s issues as it deems necessary. regarding the status of the State Children’s Health Insurance Program (SCHIP), known For the 2006 Interim, the Committee as HealthWave in Kansas. The Committee operated as the Special Committee on heard background information on the Children’s Issues pursuant to the provisions program and received an overview of the of 2006 Section 2(b) of HB 2968. This action managed care organizations, the eligibility was necessary because House members clearinghouse project, the behavioral health appointed to the Joint Committee on contract agreement, and future directions of Children’s Issues for the 2006 Interim did the agency. In addition, the KHPA discussed
Kansas Legislative Research Department 2006 Children’s Issues modifications made to the dental program to In response to Committee questions, the improve claims payment services and attract KHPA representative indicated that the additional dentists to provide services. KHPA Board will likely recommend to the 2007 Legislature that the Mental Health A major issue discussed by both the portion of health care not be transferred KHPA and the clearinghouse contractor, from the Department of Social and MAXIMUS, was the impact the new federal Rehabilitation Services to KPHA at this time. requirements for proving citizenship were having on the eligibility determination Representatives of the physical and process. The new rules, implemented on behavioral health managed care July 1, 2006, require specific additional organizations, Children’s Mercy Family documentation when a person is making Health Partners, Unicare and Cenpatico, application for medical benefits or renewing presented overviews of their organizations their current coverage. According to the and the services provided for participants in testimony, beneficiaries are confused and the Kansas SCHIP. have difficulty accessing required documents. The result has been a dramatic Conclusions and Recommendations increase in phone calls, e-mails and faxes sent to the clearinghouse where eligibility is The Committee makes the following determined. Another result of the increased conclusions and recommendations regarding requirements is an increase in the workload the State Children’s Health Insurance of eligibility workers and the creation of a Program: large backlog of applications and renewals where staff are waiting on applicants to • The Committee notes the changes in provide documentation. Finally, the managed care organizations for physical Committee was informed that Medicaid health services that will be effective directors and others across the country are January 1, 2007. attempting to work with the federal government to ameliorate the effects of the • The Committee recommends a review of new requirements. the contract renewal for behavioral health services based on concerns KHPA representatives informed the expressed to members about the revision Committee that as of July 1 , 2006, the way of the contract this summer. dental services are provided in HealthWave were changed. Instead of continuing with a • The Committee expresses concern about managed care contract, the agency decided the low participation by dentists in the to shift services to a fee for service HealthWave program. The Committee arrangement. The Committee was also told suggests the KHPA find out from the that only 24 percent of Kansas dentists dental association what needs to be done provide services for SCHIP beneficiaries. to encourage additional participation Approximately 62 percent of SCHIP and assess the real reasons so many beneficiaries received dental services in FY dentists do not participate. The 2006. The Committee was informed that the Committee acknowledges the general KHPA is working to correct the problems shortage of dentists in Kansas, dental providers experience in billing for particularly in some areas of the state services with the hope that it will encourage and encourages the KHPA to work with additional dentists to become SCHIP and the dental director at the Kansas Medicaid providers. Committee members Department of Health and Environment expressed frustration at the continuing lack to see what can be done about improving of widespread participation by dentists and dental services. suggested ways KHPA might address the issue.
Kansas Legislative Research Department 6-6 2006 Children’s Issues Joint Committee on Children’s Issues
Services for Y oung Children with Hearing Loss
Conclusions and Recommendations
The Committee notes the testimony it received about the need for a coordinated program for early identification and provision of services to help children acquire language appropriately. In addition, the Committee recommends that the 2007 Legislature appropriate the additional funding requested for a regionalized system to ensure services across the state.
Proposed Legislation: None.
Background training and experience with hearing loss and its impact on children and families; The Joint Committee on Children’s parent to parent support; and a state-wide Issues was created in 1998 as part of coordinator. legislation enacting the state children’s health insurance program, known as HealthWave in Kansas. As specified in KSA Committee Activities 46-3001, the Committee is responsible for overseeing the implementation and The Committee heard testimony from operation of the children’s health insurance representatives of the Sound Start program, including a review of measurable Committee, the Kansas State School for the outcomes for contractors. The statute also Deaf, the Kansas Department of Health and gives the Committee authority to address Environment (KDHE) and parents of other children’s issues as it deems necessary. children with hearing loss.
For the 2006 Interim, the Committee Conferees emphasized the importance of operated as the Special Committee on early intervention for infants and toddlers in Children’s Issues pursuant to the provisions order for proper language acquisition to of 2006 Section 2(b) of HB 2968. This action occur. The national incidence for deafness was necessary because House members is 2-3 percent per thousand which correlates appointed to the Joint Committee on to approximately 120 babies born with Children’s Issues for the 2006 Interim did permanent hearing loss each year in the not meet statutory requirements for state. The Kansas State School for the Deaf membership. has been in Olathe since 1866 and has acquired a vast number of resources for The Legislative Coordinating Council parents of deaf children. The hope is that assigned the Committee the responsibility of these resources can be used to create an studying issues related to children with early intervention comprehensive program hearing loss. Specifically, the Committee that is available statewide. was directed to study the need to develop a coordinated system for serving young The Committee was briefed on the work children with hearing loss and their families. of the Sound Start Committee. According to In addition, the Committee was to determine the testimony, a group of professionals and if the coordinated system should include parents have developed a statewide plan regional consultants with specialized under the name of Sound Start.
Kansas Legislative Research Department 2006 Children’s Issues The Sound Start Committee has make qualified decisions on all the options developed a plan for a comprehensive, available to facilitate total communication. systematic program that would provide Choosing the correct form of language to resources and support for families necessary meet the child’s needs, meeting with other for educating children who are deaf. The families for a support network, and Committee was informed that across the providing training for parents and other state, there is a shortage of role models and family members to be able to converse are mentors for the deaf. Additional training is all important factors to be considered for the needed by those who administer deaf community. assessments, others need access to current strategies in communication development, Three parents of hearing impaired and some need training in improved children addressed the Committee to talk techniques for auditory and visual learning. about the challenges of finding services near The program was designed based on a their homes and the amount of monies model developed in Colorado. The required for services, surgeries and hearing Committee was informed that there are a aides or implants. According to the parents, number of other states working to coordinate hearing aids are available as “loaners” in this system nationally. In addition, New some areas, but most areas do not have this Mexico and Florida offer effective programs. resource. Some insurance plans provide coverage for cochlear implants, which may A budget enhancement for the School for cost as much as $40,000, which count the Deaf is being requested for FY 2008 against the child’s lifetime benefits. which would divide the state into eight regions. Each region would have a regional A representative of KDHE spoke to the consultant, placed based on geographical Committee in support of a budget areas, with knowledge and skills in hearing enhancement proposal. loss. Training in new technology for consultants and network service providers is being recommended. In addition, the Sound Conclusions and Recommendations Start Committee will work to coordinate the Kansas Parent-to-Parent Hands and Voices The Committee notes the testimony it program on a national level, and work with received about the need for a coordinated international groups so that all deaf children program for early identification and have access to hearing and learning. provision of services to help children acquire language appropriately. In addition, The Committee heard additional the Committee recommends that the 2007 testimony which emphasized the importance Legislature appropriate the additional of early intervention for young children. A funding requested for a regionalized system conferee stated that it is imperative for to ensure services across the state. families having a deaf child to be able to
Kansas Legislative Research Department 6-8 2006 Children’s Issues Joint Committee on Children’s Issues
Miscellaneous Topics
Conclusions and Recommendations
The Committee makes the following conclusions and recommendations:
Committee Membership and Authority
The Committee notes that it has been required to operate as a special committee authorized by the appropriations bill for the 2005 and 2006 Interim sessions because of appointments made in violation of the statute governing membership of the Joint Committee on Children’s Issues.
According to KSA 46-3001 (a) the following committees are to be represented: House Insurance; House Health and Human Services; House Appropriations; Senate Public Health and Welfare; Senate Ways and Means; and Senate Financial Institutions and Insurance.
Members discussed the value of having certain committees represented and determined that the existing representation should remain but that the Judiciary Committees also should be included. After discussion, the Committee concluded that Education Committee representation would not be needed. The Committee notes that its importance is reflected in the number of issues addressed over the years that are not addressed by any other Interim Committee.
Based on the above, the Committee recommends the introduction of legislation for the 2007 session which would: add representation from the Judiciary Committees and give the Committee the authority to introduce legislation.
Adoption Law Changes
The Committee recommends that all suggestions for changes made to the Committee receive further study. The Committee also makes the following comments and recommendations:
• The Committee notes comments it received regarding cases where unknown fathers are not notified of an adoption because of mothers who provide false information regarding paternity. The Committee notes that it received specific language regarding penalties for these mothers.
• The Committee notes it received suggestions for expanding the pool of people who are allowed to perform adoption home studies and changing caseworker qualifications. •
• The Committee notes that indigent fathers who contest adoptions are appointed an attorney in order to protect their parental rights. Currently, these costs are assessed against the adoptive parents. The Committee recommends that the Legislature consider changing the statutes so that these costs are paid by the counties in the same way that criminal cases are handled. In addition, these charges should be paid at a bid rate and not at the attorney’s normal fees.
Kansas Legislative Research Department 6-9 2006 Children s Issues • The Committee notes a proposal it received from the Kansas Children’s Service League for an expanded adoption website. The Committee recommends that the Legislature appropriate funding for this project in order to increase the number of adoptions, particularly for a child in state custody.
• The Committee notes suggestions made to include language clarifying the lack of parental rights of egg donors. Current statutes only speak to sperm donors.
Scholarships for Children with Disabilities
The Committee notes that it received testimony from persons outside the state and that no state dollars were used to pay expenses associated with these speakers.
The Committee recommends the study of the services autistic children need and determine the level of state involvement.
Case Managers in Family Law Cases
The Committee notes information it received regarding the limited options parents have in addressing problems with case managers assigned to them by the courts in family law matters. Further, the Committee recommends that the Judiciary Committees study this issue further.
Changes to the Child in Need of Care and Juvenile Offender Codes
The Committee recommends that the Judiciary Committees look at the issues pointed out by two conferees.
The Committee notes with concern the information it received that secure care for girls in Sedgwick County will be unavailable after January 1, 2007. The Committee recommends that Department of Social and Rehabilitation Services (SRS) and the Juvenile Justice Authority ensure that these types of services will be available under the new structure being implemented.
Legislative Post Audit Report Regarding Children Being Removed from Their Homes
The Committee makes four recommendations with regard to the audit report:
• The Committee notes information in the Legislative Post Audit Report that child support billing practices were not consistent as to which method of calculation was used to calculate the amount of support owed. The Committee recommends that the system of assessing child support obligations for foster care cases receive further study by the Legislature.
• The Committee recommends that the Legislature study the timely appointment of attorneys for families so that they receive adequate representation. •
• The Committee recommends further study on communication issues between SRS and the Kansas Department of Health and Environment cited in the report regarding child care facilities.
Kansas Legislative Research Department 6-10 2006 Children’s Issues • The Committee requests that SRS compile all complaints since the beginning of FY 2006 and report a summary of those complaints to the 2007 Legislature.
Proposed Legislation: The Committee recommends the introduction of one bill.
Background Committee Activities
The Joint Committee on Children’s Adoption Law Changes Issues was created in 1998 as part of legislation enacting the State Children’s At its September meeting, the Committee Health Insurance Program, known as received suggestions for changes to the HealthWave in Kansas. As specified in KSA Kansas adoption laws and regulations. 46-3001, the Committee is responsible for Organizations addressing the Committee overseeing the implementation and included private and public adoption operation of the children’s health insurance agencies; and private adoption attorneys. program, including a review of measurable Conferees noted that overall Kansas’ outcomes for contractors. The statute also adoption laws are very good, especially as gives the Committee authority to address compared to other states but that there are other children’s issues as it deems necessary. areas where improvements could be made.
For the 2006 Interim, the Committee Areas where changes were suggested operated as the Special Committee on included the ability of unknown fathers to Children’s Issues pursuant to the provisions overturn adoptions; professional of 2006 Section 2(b) of HB 2968. This action qualifications; attorney’s fees in cases where was necessary because House members attorneys are appointed to represent indigent appointed to the Joint Committee on fathers; guardianship; relinquishment in Children’s Issues for the 2006 Interim did contested adoptions; best interest of the not meet statutory requirements. child provisions; and reproductive technology. In addition, suggestions were In addition to topics assigned by the made to strengthen partnerships between Legislative Coordinating Council and the child welfare providers and the community statutory topics, the Committee Chairperson mental health system; to study potential has the authority to study any other issue delays in adoption permanencies; to ensure which affects children. Other topics eligibility for college tuition assistance; and addressed this interim included: a study of the development of a centralized adoption suggested changes to state adoption laws; a information site for use in public and private study of scholarships for children with adoptions. Certain of these topics are disabilities; a review of recent changes to the highlighted in this Committee report and Child in Need of Care process; an update on details on others are available in the minutes publications for children prepared by the of the September meeting. Children’s Advocacy Resource Center; and an update on the implementation of the Conferees were asked to comment on the Grandparent’s as Caregivers program. usefulness of birth or putative father registries in terms of locating fathers to allow them an opportunity to voluntarily sever parental rights to decrease the possibility they will contest the adoption for lack of notice in the later stages of adoption or after the adoption is complete. General comments were that there is an existing
Kansas Legislative Research Department 6-11 2006 Children’s Issues notification system in Kansas that functions support and not for adoption. Also, children well but that such a registry could be an adopted from SRS custody are rarely infants additional tool for the legal system to locate and paternity is rarely an issue. With regard birth fathers. Conferees cautioned that any to delays in adoption cases involving registry legislation must be considered very disputed paternity, the Committee was carefully to avoid negative unintended informed that SRS has a contract for testing consequences. Finally, conferees DNA for child support purposes, and it has commented that in states where registries been amended for parental rights exist, such as Missouri, they are not widely termination. Most reports are returned in used by either the legal system or possible about one week. Committee members fathers. expressed some concern about this issue due to comments they have received indicating In response to questions about resources that the delays continue to be significant. available to help families defray the costs of adoption, the Committee was informed that The Committee heard several requests a reimbursement of up to $2,000 is available for changes to statutes and regulations based on the actual expenses incurred. which would increase the pool of people Additionally, there is a monthly adoption allowed to perform adoption home studies subsidy available for families who adopt and other adoption related responsibilities. special needs children in state custody. The amount of the subsidy is negotiated at the Several conferees addressed issues time of the adoption with a maximum of regarding unknown fathers who contest $600 per month. The average amount of the adoptions. Particular issues discussed subsidy is $285 per month. Annual reviews included who should be responsible for are conducted to determine the level of paying attorneys’ fees of indigent fathers and needs as the child progresses to the age of methods to deal with mothers who provide 18. Medicaid coverage for health services false information about the identity of the could be part of the adoption subsidy. The father when placing a child for adoption. In purpose of the adoption subsidy is to remove cases where a father contesting an adoption the financial barrier so that persons of is indigent, the court appoints an attorney to modest means will be able to meet the represent his rights. The fees of this special needs of children adopted from foster attorney are currently being assessed to the care. Between 70 and 90 percent of children adoptive parents. Committee members receive some amount of subsidy. expressed concern on the impact this has on the financial ability people have to become The Committee received a suggestion adoptive parents. In cases where the mother about how to address the need for has provided false information, causing a developing artificial reproductive technology father to not receive appropriate notification, law with respect to surrogacy and gestational specific statutory language was offered to the carriers. Specifically, KSA 38-1114 (f) refers Committee to penalize the mother. This only to the fact that a sperm donor has no language is available in the Committee parental rights. It was suggested that the minutes for the September meeting. language should also refer to egg donors. In most states, where surrogacy and gestational Recommendations carriers are in place, there are no parental rights for either. The Committee recommends that all suggestions for changes made to the In response to questions about the use of Committee receive further study. The DNA testing to determine paternity, the Committee also makes the following Committee was informed that SRS does use comments and recommendations: DNA testing but it is used primarily for child
Kansas Legislative Research Department 6-12 2006 Children’s Issues • The Committee notes comments it researcher with the Milton and Rose received regarding cases where unknown Friedman Foundation in Indianapolis, fathers are not notified of an adoption Indiana, who has conducted evaluative because of mothers who provide false research on several programs including the information regarding paternity. The McKay Scholarship Program in Florida. The Committee notes that it received specific second was an individual from Salt Lake language regarding penalties for these City, Utah, who presented information on mothers. the state’s Carson Smith Scholarship Program. Others presenting testimony • The Committee notes suggestions it included the President and founder of a received for expanding the pool of school for autistic children in Kansas City; a people who are allowed to perform school teacher from Kansas City and the adoption home studies and changing grandmother of an autistic child in Kansas caseworker qualifications. City. The Committee was informed that all travel expenses for the out-of-state conferees • The Committee notes that indigent were provided by private organizations and fathers who contest adoptions are that no taxpayer dollars were used to bring appointed an attorney in order to protect these two speakers to Kansas. their parental rights. Currently, these costs are assessed against the adoptive Testimony focused on: summaries of parents. The Committee recommends other state’s programs; identification of the that the Legislature consider changing educational needs of children with the statutes so that these costs are paid disabilities; reviews of research showing the by the counties in the same way as positive effects of scholarships; dispelling criminal cases. In addition, these common myths about vouchers for special charges should be paid at a bid rate and education; and expressions of concern for not at the attorney’s normal fees. services students are currently receiving.
• The Committee notes a proposal it Misconceptions specifically refuted in received from the Kansas Children’s testimony were: that private schools do not Service League for an expanded adoption accept special education students; that website. The Committee recommends disabled students do not need the option of that the Legislature appropriate funding choosing a private school because problems for this project in order to increase the with public special education can be fixed number of adoptions, particularly for a by spending more money; that disabled child in state custody. student who use vouchers become vulnerable because they are no longer • The Committee notes suggestions made covered by federal laws governing special to include language clarifying the lack of education; and that school choice hurts parental rights of egg donors. Current public schools. statutes only speak to sperm donors. Conferees supporting school choice indicated that one of the key issues for them Scholarships for School Aged is the belief that parents know what is best Children with Disabilities for their children and that they should be given options. The Committee received testimony at the September meeting regarding scholarships Committee members expressed some for children with disabilities. Two out-of- concerns with a number of issues including: state persons presented testimony to the the impact on public education; financial Committee. The first was a senior accountability of participating schools; the
Kansas Legislative Research Department 6-13 2006 Children’s Issues potential for recruiting children out of application process has been simplified in a public schools; oversight of schools to one-page document. Informational materials ensure children’s needs are being met; and and a resource book will soon be available to teacher qualification requirements. grandparents who are caring for their grandchildren. Recommendation The Committee heard that a grandparent The Committee recommended further might choose to be a caregiver rather than study of the services autistic children need become a foster parent, even though they and the appropriate level of State would receive additional funding for involvement in the provision of such becoming a foster parent, for several reasons. services. First, this type of custody may be considered a temporary measure for the benefit of the Mediators in Family Law Cases child with the hope of re-uniting the child with parents. Other reasons are to eliminate The Committee was informed of issues the stigma attached when a child is placed regarding mediators and case managers in foster care; and to preclude the state assigned by the courts in family law cases. having custody of the child and overseeing Specifically, concerns were expressed about the care of the child. the licensing and oversight of individuals who provide these services for the court Publications for Children system. Additionally, the Committee was told that the individuals involved are unable The Committee was presented to change case managers after experiencing information regarding the Children’s financial and other difficulties with the Advocacy Resource Center (CARC) operated current case manager. The Committee by Kansas Legal Services. CARC provides expressed some concerns about the issues legal and comprehensive support for persons the conferees are experiencing and offered in the foster care system who have no other several suggestions for addressing the means to secure representation. Services situation. provided by CARC assist individuals in understanding and navigating the Recommendation complexities of child welfare laws. CARC operates the statewide Guardian Ad Litem The Committee notes information it Support Center. received regarding the limited options parents have in addressing problems with The Committee received a notebook case managers assigned to them by the containing four publications available from courts in family law matters and the Support Center including Alex Goes to recommends that the Judiciary Committees Court, The Road Ahead, Planning Your study this issue further. Future and It’s Not Easy Being a Kid. The goal of each of these books is to provide Grandparents as Caregivers information for the child and each one is interactive. The goal of the support center is At the September meeting, the Committee to secure sufficient funding to make these received an update from the Secretary of books available to all children in Kansas SRS on the Grandparents as Caregivers who may need them. program which was passed in SB 62 during the 2006 session The Committee was Child in Need of Care Code Changes informed that the new program is slated to begin on January 1, 2007, with marketing to The Committee heard testimony from begin in late November 2006. The two district court judges explaining the
Kansas Legislative Research Department 6-14 2006 Children’s Issues changes made to the Code of Care for The Committee was informed that Children and the Juvenile Offender Code bv parents may request an extension to the law the 2006 Legislature. In particular, the requiring a hearing within 72 hours to better judges pointed out areas where changes prepare for the hearing. The judge have policy implications or where explained that the requirements for the complications might be created. The details quick hearing and the appointment of an of the changes reviewed can be found in the attorney are in place to protect parents’ minutes for the November meeting. rights to legal counsel but that it does not allow much time to meet with counsel. This One point that received discussion was constricted time schedule has caused the advisability of opening up judicial concern about the adequacy of proceedings to additional people, including representation parents receive at the initial the press. One judge explained that hearing. The judge did caution that parents additional openness in the process might must understand however that, given eliminate some of the negative attitudes and continuance, their child may be put in increase people’s trust in the Child in Need temporary foster care or kinship care. It is of Care (CINC) process. The conferee unknown what the effect of the extensions commented that the judge is allowed to use would be on the workload of appointed discretion based on the best interest of the attornevs. child. He further explained that print media are allowed, at least in his courtroom, but The Committee asked for information electronic media are excluded to protect the about the response time for DNA testing and child and families. whether delays in CINC proceedings were caused by delays in the testing. An SRS The Committee also had a discussion representative stated that early in the about the ability of families to fully process, tests are possible for establishing understand the proceedings. One of the paternity through Child Support judges told to the Committee about methods Enforcement contracts, which have short courts use to help educate the family about turn around times. However, waiting until the process. One example is the 18-month it is time to determine parental rights could calendar used in Sedgwick County which delay the results of DNA testing because includes providing definitions of terms, those contracts are not available. Committee contact information, as well as reminder members expressed concern about the delay sections for appointments and drug tests to and that taxpayer money is being spent out- be taken. of-state for DNA testing when there are in state labs to perform the work. The Committee expressed concern about information it received that entities Finally, a review of changes to the providing secure care for girls in Sedgwick Juvenile Offender Code was provided to the County is being terminated as of January 1, Committee. The Committee was informed 2007 apparently due to changes being made that the purpose for the changes were in the Title XIX (Medicaid) program. primarily to simplify the language, to bring Kansas statutes into compliance with the In response to questions, the Committee federal guidelines, and to make was advised that rights that existed under recommendations regarding any substantive the status of the grandparent as an changes. He spoke in detail regarding “interested party” that exist before January 1, numerous word changes, delineating 2007 will not be taken away but the rights information line by line for the Committee. will change for cases which occur after that date.
Kansas Legislative Research Department 6-15 2006 Children’s Issues Recommendations calculating the amount owed by parents for child support. State law makes parents • The Committee recommends that the liable to repay SRS for assistance provided Judiciary Committees look at the issues to children, including foster care services. pointed out by the two conferees. The amount owed can be calculated based on the cost of services or the income of • The Committee notes with concern the parents. According to the report, SRS information it received that secure care attempts to use the income method because for girls in Sedgwick County will be it almost always results in lower payments. unavailable after January 1, 2007. The The report cited scenarios where the cost of Committee recommends that SRS and service method was used resulting in the Juvenile Justice Authority ensure significant assessments against parents. that those types of services will be Committee members expressed concern available under the new structure being about the scenarios presented in the report implemented. and made a recommendation for more followup on the issue. • The Committee recommends that concerns related to DNA testing in CINC The report also cited problems in cases be addressed in the Social Services communication between SRS and KDHE Budget during the 2007 Legislative regarding persons who can legally operate session. child care facilities. According to the report, the two agencies should explore what can be done to notify KDHE when a child care Legislative Post Audit Report facility operator would be in violation of Regarding Children Being statutes which governs who can operate a Removed from Their Homes facility.
The Committee received an overview of Findings related to the court system a recent Legislative Post Audit titled Foster included a lack of consideration for families’ Care: Reviewing Decisions to Remove situations; the appearance of bias; external Children from Their Homes. In general, communications outside the courtroom; a cases reviewed were handled reasonably, lack of compliance with statutes regarding however, some problems were revealed questions to be asked of parents; regarding the actions taken by SRS, the inconsistency in time or evidence allowed at courts, and some attorneys. Post Audit staff custody hearings; inaccurate billing reviewed these issues and the practices; incomplete or lost court recommendations made in the audit. In transcripts; and unequal percentages of addition, the Committee was briefed on children placed for adoption. According to concerns expressed by families that were the audit, Montgomery County, and one either determined not to be a problem or judge in particular, was at the center of could not be determined. many of these findings.
Findings related to SRS and its In response to questions about the contractors concerned compliance with judicial district cited in the report, SRS court orders, lack of documentation, representatives indicated that staff have incomplete interviews, inconsistent billing worked with the judge and judicial oversight practices and a lack of communication with to address issues in that district. However, other agencies. there is a limited amount they are able to influence the behaviors of judicial With regard to billing practices, the audit personnel. Members of the Committee urged noted that the agency was inconsistent in the agency to provide documentation to the
Kansas Legislative Research Department 6-16 2006 Children’s Issues Kansas Commission on Judicial Recommendations Qualifications. The Committee makes four Findings related to legal representation recommendations with regard to the audit included inadequate or non-existent legal report: representation; a lack of preparation time allowed for attorneys; changes in attorneys; • The Committee notes information in the withholding information from families about Legislative Post Audit report that child case plan requirements; and a lack of action support billing practices were not taken regarding potential sexual abuse or consistent as to which method of assault. The audit did note that in many calculation was used to calculate the cases the lack of time for preparation or amount of support owed. The changes in attorneys was unavoidable but Committee recommends that the system may have disadvantaged parents. of assessing child support obligations for foster care cases receive further study by In response to Committee questions, SRS the Legislature. representatives indicated that all relevant staff and contractors have copies of the audit • The Committee recommends that the and have been requested to begin addressing Legislature study the timely appointment the areas identified as problematic. of attorneys for families so that they Supervisors of case workers have been receive adequate representation. apprised of the need to thoroughly cover all aspects of the training packet for new and • The Committee recommends further existing case workers. study on communication issues between SRS and the Kansas Department of Health and Environment cited in the report regarding child care facilities.
• The Committee requests that SRS compile all complaints since the beginning of FY 2006 and report a summary of those complaints to the 2007 Legislature.
Kansas Legislative Research Department 6-17 2006 Children’s Issues Joint Committees
Report of the Joint Committee on Economic Development to the 2007 Kansas Legislature
CHAIRPERSON: Senator Nick Jordan
VlCE-CHAIRPERSON: Representative Lana Gordon
OTHER MEMBERS: Senators Jim Barone, Karin Brownlee, Laura Kelly, and David Wysong; and Representatives Sydney Carlin, Donald Dahl, Terrie Huntington, Scott Schwab, Kenny Wilk, Jerry Williams, and Valdenia Winn
St u d y T opics
• Kansas Center for Entrepreneurship; Animal Health Research in Kansas; Extension Services; Farmaceuticals and Kansas; Workers Compensation and Medical Costs; and Trade Division Development
• Rural Business Development Tax Credit Program
• Sales Tax and Revenue (STAR) Bond Program
• Workforce Development
December 2006 Joint Committee on Economic Development
Kansas Center for Entrepreneurship; Animal Health Research in Kansas; Extension Services; Farmaceuticals and Kansas; Workers Compensation and Medical Costs; and Trade Division Development *•
Conclusions and Recommendations
• The Committee recommends that the Revisor of Statutes draft legislation that will provide technical clean up to the statutes dealing with the Center for Entrepreneurship. The Revisor has found that the term “Kansas community entrepreneurship fund” remains in statute when it should refer to Center for Entrepreneurship.
• The Committee recommends that the Revisor of Statutes draft legislation that will remove the term economic development from the mission statement of the extension services and replace the economic development program development committee with community and resource development program committee in statute.
• The Committee wishes to express its appreciation for the work the Greater Kansas City Chamber of Commerce, Kansas State University, Bayer Health Care Animal Health, Kansas City Area Life Sciences Institute, and the Kansas City Area Development Council have done to make Kansas the leader in animal health research. The animal health corridor is showing great promise as an expanding industry for the state. This industry will bring new high paying jobs and economy growth to the state. The Committee looks forward to the presentation next year about the new initiatives put forth by the various institutions and companies involved in this industry.
• The Committee wishes to acknowledge the fine job the Kansas State University Extension Services Program is doing in Kansas. However, the Committee hopes the extension services will not duplicate efforts for economic development in areas of Kansas which already have organizations in place providing economic development services. In addition, the Committee strongly believes it would be to the benefit of the extension services programs to be part of the Center for Entrepreneurship partner programs and be listed as a Network Kansas partner to further both the Center’s and extension programs goals.
• The Kansas Bioscience Authority has made great strides in its first two years of operations and the Committee is very pleased that Mr. Tom Thornton has been hired as President. However, in the future, the Committee would appreciate an explanation of the criteria employed by the Authority for determining investments and additional information about the companies the Authority has chosen to invest in.
• The Committee found the outline presented about the future of plant grown pharmaceuticals and the potential for profit for Kansas farmers very informative. The Committee requests that KTEC keep the Committee informed as this new industry develops in Kansas.
Kansas Legislative Research Department 7-3 2006 Economic Development • The Committee requests that the Department of Labor provide the appropriate House and Senate Committees the report and its recommendation to align fees for workers compensation medical costs with state of Kansas medical fee reimbursements. The Committee believes that this alignment of fees with the state of Kansas medical fee reimbursement should begin with the November 2006 meeting.
• The Committee requests that the Legislative Coordinating Council give a positive consideration to any request made by members of the Joint Committee on Economic Development to attend the 2007 BioConference in Boston, MA.
Proposed Legislation: The Committee recommends introduction of four bills.
Background whether there are any areas of need for education that are not covered through the The Joint Committee on Economic current course offerings offered in the state. Development is statutorily authorized to set its own agenda. The Committee recognized The Entrepreneurship Fund StartUp the following topics as important to the Kansas Program is to provide economic discussion of economic development in resources to startup and existing businesses Kansas. in conjunction with the Center’s NetWork Kansas partners. The StartUp Kansas program does not provide capital directly to Committee Activities the entrepreneur or small business. The Fund currently has a balance of $450,000 Kansas Center for Entrepreneurship and the Center has initiated a quarterly proposal review process. The proposals are Steve Radley, Director of the Kansas reviewed by the StartUp Kansas Committee Center for Entrepreneurship, updated the which is made up of members of the Kansas Committee on the current initiatives at the Center for Entrepreneurship Board of Center. The Kansas Center for Directors. The Center has received seven Entrepreneurship has developed a seamless proposals; four of the seven were approved integrated network of small business service for StartUp Kansas funds and will share providers in Kansas and is now working to $165,000. The four businesses will utilize connect entrepreneurs and small business StartUp Kansas funds to leverage more than owners with the necessary education, $1.5 million in private funds from banks, expertise and economic resources. regional foundations, and other sources. Two of the awards involved succession The Center has provided a grant to the management of existing businesses and two Center for Entrepreneurship at Wichita State are expansions of existing businesses. In all University to conduct an inventory of all four cases, the projects would not move entrepreneurial offerings in the state of forward without the assistance of the Kansas. The inventory will include K-12, StartUp Kansas fund. The Center is also in community college, private college, Regents’ the process of setting up a 501(c)(3) universities and public sector course work, corporation so that it can begin raising both credited and non-credited courses. The additional capital for the fund. report is expected to be completed by the end of September 2006. Once the report is Erik Pedersen, Director, Kansas Center received, the Center will then determine for Entrepreneurship, explained that on March 9, 2006, the Kansas Center for Entrepreneurship officially launched the
Kansas Legislative Research Department 7-4 2006 Economic Development NetWork Kansas call center and communities to identify issues and begin networkkansas.com website with 240 looking for solutions to problems in addition resource partners. At the present time, there to providing NetWork Kansas and its are more than 270 resource partners in this partners with substantive feedback in order statewide referral network. Currently, there to improve service. are more than 50 service providers in both the east central and south central region. In Tbe Center is in the initial stages of addition, there are more than 35 in the implementing its marketing and promotion southwest and approximately 25 in each of plan with the goal to grow the call volume. the other four economic development In addition, the staff is actively working to regions of the state. engage organizations such as Kansas Bankers Association, Kansas Association of In the five plus months between launch CPA’s, and the Kansas Chamber of and the end of August, the call center has Commerce. The Center’s staff is available to received 139 incoming calls, averaging about speak at meetings, distribute information 25 per month. About 10 percent of the calls and help members of these organizations are coming from cities with population less gain understanding that the Network Kansas than 1,000, and about 17 percent from cities is the gateway to entrepreneurial resources with population between 1,000 and 5,000. across Kansas. Therefore, just under one-third of the calls are coming from entrepreneurs in cities with Ray Hammarlund, Director, Agriculture populations less than 5,000. Approximately Marketing and Community Development, one-half of the calls are coming from cities Kansas Department of Commerce, updated with populations more than 25,000 and the the Committee on the statutory requirement remaining 20 percent fall in that of the Kansas Center for Entrepreneurship to 5,000-25,000 range. "organize a summit to recommend policy to foster an economic climate conducive to the The 139 callers were referred to NetWork development of an agriculture bioscience Kansas by more than 45 different referral industry." The Department has assembled a sources, including banks, press release, and steering committee to begin the process of word of mouth. The leading referral sources forming the issues surrounding the are the Kansas Department of Commerce, the agriculture bioscience industry. The Kansas Small Business Development Center steering committee has representatives from lead office and its resource partners. More the Kansas Center for Entrepreneurship, the than 25 of the resource partners have Kansas Small Business Development Center, referred at least one caller to the call center. Kansas Bio, Kansas Technology Enterprise Through the first five months, the most Corporation, Kansas Inc., Kansas State requested types of business assistance were: University, the Kansas Department of financial resources and assistance; business Agriculture, and the Kansas Department of planning, marketing and licensing/permit Commerce. Currently, the plan is to hold assistance. this summit January 30 or February 1 of 2007. The NetWork Kansas, in conjunction with Kansas Community Colleges and its Animal Health Research Network partners, held town hall meetings across the state to engage communities in an At the September meeting, Jenny open forum discussion concerning Erdman, Dr. Lisa Freeman, Dr. Scott Weir, entrepreneurship as a means for economic Dr. William Duncan, and Bob Walker and community development. The meetings presented testimony about animal health were held from March 15, 2006, through research occurring in Kansas. According to May 3, 2006, and were intended to challenge Ms. Erdman, Kansas City has the largest
Kansas Legislative Research Department 2006 Economic Development single concentration of animal health efficacy, animal toxicity and human interests in the world. Nearly one third of formulation to the clinical proof of concept the $14.2 billion global animal health or human testing. William P. Duncan, Ph.D., industry is represented by companies in President of the Kansas City Area Life Kansas City, and Kansas City is the only Sciences Institute, has utilized "prime the United States region investing specifically in pump" grants since October 2002, to attracting animal health companies. Finally, facilitate and expand collaborative life Kansas will benefit by this research because sciences research among the organization’s it will provide the opportunity for healthier stakeholder institutions. The expectation of people and animals, statewide economic the Institute is that the initial grant would development and increased food safety and lead to much larger research efforts funded security. by federal agencies, foundations, or private sector companies. The Life Sciences Dr. Lisa C. Freeman, Professor of Institute has routinely experienced an Pharmacology, Associate Dean for Research average 10 to one return in one year on these and Graduate Programs at Kansas State grants, i.e., $10 in additional funding University College of Veterinary Medicine, received within one year for every $1 spoke about the university’s success in invested. taking innovation in animal health from cell to society. For example, MicroHeart has Mr. Bob Walker, Director of acquired exclusive rights to develop and Communications and Public Policy for Bayer commercialize PR39, a naturally-occurring HealthCare’s Animal health business 39-amino acid peptide with angiogenic and testified that Bayer’s has its Animal Health anti-inflammatory properties. Significant North American headquarters in the State of pre-clinical findings show promising Kansas because of the strong public private applications in angiogenesis for the partnership that has occurred in Kansas. In treatment of coronary artery and peripheral addition, Bayer believes that retention and artery disease and protection against cardiac recruitment of top talent, research and ischemia/reperfusion injury. Other potential development of new products, and an applications include the treatment of stroke increase in partnership opportunities has and the prevention of restenosis. Research occurred because of the work of the animal on clinical applications for PR39 is being health corridor companies, institutions, and done at Beth Israel Deaconess Medical individuals involved. He stated that the Center and Children’s Hospital in Boston, animal health and nutrition market has Kansas State University, Max Planck grown exponentially in the last decade and Institute, Bad Nauheim, Germany, and other will continue to do so. What this means for university research centers. In addition, the animal health corridor is that businesses Mike Dryden’s focus is the biology and located from Manhattan to Jefferson City, control of fleas and ticks at Kansas State from Saint Joseph to Columbia will continue University. He has lead applied research to define this industry and grow. on: Frontline & Frontline Plus; Advantage, K9Advantix, Program, Capstar and Extension Services at Kansas Revolution. State University
Scott Weir, Pharm. D., Ph.D. Office of Dr. Daryl Buchholz, Associate Director Therapeutics Discovery and Development at Kansas State Research and Extension, the Cancer Center at the University of testified that the overall mission of Kansas Kansas spoke about the intersection of State research and extension service’s human and animal drug development. Dr. program is to build upon the university’s Weir explained how a drug moves from research and education mandates to provide discovery through pre-clinical, animal a safe, sustainable, competitive food and
Kansas Legislative Research Department 7-6 2006 Economic Development fiber system, and strong, healthy door to inadvertent human infection with communities, families and youth through animal pathogens. Using plant-derived integrated research, analysis and education. medicines eliminates that risk. Plant-based The extension program maintains a network pharmaceuticals also provide opportunity of local offices in every county across for Kansas farmers to grow more valuable Kansas. The positive benefit of funds from crops and Kansas farmers who choose to only the extension sources that generate grow rice for Ventria Bioscience could economic income into those counties and realize a potential net profit of $200 per acre. communities is estimated to he some $48 million in both direct and indirect income. Tracy Taylor, President and CEO of The economic activity is closely tied to Kansas Technology Enterprise Corporation about 1,200 jobs throughout the state’s (KTEC) briefed the Committee on the economy. In a recent study by Huffman Ventria Bioscience Company that is using and Evanson (Iowa State University 92206), rice as the host for high yield proteins for concluded that programmatic funding for use in medical foods. Ventria has planted agricultural research and extension has had rice under close USDA scrutiny since 1997, a significant positive impact on state with a 100 percent compliance record. The agricultural total factor productivity over the proposed Kansas deal would he $6 million 30 year period studied from 1970 through in grants from a consortium of KTEC and 1999. In Kansas, that total factor Junction City; $5 to $10 million of private productivity increase for agriculture equity with preferred stock at $1.30 per attributed to research and extension was at share and the projected net present value of a rate of 1.65 percent annually. Finally, a future domestic cash flows at 40 percent few examples of economic impacts of the discount is $196 million. Mr. Taylor extension programs are as follows: outlined that this biotechnology company is in an emerging field of plant-made • Adoption of new wheat cultivars; pharmaceuticals with a "world-class" • Workshops, training and consultations management and hoard of directors. The for Medicare D Program; company has 13 years of technology • Voluntary income tax assistance; development and $36 million of capital • Family nutrition program; invested to date and a strong potential for • 4-H Youth Development; and liquidity in three to five years with several • Community PRIDE program (jointly products that will address such things as administered with Department of oral rehydration; difficile infections, Commerce). inflammatory bowel and diarrhea in children and adults.
Farmaceuticals and Kansas Mr. Taylor also gave an overview of the KTEC technology commercialization value Adrian Polansky, Secretary of Kansas chain operations. KTEC’s areas of focus are: Department of Agriculture submitted written Centers of Excellence in Kansas, testimony in which he stated that the ability Experimental Program to Stimulate to develop host crops from which Competitive Research (EPSCoR), small pharmaceuticals can be derived is an business innovation research assistance; important milestone for agriculture and for Investment through the Angel Tax Credits, humanity, and it makes sense for many Creation of Angel Networks and Technology reasons. Two compelling reasons are that Commercialization Seed Fund; and business they are safer and they are more economical. assistance through incubators, Mid-America Many of the current medicines depend on Manufacturing Technology Center production methods that involve animal (MAMTC) and the KTEC pipeline of hosts or animal proteins, which opens the entrepreneur leadership development.
Kansas Legislative Research Department 7-7 2006 Economic Development Kansas Bioscience Authority The Authority is governed by an eleven-member board with expertise in the Clay Blair, Chairman of the Board of fields of finance, business, bioscience Directors of the Kansas Bioscience Authority research, plant biotechnology, basic gave the Committee an outline of the research, health care, legal affairs, bioscience Authority’s current status. The Authority manufacturing or product was created in 2004 by the Kansas Economic commercialization, education or Growth Act and has the responsibility over government. As of the September meeting a 15 year period to direct the investment of the following is a list of the funded more than $580 million. The mission of the investments of the Authority: Authority is to make Kansas the national leader in bioscience.
Prescription Solutions, Overland Park, KS - 7/1/2005 $ 150,000 Heartland Bioenterprise - 1/5/2006 200,000 Hospira, McPherson, KS - 4/11/2006 200,000 Quintiles, Overland Park, KS - 4/11/2006 3,500,000 JACAM, Sterling, KS - 4/11/2006 500,000 IdentiGEN, Lawrence, KS - 4/11/2006 125,000 American Ingredients, Lenexa, KS - 7/13/2006 1,000,000 City of Manhattan, KS - 7/13/2006 1,000,000 CritiTech, Lawrence, KS - 7/13/2006 48,700 KCADC - 7/13/2006 41,200 KCALSI - 7/13/2006 10,000 MGP Ingredients, Atchison, KS - 7/13/2006 40,000 Nutri-Shield, Courtland, KS - 7/13/2006 40,000 Sunflower Bioenergy, Holcomb, KS - 7/13/2006 13,000 KUMC Wetlab Upgrade, Kansas City, KS - 7/13/2006 100,000 Olathe Wetlab Project, Olathe, KS - 7/13/2006 150,000 TOTAL $ 7,117,900
Workers Compensation and Medical Costs for specified services. In addition, state fee schedule premiums over Medicare levels Richard Thomas, Public Resource vary greatly across service groups. In Director, Division of Workers Compensation, general, the greatest interstate variation and Kansas Department of Labor explained that largest premium over Medicare workers’ compensation medical fee reimbursement rates occurred for surgical schedules are the policy tools most often services and radiology. Fee levels were used by states to contain medical costs. closest to and sometimes less than Medicare Medical fee schedules are used by levels for physical medicine and evaluation forty-three jurisdictions in 2006 and these and management services. Kansas fee schedules dictate the maximum reimbursement that providers can receive
Kansas Legislative Research Department 7-8 2006 Economic Development reimbursement for medical services under functions. On average, the direct workers’ compensation appears to be in the involvement of the Trade Division generates middle when compared to the other states. over $18 million in export sales each fiscal year and 350 new jobs with an annual wage Paula Greathouse, Director, Division of rate of $40,000. In addition, the Trade Workers Compensation. Kansas Department Division has generated $80 million in capital of Labor reported that during the previous investment from foreign sources. nine months, the Kansas Insurance Department had received 79 complaints Representatives of the ABZ against workers compensation insurance Manufacturing, Inc of Madison, Kansas, carriers. Currently, 26 of those cases remain testified to the company’s experiences with open and six of those cases have been the Trade Division and how the Division terminated due to insufficient information facilitated opening markets to the company from the person filing the complaint. The in South America, Mexico, and Taiwan. remaining 47 cases have been closed as the Since the initial visits to South America Kansas Insurance Department has either arranged by the Trade Division in 2003, the obtained reimbursement or refunds of company’s growth in foreign markets has disputed amounts for the complainant or a increased 11 fold. discontinuance of the complained of practice or that a determination that a Patrick French, Senior Vice President of violation of law could not be established. In the W ichita Area Chamber of Commerce and addition, Ms. Greathouse reported that for the President of the Greater Wichita FY 2005 the agency had received 64,761 Economic Development Coalition, explained accident reports and 6,132 of those cases had that the Department of Commerce had been assigned to an Administrative Law partnered with his work and the Judge for hearing. Department’s foreign offices in Europe and Japan by assisting his staff in the following Trade Development Division of international activities: international air Kansas Department of Commerce show support (such as Farnborough and Paris Air Shows); direct mail assistance; John Watson, Director, Trade Division, translation services; setting appointments Kansas Department of Commerce, testified with local companies; lead generation; that the Department currently has project follow-up; and travel support. international offices in Japan (opened in 1985J, Europe (1988), Mexico (2000), and the People’s Republic of China (2005). These Conclusions and Recommendations offices are located in high-potential markets for Kansas exports and in target countries • The Committee recommends that the offering the best prospects for recruiting new Revisor of Statutes draft legislation that investment to Kansas. Each office has a will provide technical clean up to the dedicated account representative, full statutes dealing with the Center for phone, fax and website services. Research Entrepreneurship. The Revisor has found has shown that Canada is the number one that the term “Kansas community market for Kansas exports, the Mexico entrepreneurship fund” remains in statute market ranks second, and China ranks as the when it should refer to Center for third most important market for Kansas Entrepreneurship. export sales. In addition, the Kansas China Office and the Kansas Mexico Office focuses • The Committee recommends that the on export promotion only, while the Kansas Revisor of Statutes draft legislation that Japan Office and the Kansas European Office will remove the term economic perform both export and investment development from the mission statement
Kansas Legislative Research Department 2006 Economic Development of the extension services and replace the • The Kansas Bioscience Authority has economic development program made great strides in its first two years of development committee with community operations and the Committee is very and resource development program pleased that Mr. Tom Thornton has been committee in statute. hired as President. However, in the future, the Committee would appreciate • The Committee wishes to express its an explanation of the criteria employed by appreciation for the work the Greater the Authority for determining investments Kansas City Chamber of Commerce, and additional information about the Kansas State University, Bayer Health companies the Authority has chosen to Care Animal Health, Kansas City Area Life invest in. Sciences Institute, and the Kansas City Area Development Council have done to • The Committee found the outline make Kansas the leader in animal health presented about the future of plant grown research. The animal health corridor is pharmaceuticals and the potential for showing great promise as an expanding profit for Kansas farmers very informative. industry for the state. This industry will The Committee requests that KTEC keep bring new high paying jobs and economy the Committee informed as this new growth to the state. The Committee will industry develops in Kansas. look forward to the presentation next year about the new initiatives put forth by the • The Committee requests that the various institutions and companies Department of Labor provide the involved in this industry. appropriate House and Senate Committees the report and its • The Committee wishes to acknowledge recommendation to align fees for workers the fine job the Kansas State University compensation medical costs with state of Extension Services Program is doing in Kansas medical fee reimbursements. The Kansas. However, the Committee hopes Committee believes that this alignment of the extension services will not duplicate fees with the state of Kansas medical fee efforts for economic development in areas reimbursement should begin with the of Kansas which already have November 2006 meeting. organizations in place providing economic development services. In addition, the • The Committee requests that the Committee strongly believes it would be Legislative Coordinating Council give a to the benefit of the extension services positive consideration to any request programs to be part of the Center for made by members of the Joint Committee Entrepreneurship partner programs and on Economic Development to attend the be listed as a Network Kansas partner to 2007 BioConference in Boston, MA. further both the Center’s and extension programs goals.
Kansas Legislative Research Department 7-10 2006 Economic Development Joint Committee on Economic Development
Rural Business Development Tax Credit Program
Conclusions and Recommendations
The Committee believes that the Rural Business Development Tax Credit Program does require additional time to mature and grow and that three years is not adequate to determine a true test of the success or failure of the program. Therefore, the Committee recommends legislation be introduced that will extend the life of the program through tax year 2009 and that statewide tax credits be $2.0 million for FY 2008 and $2.0 million for FY 2012. Finally, the Committee is recommending that the annual audit requirement of the seven regional foundations he amended to allow for the use of an audit to coincide with the fiscal vear of the foundations.
Proposed Legislation: The Committee recommends introduction of four bills.
Background determination for the usage of funds, and encourage local investment in the region’s The Joint Committee on Economic economic future. Development is statutorily authorized to set its own agenda. The Legislative The representative of the Department of Coordinating Council asked that the Commerce encouraged and supported an Committee review the effectiveness of the extension of the program beyond the Rural Business Development Tax Credit December 2007 date. The Department Program (RBDTCP). In addition, the believes that the RBDTCP can and will offer Committee was asked to study whether the benefits to Kansas and will help empower current expiration date of June 30, 2007 (this individual foundations in the seven regions translates to tax year 2007 or December 31, to deliver financial assistance to their local 2007) for the Program should be extended. communities while utilizing the unique insights and relationships with the communities and businesses in the Committee Activities individual regions. The role of the Department of Commerce under the During the September meeting the provisions of the act is to provide oversight Committee took testimony from the and assistance to the seven regional Department of Commerce, Department of foundations. Revenue, representatives of the North Central Regional Planning Commission and The representative of the Department of the Ottawa Area Chamber of Commerce Revenue explained that for tax years 2005 about the Program. The Program provided and thereafter, as a result of 2006 Senate Bill an estimated $7.0 million in tax credits over 324, the amount of the credit was increased the three-year period of 2005 through 2007 to 75 percent of the total contribution made to encourage individuals and businesses to by the taxpayer during the taxable year to a invest in regional foundations in each of the regional foundation approved by the seven economic development regions in Department of Commerce. Prior to that Kansas. This investment was designed to legislation, the credit was 50 percent of the provide capital for entrepreneurial efforts in total contribution. If the amount of the rural communities, ensure regional credit exceeds the taxpayer’s tax liability, the
Kansas Legislative Research Department 7-11 2006 Economic Development excess amount is refunded to the taxpayer. immediately sell the credits when they first Any taxpayer taking advantage of this credit became available in 2004, and that the must make an subtraction on the Kansas foundations are only now beginning to come return to their taxable income in the amount up with a case statement that engages the of the total contribution made, for the tax interest of those possessing a state income year in which the contribution was made. tax liability. The credit is claimed on Schedule K-32. Mr. Tom Weigand, President and CEO of The following shows the regional the Ottawa Chamber of Commerce and foundation tax credit utilization to date, Economic Development Director for Ottawa based on K-32 Schedules received by the and Franklin counties, explained that the Department of Revenue from taxpayers RDTCP is an outstanding mechanism for claiming the credit: planning, coordinating and growing business opportunities in rural Kansas. The • Tax Year 2004: Confidential (less than concept of selling tax credits to raise funds five claimants) to invest in more jobs and business expansion is a perfect illustration of a “win- • Tax Year 2005: 12 filers have applied for win” program. Finally, he believes this $7,056 of tax credits program has the fundamentals of a very successful program, and it would be a tragedy if it were not permitted the time to The information for tax year 2005 is not develop and grow. yet complete, and the Department expects to receive more returns on extension claiming the credit by the end of October. Conclusions and Recommendations
Mr. John Cyr, Executive Director of the The Committee believes that the Rural North Central Regional Planning Business Development Tax Credit Program Commission stated that the program holds does require additional time to mature and out immense possibilities, but it is going to grow and that three years is not adequate to take time given the fact the program determine a true test of the success or failure promotes economic development on a of the program. Therefore, the Committee regional scale in addition to the sale of state recommends legislation be introduced that tax credits. Mr. Cyr encouraged the will extend the life of the program through Committee and the Legislature to do two tax year 2009 and that statewide tax credits things: first, extend the sunset provision of be $2.0 million for FY 2008 and $2.0 million the program out beyond the current for FY 2012. Finally, the Committee is termination date; second, award additional recommending that the annual audit tax credits during each year of the extension requirement of the seven regional at a level equal to, but preferably greater foundations be amended to allow for the use than the highest amount previously made of an audit to coincide with the fiscal year of available to each of the seven regional the foundations. foundations. He stated that the regional foundations were not in a position to
Kansas Legislative Research Department 7-12 2006 Economic Development Joint Committee on Economic Development
Sales Tax and Revenue (STAR) Bond Program
Conclusions and Recommendations
The Committee believes that the STAR Bond Program has been very successful in Wyandotte County and recommends reauthorization of the program until June 30, 2012. In addition, the Committee is recommending that the Revisor of Statutes draft legislation that provides separate sections in law for Tax Increment Financing and STAR bonds. Finally, the Department of Commerce expressed confusion about the Legislature’s intent with regard to the percent of revenue the city or county must commit to repayment of STAR Bonds and the requirement for annual reports and audits of STAR Bond projects. Therefore, the Committee has requested that the Chairman write to the Kansas Department of Commerce and explain that the legislative intent under KSA 12-1774 (a) (1) (H) is the policy that the Department is to follow if either city or county revenue is used to pay back the bonds and that an annual report and audit is required for every STAR Bond project approved by the Kansas Department of Commerce.
Proposed Legislation: The Committee recommends the introduction of four hills.
Background financing was the "Oz Theme Park" which never occurred. Mr. North concluded with The Joint Committee on Economic the 2005 amendments which allowed STAR Development is statutorily authorized to set Bonds to be used for a "major motorsports its own agenda. The Legislative complex" which was the Heartland Park Coordinating Council asked that the renovation in Topeka. Committee review the effectiveness of the Sales Tax and Revenue (STAR) Bonds. In The Department of Commerce has addition, the Committee was asked to study approved four STAR Bond projects as whether the current expiration date of June follows: 30, 2007 for the Program should be extended. • Kansas Speedway and Village West Project in Wyandotte County, Kansas
Committee Activities This project has received all necessary Mr. Bob North, General Counsel for the approvals from the Secretary of Commerce Kansas Department of Commerce gave a and construction is virtually complete. The brief history of STAR Bond legislation from original bonds have been refunded with the 1993 when the existing statutes for Tax approval of the Secretary of Revenue and Increment Financing (TIF) were amended to Secretary of Commerce and should be paid allow for the use of sales, compensating use off well ahead of schedule. STAR Bonds in and transient guest taxes for financing for an approximate amount of $298 million redevelopment projects of "statewide have been authorized for this project. The importance" and became known as STAR estimated economic impact of the Speedway Bonds financing. The first project and Village West is reported to be as follows: envisioned for the new STAR Bond 10 million annual visitors to the area;
Kansas Legislative Research Department 7-13 2006 Economic Development increase in property taxes from $15,000 to related amenities. STAR Bonds have $6.4 million in 2005; $810 million in been approved in an amount up to $4.81 combined public/private investment; annual million. sales of $450 million; 3,500 new jobs generating $52 million in payroll and $ 28 million in new state sales tax; and $200 The representative of the Department of million in new housing construction in the Commerce asked the Committee for surrounding area since 2003. clarification and possible consideration for following questions dealing with the STAR • Heartland Park Racetrack in Topeka, Bond statutes: Kansas • Should the statutes be separated by type This project was formally approved on of tax revenue required for repayment of January 30, 2006 in the amount of $10.46 indebtedness? million in STAR Bonds. Total redevelopment cost was in excess of $22 • Should financing for million. Renovations and new tourism/entertainment development construction to the racetrack and visitor projects be combined in the same statute amenities are believed to be nearly as financing for bioscience projects and complete. blighted areas or enterprise zones?
• Schlitterbahn Vacation Village in • Should clarification be provided Wyandotte County, Kansas regarding the allowance for a combination of obligated tax revenues to This project, which consists of a major pay off the indebtedness in the time water park resort, vacation village and frame allowed? related amenities, has been formally approved by the Secretary of Commerce • What combination of local and state and is awaiting construction. Total revenues should be allowed? project cost is in excess of $400 million with up to $225 million of STAR Bond • What should a feasibility study provide financing approved so long as the that in order to predict the public benefit amount does not exceed 50 percent of from the public expenditure and what the total project costs. The construction kind of reporting should follow to is to begin in 2007 with an the estimated demonstrate effectiveness? completion date of 2009. • Is it the intent of the Legislature to allow • Kansas Underground Salt Museum in for only the new sales tax revenues Hutchinson, Kansas generated in a redevelopment district to be available for the STAR Bond This project was formally approved in repayment, or all of the sales tax July 2006, construction has begun and revenues generated within the district the estimated completion date is the end given the "Greenfield" type of of 2006. The bond closing will be held development versus a redevelopment in the very near future and the project is from which tax revenues are already progressing as anticipated. This project being collected? consists of a $10.5 million destination development including a visitor complex, underground museum and Ms. Joan Wagnon, Secretary of the Department of Revenue, explained that the role of her Department is administrative for
Kansas Legislative Research Department 7-14 2006 Economic Development STAR Bond statutes, as the Department recommends that the Legislature create no collects the sales tax and distributes it. more special exceptions during this period, Secretary Wagnon believes that the and amend language only if there are legislation needs a complete rewrite to "egregious" flaws in the statute. clarify how the process works, resolve some of the points of contention, and to create a stand-alone set of statutes. Some of the Conclusions and Recommendations points that she believes need policy clarification are: The Committee believes that the STAR Bond Program has been very successful in • Whether county approval of a project by Wyandotte County and recommends resolution is needed in place of a finding reauthorization of the program until June 30, of no adverse harm? 2012. In addition, the Committee is recommending that the Revisor of Statutes • Whether county commitment of all sales, draft legislation that provides separate use, and transient guest revenues sections in law for Tax Increment Financing generated in the proposed district, if they and STAR bonds. Finally, the Department have authorized such taxes, are of Commerce expressed confusion about the warranted in all circumstances? Legislature’s intent with regard to the percent of revenue the city or county must • Whether a Formalized Project Plan commit to repayment of STAR Bonds and Review process should be included in the requirement for annual reports and statute between the Department of audits of STAR Bond projects. Therefore, Commerce, Department of Revenue and the Committee has requested that the Kansas Development Finance Authority? Chairman write to the Kansas Department of Commerce and explain that the legislative intent under KSA 12-1774 (a) (1) (H) is the Secretary Wagnon testified that the policy that the Department is to follow if Department recommends giving the process either city or county revenue is used to pay an additional five years, until 2012, to hack the bonds and that an annual report guarantee a review by the Legislature. and audit is required for every STAR Bond During this time, every effort should be project approved by the Kansas Department made to leave the statutes alone so local of Commerce. communities will know what the rules are and what to expect. Finally, she
Kansas Legislative Research Department 7-15 2006 Economic Development Joint Committee Economic Development
Workforce Development
Conclusions and Recommendations
The Committee:
• Requests a letter be sent to the Congressional delegation; National Association of State Legislators (NCSL); The Council of State Governments (CSG); and American Legislative Exchange Council (ALEC) by the Chairman asking for help regarding reauthorization of the federal Workforce Investment Act (WIA) and needed Congressional changes to the Act;
• Directs Secretary Fricke to coordinate with other states' agencies in requesting help for needed Congressional changes to the reauthorization of WIA;
• Requests the bylaws of the State Board for Workforce Investment be modified to include the removal by the Governor of any State Board member after two consecutive absences;
• Requests the Department of Commerce to begin in FY 2008 providing the local boards a marketing and implementation plan and direct the Department to report progress to the standing House and Senate committees during the 2007 Session;
• Requests that staff from the offices of Senator Sam Brownback and Senator Pat Roberts meet with legislators to discuss the problems with the Workforce Investment Act;
• Directs the Department of Commerce to create a framework for training of both local and state board members and staff and report the progress back to the standing House and Senate committees during the 2007 session;
• Directs the Department of Commerce to contact KAN-ED to seek help for local boards in receiving on-line training;
• Directs the Department of Commerce to create a uniform evaluation for local boards to implement for contracts;
• Requests a letter be sent from the Chairman to the Kansas Department of Labor inquiring why a representative from the unemployment office is not co-located in every Local Area One-Stop Center;
• Encourages the local boards for Area III and V obtain an administrative entity other than the Department of Commerce as soon as possible; and
• Asks that Kansas, Inc. report back to the House and Senate committees on its review of the Workforce Investment Act; comparison with other states; and make recommendations for improvement in the present system in Kansas.
Proposed Legislation: The Committee recommends introduction of four bills.
Kansas Legislative Research Department 7-16 2006 Economic Development Background Question 2: How much of the Workforce Investment Act funding is The Joint Committee on Economic being spent on administration and Development is statutorily authorized to set oversight, and how much is being spent its own agenda. The Legislative Coordinating directly on worker training and Council asked that the Committee to review assistance activities? the current Kansas workforce development activities and expenditures. In addition, the The Post Audit Study found that slightly Committee was asked to review the more than $2 million out of nearly $17 Legislative Post Audit report on workforce million in Workforce Investment Act money development and study the Kansas First was spent on administration under such program and its effectiveness. categories as salaries, professional services, and travel; however, that amount falls within the federal limits for administrative spending. Committee Activities It also has to be considered in light of the top- heavy administrative structure required by Legislative Post Audit Study the Act. Of equal importance is the way processes and procedures are set up to At the October meeting a staff member of safeguard program funds and ensure they are the Division of Legislative Post Audit being spent appropriately. Over the years, presented the following findings to the four federal and state monitoring reviews have questions outlined in the Scope Statement to identified such things as open-ended the Committee: contracts, inadequate fiscal procedures, and lack of supporting documentation. While Question 1: Does the administrative “control” procedures may represent some of structure Kansas has established for the most mundane aspects of any program, the Workforce Investment Act comply they provide the foundation for ensuring that with the requirements of the Act? the program is accountable to the public and is using its resources wisely, effectively, and The Post Audit Study concluded that efficiently. given the multitude of boards, administrative agencies, One-Stop operators, and program Question 3: What types of contracts are “partners” at the state, regional, and local in place to provide training or job- levels, there is a great deal of administrative assistance services, what are their structure in the current workforce terms, and have they been awarded development program. However, that competitively? structure is called for by the federal Workforce Investment Act. On the other Overall, the Division found relatively few hand, some of the ways that administrative problems with the way local areas were structure is being implemented, (including an handling their contracts, but the Department inactive state-level board, conflicts caused by of Commerce does need to improve its the Department’s dual role of operating two process for awarding contracts, by seeking local areas while also being responsible for competitive bids or by providing justification monitoring them, inadequate state for sole-source contracting when competition monitoring efforts, and the lack of doesn’t exist. Had any of its sole-source comprehensive One-Stop centers in all local contracts been competitively bid, there is no areas) can work against the goal of having an way to know if other vendors would have integrated, seamless system for delivering bid, if they would have been as qualified, or employment and training services in Kansas. if they would have submitted lower bids. But that is always the case. The state’s process is
Kansas Legislative Research Department 7-17 2006 Economic Development intended to be as open and competitive as need to take some actions to meet the federal possible to help ensure that tax dollars are program mandates. The bottom line is that used effectively. this is a federal program administered at the local level. Question 4: What other programs in Kansas meet the definition of In response to the audit findings that Local workforce development adopted by Areas 1,3, and 5 do not have comprehensive the Joint Committee on Economic One-Stop centers, Secretary Fricke stated that Development in 2005, and what level the agency has been assured by the federal of coordination exists for those government that partners are not required to programs? be physically located in the One-Stop centers as long as their services are available on an The Study found that nearly $129 million as-needed basis through part-time staff, is being spent on 35 state or federally funded electronic links, or cross-training of One-Stop workforce development programs alone, and staff. Kansas’ one-stops are in compliance an undetermined amount is being spent on a with the Workforce Investment Act. wide array of other training programs, courses, and partnerships. Despite the In addressing the finding that Kansas’ attempts that have been made to coordinate system lacks coordination, the Secretary such programs in Kansas, the Workforce pointed out that the auditors were unable to Network Board, the Department of find any state to hold out as an example of a Commerce, and local area workforce well-coordinated system. While the investment boards still have a long way to go recommendations made to address this to overcome the program silos that still finding would create minimal changes, the continue to exist within the workforce Department of Commerce will continue to investment areas. Developing a well- seek ways to better cooperate with other coordinated system is especially challenging agencies and pointed out its current activities because no single entity has the authority on with the Department of Corrections, a statewide basis to direct the types of Department of Social and Rehabilitation changes that will be needed. Nonetheless, Services and the Board of Regents. more coordination can be generated by fostering a spirt of cooperation among the Local Workforce Investment various entities involved in workforce Act (WIA) Boards development. Area I Local WIA Board. Executive Department of Commerce Director testified that this Board has authorized enrollment in a comprehensive Howard Fricke, Commerce Secretary, on-line training program called “Workforce testified that it is important to understand the Board member in Action-Making an Impact State’s role in implementing the federal in the Community.” This Board is the first in Workforce Investment Act (WIA). This the nation to take advantage of this resource, federal program currently provides $25 which will provide cost-effective and million to provide WIA services. The federal comprehensive training at a pace and time government sets the rules and guidelines for suited to each Board member. In addition, this federal program, which is carried out at the Board has conducted two performance the local level through Local Workforce training session with each of its nine Title IB Investment Boards (LWIBs). The State’s role providers. The training sessions were is to provide advice to the LWIBS on whether conducted to ensure that each provider had or not they are in compliance with the federal a through understanding of each performance program and to offer suggestions and standard and understood how to track guidance when we believe the local boards performance in the system. The training
Kansas Legislative Research Department 7-18 2006 Economic Development sessions also reviewed case management management system to help job seekers ready practices, which influence and ensure good to learn, either in a formal classroom setting performance. Finally the Board recently took or through on-the-job training. The goal of action to move from a single partner entity the program is to provide customers with being the One-Stop Operator to a consortium very short, very specific skills upgrades in approach, in which at least three required basic “prerequisites”. Job seekers can take mandatory partners share the lead roll in only those specific modules needed by coordinating activities and assuring delivery specific employers, giving them an advantage of required core services in the One-Stop in the hiring process. Employers may also centers. Partners in the Salina and Hays have incumbent workers take modules for a areas are currently working on similar very low cost. consortium proposals. The Local Area II sector initiatives include Area II Local WIA Board. Executive healthcare, biotechnology, advanced Director testified that this local area is manufacturing and construction. The first offering five new programs: Corrections to three align with the area’s WIRED Careers; the Military Spouse Program; Pre- involvement. In construction, the local area Vocational and Self-Paced Tutoring program; is partnering with the Associated General Workforce Innovation in Regional Economic contractors and the Kansas Construction Development (WIRED); and Business Association to expand both the available Services Program. The Corrections to Careers labor pool and training opportunities for both service will assess inmates from county jails new and incumbent workers. and prisons who are scheduled for release within six months. Assessments will cover Business services is concerned with basic, technical and soft skills. Concurrently, sourcing the right people to the right jobs. In local jobs will be assessed for basic, hard and addition to large, medium and small soft skills requirements. Services will businesses, the Board also is working with concentrate on business sectors experiencing many government entities who are having labor shortages in entry level positions, with difficulty with turnover or productivity. an initial emphasis on the construction trades. The goal of the program is to place Local Area III WIA Board. Executive 120 offenders with a minimum 45 percent Director for Local Area III testified that the retention rate by the end of 24 months. Board was well aware of its shortcomings and Emphasis is placed on retention vs. just job nothing in the Post Audit report came as a placement. surprise. However, it is important to point out that many problems are longstanding The Fort Riley Military Spouse Program ones that have been allowed to grow over addresses the fact that approximately 5,0000 time. Resolving them is also going to take spouses will be relocated to Fort Riley over time. With respect to Local Area III, the Post the next five years. The Local area has Audit report touches on four issues: the established an on-post satellite Workforce Department of Commerce carrying out the Center that includes an assessment/tutorial area’s administrative duties are problematic; station with six networked laptops. The a lack of a comprehensive One-Stop center in satellite workforce center is staffed by a full which partners’ services are available and time Career Counselor who is a military costs are being shared; expenditures per job spouse. As of the date of the meeting, the seeker grew significantly last year, while the office is fully operational and currently had number of job seekers served dropped; and 12 individuals enrolled in the program. the area’s difficulty meeting several performance measures. The Pre-Vocation and Self-Paced Tutoring Program uses an Internet-based learning
Kansas Legislative Research Department 7-19 2006 Economic Development On August 30, 2006, the Board published and will likely make changes to make more a request for proposals (RFP) for a WIA Adult individuals eligible. and Dislocated Worker Program Operator and One-Stop Operator roles. The Board expects The Board has submitted to the to select a new operator at its meeting in late Department of Commerce a corrective action November with the new operations plan outlining specific steps that it will have commencing July 1, 2007. taken and will take to improve performance. The plan included a number of operational The Board believes that the One-Stops in changes undertaken in the One-Stop Centers, the area are only minimally compliant; and also includes board-level changes. however the Board is not satisfied with Finally, due to the nature of the performance minimal compliance. To that end, the measurement system, it may take some time following steps are being undertaken to before the effect of these changes is apparent. enhance the interconnectedness of the One- Nevertheless, the Board is confident that the Stop programs: changes will result in improved performance.
• One-Stop partners are meeting monthly Local Area IV WIA Board. Executive to work on program integration; Director testified that the Board and staff are committed to continuous improvement of the • Cross-training session are being held so program. The Post Audit Study references a that workforce center staff can gather number of issues related to operations in the application information and conduct area, most of which have been addressed and initial eligibility determinations for any resolved. Local Area IV was cited by the program; United State Department of Labor in 2004 for not having a comprehensive One-Stop • Working committees have been Workforce Center. In response, the area established by the Board to address conducted an analysis of the facility, which program integration and One-Stop led to the determination that additional space operation issues; and was required to accommodate the partners and programs necessary to establish a • The Kansas City One-Stop had dedicated comprehensive center. Moving the Wichita additional physical space to Workforce Center to 150 North main allowed accommodate increased partner presence. the Board to bring more partners on-site. While the facilities cost have increased with the move, the base rent per square foot for As the program operator, the Department the facility is lower than the average cost of of Commerce has undertaken a renewed Class B office space in downtown Wichita as effort to recruit job seekers, and both the cited in a recent study by Grubb and Ellis. Board and Commerce have been actively Funds are also being leveraged from federal, marketing employer services as a way to state and local levels to share the costs of the increase the number of individuals served, facility, which now meets the requirement of but as a way to increase business engagement the Act for a comprehensive center to serve in workforce services. The Board is currently both employers and job seekers. undertaking an examination of the area’s eligibility rules. In 2004, the Board adjusted Since the Wichita center opened in its policies to place a higher priority on February 2006, the number of job seekers serving lower-income job seekers. That accessing services has increased change had the unintended consequence of dramatically. At the previous location an suppressing the number of individuals average of 300 to 400 job seekers were served eligible to be served under the Adult per week. Currently 800 to 1,000 job seekers program. The Board is examining this policy per week are utilizing services from the
Kansas Legislative Research Department 7-20 2006 Economic Development center. It should also be noted that the conducted, the lack of necessary information, ability to serve employers has been the lack of cooperation, timeliness, turnover augmented since moving to the new facility as well as employment and training services and this is a primary goal of the Act. In provided to employers and job seekers. The addition to holding job fairs on-site, which Local Area V Board is currently considering was not possible at the previous location, making application to engage more in the role many employers are using the center to of the administrative entitv duties and as the perform assessments for applicants, conduct One-Stop operator for Area V. job interviews and holding orientations for new employees. Companies such as Cessna Kansas Department of Social Aircraft, Union Pacific Railroad, Cox and Rehabilitation Services (SRS) Communications, NuComm International and many others have been on-site receiving The representative of the Kansas services since February. Department of Social and Rehabilitation Services explained that the Department is Local Area V WIA Board. The required by federal law to provide Chairperson testified about the area’s employment services to Temporary demand for services; and how needs for both Assistance for Needy Families (TANF) unskilled and skilled laborers in industries recipients statewide and to Food Stamp are growing. These include petroleum recipients in Dickinson, Geary, Pottawatomie, refining, machine operators in the fiberglass Riley, and Saline counties. Under the operations, furniture, plastics, rubber and requirements for TANF, each state is required plastics, welders from iron and steel to meet a work participation requirement of industries, sheet metal workers for the 50 percent for single parent households aircraft industry and several different fields providing job readiness, community service, related to the oil and gas industry, work experience, job search, and some transportation and locally what seems to be education/training activities. Each SRS a continuous demand for healthcare workers. management region has the flexibility to What Area V needs is better partnerships develop these services to meet the unique with local industry to determine what needs of consumers in its region. specific training needs should be supplied with the amount of limited funds the area The Food Stamp Employment and receives. Local workforce boards should be Training Program is funded by the United flexible and focused, knowing that the policy States Department of Agriculture and each they set is supplying and supporting real state is mandated to provide some level of local employment and training services that services to Food Stamp recipients. SRS case will enable job seekers with barriers to managers identify and address employment employment to become self-sufficient and barriers and provide an array of services to that meet local industry and employment assist customers to obtain employment and demands. provide additional services after employment to ensure stabilization and promote job The Kansas Department of Commerce has retention. Vocational rehabilitation services provided an request for proposal for Audit, help people with disabilities become Dislocated and the One-Stop operation to the gainfully employed in the competitive local board. Area V expects that the workforce. During FY 2006, vocational Department will cooperate with assisting the rehabilitation services were provided for a Board to accomplish whatever decision it total of 14,871 individuals whose disabling makes for an administrative entity duties and conditions included physical disabilities, how services should be delivered in the area. severe and persistent mental illness, However, the Board has been dismayed by developmental disabilities, and significant the way the Department’s business has been learning disabilities.
Kansas Legislative Research Department 7-21 2006 Economic Development Kansas Board of Regents used as curriculum for training many entry- level workers. However, solving workforce The representative of the Kansas Board of issues such as the nursing shortage requires Regents spoke about the comprehensive participation from all educational sectors study planned by the State Workforce Board, including technical institutions, community in partnership with the Kansas Department of colleges, and universities. Likely, other Commerce, Kansas Inc., and the Kansas workforce shortages will require a similar Board of Regents which is being designed to approach involving all educational sectors. provide a resource guide for practitioners working in the regional offices. The study Roundtable Discussion titled, Aligning Postsecondan? Education and Training to Meet the Needs of the Business The roundtable discussion included Community, is designed to include an representatives from Kansas Department of analysis of key industry sectors and identify Commerce, the five regional Workforce skill shortages within those sectors in Kansas. Investment Act Boards, Kansas Department In addition, a review of innovative and best of Social and Rehabilitation Services, Kansas practices across the country will be included Board of Regents, and Kansas Department of in the study. Corrections. The following issues were discussed during the roundtable discussion: The Post Audit study emphasizes the need for more coordination, which is • Block grants; important provided the coordination • Marketing the services of the One-Stop increases both the number of qualified Centers; employees available for businesses and the • Accountability of Local Area Board opportunities for individuals seeking members; employment. This type of coordination, • Recourse if a Local Area is not compliant; according the Regents representative, • Tracking Workforce Investment Act requires more communication than a programs in local areas; newsletter or web link can provide, which is • Local Areas III and V should obtain what the report recommended. For example, outside administrative entities; several workforce entities are cooperating to • Partnering with the Center for develop a qualified workforce for the aircraft Entrepreneurship; industry located in Wichita. The goal of this • Statewide Board’s problem of meeting specific project is to recruit and train 1,000 consistently, therefore, not effective; manufacturing workers. The progression of • Integrating better; activities initially began with the award of a • Local Area One-Stop Centers and Workforce Solution Grant from the partnering; Department of Commerce to Hutchinson • Transportation issues in Local Area III and Community College to develop an industry Local Area IV; validated manufacturing skills certificate. • Childcare providers problem in Local Area As lessons are learned from the successes and IV; and setbacks of this particular project, Commerce, • National Association Workforce Board in partnership with postsecondary provides guidance, leadership, and educational institutions, is planning to training. duplicate this type of project in other areas of the state to address other workforce development challenges.
Finally, the level of educational coursework the auditors classified as fitting the definition of workforce development is
Kansas Legislative Research Department 7-22 2006 Economic Development Conclusions and Recommendations Senator Sam Brownback and Senator Pat Roberts meet with legislators to discuss The Committee made the following the problems with the Workforce recommendations: Investment Act;
• Requests a letter he sent to the • Directs the Department of Commerce to Congressional delegation; National create a framework for training of both Association of State Legislators (NCSL); local and state board members and staff The Council of State Governments (CSG); and report the progress back to the and American Legislative Exchange standing House and Senate committees Council (ALEC) by the Chairman asking during the 2007 Session; for help regarding reauthorization of the federal Workforce Investment Act (WIA) • Directs the Department of Commerce to and needed Congressional changes to the contact KAN-ED to seek help for local Act; boards in receiving on-line training;
• Directs Secretary Fricke to coordinate • Directs the Department of Commerce to with other states' agencies in requesting create a uniform evaluation for local help for needed Congressional changes to boards to implement for contracts; the reauthorization of WIA; • Requests a letter be sent from the • Requests the bylaws of the State Board for Chairman to the Kansas Department of Workforce Investment be modified to Labor inquiring why a representative from include the removal by the Governor of the unemployment office is not co-located any State Board member after two in every Local Area One-Stop Center; consecutive absences; • Encourages the local boards for Area III • Requests the Department of Commerce to and V obtain an administrative entity begin in FY 2008 providing the local other than the Department of Commerce boards a marketing and implementation as soon as possible; and plan and direct the Department to report progress to the standing House and • Asks that Kansas, Inc. report back to the Senate committees during the 2007 House and Senate committees on its Session; • review of the Workforce Investment Act; comparison with other states; and make • Requests that staff from the offices of recommendations for improvement in the present system in Kansas.
Kansas Legislative Research Department 7-23 2006 Economic Development Joint Committees
Report of the Health Policy Oversight to the 2007 Kansas Legislature
CHAIRPERSON: Representative Melvin Neufeld
ViCE-CHAIRPERSON: Senator James Barnett
OTHER MEMBERS: Senators David Haley, Laura Kelly, Roger Reitz, Vicki Schmidt, and Susan Wagle; and Representatives Bob Bethell, Bill Feuerborn, Brenda Landwehr, Peggy Mast, and Louis Ruiz
St u d y T o pics
The Committee has the exclusive responsibility to monitor and study the operations and decisions of the Kansas Health Policy Authority.
December 2006 Joint Committee on Health Policy Oversight
Annual Report
Conclusions and Recommendations
Based on testimony and Committee deliberations, the Joint Committee on Health Policy Oversight challenged and encouraged the Kansas Health Policy Authority to continue to focus its efforts on ensuring that all health programs in Kansas are working together to improve the health of Kansans and that the health model for Kansas shift from health care to health wellness; that the state’s prevention programs encompass all age groups; that the Authority be innovative as it develops a statewide health policy agenda; that the implementation of programs be tracked to ensure that expectations are met; and that the Authority work with the state’s federal delegation on important health issues. The Joint Committee further encouraged the Authority to consider cost containment strategies; personal accountability with regard to health insurance; the implementation of e-prescribe technology; and the provision of adequate dental care, particularly for Medicaid recipients, the uninsured, and the underinsured.
The Joint Committee also approved a motion that all Memorandum of Understanding entered into by the Authority he presented to the Oversight Committee for review before being implemented. The Oversight Committee further requested the Authority give consideration to the construction and process of future requests for proposal, particularly as they relate to managed care contracts.
Additionally, the Committee commended the efforts of the Authority in the timely transition of responsibilities from the Division of Health Policy and Finance to the Authority. It also commended the Authority’s efforts to communicate openly with the Oversight Committee, with other state agencies, with other health care stakeholders, and with the general public.
Proposed Legislation: None.
Background combines effective purchasing and administration of health care with health- The Joint Committee on Health Policy promotion-oriented public health strategies. Oversight was created by the 2005 The Authority is to be abolished on July 1, Legislature (House Substitute for Senate Bill 2013. No. 272). As stated in KSA 46-3501(1), the Oversight Committee has the exclusive The Oversight Committee is composed of responsibility to monitor and study the 12 members, six from the House of operations and decisions of the Authority. Representatives and six from the Senate. All As stated in KSA 75-7401(a), the Authority members serve two-year terms with the was established as a state agency on July 1, terms ending on the first day of the regular 2005. The Authority is statutorily charged to legislative session commencing in odd- improve the health of the people of Kansas numbered years. The Oversight Committee by increasing the quality, efficiency and may introduce legislation as it deems effectiveness of health services and public necessary in performing its functions. The health programs. Specifically, the Authority responsibilities of the Oversight Committee is to develop and maintain a statewide cease on July 1 , 2013. coordinated health policy agenda that
Kansas Legislative Research Department 2006 Health Policy Oversight Committee Activities the Authority’s activities is summarized below. The Oversight Committee held five meetings in Calendar Year 2006 - January Transfer of Responsibilities. As 18, 2006; March 1, 2006; April 28, 2006; required by KSA 75-7405(c), a transfer plan, August 23, 2006; and October 16, 2006. At to include recommendations for funding and the invitation of the Authority, members of legislation, was submitted to the Legislature the Oversight Committee attended the and reviewed by the Oversight Committee Authority’s January 17lh meeting. Also on on March 1, 2006. Dr. Marcia Nielsen, then January 17lh, the Oversight Committee met Chair of the Authority, reported that jointly with the Authority, the Senate Public transition of programs from the Division of Health and Welfare Committee, the Senate Health Policy and Finance to the Authority Health Care Strategies Committee, and the would occur successfully, on time, and House Health and Human Services without an initial request for additional Committee in a meeting coordinated by the personnel or funding. Before requesting Kansas Department of Health and additional resources, the Authority directed Environment. staff to first conduct a thorough review of current workforce and resource needs to The Oversight Committee focused its determine their adequacy to meet the efforts in 2006 on monitoring the activities Authority’s broad charge to manage and use of the Authority with the intent of ensuring health data and to develop state health that the Authority work independently and policy. Dr. Nielsen reported that the with the flexibility needed to meet its functions and data previously assigned to statutory responsibilities. In particular, the the Health Care Data Governing Board, Oversight Committee monitored the transfer which included claims records from of programs from the Division of Health hospitals and the health care provider Policy and Finance to the Authority on July database, were transferred to the Authority 1, 2006. Established July 1, 2005, the on January 1, 2006. She also reported that Division was statutorily set to be abolished legislation would be introduced during the on July 1, 2006 and its functions transferred session to transfer administrative to the Authority. The Division of Health responsibilities for the Kansas Insurance Policy and Finance was established as an Department’s private insurance database to interim state agency to coordinate health the Authority. care planning, administration, purchasing and analysis of health care data for the Memorandum of Understanding. The health-related programs transferred from the Oversight Committee reviewed a draft Department of Social and Rehabilitation Memorandum of Understanding between the Services and the Kansas Department of Authority and the Department of Health and Environment. Administration. The Memorandum of Understanding, which was entered into on July 1, 2006, stipulates that the Department Health Policy Authority Activities of Administration will provide certain administrative, legal, and information The Oversight Committee requested the technology services to the Authority. Authority to provide status reports to the Committee at four of the meetings and heard Board Governance. As reported by testimony from representatives of the Connie Hubbell, Authority Board Chair, the Division of Health Policy and Finance and Authority Board has formed several the Authority regarding the transfer of the committees including an Executive health-related programs and other activities Committee, a Finance and Audit Committee, of the Authority. The testimony regarding a Human Capital and Compensation
Kansas Legislative Research Department 8-4 2006 Health Policy Oversight Committee, and a Governance and and Southeastern Kansas (Region II) was Nominating Committee. Additionally, the awarded to Children’s Mercy Family Health Board has adopted bylaws and developed a Partners. The contracts will be effective conflict of interest policy and a legislative January 1 , 2007 and are anticipated to save and external communications policy. the state between $10 million and $15 million annually. Vision Principles. Following discussion at several of the Board’s monthly meetings, With regard to the managed care the Authority adopted the following Vision contracts, Claudia Bjerre, President and Principles to help identify overall priorities Chief Executive Officer of CHCares, a and goals: subsidiary of Coventry Health Care, provided suggestions for the improvement of • Access to Health Care; the state’s Request for Proposal (RFP) • Quality and Efficiency in Health Care; process. Ms. Bjerre expressed concern about • Affordable and Sustainable Health Care; three areas in the RFP process for the • Promoting Health and Wellness; managed care contracts - the review of the • Responsible Stewardship; and submitted rates; provider network adequacy; • Education and Engagement of the Public. and technical scoring. The improvements suggested were to weight the most significant RFP components; if the managed Staffing and Personnel Changes. After care contracts were to be reviewed again, to a review of staffing needs and resources, the have a larger review committee that includes Authority has requested 22 additional staff individuals qualified in Medicaid managed for FY 2007 ($536,300 from State General care; and to sufficiently document the “best Fund) and 20 additional staff for FY 2008 and final offer” (BAFO) so that any requests ($567,000 from State General Fund). The for changes through the BAFO process be positions are primarily in the areas of made in writing to all bidders, not just to finance and accounting and operations. those bidders to whom the requested Scott Brunner, then Director of Kansas changes may specifically apply. Medical Assistance Programs, stated that the lack of staff resources had strained the The contract for a pilot program to assess ability of the agency to respond quickly and the effectiveness of the current third party effectively. Also, internal staff transfers liability function of the Authority was have left some program areas with limited terminated due to unresolved functionality. communication issues with the contractor, Digital Healthcare. The Authority will issue Additionally, Dr. Nielsen was hired and a RFP for a similar assessment of its third confirmed as Executive Director. A Deputy party liability function. Director and General Counsel for the Authority also were hired. Scott Brunner In response to Committee questions, was promoted to Chief Financial Officer, testimony was provided concerning the and a new Director of State Employee Health adequacy of dental services in Kansas. As Benefits Program was hired. reported by Dr. Nielsen, there were 1,397 dentists practicing in the state in 2003. The Program Updates. As reported by Dr. number of enrolled dental providers for Title Nielsen, new contracts for Medicaid and XIX Medicaid as of November 2005 was 506. State Children’s Heath Insurance Program Assuming no decline in the number of (S-CHIP) managed care providers were dentists in the state, approximately 36 signed. A statewide contract was awarded to percent of licensed working dentists in UniCare Health Plan of Kansas, Inc. and a Kansas were enrolled dental providers for contract for Northeastern Kansas (Region I) Medicaid beneficiaries in 2005. The number
Kansas Legislative Research Department 2006 Health Policy Oversight of enrolled dental providers for the Title XXI Hospital and Grace Medical Health Clinic. S-CHIP was 367, or 26 percent. Twenty financial counselors from Via Christi and eight from Grace Medical Health As later reported by Scott Brunner, Clinic were to be trained and the site was between January and July 2006, Authority projected to be operational by August I s'. staff and dental contractors revised the The Authority will conduct an evaluation of dental payment policies. On July 1, 2006, each site and the results will be summarized the Authority ended its administrative in a report to the 2007 Legislature. services contract with Doral for Title XIX and XXI dental services. The Authority also Program Initiatives. As reported by changed the delivery model for dental Connie Hubbell, the Authority is analyzing services for the Title XXI program from a health promotion and disease prevention managed care to a fee for service model and data from the State Health Employees established a customer service unit at EDS Benefits Program and is meeting with for dental providers. Updated dental leaders from other states to begin planning provider numbers showed that, as of May for the shift in focus from health care 2006, there were 534 enrolled Title XIX services to improved health status in Kansas. dental providers and 404 enrolled Title XXI dental providers. Between May 8th and June Dr. Nielsen reported that a Data 30th, 21 additional providers were enrolled Consortium composed of private and public in the dental program. The Authority sector stakeholders will be developed to continues to monitor dental claims payment make recommendations to the Authority in accuracy and timeliness and provider three specific areas - health care quality, participation. health care pricing, and public health/consumer information. The goal of Scott Brunner also provided an update the Data Consortium will be to collect, on the Presumptive Eligibility Pilot Project analyze and disseminate health care for children. The 2006 Legislature required information that will improve decision the Authority to report on the project making in the allocation and financing of including a detailed description of its health care and public health and wellness. implementation at the state and provider level, the anticipated cost, and the The Authority also will review its data anticipated number of children to be served. systems and analytic resources with the goal Work had begun in January 2006 on the of developing a comprehensive health care project and included writing new eligibility data collection system. Authority staff have policy and a new front end process for the reviewed data systems in others states, and initial application. Potential sites had to be preliminary estimates for an integrated identified and training and materials had to decision support system, and additional be provided to the pilot sites. The project analytic and data support staff range from involved both Authority staff, contract staff, $1.0 million ($600,000 State General FundJ and advocates from the Kansas Association to $1.5 million ($1.0 million State General for the Medically Underserved and the FundJ per year. Kansas Hospital Association. Karen Braman, Director of Quality and At the time the report was provided to Innovation provided information on the the Oversight Committee, two pilot sites had Community Health Record (CHR) pilot been selected. The Kansas City Children’s project in Sedgwick County and various e- Mercy Hospital pilot site had a start date of prescribing projects underway in the state. July 1st with 10 of its financial counselors The CHR pilot project was begun in having already received training. The February 2006 in partnership with the Wichita pilot site includes Via Christi Cerner Corporation and FirstGuard Health
Kansas Legislative Research Department 8 - 6 2006 Health Policy Oversight Plan. The project focuses on the 14,000 System that prescribers could access via the Medicaid managed care members in existing Medicaid website. Sedgwick County. Cerner developed the CHR computer application, and FirstGuard A list of FY 2008 Authority was the Kansas Medicaid managed care recommendations and studies also wTas provider. The CHR application allows presented to the Oversight Committee. The authorized providers online access to more program recommendations include than 12 months of aggregated claims data increased health insurance access for and health transactions for patients. As of children up to age five through the Healthy August 2006, the CHR was being used by Kansas First Five program; expanded dental approximately 300 providers at 20 sites. coverage for adults; expanded data There were 76 clinicians using the e- management and policy analysis by prescribing component of the CHR. General promoting of health and wellness by health response to the pilot project has been and eligibility outreach; a two-phase health positive. Based on the evaluation of an cost and quality transparency initiative; independent consultant, the Authority will development of a partnership to promote the develop an RFP to obtain this type of shared purchase of long-term care insurance; health record for the Medicaid population. provision of childhood obesity counseling through Medicaid; and additional support to Representatives of the Cerner the Health Information Exchange and Health Corporation provided a demonstration of Cost Containment initiatives. how a community health record is created. Jay Linney, with the Cerner Corporation, The studies the Authority proposes to indicated that the change of managed care complete in FY 2008 include a study of providers from FirstGuard to UniCare Health health care workforce shortages in rural and Plan would not impede the pilot project. underserved urban areas; wellness Ms. Braman also reported that the Authority incentives for Medicaid beneficiaries; the is exploring the possibility of joining Healthe subsidy and tax credit pilot for the purchase MidAmerica, a Kansas City employer-based of small business health insurance; the health information exchange that will flexibilities within the Deficit Reduction Act provide the same community application to increase the long-term sustainability of piloted in Sedgwick County to physicians as Kansas Medicaid; the addition of e- a tool to help improve quality of care. prescribing to the Medicaid program; and the potential of consolidating prescription In addition to the “e-prescribe” drug assistance programs in the state. component in CHR, the Authority is working with the provider community in a broader Coordination and Outreach. Ms. health information exchange initiative to Hubbell reported that the Authority has assess the capacity of Kansas providers to developed a new website that is updated prescribe and receive prescriptions daily to better inform consumers, providers electronically. Additionally, the Authority and purchasers about the Authority’s has submitted two grant proposals to Centers programs and policies; has developed a for Medicare and Medicaid Services (CMS) weekly staff newsletter and has started through the CMS Transformation Grant quarterly townhall meetings for staff; and project for e-prescribing pilot projects. One has held three public townhall meetings proposal would expand the existing across the state. The Authority has Sedgwick County pilot to provide e- developed a CMS audit and deferral work prescribing to all participating providers and plan in collaboration with the Governor’s to providers in Reno County. The other Office, the relevant state agencies, and the proposal would create an e-prescribing tool CMS Regional Office to resolve outstanding in the Medicaid Management Information Medicaid administrative and payment
Kansas Legislative Research Department 2006 Health Policy Oversight issues. The Authority has collaborated with seat belt law could raise seat belt usage and the Kansas Hospital Association and the save 150 lives and $450 million in health Health Care Assessment Panel to ensure that care costs each year. Dr. Rodenberg also the Provider Assessment approved by CMS identified health disparities - those is a top priority in any reforms to the Kansas differences in health status that exist Medicaid program. The Authority also has between groups characterized by race, begun to hold policy planning meetings with ethnicity, geography, or socioeconomic hospitals who receive Disproportionate status - and public health emergency Share for Hospitals (DSH) funding to ensure preparedness as areas requiring more work. that the state formula is equitable to hospitals who serve Medicaid and uninsured Dr. Rodenberg further stated that the patients and has created a Deficit Reduction state must be willing to explore all avenues Act Interagency Planning Group to consider - educational, fiscal, legislative, regulatory, new flexibilities for developing a Medicaid and environmental - to improve the health reform plan for Kansas. of Kansans. He also discussed the Healthy Kansas 2010 Project, funded by the Kansas Health Policy Issues Health Foundation, which the Department of Health and Environment considers a critical The Oversight Committee also received part of the Division of Health’s strategic briefings and updates on the following plan. The Healthy Kansas 2010 Project is health policy issues. part of the national Healthy People 2010 Project, which uses leading health indicators Health Status of Kansas. As part of the to measure health status and set goals for January 17,h joint health policy meeting, the improvement. Oversight Committee heard testimony from Dr. Howard Rodenberg, State Health Officer, Health Disparities. At the January 17,h Kansas Department of Health and meeting, Dr. David Williams, Institute for Environment, who presented an evaluation Social Research, University of Michigan, of the health status of Kansas. Kansas ranks provided additional information on racial 15lh in the nation in overall health status. disparities in health. Dr. Williams testified However, against the backdrop of a graying that although overall health has improved in population, a growing multi-ethnic culture, the last 50 years, racial differences in health and a significant but shrinking rural are unchanged or have widened. He stated presence, Dr. Rodenberg identified three that African Americans and Native major areas - death from cancer, accidental Americans have higher age-specific injury and death, and heart disease - as mortality rates than Caucasians from birth leading causes of productive life-years lost. through the retirement years. Also, racial As a means to address these problems, Dr. differences in health are not primarily Rodenberg discussed the need for a caused by genetic factors. Socioeconomic comprehensive tobacco use prevention status, racism and residential segregation program which could save 4,000 lives each can make a difference in access to care and year and up to $720 million. The need for the quality of care. Dr. Williams further programs and policies promoting healthy stated that policies to reduce inequalities in nutritional habits and physical activity was health must address these fundamental non stressed. Currently, Kansas ranks 8th in the medical determinants. nation in the percent of persons who are overweight. The need for a primary seat belt Health System Reform. Dr. Robert St. law to address the rate of accidental injury Peter, President of the Kansas Health and death in Kansas also was stressed. Institute, provided information on the Kansas is ranked 45th in the nation for seat complexity of reforming the current health belt usage. Dr. Rodenberg testified that a care system and the need for comprehensive
Kansas Legislative Research Department 8 - 8 2006 Health Policy Oversight reform. He stated that the current health opportunity for effective change is system was created in an era when acute limited and the needs of the Authority illness was dominant and does not fully may challenge the standard state incorporate what is now known about government approach. Additionally, if creating health within a population. Dr. St. the number of special studies assigned to Peter also discussed the Blue Sky Midwest the Authority continues to grow, the lack Conference held in mid-August that of adequate staffing may detract from the included the states of Arkansas, Colorado, Authority’s ability to develop and stay Kansas, Ohio, and Oklahoma with observers focused on the “big picture”; from Missouri and Louisiana. The conference was motivated by the belief that • In its deliberations, the Authority must states have primary roles as innovators in consider the costs of not changing the health policy and that state action will health system and avoid the pitfall of eventually move a national agenda. The putting out immediate fires without a Blue Sky Initiative is a multi-state strategic plan; collaboration to improve health by, transforming health care reform. Its • To enhance accountability, the Authority principles include a focus on health rather must create clear measures and than areas such as cost containment or indicators of change and make data- health insurance; recognition that, in driven decisions; addition to medical care, other areas such as education determine health; and the need to • The Authority must be willing to take emphasize interventions that improve health informed risks as it fosters and supports over a life span. innovation.
Dr. St. Peter also provided general observations regarding the Authority, Health Care Price and Quality of Care including: Transparency. Representatives of the Kansas Hospital Association, the Kansas • The Authority provides an enormous Medical Society, and the Kansas Surgical opportunity to ensure linkage between Hospital Association provided testimony on health and health care. It must maintain health care price and quality of care a clear vision of the balance between transparency. health and health care; Fred Lucky, Senior Vice President, • The Authority needs the support of the Kansas Hospital Association, stated that Governor and the Legislature; transparency in health care is receiving increased attention on the state and federal • Communication and interaction and levels and that, currently, there is not with other agencies is critical, and complete agreement on what the concept clarifying legislation regarding how the means. Transparency can mean the price Authority interacts with other agencies health care providers charge; the discounts may be necessary; taken by government programs off the price charged; the out-of-pocket costs for • The Authority is viewing the Medicaid consumers; or both price and quality of care program as a whole which is critical data. He further stated that, if the goal of because the program crosses service transparency is to share meaningful lines; • information with health care consumers about their care, then particular attention • Timely recruiting and adequate staffing must be paid to what is meaningful. Ideally, are critical because the window of it involves giving the patient an estimate,
Kansas Legislative Research Department 2006 Health Policy Oversight before the service is provided, of the total toward transparency. He also urged the amount the patient will actually owe after legislators to understand that “quick and taking into account the patient’s specific easy” approaches will only serve to derail condition and insurance coverage. the more comprehensive process planned by the Authority. Mr. Lucky also provided information on the activities of the federal government, Jerry Slaughter, Executive Director, other states, and the private sector Kansas Medical Society, focused his concerning transparency. He stated that comments on price transparency and stated President Bush has signed an executive that the Medical Society has always order directing federal agencies that encouraged physicians to make relevant fee administer or sponsor federal health information available to patients and to insurance programs to share price and discuss fees in advance of service, when quality information with beneficiaries. He possible. He stated that simply knowing the also stated that some states now require the price of various services is of little value disclosure of the cost of certain procedures; without an overall picture of the total cost of others require that individual hospitals’ the care involved which can include, in master list of charges be made available to addition to the physician’s services, other the public. Ohio will eventually require services such as lab, imaging, hospital care, publication of certain hospital quality and and prescription drugs. Additionally, he cost data on a state government website. Mr. pointed out that the following factors may Lucky further stated that, in the private keep any transparency structure from sector, Aetna will begin providing cost reaching its goals: information for certain common procedures online. He also discussed two private • The vast majority of health care services initiatives, the Patient Friendly Billing® are purchased by health insurers or third project, which is a national, industry-wide parties. As a result, physicians’ fees are initiative to improve hospitals’ financial already subject to de facto price controls communications with patients; and for many patients; PricePoint, a consumer-friendly database of hospital charges, utilization and payer-mix • Health care spending is not evenly developed collaboratively by the Wisconsin distributed across the population in that Hospital Association and the Wisconsin up to 75 percent of the health care Legislature. With regard to quality of care spending can be attributed to information, Mr. Lucky discussed Hospital approximately 25 percent of the Compare, a consumer-oriented website that population; provides information on how well hospitals provide recommended care to their patients • Much of the health care spending occurs and indicated that every eligible Kansas by patients who are the sickest and for hospital participates in the initiative. He whom shopping for the lowest priced also discussed the efforts of the Authority in physician or hospital is impractical; developing a Data Consortium composed of private and public sector stakeholders which • Patients with serious medical problems will make health care policy often exceed their annual deductible and recommendations regarding health care maximum out-of-pocket spending which quality, health care pricing, and public limits the impact of financial incentives; health/consumer information. and
Mr. Lucky concluded with specific • On average, approximately 15 percent of recommendations for providers, insurers, health care spending is paid for out-of- employers, and government in the move pocket which also minimizes the
Kansas Legislative Research Department 8-10 2006 Health Policy Oversight financial incentives to select health care Mr. Kerens indicated that Association services based on price. members have established policies for treating patients without health insurance Mr. Slaughter also referenced the based on the patient’s ability to pay. A transparency initiative of the Authority and sliding scale is used, and patients with encouraged the Legislature to allow those income two times the national poverty level discussions to take place prior to enacting are provided services at no charge. legislation. To make access to information easier for Paul Kerens, President, Kansas Surgical patients, Mr. Kerens suggested legislation Hospital Association, stated that the nine that would require hospitals to publish their physician-owned hospitals who are contracted insurance reimbursement rates, members of the Association strongly support thus voiding the contractual obligations for consumerism and believe that price confidentiality. Also, insurance companies transparency is important. However, should allow out-of-network providers and hospital billing and collection is patients access to the payment schedule for complicated, and any legislation regarding out-of-network providers or allow all willing price transparency must be considered providers the ability to sign contracts in carefully. their network.
Mr. Kerens provided the following potential barriers to price transparency in Conclusions and Recommendations the current health care system: Based on testimony and deliberations, • Insurance companies require hospitals to the Oversight Committee challenged and keep confidential the contracted encouraged the Authority to: payment for procedures; • Continue to focus its efforts on ensuring • Many physician-owned hospitals are that all health programs in Kansas are excluded from contracting with working together to improve the health insurance companies because of long of Kansans and that the health model for standing relationships the insurance Kansas shift from health care to health companies have with non-physician- wellness; owned hospitals. The physician-owned hospitals are treated as out-of-network • Encourage prevention policies and and are unable to access reimbursement programs that encompass all age groups; information until after the claim is paid; that include prenatal care; and that include all service providers who • Because patient deductibles are met as impact, directly and indirectly, the health claims are processed by the health of Kansans; insurance company, the unmet deductible balance changes and may not • Continue to develop the coordinated be applied to a hospital charge if, for statewide health policy agenda that example, a physician’s claim is paid first; combines the effective purchasing and and • administration of health care with health promotion oriented public health • Hospital charges and insurance strategies; reimbursements are based on the costs incurred by the hospital which are often • Identify new innovative ways to address not known in advance and can vary by health care policy; several thousand dollars.
Kansas Legislative Research Department 8-11 2006 Health Policy Oversight • Consider cost containment issues and strategies when reviewing Kansas health The Oversight Committee also approved policy; a motion that all Memorandum of Understanding entered into by the Authority • Encourage personal accountability be presented to the Oversight Committee for regarding health insurance; review before being implemented. The Oversight Committee further requested the • Track the implementation of health care Authority give consideration to the future programs to ensure that expectations are construction of RFP, particularly as they being met; relate to managed care contracts, and to introduce a weighting process to identify • Encourage the implementation of “e- significant RFP components. The Authority prescribe” as soon as the health care also should give consideration to the system can accommodate the creation of a policy to determine whether technology; BAFO documents should be considered public documents. • Make the provision of dental care a priority goal, particularly for Medicaid Additionally, the Committee commended recipients, the uninsured, and the efforts of the Authority in the timely underinsured; transition of responsibilities from the Division of Health Policy and Finance to the • Work with the state’s federal delegation Authority. It also commended the on important health policy issues; and Authority’s efforts to communicate openly with the Oversight Committee, with other • Continue to submit requests for state agencies, with other health care assistance to the Committee, including stakeholders, and with the general public. the introduction of legislation, as needed to meet its statutory responsibilities.
Kansas Legislative Research Department 8-12 2006 Health Policy Oversight Joint Committees
Report of the Joint Committee on Information Technology to the 2007 Kansas Legislature
CHAIRPERSON: Senator Tim Huelskamp
VlCE-CHAIRPERSON: Representative John Faber
OTHER MEMBERS: Senators Janis Lee, Mike Petersen, Vicki Schmidt, and Chris Steineger; and Representatives Nile Dillmore, Harold Lane, Joe McLeland, and Jim Morrison
Study T opics
The Committee is directed to study computers, telecommunications, and other information technologies used by state government, and to review new acquisitions of information technology.
December 2006 Joint Committee on Information Technology
Statutory Study
Conclusions and Recommendations
The Committee recommends:
• The Legislative Coordinating Council (LCC) and other committees should refer information technology (IT) projects to the Committee for further review when issues arise that require additional study.
• The Department of Administration should establish either a central staff attorney position or contract for an attorney to review IT contracts and to insure that all IT contracts contain liquidated damages provisions.
• The Kansas Lottery, when feasible, should share with other state agencies access to contracted resources, such as its communications network.
• The Board of Regents should encourage cooperative ventures between and among institutions, including universities and community colleges that may share IT resources, including hardware, software, and personnel.
• The House Appropriations Committee and the Senate Ways and Means Committee should review the proposed $98.5 million SRS project which the Committee does not recommend at this time.
Proposed Legislation: The Committee recommends no bills.
Background • Study computers, telecommunications, and other information technologies used The Committee is authorized by KSA 46- by state agencies and institutions. The 2101 et seq. The Committee may set its own state governmental entities defined by agenda, meet on call of its chairperson at KSA 75-7201 include executive, judicial, any time and any place within the state, and and legislative agencies, and Regents introduce legislation. The Committee institutions. consists of 10 members, including five senators and five representatives. The • Review proposed new acquisitions, Committee met May 25, June 12-13, August including implementation plans, project 7-8, September 7-8, November 14-15, and budget estimates, and three-year strategic December 5-6, 2006. Copies of the minutes information technology plans of state and attachments are filed with the Division agencies and institutions. All state of Legislative Administrative Services. governmental entities are required to comply with provisions of KSA 75-7209 The duties assigned the Committee by its et seq. in submitting such information authorizing legislation in KSA 46-2102 are for review by the Committee. noted below, and the first three duties also defined its general areas of interim activity:
Kansas Legislative Research Department 9-3 2006 Information Technology • Monitor newly implemented appropriations of the projects. In addition, technologies of state agencies and the Executive and Judicial CITOs are institutions. required to report to the Legislative CITO the progress regarding implementation of • Make recommendations to the Senate projects and proposed expenditures, Ways and Means and House including revisions to such proposed Appropriations Committees on expenditures. implementation plans, budget estimates, and three-year plans of state agencies The Committee presents this annual and institutions. report in compliance with KSA 46-1207 that requires the LCC to receive information • Report annually to the LCC and make about the interim work for submission to the special reports to other legislative next session of the Legislature. committees as deemed appropriate.
Committee Activities In addition to the Committee’s statutory duties, the Legislature or its committees, The Committee reviewed agency IT including the LCC, may direct the projects that received CITO approval. Committee to undertake special studies and Several proposed projects were reviewed to perform other specific duties. No special prior to CITO approval. In addition, reports study topic was assigned in 2006. were received from the Legislative, Executive and Judicial CITOs. KSA 75-7208(g) provides that the Legislative Chief Information Technology The Committee continued to monitor Officer (CITO) is staff to the Joint active IT projects, especially those with an Committee. The position is appointed by estimated cost of greater than $1.0 million. the LCC and the Committee may recommend As reported in the November 2006 Summary persons for consideration by the LCC in of Quarterly Information Technology making the appointment. Among the duties Reports, there are at least 46 active CITO- assigned to the Legislative CITO by KSA 75- approved projects which have an aggregate 7211 are those of monitoring state agency total cost greater than $220.0 million. Other execution of information technology projects proposed or planned projects could cost an and reviewing information technology additional $142.2 million. Because of the project budget estimates and revisions to the number of such projects, the Committee estimates. The Legislative CITO also may generally focused on those costing more perform other functions and duties as than $1.0 million. directed by the LCC or the Committee, as provided in KSA 75-7208(h). The Committee believes that budget reviews during the 2007 Legislature ought to KSA 75-7210 requires the Legislative, focus on all agencies with active or proposed Executive and Judicial CITOs to submit projects. The Committee provides project annually to the Committee all information information for the Senate Subcommittees technology project budget estimates and and House Budget Committees to use during revisions, all three-year plans, and all the 2007 legislative review of the Governor’s deviations from the state information FY 2008 agency budget recommendations. technology architecture. The Legislative Some of the projects may be found in the CITO is directed to review the estimates and Governor’s revised FY 2007 agency budget revisions, the three-year-plans, and the recommendations. deviations, then to make recommendations to the Committee regarding the merits and
Kansas Legislative Research Department 9-4 2006 Information Technology The following projects should warrant Judicial Branch further review by the Legislature, either FullCourt Imaging project: $1.0 million. because of the cost or the CITO project status of hold, caution or alert. On hold Kansas Bureau of Investigation indicates that a project is no longer active. Automated Fingerprint Identification System Caution refers to projects with changed project: $4.1 million. scope, or missed targeted goals by more than CITO caution status. 10 percent. Alert refers to projects with changed scope, or missed targeted goals by Kansas Bureau of Investigation more than 20 percent. Central Message Switch Client Software project: $1.2 million. Active CITO-Approved Projects Kansas Bureau of Investigation Department of Administration Offender/Missing Person Application SHARP upgrade project: $10.7 million. project: $301,306. CITO alert status. Department of Administration Capitol Complex Wireless LAN project: Department of Labor $350,421. Unemployment Insurance Modernization CITO alert status. project: $21.0 million.
Department of Administration Kansas Lottery Statewide Financial Management System Online Gaming System, Communications Needs Assessment/Feasibility Study: Network, and Related Services: $36.2 $280,160. million.
Animal Health Department KPERS Impact of Environmental Interferences and Integrated Technology System project: Performance Variation on RFID project: $8.0 million. $471,430. CITO caution status. KPERS Platform Consolidation project: $2.6 million. State Department of Education Enterprise Data System to Support Decision KPERS Making and Reporting project: Security Enhancement project: $1.7 million. $3.9 million. KPERS Department of Health and Environment Disaster Recovery and Hot Site project: Electronic Disease Surveillance project: $576,500. $3.9 million. Department of Revenue Department of Health and Environment Computer Assisted Mass Appraisal project II: Health Alert Network project: $1.2 million. $5.9 million.
Health Policy Authority Department of Revenue MMIS National Provider Identifier project: Project 2010 Vehicle Information Processing $8.3 million. System Replacement Study: $379,991.
Health Policy Authority Social and Rehabilitation Services Data Analytic Interface project: $6.3 million. Server Consolidation project: $981,763. CITO hold status.
Kansas Legislative Research Department 9-5 2006 Information Technology Social and Rehabilitation Services Department of Health and Environment Behavioral Health Care Inpatient Electronic Death Registration project: $1.0 Registration and Billing System project: million. $1.0 million. Department of Revenue Department of Transportation Vehicle Information Processing System Communication System Interoperability Replacement project: over $1.0 million. Program: $63.0 million. Social and Rehabilitation Services Department of Transportation Human Services Management project: $98.5 Comprehensive Program Management million total, $25.0 million FY 2008. System Replacement Feasibility Study: $242,573. Department of Transportation CITO alert status. Comprehensive Program Management System project: $8.2 million. Department of Transportation Crew Card Reporting III project: $953,797. Department of Transportation CITO hold status. Financial Information Management System project: $5.5 million. Department of Transportation Tape Library System project: $357,375. Department of Transportation CITO alert status. Advanced Public Transportation Management System project: $1.6 million. Emporia State University Enterprise Resource Planning System Department of Transportation project: $9.0 million. Traffic Records Coordination and Enhancement project: $1.9 million. Kansas State University Food Service System project: $655,130. CITO caution status. Interim Review Summary
Kansas State University During the 2006 Interim, the Committee Legacy Application System Empowered reviewed both active and proposed IT Replacement II project: $9.8 million. projects. The Executive CITO presented CITO hold status. quarterly reports at the September and December meetings, and a Kansas Wichita State University Information Technology Office (KITO) staff Information Network project: $10.8 million. member presented the report at the June meeting. Reports are available online at: www.da.ks.gov/kito/projstatusreport.htm Planned or Proposed Projects In addition, the Committee reviewed Department of Administration individual projects with presentations by Financial Management System project: $30.0 agency staff as well as other topics million. throughout the Interim. Such items included the following topics: State Department of Education Statewide Individual Education Plan project: Capitol Restoration. The Legislative $1.5 million. CITO provided periodic updates on the progress of renovation work in the Statehouse and the implementation of
Kansas Legislative Research Department 9-6 2006 Information Technology planning for IT enhancements throughout the state. Conferees engaged the Committee the Capitol. The Capitol Architect also from remote locations, reporting on various reported to the Committee on the project projects at Regents institutions. The video design and reconstruction involving IT conferencing was sponsored by KAN-Ed to enhancements. Video conference rooms to demonstrate the capability of the network to be located in the Statehouse were handle multisite, interactive video sessions. highlighted in conjunction with another The session demonstrated the utility and topic that demonstrated interactive feasibility of technology that will be used in committee sessions using video conferencing the Statehouse after renovation. in real time. Failed SRS Project. Beginning early in Lottery Sunset. During review of a the Interim, the Committee heard a report proposed project that since has gained from the Chief Information Officer (CIO) of Executive CITO approval, the Committee Social and Rehabilitation Services (SRS) that learned that the Kansas Lottery will seek indicated the Enterprise Circle Plan (ECP) reauthorization during the 2007 Session. project had been placed on hold and that Under current law, the agency will sunset on SRS had contracted with Forrester Research july 1 , 2008, unless the 2007 Legislature to produce a feasibility study for alternative takes action to renew its statutory authority. solutions to integrate the agency’s diverse IT The IT project involves the online gaming applications. system, communications network and related services with an estimated cost of Later, in the Interim, three alternative $36.2 million. solutions proposed in the Forrester report were presented to the Committee. Each The Kansas Lottery issued a request for would supercede the ECP project which proposals since the current vendor contract attempted to create a common platform for will expire prior to the sunset date. The all agency IT applications with access to Executive Director explained that lottery client data. Costs ranged from $2.5 million games have a prize payout period of either to $98.5 million for lowest and highest cost six or 12 months after the conclusion of a alternatives, with the third one estimated at particular game which will require $21.5 million. legislative action during the 2007 Session if the Kansas Lottery is to continue By the conclusion of the Interim, the CIO uninterrupted operations in FY 2008, the of SRS told the Committee that the agency fiscal year ending June 30, 2008. would engage a contractor to produce an enterprise application roadmap at a cost of Previously, the Committee recommended $500,000 in preparing to launch a new sharing of resources among state agencies initiative described as Human Services ought to be examined when the Kansas Management project, to replace the ECP Lottery contracts for a communications project. The new project represents the third system to link more than 1,500 sales alternative of the three suggested by the locations throughout the state. With the Forrester report, estimated to cost $98.5 contract expiring with the Lottery sunset, the million. The FY 2008 budget request for the opportunity once again presents itself to new project includes $25.0 million to begin determine if sharing resources with other after July 1, 2007, when the roadmap is state agencies is a viable option. expected to be completed.
Video Conferencing. The Committee The CIO of SRS reported expenditures of engaged in one session dedicated to live, $4.0 million had been made on the ECP interactive video conferencing that project that was being abandoned. connected eight different sites throughout Committee members expressed concern and
Kansas Legislative Research Department 2006 Information Technology regret that the money had been spent on a The Chairperson requested a 200-hour failed project when human needs were left review by the Legislative Division of Post unaddressed during the period. Of Audit. A performance audit report, Animal particular concern to Committee members Health Department: Reviewing Issues was the agency contention that it had spent Related to a Recent Tracking Technology “savings” found within the agency budgets Project, was released October 10, 2006, and over the fiscal years and that these funds reviewed by the Committee. The limited- were used for the failed project. scope audit focused on the first project that failed. Information Network of Kansas (INK). The Committee heard reports from the After Committee discussion about the Executive Director of INK and the network audit, no action was taken regarding that manager who is under contract to INK for report or this issue. providing services. During the 2005-2006 period, INK awarded $1.3 million in grants State Security Measures. The Co-Chairs to various state entities for portal of the State Security Council briefed the development projects and ancillary projects. Committee on the increasing need to increase IT security measures to protect state Livestock Commissioner Projects. assets. Increasing attacks necessitated During the 2006 Interim, the Committee creating the Enterprise Security Office in monitored a number of IT projects order to manage intrusion prevention, undertaken by the Livestock Commissioner initiate forensic examinations, and conduct without CITO approval. Early during the vulnerability assessments. Additional Interim, the Livestock Commissioner planned security enhancements were reviewed a pilot project to track livestock by enumerated. Funding is provided by the electronic means. A federal grant of agencies that use the services provided by $805,000 was used to tag livestock with the Division of Information Systems and radio transmitter identification devices and Communications as part of the indirect to monitor locations and movements of charges paid. livestock. The project was considered a failure, according to the Livestock Geographic Information Systems (GIS). Commissioner’s report, and was halted Representatives of KITO and other state before all funds were expended. agencies provided an overview of GIS applications being utilized by state agencies. Later during the Interim, the Committee The Data Access and Support Center was received subsequent information from the described as the single repository for web- Livestock Commissioner and a based data. The Committee viewed representative from Kansas State University demonstrations of the various GIS responsible for the conduct of a second applications available to the public users. project that previously had not received CITO approval. Their report focused on the State IT Contracting. While reviewing a Cattle Tag Electronic Tracking Research and Department of Revenue project in which the Grant Awards project. The project is funded Property Valuation Division contracted with with a $441,000 federal grant, supplemented a vendor for replacing the Computer by a $30,000 state grant. This project Assisted Mass Appraisal (CAMA) system, the involves 15 markets, various brand radio Committee learned that even after delays in frequency identification devices and readers, the project attributed to the vendor, no with 3,000 tags being analyzed while punitive action was taken because the tracking 1,200 animals. contract did not include such provisions. The Director of Purchases, Department of Administration, reviewed state purchasing
Kansas Legislative Research Department 9-8 2006 Information Technology and contracting procedures for the IT Cooperation. The Committee heard a Committee. report from a representative of the community colleges who cited cooperative Members of the Committee discussed the work between Barton County Community issue of penalties in contracts and heard a College and Wichita State University. The report by the Revisor’s Office concerning Committee believes that such cooperation penalty clauses. Legal case law suggests that between and among postsecondary liquidated damages rather than penalties institutions represents an underutilized should be addressed in contracts. opportunity for addressing IT needs in this state. Following Committee discussion, members decided to recommend either The Board of Regents, which is charged establishment of a position within the with governing the Regents institutions and Department of Administration Legal supervising the community colleges, should Division, or contracting for such legal take affirmative action to encourage such services that would oversee all IT contracts. cooperation and sharing of resources among In addition, the Committee agreed to all institutions. recommend that liquidated damages clauses should be included in all future IT contracts. Conclusions and Recommendations
IT Project Oversight. Continuing the One topic that was not reviewed Committee’s review procedures for detecting specifically by the Committee during the IT projects and seeking to identify 2006 Interim was KAN-ED and its previously unapproved IT projects was a relationship to other state networks. focus of concern during the Interim. The Another Interim study focused on that topic Committee’s activity in identifying the during this Interim. The Committee intends Livestock Commissioner’s IT projects to undertake its own study next Interim of demonstrates that concern is valid. the possible overlap and duplication by the state’s networks, including KAN-ED. Reports from the Legislative, Judicial, and Executive CITOs recommended some Regarding other topics reviewed during changes in current IT oversight procedures the 2006 Interim, the Committee makes the that may be addressed next Interim. The following conclusions and Executive CITO reported that recommendations: recommendations will be presented during the 2007 Interim as a result of a review of • The LCC and other committees should the Kansas Project Management refer IT projects to the Committee for Methodology. The review is focusing on two further review when issues arise that areas: the project plan approval and require additional study. quarterly reporting process, and the actual project management methodology. • The Department of Administration should establish either a central staff The Committee continues to attorney position or contract for an recommended that the LCC, the House attorney to review IT contracts and to Appropriations Committee, and the Senate insure that all IT contracts contain Ways and Means Committee refer any and liquidated damages provisions. all IT projects for further review by the Committee whenever additional study is • The Kansas Lottery, when feasible, required. should share with other state agencies access to contracted resources, such as its communications network.
Kansas Legislative Research Department 9-9 2006 Information Technology • The Board of Regents should encourage • The House Appropriations Committee cooperative ventures between and and the Senate Ways and Means among institutions, including Committee should review the proposed universities and community colleges that $98.5 million SRS project which the may share IT resources, including Committee does not recommend at this hardware, software, and personnel. time.
Kansas Legislative Research Department 9-10 2006 Information Technology Joint Committees
Report of the Joint Committee on Kansas Security to the 2007 Kansas Legislature
CHAIRPERSON: Senator Jay Emler
VlCE-CHAIRPERSON: Representative Mario Goico
Ranking M inority M em ber: Senator Jim Barone
OTHER MEMBERS: Senators Nick Jordan, Carolyn McGinn, and Chris Steineger; and Representatives Carl Krehbiel, Judith Loganbill, Julie Menghini, and Lee Tafanelli
Study T opics
The Joint Committee on Kansas Security is statutorily directed to study, monitor, review and make recommendations on matters regarding the security of state employees and state owned buildings or property; matters regarding the security of the public, including public buildings and facilities; matters regarding the security of the Kansas infrastructure, including information systems; and measures for the improvement of security for the State of Kansas. The Committee is also charged to review and monitor federal moneys received by the state for homeland security or other security purposes.
December 2006 Joint Committee on Kansas Security
Homeland Security Issues
Conclusions and Recommendations
The Committee discussed the possibility of introducing legislation providing tuition assistance to Kansas National Guard soldiers and airmen and Kansas Reserve members returning from Iraq or Afghanistan. The Committee discussed the possibility of introducing legislation on this topic early in the 2007 Legislative Session.
The Committee recommends further study of a state Emergency Disaster Relief Fund to provide assistance for victims of a disaster when the disaster does not meet the threshold to qualify for federal assistance. The Committee discussed whether grant funds should be provided to businesses for disaster relief, and, if so, whether an eligibility threshold should be included based on business size. The Committee discussed the possibility of introducing legislation on this topic early in the 2007 Legislative Session.
The Committee recommends further study of the proposal to expand the membership of the Commission on Emergency Planning and Response. The Committee expressed concern that a membership increase may limit the effectiveness of the Commission.
The Committee received information on the number of Mobile Command Vehicles or Trailers across the state. The Committee expressed concern that some counties have no Mobile Command Vehicle or Trailers, while other counties may have two or three owned by various local entities in varying conditions. The Committee recommends further study to insure that resources are adequately distributed across the homeland security regions and the state.
The Committee continues to express concern with the procurement process for homeland security equipment, including the contract with Fisher Scientific.
The Committee recommends further study of Statehouse security.
The Committee recommends further study of hospital credentialing of health care providers in emergency situations.
Proposed Legislation: None.
Background buildings and facilities; matters regarding the security of the Kansas infrastructure, The 2004 Legislature established the including information systems; and Joint Committee on Kansas Security. The measures for the improvement of security for Committee is directed statutorily to study, the State of Kansas. The Committee also is monitor, review, and make charged to review and monitor federal recommendations on matters regarding the moneys received by the state for homeland security of state employees and state-owned security or other security purposes. buildings or property; matters regarding the security of the public, including public
Kansas Legislative Research Department 10-3 2006 Kansas Security Committee Activities floor, for biosecurity research of animal, plant, and foodborne pathogens. During the 2006 Interim, the Committee held four meetings. At the June 23 meeting, At the September 5 meeting, the the Committee reviewed a report by the Adjutant General updated the Committee on Department of Administration and the the state’s Emergency Response Plan. A new Kansas Highway Patrol on the Fisher Plan has been recently developed. In this Scientific purchasing contract. Legislation plan, all units are function-based, with clear passed during the 2006 Session required that and defined roles and responsibilities for the Kansas Highway Patrol submit a report each unit. Consistent terminology is used at on the contract to the Committee by June 30, all levels, and public and private 2006. It was reported that the contract had partnerships are utilized. The adoption of been renegotiated to address concerns with the Incident Command System allows for a the fees charged for third party purchases. A common operating picture. representative from the Kansas Highway Patrol also updated the Committee on the Noted strengths of the Plan included: Federal Fiscal Year 2006 Homeland Security Grant Program. • That critical areas of the plan were sufficient; At the August 11 meeting, the Committee • The most likely and dangerous hazards, learned about the National Agricultural direction and control, and emergency Biosecurity Center (NABC) at Kansas State public information, were addressed: University. The mission of the NABC is: “To • State agencies providing social services help coordinate the development, program were included; implementation, and enhancement of • Primary and support agencies were diverse capabilities for addressing threats to included; the nation’s agricultural economy and food • Greater emphasis was placed on “worst supply.” Activities at the NABC include case” scenario; disease surveillance, toxin/pathogen • The National Incident Management mitigation, plant and animal infectious System (NIMS) was institutionalized; disease research, vaccine development, food • The relationship with nongovernmental safety, and other homeland security agencies such as the Red Cross and measures. The Center has received funding Salvation Army was addressed; from the United States Department of • Regional Incident Management Teams Agriculture-Animal and Plant Health were established; and Inspection Service (USDA-APHIS), the • Regional Homeland Security federal Department of Defense, the General Coordinators were assigned and trained. Services Administration, the United States Department of Justice, the National Science Noted weaknesses of the plan included: Foundation, and the Sandia National Laboratory. International surveillance • Quantified and listed resources were not collaborations have been initiated with included; Russia and the European Union. • Special needs populations were not pre identified; The Committee toured the Biosecurity • Animal care and control was not Research Institute (BRI), a component of the addressed; NABC. The BRI is a $50 million, 34,000 • Emergency management funds and square foot Biosecurity Level Three (BSL-3) personnel are lacking; biocontainment facility. When completed, • No process to maintain a patient tracking the facility will house laboratory space, system is established; and including animal rooms and a slaughter
Kansas Legislative Research Department 10-4 2006 Kansas Security • No procedures were in place for no emergency funding available for victims licensing out-of-state medical personnel. of a disaster when the disaster does not meet the threshold to qualify for federal assistance. Also at the September 5 meeting, the Kansas Highway Patrol updated the The Adjutant General’s Department Committee on the federal Homeland presented a review of the Commission on Security Grant Program funding. Emergency Planning and Response (CEPAR), Expenditures of the state’s 20 percent of the and proposed adding members to the funding were addressed. It was noted that Commission. The Committee was also for federal fiscal year (FFY) 2006, of the 80 updated by the Adjutant General’s percent designated for local use, half of the Department on the lessons learned in funding will be allocated to the counties and response to Hurricane Katrina in 2005. half will be allocated to the regions. For FFY 2007, the entire local portion, or 80 percent The Committee heard a report on the of the grant, will be allocated to the regions. International Symposium on Agriterrorism, which was attended by several Committee At the December meeting, the Deputy members in September. It was reported that Director, Division of Health, Kansas the nation’s food supply would be an easy Department of Health and Environment target for terrorism and has the potential to (KDHE), updated the Committee on cause widespread disruption to the economy pandemic influenza. The Committee was and United States citizens. informed on the differences between seasonal influenza (or flu) and pandemic flu, The Committee attended the Governor’s how flu is spread, who is susceptible, and Council on Homeland Security and received flu prevention. The Committee also received an update on global terrorism by General information on local, state, and federal (ret.) Barry McCaffrey. The General’s planning efforts for a possible pandemic flu presentation included insights on the War outbreak. KDHE has been working on on Terror and observations on Iraq, pandemic flu preparedness with other state Afghanistan, and Guantanamo. agencies and organizations including the Kansas Association of Local Health Departments, the Kansas Hospital Conclusions and Recommendations Association, the Adjutant General’s Division of Emergency Management, the Kansas The Committee discussed the possibility Highway Patrol, the Department of of introducing legislation providing tuition Agriculture, the Department of Wildlife and assistance to Kansas National Guard soldiers Parks, Kansas State University, and the four and airmen and Kansas Reserve members Native American Tribes located in Kansas. returning from Iraq or Afghanistan. The Other state preparedness activities include a Committee discussed the possibility of State Pandemic Flu Task Force, planning introducing legislation on this topic early in and exercise activities, disease surveillance, the 2007 Legislative Session. and public education. The Committee recommends further The Committee held a closed meeting study of a state Emergency Disaster Relief regarding Statehouse security. Fund to provide assistance for victims of a disaster when the disaster does not meet the In December, the Committee discussed threshold to qualify for federal assistance. the possibility of creating a Kansas The Committee discussed whether grant Emergency Disaster Relief Fund. The funds should be provided to businesses for Committee mentioned that currently there is disaster relief, and, if so, whether an
Kansas Legislative Research Department 10-5 2006 Kansas Security eligibility threshold should be included while other counties may have two or three based on business size. The Committee owned by various local entities in varying discussed the possibility of introducing conditions. The Committee recommends legislation on this topic early in the 2007 further study to insure that resources are Legislative Session. adequately distributed across the homeland security regions and the state. The Committee recommends further study of the proposal to expand the The Committee continues to express membership of the Commission on concern with the procurement process for Emergency Planning and Response. The homeland security equipment, including the Committee expressed concern that a contract with Fisher Scientific. membership increase may limit the effectiveness of the Commission. The Committee recommends further study of Statehouse security. The Committee received information on the number of Mobile Command Vehicles or The Committee recommends further Trailers across the state. The Committee study of hospital credentialing of health care expressed concern that some counties have providers in emergency situations. no Mobile Command Vehicles or Trailers,
Kansas Legislative Research Department 10-6 2006 Kansas Security Joint Committees
Report of the Legislative Budget Committee to the 2007 Kansas Legislature
CHAIRPERSON: Senator Dwayne Umbarger
VlCE-CHAIRPERSON: Representative Melvin Neufeld
OTHER MEMBERS: Senators Jim Barone, and Stephen Morris; and Representatives Bill Feuerborn, Brenda Landwehr, and Ray Merrick
Study Topics
• Homeland Security Funding
• Kansas University Medical Center, Kansas University Hospital, and Missouri-Based Hospitals
• Impaired Provider Program
• Colorado Water Litigation
• Public Mental Health System
• Deferred Maintenance
• Regional Economic Area Partnership (REAP)
• Public Developmental Disabilities System
• State General Fund
• State Inspector General
• Veterans’ Funding Issues December 2006 Legislative Budget Committee
Homeland Security Funding
Conclusions and Recommendations
The Committee makes no recommendation on the topic of homeland security funding.
Proposed Legislation: None.
Background by assets within the state and geography. Of the amount received by Kansas, 20 percent The Legislative Coordinating Council is utilized by the State, with the remaining directed the Legislative Budget Committee to 80 percent passed-through for local use. study the expenditure of federal homeland security funds across all state agencies. This The local portion of the FFY 2006 topic was selected in response to a proposal funding was distributed 50 percent to to shift salaries and wages funding for counties with the remaining 50 percent several positions within the Adjutant divided among the seven regions. The General's Department and the Kansas intention of the FFY 2007 award is to Highway Patrol budgets to the State General distribute the entire local portion to the Fund. These positions are currently funded seven regions. The agency reported that this with federal homeland security funds. The approach was adopted because significant Committee also was directed to review the funding has already been provided to the projected federal homeland security funds counties to develop basic capabilities, that Kansas might receive in the near future. federal homeland security funding has significantly dropped, regionalization of homeland security activities has been encouraged by the federal government, and Committee Activities Kansas could not afford for each county to At the September meeting, the develop all necessary capabilities. Superintendent of the Kansas Highway Of the State’s 20 percent, the agency Patrol noted that homeland security funding for Kansas has dropped from about $28.0 reported an increased use of federal homeland security funding for salaries and million in 2004 to about $14.0 million in wages. The Kansas Highway Patrol, the 2006. He stated that the Kansas Highway Kansas State Fire Marshal, and the Adjutant Patrol administers the funds with the intent General’s Division of Emergency to use them as efficiently as possible. Management used funding from the FFY 2004, FFY 2005 and FFY 2006 grant awards The Homeland Security Operations for salaries and wages. About 35 percent of Commander of the Kansas Highway Patrol the FFY 2004 award was used to support provided information on the expenditure of state positions. About 70 percent of the FFY federal homeland security funds. The federal 2006 grant award was used for the same government began to provide homeland purpose. security funding to the state in 1999. For Federal Fiscal Year (FFY) 2006, the funding The Kansas Adjutant General presented allocation process became quasi-competitive information on the benefits of the based on need and risk. Risk is determined
Kansas Legislative Research Department 11-3 2006 Budget regionalization of homeland security developing and maintaining relationships capacity across the state. The state has seven among participating entities. The 13 regional coordinators around the state to identified investment priorities were also administer homeland security functions. He highlighted, with the focus currently to noted that regionalization encourages address food safety and defense, critical efficiency in preparedness by sharing food/water infrastructure, and plant health benefits for the amount of money spent, emergency response capabilities. increasing capabilities through regional assets, and sharing commitment for identifying solutions. Regionalization also Conclusions and Recommendations creates effective partnerships by developing a grassroots view of priority needs, creating T h e Committee makes no collaboration across disciplines, encouraging recommendation on the topic of homeland coordination among jurisdictions, and security funding. improving information exchange. The Adjutant General stressed the importance of
Kansas Legislative Research Department 11-4 2006 Budget Legislative Budget Committee
Kansas University Medical Center, Kansas University Hospital and Missouri-Based Hospitals
Conclusions and Recommendations
The Committee recommended continued dialogue between the University of Kansas School of Medicine and the University of Kansas Hospital, and that Kansas-based proposals for the Kansas City area be developed jointly bv the University of Kansas School of Medicine and the University of Kansas Hospital.
Proposed Legislation: None.
Background the region's only level one trauma center and burn center. The Chancellor noted that the The Legislative Coordinating Council University of Kansas School of Medicine tasked the Legislative Budget Committee receives $30.0 million in annual support with reviewing ongoing discussions of joint from the Hospital, for the most part from life sciences programs between Kansas fees paid for services provided by the University Medical Center, Kansas Medical Center to the Hospital. This level of University Hospital, and Missouri-Based support was not possible when the Hospital Health Systems. was first placed under the governance of the Authority.
Committee Activities The Chancellor noted that the Greater Kansas City Community Foundation and the During the December meeting of the Kauffman Foundation funded a study by a Legislative Budget Committee, Robert Blue Ribbon Task Force to assess higher Hemenway, Chancellor of the University of education in the Kansas City area. The Kansas, addressed the issue of proposed study, entitled “Time To Get It Right: A collaboration between the University of Strategy for Higher Education In Kansas Kansas School of Medicine and the City” concluded that the area had the potential to become a life sciences center in University of Kansas Hospital. He gave a the country . He explained that discussions brief history of the relationship between the had started in June with region’s life science School of Medicine and the University of leaders about how additional education and Kansas Hospital, which was split from the research partnerships might help the Kansas School of Medicine in 1998 when it was City area achieve this goal. He pointed out placed under the University of Kansas that leadership at the Hospital and Medical Hospital Authority by 1998 SB 373. Center are committed to building for the future, which includes the School of The Chancellor noted the success of the Medicine becoming a top-tier research University of Kansas Hospital under the institution. Among the other goals he Authority. The Hospital has over 3,550 expressed for the future were the following: employees, 465 staffed beds, and 450 University of Kansas faculty physicians. In addition, the hospital has a new $77.0 million Center for Advanced Heart Care and
Kansas Legislative Research Department 11-5 2006 Budget • The University of Kansas Hospital as a behalf of the University of Kansas Hospital competitively strong, clinically excellent Authority. He first noted that the statutory and accessible institution. mission of the University of Kansas Hospital is to operate a teaching hospital for the • A partnership between the two benefit of the University of Kansas Medical institutions that will enable the cancer Center, to provide high quality patient care, center to achieve National Cancer and to provide a site for medical and Institute (NCI) designation. biomedical research. He then provided details regarding the success of the Hospital • The main goal of the health of Kansans since it was placed under the authority, will not be compromised. including:
• Increased in-patient utilization; The Chancellor did make it clear that there are several things that will not occur as • A shifting payer mix with more insured the Medical School and the Hospital strive patients and fewer Medicaid and self-pay to achieve these goals. The Medical School patients; will not support: • Increased service to the indigent as • Partnerships or affiliations that would be evidenced by increased uncompensated detrimental to the future of the KU care; Hospital or the patients it serves; • Increased employee satisfaction; • Affiliations that transfer Kansas taxpayer dollars to directly benefit Missouri-based • Reduced employee turnover; and institutions; • Increased patient satisfaction. • Affiliations that reduce the number of resident physicians from the School of Medicine serving in the KU Hospital; or Senator Kerr then noted the financial stability of the Hospital, pointing to the • Affiliations that would compromise the increase in the operating margin (the School of Medicine’s commitment to difference between revenues and train doctors for Kansas or to serve expenditures) from $4.3 million in FY 1996 indigent Kansans. to $48.1 million in FY 2006. In addition, he noted the increased capital investment by the Hospital, which increased from $33.0 He noted that the School of Medicine is million in years 1993 through 1998 to $297.0 committed to support only affiliations which million in the years 2004 through 2007. advance the vison of creating and sustaining This stability has allowed the Hospital to new levels of excellence in the University of open a new $77.0 million Center for Kansas School of Medicine and thereby Advanced Heart Care in October of 2006 and contributing to improving the health of the invest $74.1 million in cancer research from state and region. In addition, any affiliation 2000 to 2007, with the anticipated opening proposal will be fully vetted and shared with of an outpatient cancer center in the area in the Hospital Authority board prior to 2007. adoption and that faculty will be consulted and informed about any proposal. Senator Kerr noted that investment in the University of Kansas has increased as The Committee then heard testimony well, growing from $6.9 million in FY 1999 from former state Senator Dave Kerr, on to a budgeted $30.0 million in FY 2007. The
Kansas Legislative Research Department 11-6 2006 Budget Hospital has proposed to provide an Conclusions and Recommendations additional $400.0 million to the School of Medicine over the next 10 years to achieve The Committee recommended continued the goals set forth by the Greater Kansas City dialogue between the institutions, and that Community Foundation Blue Ribbon Task proposals from the Kansas side be developed Force report. jointly by the University of Kansas School of Medicine and the University of Kansas Hospital.
Kansas Legislative Research Department 11-7 2006 Budget Legislative Budget Committee
Impaired Provider Program
Conclusions and Recommendations
The Committee reviewed the issue and took no action.
Proposed Legislation: None.
Background Optometry. The programs provide monitoring and referral to treatment. The Legislative Coordinating Council Licensees who are referred to an Impaired directed the Legislative Budget Committee to Provider Program will still need to pay for review Impaired Provider Services offered their treatment costs and drug screens. by various regulatory hoards. Also, to review the outcomes associated with the The Board of Pharmacy contracts impaired provider services, the number of through the Kansas Pharmacists Association, individuals served, and the costs for who subcontracts with the Heart of America providing these services. Professional Network. A set price for this program has been budgeted at $30,000 per year for ten years through FY 2006. However, this fee was increased to $35,000 Committee Activities in the budget approved by the Legislature for Staff provided background information FY 2007. A representative of the Board of on the various Impaired Provider Programs. Pharmacy noted that most persons using the KSA 65-4924 (2005 Supp.) provides that program have drug abuse problems. It also upon a report or complaint related to "... a was discussed that the Program does not health care provider's inability to practice include pharmacy technicians. It was the provider's profession with reasonable further noted that many technicians would skill and safety due to physical or mental not be able to afford the treatment costs for disabilities, including deterioration through dependency issues since many technicians the aging process, loss of motor skills, or are working at a low wage. Most technicians abuse of drugs or alcohol, the agency may would lose their license because they would refer the matter to an impaired provider not be able to enter into any kind of committee of the appropriate state or county treatment program. professional society or organization." This statute further grants the authority for the The Dental Board budgeted $10,000 for licensing agency to contract with the its Impaired Provider Program in FY 2006, relevant professional association to and spent $8,387. Eight licensees used the undertake those functions and to pay for program in FY 2006. The Dental Board such services, including contracting with contracts through the Kansas Dental providers of treatment programs. The Association (KDA) to administer the following regulatory boards offer Impaired Program, and the KDA in turn contracts for Provider Programs: the Kansas Board of services through the Heart of America Pharmacy, the Kansas Dental Board, the Professional Network. A representative of Kansas Board of Healing Arts, the Kansas the Dental Board testified that more money Board of Nursing, and the Kansas Board of for the program had been requested for FY
Kansas Legislative Research Department 11-8 2006 Budget 2007 because it was anticipated that more provider program. The Board of Optometry persons would be using the program. contracts through the Kansas Optometeric Association, who then contracts with the The Board of Healing Arts contracts for Heart of America Professional Network. No each group of licensees separately through licensees used the program in FY 2006. For each professional association. The FY 2002 through FY 2005, one licensee per professional associations either administer year used the program. A representative of their program, contract through the Heart of the Board of Optometry noted that in the America Professional Network, or contract past five years, most persons in the program with the Kansas Medical Society Medical have been self reported. It also was noted Advocacy Program. For FY 2006, the Board that there is a comfort level for licensees to of Healing Arts budgeted $241,220 for the self report to the Optometeric Association, Impaired Provider Programs and actual rather than the Board. expenditures were $240,884 to serve 148 licensees. A representative of the Board of The Board of Nursing spent $104,501 Healing Arts noted that the Board now during FY 2006 and 238 licensees utilized regulates three new professions (athletic the program. A representative of the Board trainers, naturopathic doctors, and of Nursing noted that over the last five years radiologic technologists), hut statutory the number of individuals in the program language does not allow the Board to has increased by 100, largely due to drug contract for impaired provider programs for and alcohol problems. these licensees. It was noted that 8.5 percent of the budget for the Board of Healing Arts goes toward Impaired Provider Programs. Conclusions and Recommendations
The Board of Optometry budgeted and The Committee reviewed the issue and spent $900 for FY 2006 for its impaired took no action.
Kansas Legislative Research Department 11-9 2006 Budget Legislative Budget Committee
Colorado Water Litigation
Conclusions and Recommendations
The Legislative Budget Committee recommends that the Attorney General’s Office present to the Senate Ways and Means and House Appropriations Committees prior to February 1, 2007, an update on the Colorado Water Litigation and Nebraska’s potential noncompliance with the Republican River Compact.
Proposed Legislation: None.
Background The purpose of the Arkansas River Compact is to resolve water disputes Scope of Study. The Legislative between Kansas and Colorado, to divide the Coordinating Council (LCC) initially charged waters of the Arkansas River between the the Legislative Budget Committee to review states equitably, and to apportion water the current status of the Colorado water conservation benefits arising from the litigation case and to review how the operation of the John Martin Reservoir settlement proceeds from Colorado are being Project. During the late 1970s and early expended and will be expended in the 1980s, Kansas became increasingly future. dissatisfied with the Compact, partly because of specific decisions made by the Arkansas River Compact. The Compact commissioners and because the headwaters of the Arkansas River are located commission often was hindered by the in the Rocky Mountains above Leadville, requirement that all of its decisions had to Colorado, and supports agricultural be unanimous. endeavors in eastern Colorado before flowing into Kansas. Kansas has long Current Colorado Litigation. In 1983, contended that agricultural demands for the Legislature made its first appropriation irrigation in Colorado depleted water coming to the Attorney General for its staff to into Kansas to the extent that irreparable investigate and prepare litigation against injury had been done, particularly to the Colorado regarding interstate water rights. agricultural interests in the western part of The litigation began in the 1980s has Kansas. The State of Kansas and Kansas extended over two decades. The lawsuit ditch companies (holders of water rights) originally asked the United States Supreme brought suit against Colorado that was heard Court to require that the waters of the before the United States Supreme Court Arkansas River be delivered in accordance several times. In the first half of the last with the provisions of the Arkansas River century two actions brought before the Compact. In 1987, the Court ruled that United States Supreme Court were resolved monetary damages could be recovered in in Colorado’s favor. The two states formed water compact enforcement cases and the Arkansas River Compact in 1948 in an Kansas’ motion was amended to seek effort to resolve ongoing disputes over water, monetary damages. In 1995, the Court particularly after the federal construction of found that Colorado diverted water that the John Martin Reservoir in Colorado in should have gone to Kansas and had violated 1946. the Arkansas River Compact. In 2001, the
Kansas Legislative Research Department 11-10 2006 Budget Court ordered Colorado to pay Kansas for Court. It is expected that the Court will not damages and prejudgment interest. In April release active jurisdiction until it is satisfied 2005, Colorado paid Kansas $34,615,146. Of that Colorado is in compliance with the that amount, $722,108 was used to pay Compact and a process is in place to attorneys who represented the State for work evaluate and monitor compliance for each they already had done, $19,366,401 was succeeding ten-year "running" compliance transferred to the Interstate Water Litigation period, such as 1998 to 2007. Account of the State General Fund, $9,684,425 was transferred to the Water How Colorado Water Conservation Projects Fund, and $4,842,212 Money Is To Be Used was transferred to the Water Conservation Project Reserve Account of the State Water Legislation enacted in 1996 (KSA Plan Fund. The 2005 Legislature placed 82a-1801) specifies how money recovered restrictions on expenditures from these three from Colorado is to be spent. Under that law, accounts so that no expenditure can be an amount equal to the amount spent on the made except by specific appropriation acts litigation (both money appropriated by the of the Legislature. The 2005 Legislature also Legislature and money spent by ditch appropriated $112,500 from the State companies) is to be credited to the Interstate General Fund to repay ditch irrigation Water Litigation Fund under the jurisdiction companies and individuals who contributed of the Attorney General. Money in the Fund in the early 1980s to initial water litigation is to be used to reimburse the ditch costs involving the dispute between Kansas companies ($112,500) and to pay for: and Colorado regarding the Arkansas River Compact. • Preparation for or actual water litigation with another state, the federal The Attorney General announced in June government, or an Indian nation; 2006 than an additional $1.1 million had been collected from Colorado, representing • Monitoring or enforcing compliance with costs associated with various experts an interstate water compact or water retained by the Attorney General to support settlement; and Kansas’ claims that Presumptive Evapotransporation (PET) values required an • Ongoing expenses connected with increase in replacement water flows due Colorado litigation and expenses of Kansas. Kansas agencies to monitor the settlement, including expenses of a River The United States Supreme Court retains Master or other official appointed by the jurisdiction in the case and probably will for United States Supreme Court. several more years. The next phase will be the issuance of a Decree by the Court specifying the data, computer modeling, and Any money recovered from Colorado in engineering analyses necessary to maintain excess of amounts spent on the litigation compliance in the future with the Compact. with Colorado would be allocated as follows: The Special Master will review the results from the Hydrologic-Institutions (H-I) Model • One-third would go to the State Water for the first ten-year accounting period of Plan Fund for water conservation 1997 to 2006 to determine whether Colorado projects; and has come into compliance with the Compact. Because the model has to be • Two-thirds would go to the Water updated annually with new data and Conservation Projects Fund for projects analyzed, it could be several more years in the Upper Arkansas River Basin before that information is presented to the affected by the Arkansas River Compact.
Kansas Legislative Research Department 11-11 2006 Budget Where the Colorado Money Went The 2006 Legislature approved the Attorney General’s request to transfer When Kansas received $34.6 million $560,000 from the Interstate Water Litigation from Colorado in April 2005, the 2005 account of the State General Fund (the "lock Legislature was nearing adjournment of the box") to the Interstate Water Litigation Fund regular session and faced a low State for ongoing water litigation activities General Fund balance. Notwithstanding the involving Colorado. provisions of KSA 82a-1801 which sets forth how Colorado water money is to be used, the In addition, the Attorney General Legislature transferred money which had announced that of the $1.1 million collected been credited to the Attorney General’s in June 2006, two-thirds would go to the Interstate Water Litigation Fund to a Water Project Conservation Projects Fund newly-created account in the State General and one-third to the State Water Plan Fund. Fund to shore up ending balances for FY 2005. Further, the Legislature placed The following table reflects State General restrictions on the expenditure of this money Fund expenditures for costs related to the so that, effectively, it was put in a "lock box" Colorado water litigation: and could not be spent unless specifically authorized by the Legislature. The Colorado Fiscal Year Amount litigation money was apportioned as follows: Kansas received $34,615,146 from Colorado, 1984 $ 96,032 which was credited to the Attorney General’s 1985 70,424 Interstate Water Litigation Fund. Using KSA 1986 281,324 82a-1801 as a guide, an amount equal to the 1987 651,449 total appropriation from the State General 1988 511,045 Fund for Colorado water litigation over the 1989 746,490 years ($20,173,363) was earmarked to be 1990 1,655,812 transferred to the Interstate Water Litigation 1991 3,213,075 Reserve Account of the State General Fund. 1992 1,313,943 Prior to that transfer taking place, the 1993 655,060 Attorney General was authorized to pay 1994 354,457 $722,108 to attorneys who had represented 1995 506,250 the state in the litigation for work they had 1996 1,042,688 already done. Payment of this amount 1997 921,800 owed, plus the fact that revenues from 1998 730,715 Colorado had been slightly overestimated, 1999 950,215 resulted in the final transfer from the 2000 1,523,871 Interstate Water Litigation Fund to the State 2001 878,172 General Fund account being $19,366,401. 2002 815,120 Of the remaining money from Colorado, 2003 939,835 $9,684,425 was transferred to the Water 2004 695,308 Conservation Projects Fund and $4,842,212 2005 514,208 was transferred to the Water Conservation 2006 (Approved) 929,000 Project Reserve Account of the State Water 2007 (Approved)* 0 Plan Fund. These transfers were made TOTAL $ 19,996,293 pursuant to KSA 82a-1801. However, the 2005 Legislature also placed restrictions on expenditures of these monies so that no expenditure can be made except by specific appropriation acts of the Legislature.
Kansas Legislative Research Department 11-12 2006 Budget The 2006 Legislature approved the and monitoring issues. In June 2006, the Attorney General’s request to transfer final decree, along with briefs on the $560,000 from the Interstate Water remaining disagreements between the states, Litigation account of the State General was submitted to the Special Master. In Fund to the Interstate Water Litigation August 2006, the United States submitted its Fund for ongoing water litigation comments on the final draft decree. In the activities involving Colorado. As such, next few months, the Special Master will it is not considered a State General recommend the U.S. Supreme Court adopt a Fund expenditure for FY 2007. decree.
Responsibility to monitor Colorado’s Committee Activities water use and compliance with the Compact will shift from outside litigation The Committee began its review of the experts funded by the Attorney General to Colorado water litigation topic by hearing KDA staff and contract experts. These fiscal from staff with an overview of the Kansas v. needs are reflected in the budget Colorado litigation. A Deputy Attorney enhancement request for interstate water General, from the Office of Attorney General, issues for FY 2007. For FY 2008, KDA then presented to the Committee that requests continued funding for additional regarding Kansas v. Nebraska, Nebraska is staff and outside expert contracts. As falling short of it of its obligation by Colorado continues to develop its water approximately 80,000 acre feet. In April resources, Kansas must monitor and 2007, there will be 10 years of data and will evaluate Colorado’s activities to ensure that see if use rules have been followed by Kansas’ compact rights are not violated. Nebraska. The deputy then outlined what appropriations the Office of the Attorney KDA anticipates initiating additional General will require for FY 2007 and FY efforts to address Nebraska’s and Colorado’s 2008 for the Kansas v. Nebraska litigation. potential noncompliance with the The costs for litigation are approximately Republican River Compact settlement. $1,010,000 and $100,000 for the cost of Nebraska and Colorado could be about arbitrators for a total cost of $1,110,000. For 233,000 acre feet over their allocations for continued litigation costs for Kansas v. 2003 through 2007. The alternative dispute Colorado, an estimated $410,000 for the cost resolution provisions of the settlement may of litigation and $100,000 for the Special need to be involved, and litigation may need Master for a total cost of $510,000 for the to be filed in the U.S. Supreme Court to Kansas v. Colorado expenses. enforce the final settlement stipulation and decree. The Chief Engineer, Division of Water Resources, Kansas Department of The Chief Fiscal Officer of the Kansas Agriculture (KDA) also presented an update Water Office (KWO), provided an update on Kansas v. Colorado. Kansas and Colorado regarding the status of monies received from have worked since March 2005 to draft a the State of Colorado for violations to the final decree and complete the Hydrologic Arkansas River Compact. Of the $9.6 Institutions model update, which will be million received in the Water Conservation used to determine if Colorado is complying Project Fund (WCPF), the 2006 Legislature with the compact. The first 10-year appropriated $193,036 for reimbursement to compliance period for Colorado will be 1997 ditch irrigation companies required by the through 2006. Completing and updating the Division of Water Resources; $552,000 for Hydrologic Institutions model through 2004 engineering feasibility studies; $100,000 to require KDA to solve many technical hire temporary staff to oversee the feasibility modeling issues and related data collection study and project implementation; and $2.5
Kansas Legislative Research Department 11-13 2006 Budget million for a project to reduce leakage by The Executive Director of the State lining the southside ditch and developing a Conservation Commission (SCC) presented southside canal alternative delivery system. information on the Water Transition The KWO is requesting a FY 2007 Assistance Program (WTAP) which is to supplemental appropriation for work in-conjunction with State Water reimbursement to Groundwater Planning efforts to reduce consumptive use Management District #3 for $29,448 for the of groundwater in Kansas. SCC funding Upper Arkansas River Conservation Project requests for FY 2008 include $120,000 from Reconnaissance Study. The KWO also the SCPF to plug wells in CREP and $1.5 proposes additional funding from WCPF of million for WTAP. $3.2 million in FY 2008 and $3.8 million in FY 2009 for the construction of projects deemed feasible. Conclusions and Recommendations
Of the $4.8 million deposited into the The Legislative Budget Committee Water Conservation Project Reserve Account recommends that the Attorney General’s of the State Water Plan Fund, the 2006 Office present to the Senate Ways and Legislature appropriated $4.0 million for a Means and House Appropriations
Conservation Reserve Enhancement Program Committees prior to February 1 , 2007, an (CREP) and $786,268 for Irrigation Water update on the Colorado Water Litigation and Use reduction. Nebraska’s potential noncompliance with the Republican River Compact.
Kansas Legislative Research Department 11-14 2006 Budget Legislative Budget Committee
Public Mental Health System
Conclusions and Recommendations
1 he Committee recommends that the Senate Ways and Means and House Appropriations Committees have additional hearings on issues identified relating to persons with a dual diagnosis of developmental disabilities and mental health concerns who demonstrate challenging behaviors in community settings of a nature that puts themselves and others at risk of harm.
The Committee requests:
• That the Department of Social and Rehabilitation Services (SRS) be prepared to provide testimony on the nature of the challenging behavior issues presented to the Committee and the following options be considered:
o Supplemental funding be added to the SRS budget for FY 2007 (amount to be identified by SRS and legislative staff) to support the opening of one 30 bed inpatient unit at Osawatomie State Hospital within the existing and available physical plant with funding added to continue this unit in FY 2008.
o Supplemental funding be added to the SRS budget for FY 2008 (amount would need to be identified by SRS and legislative staff) to allow SRS to enter into contractual arrangements with local hospitals who have the capacity to provide acute care inpatient services with funding added to continue these contracts in FY 2008.
o SRS and mental health stakeholders shall work together to define what the future role of the State Mental Health Hospitals (SMHH) is going to be; to determine what the appropriate number of inpatient beds that is necessary to meet the needs of the citizens of Kansas based on the State’s current population and respective population growth projections (either SMHH beds or a combination of SMHH beds and local acute care inpatient resources); and to propose a plan as part of the agency’s budget hearings in 2007 to the Ways and Means and Appropriations Committees that would support the needs identified in the plan.
• Hearings should be held in the appropriate Legislative committees regarding the liability insurability of community service providers serving persons who have demonstrated behaviors which pose a risk to the safety of those who serve them, those who are served in the same setting, and the community at large, and that such remedies and protections include an examination of State/Community shared liability, including tort claims protections for community service providers.
Proposed Legislation: None.______
Kansas Legislative Research Department 11-15 2006 Budget Background Increased Admissions and Capacity at State Mental Health Hospitals The Legislative Coordinating Committee assigned the Legislative Budget Committee Census and capacity issues at state responsibility to study the public mental hospitals were the centerpiece of a health system. Specifically, the Committee discussion about the capacity of the mental was charged with reviewing the history of health system in general. the system since Mental Health Reform was passed in 1991 and the need for a process to The SRS Secretary provided the be in place to address census issues at the Committee with information about state hospitals. In addition, the Committee admissions to the state’s three mental health was to look at the adequacy of using hospitals and the efforts underway to Diagnostically Related Group methodology manage the census. Admissions have to reimburse community hospitals for increased over the last several years, psychiatric stays. especially in the Osawatomie State Hospital catchment area. The increased admissions have forced hospitals to manage the hospital Committee Activities census within the resources available.
At the October meeting, the Committee The testimony focused on the systemic spent a day hearing testimony from efforts to work with the entire mental health twenty-five conferees on the public mental system to reduce lengths of stay and health system in Kansas. Conferees facilitate discharges. The efforts have represented state agencies, Community included the use of a protocol to manage Mental Health Centers (CMHCs), census which was developed in professional associations, hospital systems, collaboration with the CMHC system. In county attorneys, private mental health addition, the Secretary indicated that the practitioners, the Governor’s Mental Health hospitals have been reviewing treatment Services Planning Council, consumers, and methods and practices to ensure patients are other advocacy organizations. as stabilized as possible before re-entering the community to prevent readmission. To begin the meeting, staff presented Finally, the Secretary reviewed the ongoing information on the history of mental health discussions and ideas occurring between services, including Mental Health Reform in SRS and the CMHCs to address the census 1990; a description of the mental health when it reaches certain levels. system, including institutional and community based services; and past closure There was general agreement among discussions. conferees that there are currently too few inpatient beds, not just at state hospitals, to Key topics discussed by conferees accommodate the needs of Kansans with included: mental illness. Conferees agreed that the state hospitals must be fully supported and • census and capacity issues at state emphasized their critical part in the mental hospitals; health system. However, one conferee • the continuum of services in the cautioned that hospitals should not be community; managed based on census but on clinical • plans for the future; and and social patient outcomes. • payments to community hospitals.
Kansas Legislative Research Department 11-16 2006 Budget A number of conferees provided reasons Suggestions to address the shortage of why the apparent shortage of inpatient beds inpatient beds included adding state hospital exists and rising admissions to the state beds, regionalized inpatient services with hospitals. These suggestions were: day hospitals: and better utilization of community hospitals for acute care with • Excessive closures during adequate reimbursement. deinstitutionalization under Mental Health Reform. With regard to state hospital beds, one conferee requested funding for creating one • A dramatic decrease in private hospital bed per 100 target population patients which beds. According to testimony private would increase state hospital beds from 340 psychiatric beds decreased by 84 between to 450. Before Mental Health Reform, the 2003 and 2004. Nationally, the ratio was one per 14 and now it is one per Department of Health and Human 132 target population patients. Services estimates a 53 percent decline in inpatient psychiatric beds between 1992 Continuum of Services and 2002. Another major topic of discussion, • Inadequate public-private hospital intertwined with the discussion of state collaboration and inadequate hospital admissions, was the continuum of reimbursement for community hospital services that must be available to provide services. services to Kansans with mental illness.
• Insufficiency of drug and alcohol One conferee noted that despite advances treatment facilities requiring people to go in medications, inpatient beds are still to state mental health hospitals for needed for some patients. treatment. According to testimony, over 65 percent of admissions at Larned State A number of conferees suggested that an Hospital have multiple issues with intermediate level of care was needed substance abuse and dependence. between community services and state hospital care. • There are more individuals with more intense needs who may need A conferee testified the role of state hospitalization. Between 1990 and 2005 hospitals has not changed since Mental the state population increased by 10.6 Health Reform but there have been changes percent with most of the growth in the in the population needing services. As a eastern half. Given prevalence data for result, there is a need to have a long range serious mental illness and severe plan using input from all stakeholders, emotional disturbance (SED), the number regarding the role of state hospitals in the of people in Kansas with serious mental continuum of care. illness grew from 55,746 to 61,755, and children with SED grew from 31,099 to Several conferees discussed the need to 24,308. According to the Association of have a three-tier structure, like the physical Community Mental Health Centers, 50 health system, for services. One structure percent of all admissions to crisis services that was presented is: and state mental health hospitals are new to the Kansas mental health system. • Primary care provided by a CMHC or Additionally, according to national other community provider statistics there is an increased incidence of severe psychiatric disorders. • Intermediate care provided in a residential or inpatient community
Kansas Legislative Research Department 11-17 2006 Budget setting. The conferees indicated there parents of children with mental illness currently is not enough access to this testified about services they receive and type of care. More of this service would importance of continuing funding. take pressure off of state hospitals, according to the conferees. Adequacy of Payments to Private and Community Hospitals • Tertiary care provided in a secure hospital with specialized treatment The Committee heard testimony programs and personnel to treat the most regarding the adequacy of the Diagnostically difficult disorders. This is the role our Related Groups (DRG) methodology for SMHH should serve. Currently, they reimbursing hospitals for the treatment of serve as more of intermediate care mentally ill patients. Of particular concern, facilities with a focus on limiting length was the treatment of patients who are of stay and not getting maximum benefit involuntarily committed to treatment. for the patient. Information was received by the 2006 Legislature that a major provider of these A portion the testimony focused on the services, Via Christi Health System, was gap that exists for caring for the violent considering discontinuing the provision of mentally ill in the community. The inpatient mental health services due to conferees, including a service provider and financial concerns. The discontinuation of county attorney, expressed the need for these services is of particular concern secure intermediate care. The conferees told because of the significant impact it could the Committee about their local experiences have on the admissions to state hospitals. in trying to deal with people who need a Via Christi operates 100 (36 percent) of the more secure setting in the community. 275 non-state hospital beds for mental According to the testimony, there is not health services for adults and 74 (45 percent) currently a place for these people once they of the 164 beds for involuntary are released from the state hospital. commitments. If Via Christi stops service for involuntary patients it would mean an Several conferees commented on current additional 500-700 patients for state community mental health services and hospitals. As discussed in relation to barriers to the adequate provision of increasing admission at state hospitals, services. Services are not uniform across many other private hospitals have already the state according to the conferees. left the state and community hospitals have Particularly in more rural areas of the state, stopped providing inpatient mental health access to services can be a problem. care because providing services was not Constricted funding for non-medical services financially viable. that are not eligible for Medicaid funding put strains on CMHC budgets. Several Testimony was given that the Mental conferees noted the challenges encountered Health Task Force at the Kansas Hospital by CMHCs in providing services to Association, has concluded that the DRG uninsured persons who are not part of the methodology is a reasonable payment target population. According to the mechanism. The problem lies in how the testimony nearly two-thirds of CMHC state has implemented the payment system. patient load falls into this category. Other According to the testimony, the State conferees discussed the need to address Medicaid agency decided a few years ago to choice by expanding the network of pay DRG or hospital charges, whichever was providers. Finally, several consumers and less. The conferee indicated that this violates the concept of DRGs which is designed to pay for the average cost per
Kansas Legislative Research Department 11-18 2006 Budget patient. Under that system, the hospital gets Representatives of the Governor’s Mental a benefit if patients stay shorter than average Health Services Planning Council times and loses if the patient stays longer (GMHSPC) and its subcommittees addressed with the idea that it will balance out on the Committee about the role of the council. average. Under the current payment system, hospitals get paid for lengths of stay which The GMHSPC has eight subcommittees are under the average (based on charges) but to address specific areas of mental health are not compensated for those who stay services. The subcommittees are: aging, longer than the average. The problem is children, forensics, housing and exacerbated with involuntary patients who homelessness, supported employment and are generally much sicker, require more vocational, service delivery, suicide resources to treat, have a high potential for prevention, and transformation. Each violence, take longer to stabilize and require subcommittee has a work plan including additional processes because of the goals, action steps or recommendations, involvement of the legal system. The progress and target date for completion. Committee wras informed that Via Christi is currently in discussion with the Kansas The President’s New Freedom Health Policy Authority. Commission report called for transformation of the nation’s mental health system and Action has been taken to increase some made six recommendations. In Kansas, the rates paid to hospitals for inpatient mental transformation subcommittee has health treatment. Testimony indicated that coordinated with the other subcommittees to the provider assessment passed by the study the recommendations and determine Legislature in 2004 includes a 30 percent where we are and what the desired future is increase in DRG rates and that rates for for Kansas. According to testimony, the two observation and stabilization rates were main themes are to: promote public increased by $300 per day and covers up to awareness to maximize wellness and two days of services. resources; and assure consumer/family driven process in design, delivery and Conferees told the Committee that evaluation. During the testimony, conferees although these payment issues are of expressed positive comments on the role of concern, perhaps the biggest payment issue SRS in supporting stakeholder planning. facing hospitals is the percentage of psychiatric patients who are uninsured. The SRS Secretary updated the Rates of uninsurance among mental health Committee on the Medicaid state plan patients ranged from 10 to 23 percent amendment and waiver that were submitted compared to 6 percent uninsured in the in June 2006. According to the Secretary, general hospital population. the changes were required to avoid further negative actions from the Federal Centers for Planning for the Future Medicare and Medicaid Services (CMS) who had determined that portions of the Another area of discussion at the approved Kansas Medicaid State Plan were meeting was a discussion ol the need for a now out of compliance with their practice vision of a comprehensive system of services standards. The Secretary explained that the and a planning process for how to achieve submission was created as part of a that vision. In addition, SRS provided the collaborative and focused work group of staff Committee with a report on the Medicaid from SRS, the Kansas Health Policy state plan amendment and waiver Authority, and other Medicaid experts. The application submitted in June 2006. work was also based on stakeholder input and leadership from state agencies and the Legislature. The genesis of the workgroup
Kansas Legislative Research Department 11-19 2006 Budget was as a response to a 2006 Legislative homes and creating problems with timely proviso and an attempt to address a variety reintegration. Specifically, the conferee of issues about which CMS had expressed made recommendations for creating a single concern. shared outcome to address mental health needs of child welfare clients. Under this At the end of June, a comprehensive proposal, CMHCs and contractors would be package of proposals was submitted to CMS. held accountable to: The package included extensive amendment to the Kansas Medicaid state plan, an • a consistent definition of service application to amend the existing waiver for expectations for the child welfare vouth with Serious Emotional Disturbance, population; and an application for a selective services contracting waiver for all public mental • measurable outcomes shared across health and substance abuse services. The systems; Secretary explained the outreach activities undertaken by the agency subsequent to the • an external evaluation of waiver application to inform stakeholders appropriateness of services; and and prepare for implementation. The Committee was informed that CMS has fully • assurances that if a CMHC is unable approved the selective services contracting provide needed services that they will waiver to be effective July 1, 2007. Other partner with a local provider to see that amendments were still under consideration the family received timely services. by CMS.
Representatives from the Kansas chapter The Committee was urged to continue of the National Association of Social support for a multi-disciplinary approach to Workers commented to the Committee that mental health services. Providers would the new federal amendments will allow include psychologists, marriage and family clinical social workers to become providers therapists, clinical social workers and of Medicaid mental health services if they professional counselors in addition to other associate with a CMHC which expands the current providers. Specifically, the conferee pool of providers. Previously, clinical social requested the Committee’s attention to workers were not allowed to be Medicaid updating four older statutes which providers. compromise this multi-disciplinary approach and create inefficiencies. These Other Topics provision may prevent citizens, employers and courts from utilizing the full range of Conferees discussed a number of other professionals in mental health and child topics with the Committee including the welfare. Statutes to be amended include: relationship of child welfare services; the need for a multi-disciplinary approach; • KSA 38-1583 which limit testimony in mental health needs of the incarcerated parental rights termination to population; and the problem of the physicians, licensed psychologist or uninsured licensed social worker.
The Committee was presented with • KSA 59-2132 which limits adoption information about the need to have better home studies to licensed social workers. integration of child welfare and mental health services. The lack of available mental health services has been cited as a reason for removing children from their
Kansas Legislative Research Department 11-20 2006 Budget • KSA 40-2,104 and 40-2,114 which The Committee requests: require specified insurance companies reimburse licensed psychologists and • That the Department of Social and licensed specialist social workers Rehabilitation Services (SRS) be prepared to provide testimony on the nature of the challenging behavior issues The need to address increasing demand presented to the Committee and the for mental health services in jails and following options be considered: prisons was also presented to the Committee. According to testimony, the o Supplemental funding be added to National Mental Health Association the SRS budget for FY 2007 (amount estimates that 40 percent of individuals who to be identified by SRS and come in contact with corrections, whether legislative staff] to support the adult or juvenile, have a mental illness. The opening of one 30 bed inpatient unit testimony also included examples of local at Osawatomie State Hospital within initiatives to address the issue. the existing and available physical plant with funding added to continue The growing number of uninsured was this unit in FY 2008. discussed as an issue by several conferees. The uninsured population puts a strain on o Supplemental funding be added to CMHCs and community hospitals who must the SRS budget for FY 2008 (amount provide services. The Association of would need to be identified by SRS Community Mental Health Centers and legislative staff) to allow SRS to conducted a survey to determine the cost to enter into contractual arrangements the system. The 17 CMHCs that responded, with local hospitals who have the including those from the large metropolitan capacity to provide acute care areas, estimated that they served about inpatient services with funding 22,166 individuals without health insurance added to continue these contracts in coverage in FY 2005 at a total cost of $17.8 FY 2008. million. According to the testimony, one factor is a growing number of employers o SRS and mental health stakeholders who have dropped health insurance for shall work together to define what employees or do not provide adequate the future role of the State Mental mental health coverage. The level of Health Hospitals (SMHH) is going to uninsurance was also cited by community be; to determine what the hospitals as a major problem with providing appropriate number of inpatient beds inpatient psychiatric services. that is necessary to meet the needs of the citizens of Kansas based on the State’s current population and Conclusions and Recommendations respective population growth projections (either SMHH beds or a The Committee recommends that the combination of SMHH beds and local Senate Ways and Means and House acute care inpatient resources); and Appropriations Committees have additional to propose a plan as part of the hearings on issues identified relating to agency’s budget hearings in 2007 to persons with a dual diagnosis of the Ways and Means and developmental disabilities and mental Appropriations Committees that health concerns who demonstrate would support the needs identified challenging behaviors in community settings in the plan. of a nature that puts themselves and others at risk of harm.
Kansas Legislative Research Department 2006 Budget • Hearings should be held in the served in the same setting, and the appropriate Legislative committees community at large, and that such regarding the liability insurability of remedies and protections include an community service providers serving examination of State/Community shared persons who have demonstrated liability, including tort claims behaviors which pose a risk to the safety protections for community service of those who serve them, those who are providers.
Kansas Legislative Research Department 11-22 2006 Budget Legislative Budget Committee
Deferred Maintenance
Conclusions and Recommendations
The Legislative Budget Committee recommends that a high priority be placed on passage of a five-year comprehensive program to address deferred maintenance at the state universities and community colleges.
Proposed Legislation: None.
Background Funding Need The Legislative Coordinating Council Institution in Millions directed the Legislative Budget Committee to review current deferred maintenance needs Kansas State Universitv $254.1 for the state Regent’s institutions, especially The University of Kansas 209.1 for needed life safety improvement. In The University of Kansas 75.6 addition, the Committee was asked to study Medical Center possible funding mechanisms to provide for Pittsburg State University 58.6 a long term program to address deferred Emporia State University 44.7 maintenance at the Regent’s institutions. Wichita State University 44.1 Fort Hays State University 40.9 TOTAL $727.1
Committee Activities
The Legislative Budget Committee heard President Robinson attributed the high testimony from Reginald Robinson, cost of deferred maintenance needs to a lack President and Chief Executive Officer of the of state funding, in the past, and the age of Kansas Board of Regents. He indicated that the buildings. He stated that 80.0 percent of $727.1 million would be required to bringall the university buildings are at least 20 years of the buildings at the state universities to old, and the average age of the buildings is 90.0 percent of perfect condition. It would 46 years. require $84.0 million annually to maintain the buildings in that condition. Deferred He explained that the Board of Regents maintenance at the universities includes requested a "down payment" from the unreliable electrical components, falling Governor of $175.0 to $200.0 million, stones from buildings, collapsing utility approximately 25.0 percent of the estimated tunnels, leaking roofs, deteriorated windows, total deferred maintenance needs, as part of and obsolete heating and air conditioning their budget appeal. The request was not included in their September budget systems. submission because the audit of the The following table provides the university facilities was not yet complete. break-down, by university, of the deferred President Robinson pointed out that maintenance funding needs: these repairs are necessary to the success of higher education in Kansas. He noted that
Kansas Legislative Research Department 11-23 2006 Budget state universities continue to experience interest in distributing any additional record enrollments, and that campus funding for deferred maintenance on the facilities often do not meet student needs. In basis of need, as long as no one institution addition, he noted that businesses consider would receive all of the funding. In the state’s higher education system when addition, the Committee requested a determining expansion or moving to Kansas. prioritized list of projects, with estimated costs, by university to identify the highest The Committee, after discussion of the priority needs. The Committee pointed out Regents’ study completed in the Fall of 2006, that they expect estimated costs, not costs as requested the Regents review the report and determined by a full architectural study. remove deferred maintenance projects which have already been completed or funded. President Robinson agreed to Conclusions and Recommendations review the report, and to provide building by building detail of the deferred maintenance The Legislative Budget Committee projects that need funding. recommends that a high priority be placed on passage of a five-year comprehensive Distribution of the deferred maintenance program to address deferred maintenance at dollars was also discussed. In the past, the state universities and community funds have been distributed to the colleges. universities on the basis of square footage. However, the Committee expressed an
Kansas Legislative Research Department 11-24 2006 Budget Legislative Budget Committee
Regional Economic Area Partnership (REAP)
Conclusions and Recommendations
The Committee recommends that there be greater transparency on the part of REAP in the future. Additionally, the Committee noted its concern that REAP had accepted proposals for such a short time frame when formulating the grants for FY 2007. The Committee noted that it was the intent of the Legislature to make this open to multiple entities and that more effort should be made in the future to advertize the request for proposals and that a longer amount of time be allowed to accept the proposals in the future.
Proposed Legislation: None.
Background Committee Activities
2006 House Substitute for Senate Bill During the December meeting of the 475 directs that “During the interim between Committee, a representative of the Regional regular sessions of the legislature, Economic Area Partnership (REAP) provided commencing with the 2006 legislative the Committee with an update on its actions interim period, the legislative budget to date concerning the Kansas Affordable committee shall study and review the Airfares Program. activities of the regional economic area partnership (REAP) under the program to The REAP representative indicated that provide more air flight options, more it has developed guidelines for competition for air travel and affordable air administering the program, which were fares for Kansas, including a regional airport provided to the Committee. These in western Kansas.” guidelines include selection procedures and criteria for award of funds. Additionally, 2006 Senate Sub. for HB 2968 made the following appropriation: “On The REAP representative indicated that July 1, 2006, or as soon thereafter as moneys only one proposal for the program was are available, the director of accounts and received, and that it was from Sedgwick reports shall transfer $5,000,000 from the County. The representative further noted state highway fund of the department of that the proposal included a guaranteed transportation to the state affordable airfare local match of $1.67 million. fund of the department of commerce: Provided, That, in addition to the other The representative noted that REAP purposes for which expenditures may be awarded a $5.0 million grant to Sedgwick made from the state highway fund during County in July 2006. Additionally, the fiscal year 2007 and, notwithstanding the REAP representative noted that upon receipt provisions of KSA 68-416 and amendments of proof of the local match, the Department thereto or any other statute, transfers may be of Commerce transferred $5.0 million to made from the state highway fund during REAP. As of December 8, 2006, REAP had fiscal year 2007 to the state affordable airfare made two payments to Sedgwick County, fund of the department of commerce.” totaling $3.34 million.
Kansas Legislative Research Department 11-25 2006 Budget A representative of the Department of in the future. Additionally, the Committee Commerce indicated that greater noted its concern that REAP had accepted transparency on the part of REAP would be proposals for such a short time frame when appropriate and that more effort should be formulating the grants for FY 2007. The made to advertize the request for proposal in Committee noted that it was the intent of the the future. Legislature to make this open to multiple entities and that more effort should be made in the future to advertize the request for Conclusions and Recommendations proposals and that a longer amount of time be allowed to accept the proposals in the The Committee recommends that there future. be greater transparency on the part of REAP
Kansas Legislative Research Department 11-26 2006 Budget Legislative Budget Committee
Public Developmental Disabilities System
Conclusions and Recommendations
1 he Legislative Budget Committee recommends that the Legislature establish a phased-in effort to accomplish the programmatically linked goals of community capacity expansion and the elimination of the waiting list for services from Home and Community Based Services waiver for persons with Developmental Disabilities (HCBS DD). This effort would consist of the following:
• Expand community capacity through rate adjustments to achieve rates which would more closely reflect a parity between community wages and state institutional wages by adding $15 million SGF in FY 2008 and $10 million SGF in FY 2009 and FY 2010: and
• Eliminate the waiting lists for developmental disability (DD) services by adding $10 million from the State General Fund in both FY 2008 and FY 2009, and $15 million in FY 2010.
Additionally, the Committee recommends that the Senate Ways and Means and House Appropriations Committees request information during the 2007 Legislative Session on items including but not limited to the following:
• To assure that all programs are designed to meet the intent of the DD Reform Act for greater emphasis on independence, inclusion, integration and productivity;
• To examine, and replicate if appropriate, models in other states which are better designed to assist families of dependent children, rather than relying solely on the current HCBS DD waiver;
• To establish minimum standards for all persons and entities who provide services to persons with DD;
• To assess current capacity planning at the Department of Social and Rehabilitation Services to upgrade the State’s ability to provide monitoring and oversight for the expanded numbers of community service providers; and
• To propose ways by which to upgrade employment related services for persons with DD, including providing the Legislature with a fiscal estimate on unbundling supported employment services so as to allow providers of such services to build employment service capacity in the community, and therefore be able to reduce reliance on facility-based employment services.
Proposed Legislation: None.______
Kansas Legislative Research Department 11-27 2006 Budget Background • Reduction of the waiting list for Medicaid Home and Community Based The Legislative Coordinating Council Services (HCBS) waiver services and directed the Legislative Budget Committee to expansion of community based services; study the state’s system for serving individuals with developmental disabilities. • Increased wages for direct care Specifically, the Committee was directed to professionals; review the updated Department of Social and Rehabilitation Services’ (SRS) strategic • Improved quality assurance and plan and quality assurance and monitoring; enhancement activities. In addition, the Committee was to examine current and • Focus on the vision set out in the proposed models to meet the demand for Developmental Disabilities (DD) Reform community based services. Act; and
• Service requirements for individuals Committee Activities with severe, and sometimes violent, behaviors. At the September meeting the Committee heard full-day testimony from nearly 20 conferees regarding the developmental The expansion of community based disabilities system. Conferees included services and the elimination of the waiting representatives of state agencies, consumer list for HCBS waiver services are underlying organizations, Community Developmental themes in nearly all of the testimony. Disability Organizations (CDDOs), However, cautions were expressed regarding Community Service Providers (CSPs), the need for capacity expansion, quality provider associations, and other advocacy oversight, funding and other measures to organizations. ensure the expansion is successful. Conferees commented that a quality system Staff presented an overview of the of services requires both access for developmental disabilities system to orient individuals needing services and service the Committee and lay the foundation for providers reimbursed at levels sufficient to testimony. Following the staff presentation, recruit and retain employees with the right SRS briefed the Committee on the number of skills and abilities. persons served, or waiting for services, and the impact the additional funding approved A number of conferees addressed issues by the 2006 Legislature is having on waiting with having adequate direct care lists. In addition, the agency presented professionals in the community. The most information on the Developmental common comment was regarding the salary Disabilities (DD) Strategic Plan, quality of direct care professionals, especially in assurance activities, targeted case relation to what staff at the state hospitals management services, and the Federal are paid. According to testimony, the Deficit Reduction Act. current state-wide average wage for direct care staff in the community is $8.83 per hour Although, many comments and while the beginning wage for a similar suggestions were made by conferees, position at a state hospital is $11.81 per testimony centered on the following primary hour. According to testimony, the estimated themes: cost to increase community based staff wages to $11.81 per hour is $35 million from • Closure of remaining state hospitals and the State General Fund. Several conferees private large bed facilities; commented on the amount of work required
Kansas Legislative Research Department 11-28 2006 Budget from direct care staff and the difficulty in adult independence, was a key in a number hiring, training and retaining qualified staff of presentations. Multiple conferees to provide around-the-clock services. commented on the need for timely transition of services when youth graduate from high The closure of the remaining two state school and move into adult services. hospitals and private facilities was discussed According to conferees, these services are by two conferees representing advocacy critical to moving people into the organizations. According to conferees, community and out of the family home institutional services are not the most where their adult independence may be economical wray to serve persons with hampered by overly paternalistic families. developmental disabilities. Additionally, Integral to this process and to the provision federal pressure is building to re-balance of better services during school age years, is funding in favor of community based better communication between SRS and the services. Conferees recommended that all Department of Education about program savings generated from closing institutions requirements and service coordination. be directed into the community to fully fund Another challenge to adult independence services. The suggestion also was made to noted by conferees was payments made to set a binding date for closure to facilitate the families to provide care. According to the process. Finally, one conferee suggested the testimony, paying family members to Committee review the report on the closure provide service may provide a disincentive of Winfield State Hospital and Training to those families to move the child out of the Center which reported that individuals home for fear of losing a source of income. moved into the community had better The result is a lack of independence for the outcomes than when they were in the now adult child to gain independence and hospital. integrate into the community.
Improving the system for quality Another piece of the adult independence assurance and monitoring was cited as a theme was testimony about the importance principal of providing quality community of Supported Employment and Supported services. Conferees indicated that the Living programs. Testimony was presented current system has not kept up with the that stressed the importance of these two expanding community system resulting in a types of services to ensuring adults were concern about whether people are receiving integrated into the community. Conferees the appropriate services and if state dollars requested additional support for these are being spent effectively. Conferees cited programs. the lack of new funding for quality monitoring, both at the state and local level, Challenges with dealing with despite increases in the numbers of developmentally disabled persons who have consumers, providers and service models. severe behavioral issues in the community In addition, one conferee commented on the were addressed by two service providers. reduction in day-to-day contact that SRS According to the testimony, service staff have to monitor the provision of providers have very little ability to reject services due to staffing reductions and clients whose behaviors pose dangers to staff reorganization. Conferees asked for or exceed the providers ability to serve the additional resources dedicated to the individual. The providers commented that, development of outcome measurements and particularly in light of the relatively low the establishment of minimum standards for wages, direct care staff were being put in all providers. harms way without sufficient recourse. It was suggested that the state needed to look A refocusing on the vision of the DD Reform Act, particularly with respect to
Kansas Legislative Research Department 11-29 2006 Budget at alternatives to deal with persons who wages by adding $15 million SGF in FY exhibit criminal, predatory, violent or other 2008 and $10 million SGF in FY 2009 and aggressive behaviors. FY 2 0 1 0 ;and
Other topics presented to the Committee • Eliminate the waiting lists for included the value of consumer developmental disability (DD) services by self-advocacy; gaps in services for children; adding $10 million from the State General and the need for Ombudsman services. Fund in both FY 2008 and FY 2009, and With regard to consumer self-advocacy, the $15 million in FY 2010. following three steps were given to ensure consumer rights: consumer participation in quality assurance; increased opportunities Additionally, the Committee recommends for choice and control of services; and that the Senate Ways and Means and House increased education and awareness of Appropriations Committees request service delivery options. In addition, more information during the 2007 Legislative financial support for statewide self-advocacy Session on items including but not limited training was requested. Gaps in services for to the following: young children were identified that results from a system designed to serve adults. • To assure that all programs are designed These gaps include: the lack of HCBS waiver to meet the intent of the DD Reform Act services for persons under age five; in-home for greater emphasis on independence, supports not designed to meet families’ inclusion, integration and productivity; needs; lack of billing system for mental health services; inflexible systems that do • To examine, and replicate if appropriate, not support community collaboration and models in other states which are better limited discretionary funds. Finally, one designed to assist families of dependent conferee noted the need for Ombudsman children, rather than relying solely on the services to support and educate persons with current HCBS DD waiver; developmental disabilities. • To establish minimum standards for all persons and entities who provide services Conclusions and Recommendations to persons with DD;
The Legislative Budget Committee • To assess current capacity planning at the recommends that the Legislature establish a Department of Social and Rehabilitation phased-in effort to accomplish the Services to upgrade the State’s ability to programmatically linked goals of community provide monitoring and oversight for the capacity expansion and the elimination of expanded numbers of community service the waiting list for services from Home and providers; and Community Based Services waiver for persons with Developmental Disabilities • To propose ways by which to upgrade (HCBS DD). This effort would consist of the employment related services for persons following: with DD, including providing the Legislature with a fiscal estimate on • Expand community capacity through rate unbundling supported employment adjustments to achieve rates which would services so as to allow providers of such more closely reflect a parity between services to build employment service community wages and state institutional capacity in the community, and therefore be able to reduce reliance on facility- based employment services.
Kansas Legislative Research Department 11-30 2006 Budget Legislative Budget Committee
State General Fund
Conclusions and Recommendations
After reviewing several items affecting the state budget, the Committee makes the following observations and conclusions:
• On the topic of tax collections, to increase compliance with sales tax laws, the Committee recommends amending the current sales tax law which would allow the Department of Revenue to revoke or suspend a retailer’s registration certificate if the retailer has not paid the tax due or filed a return for a period of 60 days. Any individual who continues to operate a business after the registration certificate has been suspended or revoked would be guilty of a Class A misdemeanor. The Committee recommends this be introduced as a bill in the Senate during the 2007 Session of the Legislature.
• Regarding the earnings limitation for retired nurses, the Committee recommends that the issue be addressed in the 2007 Legislative Session in the appropriate standing committees (Senate Ways and Means and House Appropriations). Items for the standing committees to consider include: allowing nurses that retire and work at state hospitals and veterans' homes to earn up to $20,000 annually, which would be the same as school teachers, or allowing the exemption scheduled to expire at the end of FY 2008 to be continued indefinitely.
• On the topic of the Kansas Aviation Research Initiative in Wichita, the Committee supports the aviation research done in Wichita and the renewal of ongoing support from the Legislature for the aviation industry research.
Proposed Legislation: The Committee recommends the introduction of one bill.
Background Medicaid audits and deferrals, an update on the implementation of 2006 HB 2105 or the The Legislative Budget Committee, as Abuse, Neglect and Exploitation (ANE) of provided by law (KSA 46-1208), can set its Persons Unit in the Attorney General's own agenda. The Committee conducted its Office, an update on increased tax usual monitoring of the State General Fund collections, and an update on the Aviation finances. Other topics that the Committee Research Initiative in Wichita. reviewed included the following: an overview of the state pay plan, a review of the earnings limitation for retired nurses, an Committee Activities update on the state vehicle replacement policy and usage, an update on the payment State Finances methodology for residential mental health services for youth, a report on the increased At each meeting, staff of the Legislative appropriation for the home and community Research Department presented a report based services waiver for persons with comparing estimated and actual receipts to physical disabilities, an update on current the State General Fund. In addition, staff
Kansas Legislative Research Department 11-31 2006 Budget also provided the Committee with the State Employee Pay Plan Study and to information on actual FY 2006 State General work with the Hay Consulting Group to Fund expenditures, the shifting of certain determine its interest and availability in State General Fund expenditures from FY assisting with the Pay Plan Study. Current 2006 to FY 2007, and updated State General plans are to have the Pay Plan Study ready Fund profiles. Staff also provided to present at the 2008 Legislative Session for information on the November 2006 caseload FY 2009. estimates for the Department of Social and Rehabilitation Services, the Health Policy The President of the Kansas Association Authority, the Department on Aging, and the of Public Employees extended the November 2006 State General Fund appreciation of their state employee Consensus Revenue Estimates. members who are in the classified service for the Legislature’s leadership for
State Pavm / Plan Review reinstating step-movement for career employees, offering wage adjustments for The Committee heard testimony from uniformed officers in the Department of representatives of the Kansas Department of Corrections, the Juvenile Justice Authority, Administration who presented an overview and Social and Rehabilitation Services, and of the State Employee Pay Plan. Information the 30-cents-per-hour increase to members was provided regarding the history of the of the trades. He requested the following compensation system in the past 20 years, items be included in the new pay plan operation of the pay plan, actions and system: reactions attributed to the current pay plan, the FY 2007 pay plan, and plans for the • Codify Step-Movement; future. • Retain the Longevity Pay Bonus; • Cost-of-Living Adjustment; It was noted that the University of • Reclassification of Positions; Kansas did opt out of the Civil Service • Reclassification of Employees; System pay plan and that legislation would • Professional Development Assessment; leave it open for the other Regents • Pay for Performance; and institutions to follow; so far that has not • Cost Savings Incentive. happened, but it is a possibility.
The Committee also heard testimony that Earnings Limitation for Retired Nurses the Kansas Legislative Research Department and the Office of the Revisor of Statutes have The Committee heard testimony from the been working with the Department of Planning and Research Officer for the Administration for a Pay Plan Study. The Kansas Public Employees Retirement System proposed scope statement should be (KPERS) who addressed the $15,000 completed by March 2007 and would be earnings limitation for retired nurses. The composed of two phases: conferee noted that the exemption is for nurses at the state mental health institutions, • Conduct salary surveys; and developmental disability institutions, and veterans' home and is in effect from July 1, • Evaluate a tentative new compensation 2005, through June 30, 2008, and: system. • Retirees must be off the institution’s payroll for 30 days before returning to The Legislative Coordinating Council, at work; a previous meeting, had directed the staff to prepare an outline of a scope statement for
Kansas Legislative Research Department 11-32 2006 Budget • Current employees must be eligible for necessary for residents including physical normal retirement (not early retirement) health care. According to the Secretary, to qualify for the exemption; and many options for restructuring the system were discussed by a group of stakeholders • Participating employers are required to but ultimately, it was concluded that the pay KPERS the actuarially-determined conversion to IMDs was the solution that employer contribution rate. would best meet the federal requirements and the needs of youth. The conversion to IMD status caused concern, particularly State Vehicle Replacement Policy and Usage among Level V facilities which would be required to make the most significant The Committee heard testimony from the changes. Secretary of Administration on the post- moratorium vehicle replacement policy. Documents were submitted to CMS in The new vehicle must replace a similar June to address the issues related to existing vehicle and the vehicle being residential services for youth and also replaced must have reached 100,000 miles address issues related to other mental health for cars and 140,000 miles for pick-up services. With regard to the residential trucks. treatment issue, the submitted proposal added Private Psychiatric Residential Residential Mental Health Sendees for Youth Treatment Facility (PRTF) services to the state plan to provide these services. At the August meeting, the Committee According to the agency, the use of the PRTF was briefed on recent activities relating to has the advantages of continuing federal residential mental health services for youth, financial participation, using cost-based sometimes called Level V and VI services. reimbursement; and providing services that are structured to meet the needs of youth. The Secretary of Social and Rehabilitation Services (SRS) provided Operational details of the reimbursement testimony regarding actions taken to address methodology are still in development. issues raised by the federal Centers for Important considerations will include the Medicare and Medicaid Services (CMS) management of medical or physical health regarding mental health services provided in care costs to not put providers at-risk and residential settings. This issue was recognize increased costs associated with discussed at length during the 2006 people whose needs are more intensive. Legislative Session. The Secretary informed the Committee One of the key issues of concern to CMS that the target start date for implementation was the need to reclassify Level V and VI is January 1,2007. Pending the transition to facilities as Institutions for Mental Disease these services, SRS and the Juvenile Justice (IMDs), similar to state mental health Authority (JJA) are continuing the status quo hospitals, in order to claim federal Medicaid system. This includes payments to facilities funding. The new classification requires using all State General Fund dollars to pay new accreditation and payment structures for services which exceed the current for existing facilities. Previously, facilities Medicaid limitations for length of stay (140 were paid a daily rate and then were able to days for Level V and 180 days for Level VI). use the youth’s Medicaid card to access The Secretary noted that under the PRTF additional behavioral health and medical system, length of stay will be based on the services. Under the new classification, medical necessity for services and not on a payments to facilities must be all-inclusive preset maximum. Finally, the Secretary and provide funding for all services informed the committee that of the 29 Level
Kansas Legislative Research Department 11-33 2006 Budget V or VI facilities, six were not yet accredited status of federal Medicaid audits and but were on track to receive the required deferrals. accreditation. In August, SRS addressed the
The Commissioner for JJA addressed the Committee. The Secretary•/ first reviewed the Committee regarding the system redesign state’s past efforts to maximize federal underway for residential treatment facilities. financial participation in human services According to the Commissioner, the programs which resulted in a significant conversion to PRTFs achieves three main infusion of federal dollars. The Secretary goals: ensure access for youth to appropriate then advised the Committee of the federal residential services; keep the current government’s increased scrutiny of all states’ provider system intact; and ensure federal use of federal funds resulting in a number of financial participation. In conclusion, the audits in Kansas. The Secretary also noted Commissioner commented on the that Kansas may be receiving particular collaborative process being used to help scrutiny due to the privatization of our child facilities adapt to the new system. welfare system and the difficulty the CMS has had in determining how it should be regulated due to its uniqueness. The Home and Communitym / Based Services Waiver for Persons Committee was reminded that Medicaid with Physical Disabilities funds have been deferred for mental health services for children in SRS custody since At the August meeting, the Committee July 2003 and was advised that the agency was presented with information on the use expects to reach settlement with CMS on of enhanced funding for the Home and those deferred payments. Included in the Community Based Services Waiver for written testimony was a summary of the Persons with Physical Disabilities status of all federal deferrals, audits, and appropriated by the 2006 Legislature. penalties currently in process.
The appropriations bill contained The Secretary briefed the Committee on additional funding of $8.8 million ($3.5 changes to the Kansas Medicaid Plan and million State General Fund) for the waiver in new waiver request submitted in June to FY 2007 but gave SRS the authority to CMS regarding mental health and substance decide how the funds would be allocated abuse services. These actions have been between increasing reimbursement rates for taken to comprehensively address pending direct care services and waiting list issues; address issues going forward; and reduction. The language further required avoid further negative findings from the the agency to report to the Legislative Budget federal government. Details of the submitted Committee on its allocation decision. The changes were in the agency’s written Secretary reported that SRS held a meeting testimony. with key stakeholders to discuss the issue. The consensus of the group was to use the Finally, the Secretary informed the entire amount to reduce the waiting list. Committee of other initiatives the agency is According to the agency, services were taking or has taken to minimize the risks of offered to an additional 262 individuals on increased federal scrutiny. Activities July 1 and the waiting list was eliminated at included ending the revenue maximization that time. contracts with MAXIMUS; reviewing the way federal funding is claimed; and Medicaid Audits and Deferrals identifying risks in the areas of mental health certified match and targeted case At the August and September meetings, management in developmental disabilities the Committee received an update on the services.
Kansas Legislative Research Department 11-34 2006 Budget In September, a representative of the cooperation of SRS in addressing these Kansas Health Policy Authority (KHPA) reporting issues. appeared before the Committee to present information on federal audits conducted on The Secretary of SRS also addressed the Medicaid payments to school districts for Committee to comment on the services provided by the Local Education implementation of HB 2105. The Secretary Agencies (LEAs). The conferee noted the told the Committee that field staff received recent increased federal scrutiny of states’ instructions on providing information to the use of Medicaid dollars. The Committee was /ANE unit. According to the Secretary, the briefed on the background of claiming for new law has helped to establish a more LEA services. All of the audits being formal, effective and cooperative reviewed concern claims from FY 1998-FY relationship with the Attorney General’s 2003 with significant overlap across audits office regarding protective services for in the time periods and expenditures in vulnerable citizens. Additionally, the question. The conferee briefed the five Secretary noted the follow-up being audits underway or recently settled and provided by the Attorney General on cases included details in written testimony. referred by SRS for assistance investigating or prosecuting cases of abuse neglect and In conclusion, the KHPA conferee exploitation. informed the Committee of all of the actions currently being taken to resolve outstanding Tax Collections issues and prevent further negative exposure to audits. During the August meeting, the Secretary of the Kansas Department of Revenue Update on Implementation (KDOR) presented information on the of 2006 HB 2105 Department’s tax collections. The Secretary mentioned that the total investment in the At the October meeting the Committee tax recovery efforts was $7.7 million and the received an update on the implementation of Department brought in $108.0 million, 2006 HB 2105 which created an Abuse, therefore, as calculation of return on Neglect and Exploitation (ANE) of Persons investment there was a ratio of $15.00 unit within the Office of the Attorney collected on every $1.00 spent. In response General. Representatives from the Attorney to questions from the Committee, the General’s office explained the process Secretary explained that the agency tries to created by the bill and noted that the help taxpayers before they get into trouble implementation is proceeding well. Since and that the field agents work with taxpayers the enactment of the bill, the ANE unit has to resolve issues. The Committee asked for received 495 cases from 58 counties information regarding legislation passed on including 475 from SRS; 19 from the unemployment tax and can this be done on Department on Aging; and one from the sales tax regarding people not paying taxes. Atchison Juvenile Correctional Facility. The The Secretary indicated the Department representative told the Committee that all would look into providing a proposal. agencies required to submit confirmed cases of abuse are cooperating with the Attorney During the December meeting, a General’s office and submitting reports in a representative of KDOR presented a timely manner. In particular, the conferee proposed amendment to the current sales tax noted the office is working closely with SRS law which would allow KDOR to revoke or to continue to improve the reported suspend a retailer’s registration certificate if information to help with the investigation the retailer has not paid the tax due or filed and prosecution of alleged perpetrators. In a return for a period of 60 days. The penalty closing, the representative noted the for any taxpayer, officer, agent, or employee
Kansas Legislative Research Department 11-35 2006 Budget continuing to operate the business after the • On the topic of tax collections, to registration certificate has been suspended increase compliance with sales tax laws, shall be guilty of a Class A misdemeanor. the Committee recommends amending the current sales tax law which would Update on Aviation Research in Wichita allow KDOR to revoke or suspend a retailer’s registration certificate if the The Committee heard testimony from the retailer has not paid the tax due or filed Vice-President of Engineering for Spirit a return for a period of 60 days. Any AeroSystems, who provided an update on individual who continues to operate a the Kansas Aviation Research Initiative in business after the registration certificate Wichita. The testimony included has been suspended or revoked would be information on the current environment in guilty of a Class A misdemeanor. The aviation, aviation's economic impact in Committee recommends this be Kansas, a summary of the previous aviation introduced as a bill in the Senate during research initiative, industry's need for future the 2007 Session of the Legislature. technology investment, and a proposal to sustain and grow the industry. The conferee • In regard to the earnings limitation for noted that the aviation industry is a major retired nurses, the Committee contributor to the economic vitality of recommends that the issue be addressed Kansas and has the potential for significant in the 2007 Legislative Session in the growth as a national center for aerospace appropriate standing committees (Senate innovation. Ways and Means and House Appropriations). Items for the standing The aviation industry in Wichita is committees to consider include: requesting an appropriation of $5 million allowing nurses that retire and work at per year for five years for aviation-related state hospitals and veterans' homes to research at the National Institute for earn up to $20,000 annually, which Aeronautical Research (NIAR) beginning in would be the same as school teachers, or FY 2008. In summary, the industry believes allowing the exemption scheduled to that it must be capable of competing in an expire at the end of FY 2008 to be ever-changing economic environment and continued indefinitely. investment must be made to maintain a leadership role in Kansas. • On the topic of the Kansas Aviation Research Initiative in Wichita, the Committee supports the aviation Conclusions and Recommendations research done in Wichita and the renewal of ongoing support from the After reviewing several items affecting Legislature for the aviation industry the state budget, the Committee makes the research. following recommendations and conclusion.
Kansas Legislative Research Department 11-36 2006 Budget Legislative Budget Committee
State Inspector General
Conclusions and Recommendations
The Committee recognizes that progress has been made in defining the role of the Inspector General. The Committee recommends that the current process of stakeholders meeting continue to further define the role and report to the appropriate standing committees during the 2007 Session.
Proposed Legislation: None.
Background Staff provided a review and summary of a balloon for 2006 SB 327 that would help The Legislative Coordinating Council define the purpose, authority and scope of assigned the Legislative Budget Committee the Inspector General’s Office. The responsibility to study the State Inspector Inspector General would be a classified General. More specifically, to study the employee in the Attorney General’s Office. need for substantive legislation to create an inspector general position in Kansas similar The Vice President for Government to the one proposed in 2006 SB 327. The Relations of the Kansas Hospital Association Committee also was to review the need for (KHA) also presented information on the the position to have authority for oversight establishment of the Office of Inspector responsibilities over Medicaid, MediKan, General. The conferee mentioned that a lot and so forth. of progress has been made on the 2006 SB 327 legislation. KHA looks forward to resolving a couple of minor issues with Senator Derek Schmidt and the other Committee Activities stakeholders before the beginning of the 2007 Legislative Session. The Committee heard testimony from Senator Derek Schmidt who presented an The Director of Government Affairs for update on legislation to establish an Office the Kansas Medical Society explained that of Inspector General for the State’s Medicaid they had some questions about details of the program. Senator Schmidt discussed original 2006 SB 327. They believe things possible changes and additional definitions are going in the right direction, but still have to 2006 SB 327 recommended by a group some concerns they are confident will be that consisted of Attorney General’s Office, resolved. Kansas Medical Society, Kansas Hospital Association, EDS and the Kansas Health The Office of the Attorney General Policy Authority. He noted that the provided information in support of the re Legislature has appropriated funds to hire a drafted language concerning 2006 SB 327. Medicaid Inspector General, but has not The Attorney General’s Office has been enacted substantive law to define the involved in the discussions on the bill and purpose, authority and scope of an Inspector believes that improvements are moving in General’s work. the right direction. He noted that there are still minor changes that need to be made
Kansas Legislative Research Department 11-37 2006 Budget regarding language, but it gives them a plan Inspector General. The Committee to move forward with the Inspector General recommends that the current process of position. stakeholders meeting continue to further define the role and report to the appropriate standing committees during the 2007 Conclusions and Recommendations Session.
The Committee recognizes that progress has been made in defining the role of the
Kansas Legislative Research Department 11-38 2006 Budget Legislative Budget Committee
Veterans’ Funding Issues
Conclusions and Recommendations
The Committee noted its concern that the rules and regulations for the Veterans’ Claims Assistance Program were not finalized as of the December meeting. The Committee recommends that the Kansas Commission on Veterans’ Affairs work to expedite the process to allow rules and regulations to be implemented for this program as soon as possible.
Proposed Legislation: None.
Background General Fund in HB 2968 Section 58 for the purpose of funding the Claims Assistance 2006 SB 480 Section 60 contained the Program. Additionally, the bill contained following proviso:"... and provided further, the following proviso: "Provided, That that expenditures shall be made during the expenditures from the veterans claims fiscal year ending June 30, 2007, from the assistance program — service grants account operations (including official hospitality) shall be made only for the purpose of account to pay for a legislative study awarding service grants to veterans service committee to study veterans’ funding issues, organizations for the purpose of aiding particularly how veteran service veterans in obtaining federal benefits: representatives are funded, during the 2006 Provided however, That no expenditures legislative interim." shall be made by the Kansas commission on veterans affairs from the veterans claim Additionally, the 2006 Legislature passed assistance program — service grants account SB 396 which directed the Kansas for operating expenditures or overhead for Commission on Veterans’ Affairs to establish administering the grants in accordance with and administer a Veterans Claims Assistance the provisions of 2006 House Substitute for Program to be implemented through annual Senate Bill No. 396." grant agreements with veterans service organizations. The program was to be established and operations to commence on Committee Activities or before August 1, 2006. The grants would be subject to appropriation by the During the August meeting of the Legislature. Additionally, the program Committee, Representative L. Candy Ruff would be structured to: improve the provided an update on implementation of coordination of veterans’ benefits counseling the Veterans Claims Assistance Program in the state; maximize the effective and established in 2006 SB 396. She addressed efficient use of taxpayer dollars in this goal; the rules and regulations that may be and ensure that every veteran is served and causing the Kansas Commission on Veterans' receives claims counseling and assistance. Affairs Executive Director and perhaps other The bill directed the Kansas Commission on Commission members some issues. Veterans’ Affairs to adopt rules and Additionally, Representative Ruff noted that regulations to implement and administer the when the Kansas Commission on Veterans' grant program. The 2006 Legislature Affairs meets in Winfield on August 25, appropriated $500,000 from the State members will vote on these proposed rules
Kansas Legislative Research Department 11-39 2006 Budget and regulations. At the same meeting, the During the December meeting a Veterans of Foreign Wars and American representative of the Kansas Commission on Legion will be asked to sign their contracts Veterans Affairs provided the Committee with the state, and within a few weeks, new with an update on the Veterans Claims employees would come on board. A Assistance Program. The Kansas representative of the Kansas Commission on Commission on Veterans’ Affairs Veterans' Affairs appeared and provided a representative indicated that the American report on the Veterans Claims Assistance Legion and the Veterans of Foreign Wars had Program. The representative noted that the signed the contracts to participate in the Veterans Claims Assistance Program program on August 21, 2006. In addition, Advisory Board recently made its first these two organizations each received an recommendations to the Commission, and advance payment of $41,666.66 on August the Commission discussed the 24, 2006. recommendations during a meeting on July 21, 2006. Additionally, representatives of The representative of the Kansas the Veterans of Foreign Wars and the Commission on Veterans’ Affairs indicated American Legion provided testimony on the that the month of September produced a Veterans Claims Assistance Program to number of resignations by staff members express their concern regarding certain who were then hired by both the Veterans of aspects of the program and the proposed Foreign Wars and the American Legion. rules and regulations. The Chairman of the Kansas Commission on Veterans’ Affairs The representative of the Kansas indicated that he would call an emergency Commission on Veterans’ Affairs indicated Commission meeting via a teleconference to that the most recent draft of the proposed approve the proposed rules and regulations rules and regulations for the program were so the process could move forward as again submitted to the Department of quickly as possible. Additionally, he Administration for review on December 7, indicated that the agency would pursue 2006. Additionally, the representative temporary rules and regulations on this indicated that temporary rules and issue. regulations were not being pursued, only permanent rules and regulations. The representative of the Kansas Commission on Veterans’ Affairs provided testimony regarding the veteran service Conclusions and Recommendations representatives pay issues. The representative noted that the Veteran Service The Committee noted its concern that Representative I positions (Range 20] had the rules and regulations for the Veterans’ been reallocated to Human Service Claims Assistance Program were not Specialists (Range 21] and that the Veteran finalized as of the December meeting. The Service Representative II positions (Range Committee recommends that the Kansas 22) had been reallocated to Program Commission on Veterans’ Affairs work to Consultant I (Range 24). Additionally, the expedite the process to allow rules and representative noted that the remainder of regulations to be implemented for this the proposed reallocation, involving program as soon as possible. representatives at the VA hospitals, was on hold pending additional information.
Kansas Legislative Research Department 11-40 2006 Budget Joint Committees
Report of the Legislative Educational Planning Committee to the 2007 Kansas Legislature
CHAIRPERSON: Representative Kathe Decker
VICE-CHAIRPERSON: Senator Jean Schodorf
OTHER MEMBERS: Senators Marci Francisco, Roger Pine, Mark Taddiken, Ruth Teichman, and John Vratil; and Representatives Barbara Ballard, John Faber, Deena Horst, Steve Huebert, Eber Phelps, and Jo Ann Pottorff
St u d y T o pics
• Elementary and Secondary Education
December 2006 Legislative Educational Planning Committee
Elementary and Secondary Education
Conclusions and Recommendations
The Legislative Educational Planning Committee recommends ten hills for introduction during the 2007 Session. The legislation woidd:
• Extend the Technical College and Vocation School Commission another two years and require that the Commission make annual reports to the Committee.
• Create the English for Speakers of Other Languages Task Force, a nine member entity whose charge would include considering how preparing teachers to teach English Language Learners could be incorporated into the basic teacher education curriculum. The Task Force would exist for two years and report annually to the Committee.
• Prohibit a public agency, including the State of Kansas, any department, agency, board, or school district, from spending public money to adopt, implement, or enforce school accreditation guidelines or standards which establish or are based upon a requirement of student performance or student proficiency. In addition, provide that a program begun or expanded with federal funding could be eliminated or reduced if the federal funding is eliminated or reduced.
• Consolidate four existing teacher education programs into the Comprehensive Teacher Scholarship Program, as proposed by the Kansas Board of Regents.
• Create a new program to award grants to state universities for projects that would benefit teachers and teacher preparation.
• Reconcile a conflict between two enactments of the Legislature to allow state universities both the flexibility to convert their classified staff to University Support Staff and to raise annual leave and discretionary leave for classified staff up to the level offered to unclassified personnel.
• Create the Nurse Educator Scholarship Program by statute, rather than by proviso.
• Give the Kansas Board of Regents and the state universities the authority to transfer property to state university endowment associations or other investing agents.
• Expand current state law that exempts from state construction and contracting laws capital improvements projects using private moneys of $1.0 million or less. The proposed legislation would eliminate the $1.0 million limit and expand the source of revenues exempted to include restricted fees collected by universities for construction and renovation of state educational institutional buildings.
• Increase the monthly stipend for the Medical Student Loan Program from $1,500 to $2,000 and allow third- or fourth-year students to be eligible to participate in the program retroactively.
Kansas Legislative Research Department 12-3 2006 LEPC In addition, the Committee recommends the following:
• Consideration by the Legislature of the creation of a commission or task force to review services for individuals with autism up to the age of adulthood for purposes of identifying the most effective treatment methods and transition services following the completion of school.
• Ongoing monitoring by the Committee of Medicaid payments to school districts for medical services to special education students, including reports from the Kansas Health Policy Authority on its efforts to resolve disputes with the United States Health and Human Services Office of the Inspector General and on its efforts to reduce or eliminate a fee charged school districts by the Authority for its services in administering the reimbursement program.
• General endorsement of the recommendations of the At-Risk Council, including the recommendation that the Non-Proficient At-Risk Weighting be extended beyond its current statutory termination date of June 30, 2007.
• An ongoing effort by the Legislature to make three-year appropriations for general, supplemental general, and special education state aid in order to give school districts a longer planning horizon.
• Consideration by the Legislature of various proposals concerning the mission, governance, and funding of technical education.
• The addition of $34.0 million in FY 2008 and another $34.0 million in FY 2009, for a total of $102.0 million including the existing FY 2007 base of $34.0 million, for postsecondary state aid for technical schools and colleges.
• Support for the Kansas Board of Regents to look at ways teacher education programs at the state universities could be restructured to prepare teachers to meet the needs of a growing number of Kansas students who are English Language Learners.
• Encouragement for the appropriate standing committees of the Legislature to review the policies of the Department of Social and Rehabilitation Services (SRS) regarding administrative fees charged to administer various Medicaid reimbursement programs to consider whether the fees could be reduced or eliminated.
• Encouragement for the Joint Committee on State Building Construction, the Senate Ways and Mean Committee, and the House Appropriations Committee to review the Board of Regents’ facilities request and perhaps develop a multi-year plan to address the building needs of the campuses.
Proposed Legislation: The Committee recommends the introduction of ten bills.
Background elementary, secondary, and postsecondary education. The Committee is charged The Legislative Educational Planning statutorily with monitoring the Committee (LEPC) is a statutorily-authorized implementation and ongoing operation of committee with jurisdiction over preschool, the Kansas Higher Education Coordination
Kansas Legislative Research Department 12-4 2006 LEPC Act (KSA 74-3201 et seq.). Legislation face the following obstacles: enacted by the 2005 Legislature changed the Committee’s role to exclude matters relating • Early and Accurate Diagnosis. Early to school finance from its purview. This diagnosis of autism is critical, but the action eliminated duplication between the two places in Kansas where diagnoses LEPC and the 2010 Commission, a new are made are the Developmental entity created by the 2005 Legislature which Disabilities Center at the University of is responsible for monitoring school district Kansas Medical Center and the Section funding. of Developmental and Behavioral Sciences at Children’s Mercy Hospital. The LEPC consists of seven House Both facilities have waiting lists of about members and six Senate members appointed four months. by the Legislative Coordinating Council (LCC). The Committee may initiate its own • Early and Appropriate Intervention. Dr. studies or be assigned proposals by the LCC. Wasmer cited research findings which The LCC assigned the Committee the report effective treatment of children following three studies during the 2006 with autism when children have early Interim: and intensive therapy. However, according to Dr. Wasmer, the Infant and • A review of scholarships with service Toddler Program, which is the point of obligations that are administered by the entry for most newly diagnosed children Kansas Board of Regents, including with autism, does not always fully scholarships administered by the inform parents of best practices for University of Kansas Medical Center and autistic children and instead provides the Kansas State University Veterinary substandard therapy. Medical Center. • Insurance. Parents who decide to pay • A review of existing therapy programs for services directly often incur expenses for autistic children and the need to in excess of $30,000 a year, which improve or expand such services to insurance companies usually do not pay. achieve early intensive intervention for Companies also do not pay for related children with autism. services, such as speech and occupational therapy. • A review of 2006 SB 596 which deals with state educational performance • School District Special Education standards for students and a Programs. According to Dr. Wasmer, consideration of the consequences of most school districts are not prepared to modifying the standards in terms of provide intensive programs for autistic federal funding. children, primarily because of the cost.
• Shortage of Trained Personnel. The Elementary and Secondary Education University of Kansas has two programs that train providers of educational Services for Autistic Children services to autistic children-the Department of Applied Behavioral The LCC directed the Committee to Sciences and the Department of Special review services for autistic children at the Education. The State Board of Education initiative of Senator Dennis Wilson on licenses only graduates of the behalf of Dr. Michael Wasmer, the parent of Department of Special Education to work an autistic child. Dr. Wasmer told the in the public school system and Committee that families of autistic children recognizes only them for special
Kansas Legislative Research Department 12-5 2006 LEPC education reimbursement, but, according Regarding the latter recommendation, to Dr. Wasmer, it is often graduates of the State Board of Education licenses the Department of Applied Behavioral teachers as “adaptive special education Sciences who provide intensive services teachers,” who are qualified to work with all to autistic children paid for by their children who have learning problems and families. needs in the mild through moderate range, and as “functional special education teachers,” who are qualified to work with Dr. Wasmer requests that the Legislature children who have learning problems in the enact legislation to do the following: severe through profound range. These two categories of teachers are employed by • Create a Legislative Autism Task Force school districts, are qualified to work with to recommend best practices for autistic autistic children, and are counted for special children: align agencies that provide education state aid reimbursement. services for autistic children; access existing services for screening, diagnosis, Behavior analysts currently can be hired and treatment for autistic children; and by a school district as consultants, but do address the need to increase the pool of not generate special education qualified professionals and reimbursement. However, the State paraprofessionals who can provide Department of Education has developed a intensive behavioral therapy. proposal which will be presented to the State Board for its consideration. The • Create an Autism Insurance Task Force proposal would allow State Board to investigate insurance coverage of certification for individuals who hold services for autistic children. graduate degrees in applied behavior analysis and who are certified by the • Create an Autism Registry to provide Behavior Analyst Certification Board. To be accurate numbers of people with autism certified, the individual would have to in Kansas in order to budget accurately complete a specified number of graduate for the cost of services, to improve level courses, meet experience requirements, current knowledge and understanding of and pass an examination. A certified autism spectrum disorders, and allow for individual would be eligible to work with complete epidemiologic surveys of the autistic children as a specialist or related disorder. services provider in a school district or cooperative and could be counted for special • Provide an additional funding source for education state aid reimbursement. If the programs that provide evidence-based State Board approves the proposal, it would intensive behavioral therapy, including take effect in the 2007-08 school year. home-based programs provided by parents. Another initiative is a proposal by SRS. The proposal would address the need for • Increase the pool of qualified service respite care, parent support and training, providers by enacting a scholarship attendant care, social skills training, program with a service commitment in behavioral intervention, therapeutic daycare, order to encourage behavior analysts to and case management. Under the proposal, stay in Kansas. In addition, encourage the Department would explore the option of the State Board of Education to obtaining a Medicaid waiver to allow acknowledge officially behavior analysts services for children to be provided without in its certification process. regard to parental income and also to waive certain requirements in order to provide more services. Funding provided under the
Kansas Legislative Research Department 12-6 2006 LEPC program could not be used for services teacher shortages are in high-poverty which other agencies already must provide. districts, where 8.6 percent of all teaching positions are vacant or filled by teachers who are teaching out-of-field. Southwest Committee Recommendation Kansas has the greatest shortage (8.5 percent). By subject area, shortages are The Committee recognizes the worse for special education (17.2 percent) importance of early intervention for children and foreign language (11.2 percent). who have been diagnosed with autism and understands that an increasing number of About 16 percent of Kansas teachers children are being diagnosed with autism. change jobs each year (the same as the The Committee agrees that more information national percentage), with almost 9 percent is needed about the condition and leaving the system and more than 7 percent appropriate treatment options. For that moving between schools. Attrition is worse reason, it recommends that the Legislature among high-poverty districts (a 10 percent consider the creation of a commission or attrition rate compared to 8 percent task force to review services for individuals elsewhere). Teachers in Kansas tend to with autism up to the age of adulthood for move from west to east and away from rural purposes of identifying the most effective and high-poverty districts. treatment methods and transition services following the completion of school; Other findings in the audit include the investigate ways to fund services for persons following: with autism, including insurance coverage, Medicaid payments, and any other revenue • Kansas’ starting salary for teachers sources; and create an Autism Registry to ranked 6'1’ nationally in school year provide an accurate count of people with 2004-05, but salaries for experienced autism in order to identify the need for teachers ranked about 36th, with the services. overall salaries for Kansas teachers being 33rd nationally after adjusting for The Committee also encourages SRS to regional cost differences. The auditors pursue the option of obtaining a Medicaid concluded that these statistics could waiver to allow services for children to be indicate that the long-term earning provided without regard to parental income potential for Kansas teachers is limited. and to waive certain requirements in order to provide more services. • Annual salaries for Kansas teachers are low compared to similar professions, but School District Audit Report on School hourly pay is comparable. District Personnel Shortages
Staff from the Legislative Division of Post Several of the key findings based on the Audit presented a performance audit entitled Kansas survey relate to leadership. For Reviewing Issues Related to Developing and example, “teacher leadership” was cited by Retaining Teachers and School Principals. 36 percent of the respondents as the aspect According to the audit, almost 6 percent of of the work environment that most affected all teaching positions in Kansas are vacant their willingness to remain teaching at their or are not filled by a fully qualified teacher. school, an aspect selected over “time during The term “fully qualified” can mean several the work day” (16 percent), “school facilities things, but usually means the lack of one or and resources" (22 percent), “teacher more requirements, the most common being empowerment” (22 percent), and a proper teaching endorsement for the “professional development” (4 percent). On individual’s assignment. The most severe another question, “support from school
Kansas Legislative Research Department 12-7 2006 LEPC administrators” was selected by 58 percent Survey of Kansas Teachers of the respondents as the most important and Principals influence on their future plans, over such influences as “teaching assignment” (43 The Committee received a report from percent), “salary” (42 percent), and “cost of the Kansas-National Education Association living in the community where the school is concerning working conditions of teachers located” (24 percent). The second highest and administrators. A survey, entitled influence was “effectiveness with the “Teacher Working Conditions” (TWC), was students 1 teach”, selected by 52 percent. administered to educators across the nation and has been used to implement funding Most interesting was the difference in and policy changes in a number of states. perception between teachers and principals regarding leadership, with principals grading The survey shows that working themselves higher on each item indicated. conditions have a bearing on student For example, 88 percent of the principals achievement and teacher retention. Among who responded said that there is an the most important findings to emerge from atmosphere of trust and mutual respect TWC research are the following: within the school, compared to 60 percent of teachers. Ninety-five percent of the • Teacher working conditions are an principals said school leadership important indicator of student consistently enforces rules for student achievement, an example being that conduct, compared to 53 percent of the higher school leadership correlates with teachers. a higher number of students at or above grade level.
Committee Recommendations • Teacher working conditions make a difference in teacher retention. Elsewhere in this report, the Committee makes specific recommendations concerning • Leadership is critical to improved teacher scholarships and the need for teacher working conditions. Working teachers of English Language Learners. The conditions also are viewed differently by Committee considers that the Post Audit teachers and administrators: In every study serves to reinforce some of its state in which the survey has been given, concerns about the need to recruit and retain teachers rate their working conditions highly qualified teachers in hard-to-fill one full point lower than school teaching disciplines, in parts of the state administrators. where there are teaching shortages, and in high-poverty school districts. In particular, • Teachers view working conditions the Committee is aware that an upcoming similarly, regardless of years of shortage of teachers may be critical and experience, degree level, or other notes the importance of teacher mentoring, variable. professional development, and other factors that contribute to a positive work environment, factors that will become Development and Implementation of increasingly important as the aging Kansas Early Learning Guidelines workforce retires and new teachers need to be hired. Kansas agencies that provide services to children, including SRS, the State Department of Education, the Department of Health and Environment, and other partners have developed the “Kansas Early Learning
Kansas Legislative Research Department 12-8 2006 LEPC Guidelines and Standards.” Guidelines and These sessions were sponsored by the Standards will provide a common language Kansas Health Foundation and were and understanding for all early educators to attended by more than 1,100 persons. use regarding children’s learning expectations, accomplishments, and Activities underway in school year 2006- capabilities. The collaborative effort will 07 include the development of a new provide a framework for curriculum website which links the guidelines to development and selection and is designed additional resources and ongoing technical to help prepare children to enter school assistance from the State Department of ready to learn. Education.
Committee Recommendation Educational Programs for Children with Cochlear Implants The Committee is pleased with the progress that has been made to develop the The issue of how to educate deaf students Kansas Early Learning Guidelines and has its historical roots in two philosophies of Standards and looks forward to its full how to deal with deafness-sign language and implementation. The Committee commends spoken communication. Controversy as to the agencies that worked together over a which is better—manualism or the oral period of years for their efforts. method—has resulted in debates over the years and the division of some educators School District Nutrition Programs into two camps, some advocating one method and some advocating the other. Legislation enacted by the United States Congress requires “local wellness policies” The specific topic before the Committee that must be implemented by July 2006. was educating children with cochlear Legislation enacted in Kansas directs the implants. “Cochlear implants” were defined State Board of Education to develop as follows: nutrition guidelines for all foods and beverages made available to students in A cochlear implant is a surgically public schools during the school day. These implanted electronic device that can guidelines must address providing healthful help provide a sense of sound to a foods and beverages, physical activities, and person who is profoundly deaf or wellness education with the goal of severely hard of hearing. Unlike preventing and reducing childhood obesity. hearing aids, the cochlear implant doesn’t amplify sound, but works by The State Board of Education developed directly stimulating with electrical three levels of goals: basic (which meet the impulses any functioning auditory federal requirements for food service nerves inside the cochlea. External programs), advanced, and exemplary. It is components of the cochlear implant up to local boards of education to select their include a microphone, speech own wellness policy. The only requirement processor, and transmitter. is that they have a policy and that, in developing it, they take into account the State Board’s guidelines. The Committee learned that cochlear implants can be controversial and have The State Department of Education held tapped into the old disagreement about 12 training sessions around the state to which mode of communication is best. educate food service workers and other According to one conferee, this is because school personnel about the guidelines. the medical model views deafness as a
Kansas Legislative Research Department 12-9 2006 LEPC disability that requires a “fix,” while the age who will benefit from the implants and cultural model views deaf people as a physicians are making parents aware that cultural minority with its own language, early implantation may help a child enter history, and heritage. school with near-age appropriate speech and language skills. As a result, more parents The Kansas School for the Deaf supports may ask school districts to provide their a bilingual approach to educating deaf children with speech and listening skills as children and uses American Sign Language opposed to sign language. He noted that as the child’s first language, with the school districts are not financially development of English as a second language responsible for providing surgically through reading, writing, and spoken implanted devices for students with language. The School supports the position disabilities. that children with cochlear implants may become efficient oral communicators for Mr. Guthrie acknowledged that social situations, hut need sign language for controversy exists as to the proper method of critical or abstract thinking, problem educating children with cochlear implants. solving, and assimilating new information. He said school districts must work with a variety of children who have different needs A conferee before the Committee, Ruth and cannot wed themselves to a single Mathers, Campus Director of the St. Joseph service delivery model. He said if cochlear Institute for the Deaf in Kansas City, implants are not done early enough, the described the Institute’s program, which is child cannot be educated using the auditory- based completely on oral communication. verbal method exclusively and some sign The maximum amount of time a child stays language must be used. He said his school at the Institute is six years. Ages of the district currently is looking for a teacher for children served range from three to nine a group of deaf students who will be taught years and half of the 60 students at the using the auditory-verbal method, but one of Institute have come from school districts. the most difficult problems a school district faces is parents who demand only one Ms. Mathers told the Committee that teaching method and refuse to allow the advancements in technology, including district to use an alternative method. He cochlear implants, provide a greater said his school district tries to accommodate opportunity for deaf children to grown up in parents who want their deaf children a hearing world. In her opinion, an educated using only the auditory-verbal auditory-oral education allows children to method, but he said the district cannot be placed in the local school setting at an guarantee that the child will not be around early age with minimal support services. deaf children who use sign language. However, many school districts continue to emphasize sign language, in part because Interlocal Agreement Proposal in newly-trained teachers cannot provide Doniphan County auditory-oral services. Two identical bills were introduced A public school special education during the 2006 Session which would have director, Neil Guthrie, Division Director of authorized school districts to enter into Special Education/Support Services for USD interlocal agreements in order to operate 259 (Wichita), also discussed educational shared schools. One bill, SB 2625, was programming for children with cochlear introduced by Representative Jerry Henry to implants. Mr. Guthrie said school districts facilitate agreements for school districts in are enrolling more students with cochlear Doniphan County, although the policy had implants because early identification of statewide applicability. Under both bills, hearing loss is finding children at a younger participating districts would have had
Kansas Legislative Research Department 12-10 2006 LEPC authority to combine their assessed Act, recognizes outstanding public and valuation for the calculation of the payment private schools that are making significant of the cost of new facilities and to divide progress in closing the achievement gap. debt evenly among the participants. The Schools qualify in one of two ways; They bills included a procedure for the issuance can serve at least a 40 percent disadvantaged of bonds for capital projects, subject to population with dramatically improved protest and election. student performance scores in reading and mathematics, or they can score in the top 10 HB 3012 was introduced by the House percent of schools in the state in both Select Committee on School Finance, which reading and mathematics, regardless of amended the bill to require an election prior demographics. There are 250 Blue Ribbon to the issuance of any bonds; to provide that, Schools nationwide, of which the following if a majority of the voters in the participating five are in Kansas. districts voted in the aggregate to approve the bond issue, each district could issue the USD 233 (Olathe)-Westview bonds; to provide that the aggregate amount Elementary. Westview Elementary was of outstanding bonds issued by each district labeled a failing school six years ago. would be subject to a statutory debt limit; to Approximately 45 percent of the students provide that the debt service for any new are on the free lunch program and 15 facilities would be divided proportionately percent on reduced lunches. The staff among the districts based upon the resolved to turn the school around and enrollment of each district; to provide that adopted several strategies. One was to the combined assessed valuation of the become data-driven and to focus on participating districts may be used when improvement. Another was to target areas in calculating the amount of state aid for bond which improvement is needed and teach and interest; and to limit the school facilities those areas in each grade. weighting to two years. The school implemented after-school HB 3012 was further amended on House reading, math, science, and Spanish clubs General Orders to, among other things, and developed programs to encourage more require the closing of at least one school in parental involvement, such as Family each of the participating districts and Learning Nights. The school has eliminate the requirement that a school Professional Learning Communities (PLCs), administrator be employed to administrate which employ a type of team teaching that, at the shared schools. depending on the circumstance, brings together the several teachers who work with Neither bill was enacted by the 2006 an individual child, along with supporting Legislature. After the 2006 Session ended, staff such as the school nurse or counselor, Representative Henry notified the in order to identify the best way to help the Committee that representatives of the school student succeed. Implicit in the concept of districts in Doniphan County had reached a PLCs is the need to give PLCs adequate time new agreement. Because the agreement was to meet and plan and to have high quality not final and could not be presented to the professional development programs in place. Committee, he said it was his intention to An outgrowth of PLCs is better focus on introduce legislation to authorize the student needs and staff collaboration and agreement during the 2007 Session. teamwork.
Kansas Blue Ribbon Schools USD 234 (Fort Scott)-Eugene Ware Elementary. In 2000, no reading scores in The “Blue Ribbon Schools Program,” the school were equal to or above the state which is part of the No Child Left Behind averages and only two of 24 mathematics
Kansas Legislative Research Department 12-11 2006 LEPC scores were equal to or above the state USD 470 (Arkansas City)-Francis averages. A new principal had just assumed Willard Elementary and IXL Elementary. her position and she set about to improve The district enrollment is comprised of 35 student achievement. Among the strategies percent minority students and 61 percent she used were the following: students on free and reduced lunches. Because of the high at-risk population, the • Have the staff function as a family unit district decided it needed to develop a united in purpose and effort. district-wide strategic plan which addressed facilities, staff, student achievement, student • Have the staff realize the value of each life issues, technology, and other person’s part in the success on components of elementary-secondary assessments. education. The plan, adopted by the local hoard in November 2004, identifies activities • Have the staff be confident that the necessary to achieve each goal, the person “teacher next door was capable of doing accountable for the activity, when the everything that I do.” activity will be implemented and completed, what resources will be needed, and how progress will be measured. The school became “data conscious” in school year 2000-01; began PLCs in school Preliminary data for fall 2006 indicate year 2001-02; implemented new reading and that all schools are meeting adequate yearly math programs in school year 2002-03 and progress, a marked improvement over 10 provided training for the entire staff; years ago when only one in three students implemented additional programs in school was reading at grade level and math scores year 2003-04 and added one-hour common were declining. The turn-around is planning times for each grade level; and in attributed to strategic planning, data-driven school years 2004-05 and 2005-06 created educational designs, and professional extended-day learning opportunities and development which involves outside experts continued grade level and cross grade level and “internal experts” who work with other collaboration. As a result of these efforts, teachers. 100 percent of the students scored at “Proficient” and above on the 2005 Kansas USD 233 (Olathe)-Regency Place Mathematics Assessment and 95 percent Elementary. One of the school’s strategies scored at “Proficient” and above on the 2005 is “vertical teaming,” whereby teachers meet Kansas Reading Assessment. with teachers in one grade level below and one grade level above. Vertical teaming USD 402 (Augusta)-Garfield helps teachers integrate what they are Elementary. A strategy the school teaching into a more seamless learning developed is after-school tutoring, which is experience for the child and better prepare small groups of three to five students who students for the next grade. obtain individualized instruction that targets specific learning needs. Tutoring is provided by a team of three teachers for each Committee Recommendation grade level and attendance for a student who is struggling is mandatory. Future plans The Committee is proud that five Kansas include fitting the tutoring into the school schools were selected as this year’s Blue day, directing more attention to students Ribbon Schools and applauds them for their with Individual Learning Plans (ILPs), and accomplishment. In reviewing their implementing more early intervention presentations, the Committee noted both programs to address emotional issues that similarities and differences among the affect learning. schools and believes that what the schools
Kansas Legislative Research Department 12-12 2006 LEPC have done to attain distinction serves as • School District Administrative models for other schools to follow. The Functions. Beginning in FY 2001 and Committee also commends the through April 2005, 156 school districts administrators and teachers at the schools in Kansas received a total of $9.7 million for the personal and professional efforts they to perform administrative functions such have made to create learning environments as outreach, eligibility intake, that help all students perform better. information and referral, health service coordination and monitoring, and Medicaid Payments to School Districts interagency coordination. Based on an audit of $2.8 million in Medicaid School districts are eligible to receive reimbursements made in FY 2002 to four Medicaid reimbursement for medically school districts, OIG concluded that necessary services in a school setting. At errors were made that resulted in the one time, schools received the money on a districts receiving $293,182 for which fee-per-service basis, which was costly and they did not qualify. time-consuming to claim. As a result, many districts could not afford to calculate the Kansas officials do not agree with the reimbursement they were due. finding because the particular requirement cited in the audit was not a To make it easier for districts to receive requirement until FY 2003. reimbursement, “bundled” rates were approved so that, for each of 15 separate • Application of Bundled Rates. During categories of disabilities, school districts the period from FY 1998 through FY receive a flat rate reimbursement. In Kansas, 2003, bundled rate payments were made the program formerly was administered by for the entire year, not for the nine SRS. It now is administered by the Kansas months of the typical school year, Health Policy Authority. At the federal resulting in an overpayment of $13.9 level, the Medicaid program is overseen by million. the Centers for Medicare and Medicaid Services. To ensure that programs in Kansas officials agree that the rate Kansas are compliant with federal Medicaid payments should have been made only and Medicare rules and regulations and with for a nine-month period. A subsequent the Kansas plans for Medicaid and Medicare, reimbursement to Kansas was reduced to audits are conducted by the United States adjust for the excess payment. Health and Human Services Office of the Inspector General (OIG). • Claimed Costs for School-Based Health Services. An OIG audit of 300 claims The immediate issue before the submitted by three school districts found Committee was that five OIG audits of that the districts provided incorrect or school districts and Medicaid payment inadequate instructions to local school policies have identified problems. Some of districts on submitting claims, resulting these audit findings have resulted in Kansas in claims that were unallowable because refunding Medicaid payments; others services were not rendered or the claims currently are being appealed. All of the did not include the required audit findings pertain to payments prior to prescriptions or referrals. According to FY 2003. OIG, many services lacked documentation for items such as place of A summary of the audits and an service, type of service rendered, and explanation by the Chief Financial Officer units of service provided. OIG contends for the Kansas Health Policy Authority of that, for the three districts, $5.1 million action currently being taken are as follows; in Medicaid reimbursement should be
Kansas Legislative Research Department 12-13 2006 LEPC refunded. Further, it recommends that The audit recommends that Kansas Kansas assume the same incidence of refund $18.5 million which had been error statewide and calculate an amount reimbursed based on incorrect indirect that should be refunded for all districts cost rates. in the state. Kansas officials concur with the audit Kansas officials are challenging the findings and have refunded the $18.5 finding for several reasons. First, they million. They also have agreed to do not believe a physician’s order is continue efforts to ensure that the school required for some of the services deemed district Medicaid program complies with unallowable, as OIG contends, and they all federal requirements. do not believe the findings for the three districts are representative of the state as a whole. To ensure that school districts The Chief Financial Officer for the are fully aware of federal requirements, Authority who met with the Committee said Kansas officials have provided increased the Authority has increased oversight of the oversight of school districts regarding program through contractual changes and supporting documentation of claims and improved training for schools. The state have provided additional billing also initiated a new contract in January 2005 instructions. with Public Consulting Group to revise the administrative claiming process to meet new • Inflation Adjustment of Bundled Rates. requirements imposed by the Centers for OIG found that Kansas did not Medicare and Medicaid Services, based on periodically adjust the bundled payment the comments of OIG. The Chief Financial rates for inflation in the manner Officer told the Committee that, in some required, resulting in overpayments to instances, the contractor hired by SRS to school districts from FY 1998 through FY administer the program “inadvertently 2003. advised” school districts regarding the program, which resulted in some of the Kansas officials agree that the problems cited by OIG. He said it also was appropriate inflation rates were not used, possible that incorrect information was although the rates used were not applied given by SRS officials to school districts. each year, meaning that, overall, the state probably received less Medicaid According to the Chief Financial Officer, reimbursement than it was entitled to, in its negotiations with the federal rather than more. Presently, the state is government, the state is taking the position working with the federal government to that too many years have passed to expect determine if the rates should be adjusted the state to repay all of the money that is or recalculated and to refund any being contested. Further, it is unfair to identified overpayments. expect reimbursements for actions taken by school districts that complied with the • Development of Bundled Rates. The federally-approved Kansas State Plan which bundled rates in Kansas were developed was in effect at the time. using cost and utilization data of special education students in six school The main concern of the Committee is districts. OIG found that these original that Kansas be in compliance with federal rates were not developed in compliance requirements that are applicable to the with federal requirements and the State school district Medicaid program. If state Plan, nor did the state have adequate policy is contrary to federal requirements, internal controls to ensure that it the possibility exists that the state will incur correctly developed the payment rates. ongoing violations and penalties. Medicaid
Kansas Legislative Research Department 12-14 2006 LEPC reimbursement to school districts is concerns regarding the OIG audits and has estimated to be $35.0 million in FY 2007. If implemented changes to keep Kansas in some or all of this money were to be compliance with federal requirements. The disallowed because of failure to comply with Committee intends to monitor Medicaid federal requirements, the money either payments to school districts and requests would have to be made up from some other that the Authority report to it during the source or school districts would get less 2007 Interim on developments relating to the special education funding than estimated. audits of the program, including resolution of disputes with OIG; outcome of A second concern is that the Health discussions regarding continuation of the Policy Authority receives approximately administrative fee; and ongoing discussions $1.5 million as an administrative fee to with the federal government about whether perform duties related to Medicaid states will be allowed to continue to bundle reimbursement to school districts. This is a claims for Medicaid reimbursement or little more than 4.0 percent of the state’s whether they will have to revert to other total allotment, an amount that could be methods, such as fee-based reimbursement. given to schools to increase their (The Chief Financial Officer of the Authority reimbursement for medical expenses to estimates that school districts would receive special education students rather than being less than 30 percent of the Medicaid kept at the state level. reimbursement than they do now under a fee-based system. That is because the fee- The Chief Financial Officer of the based system is so time consuming and Authority told the Committee that the potentially costly to administer that some Authority has changed its regulations to school districts would discontinue making bring Kansas into compliance with regard to claims.) the OIG finding that some claims were unallowable because they did not include Having been told that it is possible that the required prescriptions or referrals. The the administrative fee charged school Authority will continue to work with OIG to districts by the Authority could be reduced address other problems identified in the or eliminated, the Committee suggests that audits. the appropriate standing committees of the Legislature obtain information on fees The Chief Financial Officer also told the charged by SRS to administer other Committee that the fee assessed by the Medicaid programs, including programs to Authority includes payments to the Community Developmental Disability contractor used to calculate the bundled Organizations. The Committee also requests rates and to determine the amount of that SRS report back to it during the 2007 administrative costs claimed by the districts. Interim concerning Medicaid administrative The fee also is intended to help offset the fees which are assessed entities such as the cost to the state of processing the payment. Community Developmental Disability The representative of the Authority told the Organizations, what they are used for, and Committee he would begin discussions whether they can be reduced or eliminated. within the Authority as to whether it is possible that the fee could be reduced or Recommendations of the eliminated. At-Risk Council
Dr. Andy Tompkins, former Committee Recommendation Commissioner of Education and Chairperson of the At-Risk Council, presented the The Committee is satisfied that the Council’s recommendations to the Authority has responded to its initial Committee. The six-member Council was
Kansas Legislative Research Department 12-15 2006 LEPC created by the 2005 Legislature to make believes that the density formula needs recommendations to the 2010 Commission to be reviewed periodically to ensure and to the Governor by October 1, 2006. A that it is taking into account all areas of final report is due by October 1, 2007. the state and that it is adding value to student learning. The Council reached a number of conclusions, including the following: • The Council affirms that the third level of funding, Non-Proficient At-Risk • The Council continues to believe that the Weighting, be for students who are best state proxy for identifying at-risk below proficiency and not on free lunch. students is poverty, whether that be Also, the Council recommends that the measured by free or free and reduced 2010 Commission study the impact of price lunches. this provision and that the formula which distributes the funding should be • The Council notes that student simplified if the weighting remains in achievement on state assessments has effect beyond its current statutory improved in elementary and middle termination date of June 30, 2007. schools, but little at the high school Further, the Council notes that the level. The Council believes that there student improvement team practice needs to be a better understanding of the currently utilized in the schools should achievement gap at the secondary level be helpful in identifying the results of to include examination of dropout, this initiative. graduation, and attendance rates. • The Council recommends the continued • The Council believes that a single tool, support of the data system being such as state assessment scores, is too developed and implemented by the narrow to determine if a child is at risk. Kansas State Department of Education as a critical component in the ongoing • The Council affirms the work of the understanding of the achievement gap of Kansas Legislature and Governor in at-risk students. Furthermore, the differentiating at-risk funding with the Council supports the implementation of core funding being decided on poverty 2006 SB 549 which requires the State and the second level of funding taking Department of Education to provide density into account. The Council performance and financial accountability believes that the third level of funding for the use of at-risk funding. at-risk students based only on student Additionally, the Council recommends proficiency on the state assessments for that the Kansas State Department be those who are not on the free lunch supported in its efforts to be a resource program is an interesting and potentially for schools in identifying successful effective approach that needs further programs and strategies for helping at- study. risk students.
The specific recommendations of the • The Council recommends that the Council are the following: Department of Education periodically reevaluate the existing criteria for the • The Council recommends that the determination of a student to be in need second level of funding for at-risk of at-risk services to include students, which is the high density consideration of the use of at-risk funds formula, be based on the prior year’s on specific professional development to data and implemented using a linear serve at-risk students such as behavior transition calculation. The Council management training.
Kansas Legislative Research Department 12-16 2006 LEPC School District Collaborative Efforts • The Council recommends that the 2010 Commission authorize follow-up studies The Committee received a report from on early career teachers who leave the the Kansas Association of School Boards on profession to determine what factors school district collaborative activities. The contribute to their leaving, as well as report showed that certain categories of successful practices needed to recruit school personnel, such as superintendents, and retain highly qualified teachers. assistant superintendents, and administrative assistants, have decreased, while other categories, such as reading Committee Recommendation specialists, kindergarten, and pre-K teachers, have increased. Superintendents in many The Legislative Educational Planning school districts have additional duties, such Committee is specifically exempted from as serving as director of Quality Performance dealing with matters relating to school Accreditation, as principal, director of finance as the result of legislation enacted by transportation, business manager, or other the 2005 Legislature. The rationale for that position. Twelve districts share action likely was to avoid duplication among superintendents. the Committee, the 2010 Commission, and the At-Risk Council. Budget Preparation Time Line
The Committee reviewed the report of State Department of Education staff the At-Risk Council and in general supports reviewed the time line for school district a number of its recommendations. Because budget preparation. The process usually the Committee cannot recommend the begins in December with districts introduction of school finance legislation, it conducting a needs assessment and expresses its hope that legislation will be receiving budget requests from attendance introduced during the 2007 Session to centers. In March and April, local boards of extend the Non-Proficient At-Risk Weighting education review requests and consider beyond its current statutory termination date tentative budget projections in the event it is of June 30, 2007, as recommended by the necessary to notify staff that reductions are Council. necessary.
Montoy et al. v. State of Kansas In May, the Legislature adjourns and districts know how much money will be The Committee received a staff report available. In June, actual preparation of summarizing the Kansas Supreme Court budgets begins, with public hearings on the decision in Montov et al. v. State of Kansas. budgets being held in August. Local boards In its decision, the Court ruled that the adopt budgets in August and submit them to Legislature had substantially complied with the State Department of Education and to the Court’s prior orders to correct flaws in county clerks by August 25. the School Finance Act. The Court stated that the constitutionality of 2006 SB 549 was According to the State Department of not before it and noted that the Legislature Education, school district budget will have provided at least $755.6 million in preparation has been difficult in recent years additional funding for elementary and when the amount of the legislative secondary education by school year 2008-09. appropriation has not been known until late The Court also lifted the stay it had placed in the process, especially in 2005 when there on two provisions contained in the 2005 was a special session. Districts are helped legislation and dismissed the appeal. by the adoption in 2006 of a multi-year plan which lets them know that the expected
Kansas Legislative Research Department 12-17 2006 LEPC appropriation will be for the next three fiscal • The workforce is getting older and will years. need to be replaced.
Committee Recommendation • The education system is steering young people away from technical education, The Committee recognizes the benefit to in part because the demands of the No school districts of multi-year funding for Child Left Behind Act leave no time for school finance and the advantage it gives elective classes. them in terms of planning for several years at a time. For that reason, it recommends • Very little career counseling is being that the Legislature annually make a three- done. year appropriation for general, supplemental general, and special education state aid, as it • Tight budgets have forced many schools did during the 2006 Session for FY 2007, FY to eliminate career and technical 2008, and FY 2009. education classes.
Career and Technical Education The Committee also received a report on The Committee heard testimony from the activities of the Technical College and representatives of the State Department of Vocational School Commission created by Education and private sector employers. the 2006 Legislature by a proviso in an They told the Committee that “vocational appropriations bill. The Commission will education” has developed into career and make its final report by the beginning of the technical education and no longer involves 2007 Legislature. Among the things the such courses as woodworking and “bread Commission has considered is a proposal by and thread” home economics classes. This staff of the Kansas Board of Regents to merge is because current demands require a much or affiliate technical colleges with a higher level of academic knowledge and community college or four-year institution. technical skills. Further, the skills must continue to develop as jobs become more Representatives of the Kansas specialized. Association of Technical Schools and Colleges met with the Committee and said One point made was that greater effort the Association was in the process of must be made to make teachers and developing a proposal that would be an counselors aware of career opportunities for alternative to the proposal of the Board of students and to direct students toward a Regents staff, which at this time was not career education. Because parents, fully developed. They indicated it would be counselors, and teachers continue to a statewide system of technical institutions promote college-bound curricula even with a state-level coordinating body which though a baccalaureate degree is not would speak with one voice for workforce necessary for many jobs, blue collar development and would have representation positions remain unfilled. An example, from technical institutions statewide. They according to one conferee, is that the indicated that a major component of their aviation industry in Wichita has an unmet recommendation would be the need for need for 4,000 employees. more funding and cited the State of Georgia as a model for workforce training. Georgia, The Chairperson-Elect of the Kansas which has a population three times the size Advisory Committee on Career and of Kansas, spends an estimated $300.0 Technical Education identified the following million on technical education compared to problems with technical education in $34.0 million spent in Kansas. Kansas:
Kansas Legislative Research Department 12-18 2006 LEPC Committee Recommendation recommendation is to make a dramatic gesture to call attention to the fact that it The Committee has a long-standing believes funding for technical education history of support for technical education is inadequate and that more money is and believes the time has come for the necessary in order to make Kansas a Legislature to devote attention to the state that, like Georgia, is recognized for mission, governance, and funding of the quality of its technical education and vocational schools and technical colleges. responsiveness to workforce needs. The fact that the Board of Regents is considering recommendations, that the 2006 • Recommend that legislation be prefiled Legislature created a Commission to study to extend the Technical College and workforce training, and that the Association Vocational School Commission another of Technical Schools and Colleges is two years and require that the developing its own recommendations Commission make annual reports to the indicates that unresolved issues have LEPC. emerged which need to be addressed. For that reason, the Committee makes the following recommendations: Charter Schools
• Recommend that the 2007 Legislature The State Department of Education made take under consideration the a report to the Committee on charter recommendations presented by the schools. Charter schools in Kansas are Kansas Board of Regents, the Technical under the jurisdiction of local boards of College and Vocational School education which are responsible for Commission, the Kansas Association of allocating staff and funding for the schools. Technical Schools and Colleges, and any A petition to begin a charter school may be other related proposals. The LEPC itself submitted to a local board by any entity, does not endorse any particular proposal including the district itself, a school, a at this time because such action would school district employees’ group, or an be premature, but it wants to call educational services contractor. A petition attention to the work that is being done to establish or continue a charter school in the area and stress its importance. must describe the educational program of the school; program goals and measurable • Recommend $34.0 million of additional pupil outcomes; an explanation of how pupil funding in FY 2008 and another $34.0 performance in achieving specified million in FY 2009 (total funding of outcomes will be measured, evaluated, and $102.0 million) for technical institutions. reported; and the governance structure of The figures are based on information the school, including the means of ensuring provided about the State of Georgia, accountability to the local board. Petitions which spends $300.0 million on to establish or continue charter schools must technical education and has a be approved by both the local board and the population three times that of Kansas. If State Board of Education. Kansas spent proportionally to Georgia, it would spend $100.0 million annually Currently, there are 28 charter schools in on technical education. The Committee 24 school districts. The State Board of is well aware that the recommendation is Education approved three new charter based on a figure that was cited during schools for the 2006-07 school year and two Committee discussion and not on a schools were discontinued. Of the schools, careful analysis of the true need for 56 percent are high school, 21 percent are additional funding in Kansas. The elementary and secondary through the 12th Committee’s purpose in making such a grade, 17 percent are elementary and
Kansas Legislative Research Department 12-19 2006 LEPC secondary through the eighth or ninth grade, and 4 percent are elementary only. Kansas • Make information more accessible to the recently received a federal charter school public. grant which will provide $10.0 million over a three-year period, of which $9.4 million • Give policy makers better information on will be in grants to schools and the which to base decisions. remainder will be for administrative and indirect costs. • Provide a better way to track and measure student progress. Some charter schools decide to discontinue their status, often reverting to regular attendance centers within the School Accreditation and district. This can happen for a variety of Student Performance reasons but often is correlated with the availability of federal funding to either The LCC charged the Committee with a establish or maintain charter schools. If the review of 2006 SB 596 which dealt with state funding ends, the school may no longer be educational performance standards for able to operate. students, and also directed the Committee to study the consequences of receiving federal education funds if the state educational Committee Recommendation performance standards were to be modified.
The Committee supports charter schools SB 596, introduced by Senator Vratil, because they provide an opportunity for would prohibit a public agency, defined to innovation and alternative ways to meet the include the State of Kansas, any department, needs of students. It believes that charter agency, board, or school district, from schools serve as incubators to test and spending public money to adopt, implement, develop new ideas that can be adapted to or enforce school accreditation guidelines or other settings and encourages the Legislature standards which establish or are based upon to consider incentives to expand the number a requirement of student performance or of charter schools in the state. student proficiency. However, the bill would not prohibit the State Board of Enterprise Data Warehouse Project Education from establishing school accreditation standards which establish or The Committee received a report on the are based upon improvement in student “Enterprise Data System” being developed performance or student proficiency goals. by the State Department of Education which The impact of the bill would be to prohibit will be used to support decision making and the State Board of Education from adopting reporting. The system was begun in 2006 accreditation guidelines or standards which and will be completed in 2009. require Kansas students to attain the performance and proficiency standards of The system will: the No Child Left Behind Act. Nothing would prevent the State Board of Education • Make data accessible. from setting those standards as desirable goals for Kansas students to meet. • Reduce the reporting burden on local districts and the State Department of Federal funding under the No Child Left Education. Behind Act is expected to total $174.7 million in FY 2007, which is only a slight • Connect numerous data reporting increase ($3.2 million) over FY 2006. The systems that presently are not integrated. rough rule of thumb for the amount of
Kansas Legislative Research Department 12-20 2006 LEPC money a state would lose if it failed to comply with the Act is 2.5 times the state’s Student Assessments Title I funding. In Kansas, that amount would be $250.0 million. According to the The Committee received a report from National Conference of State Legislatures the State Department of Education on the (NCSL), no one really knows what the most recent student assessments, including federal government would do if a state tried a review of the process by which the to “pull out” of the No Child Left Behind assessment instrument is developed. The Act. To date, Utah is the only state that assessments, developed in Kansas for Kansas seriously has considered the action and, students, are intended to provide according to NCSL, the federal government information on individual students, classes, made considerable efforts to keep Utah from schools, districts, and subgroups and are the withdrawing. basis for measuring student achievement under the No Child Left Behind Act.
Committee Recommendation School districts that meet or exceed their annual goal of student progress in reading The Committee is concerned about the and mathematics are considered to have met increasing demand placed on states by “Adequate Yearly Progress ” (AYP). Based federal requirements which erode the states’ on preliminary data for school year 2006-07, traditional role in determining what is best 264 out of 300 school districts made AYP. for students. For that reason, it recommends School year 2006-07 also was the first year the introduction of legislation which would of full testing for all of the grades required prohibit a public agency, defined to include by the No Child Left Behind Act. In the State of Kansas, any department, agency, addition, fewer exceptions were allowed for board, or school district, from spending participation. It should be noted that, under public money to adopt, implement, or the Act, if one subgroup fails to meet AYP, enforce school accreditation guidelines or the entire school fails to meet AYP. The standards which establish or are based upon State Department of Education itself also a requirement of student proficiency. The underwent staffing changes, developed new bill would not prohibit the State Board of tests, and changed how the test results were Education from establishing school reported to schools. accreditation standards which establish or are based upon improvement in student There is a series of sanctions under the performance or student proficiency goals. No Child Left Behind Act for schools and The impact of the bill would be to prohibit districts that fail to attain AYP, ranging from the State Board of Education from adopting the opportunity for parents to choose accreditation guidelines or standards which another school for their children to a require Kansas students to attain the restructuring plan imposed by the state. performance and proficiency standards of Based on preliminary 2006-07 data for Title the No Child Left Behind Act. However, I schools, there are 26 schools and 11 nothing would prevent the State Board of districts identified for improvement. Of the Education from setting those standards as schools, 11 are on the list because of desirable goals for Kansas’ students to meet. mathematics, 11 because of reading, and Failure of a school to attain the State Board’s three are on the list for both mathematics goals would not jeopardize the schools’ and reading. Twelve schools are on the list accreditation. The bill also would provide for the first time. These schools and districts that programs created with or expanded by must make AYP for two consecutive years to federal funds may be reduced or eliminated be removed from the list. if the federal funds are reduced or eliminated.
Kansas Legislative Research Department 12-21 2006 LEPC In general, student achievement $43.81 in school year 2006-07 ($657 per continues to rise in Kansas and more than semester for a full-time student), an increase 1,200 of the 1,414 public schools made AYP of about 40 percent. in the 2005-06 school year. These schools meeting AYP represent 85 percent of the A major development for community schools in the state and have met AYP even colleges was the enactment of the Higher though the targets have increased Education Coordination Act (SB 345) in incrementally since 2000 when Kansas 1999. The major provisions of the Act as started testing students under the No Child they affected community colleges are the Left Behind Act. Nationwide, based on data following: reported in September 2006, the national average for schools making AYP was 71 • Community college coordination was percent. moved from the State Board of Education to the Kansas Board of Regents.
Committee Recommendation • Funding for community colleges was changed from a per-credit-hour basis to The Committee is pleased that Kansas a block grant linked to the per-full-time students and schools continue to make equivalent (FTE) pupil appropriation for progress toward achieving proficiency. It lower division courses at the three encourages the State Department of regional state universities, and was Education to strengthen its relationship with supposed to increase in equal school districts by making assessment data increments over a four-year period from available as quickly as possible in the school 50 percent to 65 percent. year. However, the Committee is mindful that more tests were given in the 2006-07 • Local tax relief was provided by the school year and that changes occurred in the requirement that 80 percent of a portion State Department which help explain why of increased state aid over the prior year information was late in getting to school had to be dedicated to tax reduction. districts. • County out-district tuition was phased out over a four-year period, with the lost Postsecondary Education revenue from the county made up by the state. Issues Concerning Community Colleges
Dr. Edward Berger, President of Despite the intentions behind SB 345, Hutchinson Community College and Area revenue shortfalls have caused the reality to Technical School, and Chairperson of the be that the goal of community college state Finance Committee of the Kansas aid equaling 65 percent of the FTE Association of Community College Trustees, appropriation to the regional universities gave an overview of the community college never has been attained. Instead, role and mission. He told the Committee implementation of the Act peaked at 55 that community colleges are responsive, percent in the second year of the four-year affordable, and accessible and traditionally plan. According to Dr. Berger, it would take have been a low-cost alternative for students an additional $116.0 million to fund the 65 who seek additional education. He noted, percent level with the current community however, that student tuition continues to college enrollment. Further, institutions rise, with the average hourly rate increasing have lost a total of $4.2 million in recent from $30.89 in school year 1999-00 ($463 years because the Legislature has not per semester for a full-time student) to appropriated money to local units from the
Kansas Legislative Research Department 12-22 2006 LEPC Local Ad Valorem Tax Reduction Fund. In engaged in a number of activities that affect all, state aid to community colleges has teachers and school districts. The increased from $58.7 million in school year Committee receives a report annually on its 1999-00 to $96.2 million in school year activities, which include the following: 2006-07, an increase of $37.5 million (63.8 percent). The Center for Innovative School Leadership. The Center for Innovative Dr. Berger told the Committee that, School Leadership was created by the although there is a tax-reduction feature in Legislature in 2004 and involves Emporia the legislation, failure of the Legislature to State, Fort Hays State, and Pittsburg State adequately fund the state aid portion of the Universities. Its purpose is to work with funding mechanism resulted in mill levy public school districts to identify best reductions only in the first two years after practices, cost savings, and potential the legislation was implemented. Currently, efficiencies in the areas of leadership, property tax support for community colleges teaching and learning, facilities is higher than before the implementation of management, and human resources. SB 345, with total mills levied for the institutions being 469.18 in school year Participation is voluntary on the part of 1999-00 compared to 496.02 in school year the school district. Once a school district 2005-06. indicates it wants to participate, the Center surveys administrators and board members, Dr. Berger said the Kansas Association of teachers, classified staff, parents and Community College Trustees remains patrons, and students on issues such as committed to the goals of the Higher efficiency of the central office, adequacy of Education Coordination Act, but wants the the district’s educational programs, quality Legislature to fulfill its commitment to and cleanliness of facilities, and safety of the adequately fund the legislation. The school environment. Team members Association endorses performance funding conduct on-site visits to the district and at as a way to ensure continuous improvement the end of the process a final report is but requests a new, separate revenue source created and given to the district’s for business and industry training (perhaps superintendent. The final report includes all the Economic Development Initiatives Fund) information pertaining to the effectiveness and a differential funding source for and efficiency review, including team developmental programs. Dr. Berger pointed member reports, comparative data, results of out the particular funding problems the surveys, and a detailed conclusion of the associated with providing high cost Center’s findings. programs, such as allied health and fine arts, and addressed the need for funding to pay During the 2005-06 school year, for facility repairs and upgrades. efficiency reviews were conducted in the following six school districts: Committee staff also presented information about community colleges, • USD 210 (Hugoton) including a summary of 24 studies of • USD 235 (Uniontown) postsecondary education spanning the years • USD 355 (Ellinwood) 1972 through 1998. • USD 423 (Moundridge) • USD 418 (McPherson) Activities of the Jones Institute for • USD 218 (Elkhart) Educational Excellence Reading Recovery Program. Sixty-eight The Jones Institute for Educational school districts in Kansas use the Reading Excellence, located at Emporia State, is Recovery Program, which is a reading
Kansas Legislative Research Department 12-23 2006 LEPC intervention program for first-grade students Board to address the nursing shortage in who find learning to read and write difficult. Kansas. The Board had been asked by the In 2005, 1,069 students were served by the 2005 Legislature to prepare a report Program. In that same year, 80 percent of assessing the cost of increasing capacity for those students completing an average of 18 educating registered professional nurses by weeks of intervention were finally able to 25 percent and to submit a time line for read and write within the average or above expanding the system to accommodate up to compared to their peers. According to staff 250 more nursing students each year. The from the Jones Institute, reading and writing Board reported that the total number of gains are sustained at least through the nurses needed by 2010 is 28,973, of whom fourth grade. 11,350 will be new nurses.
National Board Certification Program. The Committee learned that, in the The National Board for Professional opinion of the Board’s staff, the problem is Teaching Standards was formed in 1987. Its not the number of potential nursing students mission is to advance the quality of teaching in the pipeline, but the nursing training and learning by developing professional capacity of the education system in terms of standards for accomplished teaching, qualified nursing faculty, clinical access, creating a voluntary system to certify classrooms, and equipment needs. The teachers who meet those standards, and Board’s recommendations to increase the integrating certified teachers into number of registered professional nurses are educational reform efforts. The the following: performance-based assessment takes between one and three years to complete • Initiate a Tuition Forgiveness Program and measures what accomplished teachers funded by the Legislature which is should know and be able to do. There are targeted to nurses with a bachelor of more than 47,000 National Board Certified science degree who are willing to obtain Teachers nationwide, including 204 in a master’s degree in nursing, remain in Kansas. Kansas, and teach nursing at the postsecondary level. Future Teacher Academy. Over the past 17 years, the Kansas Future Teacher • Provide 22 eligible nursing programs the Academy has graduated more than 840 opportunity to hire additional nursing Kansas high school juniors and seniors who teaching faculty. (The 22 eligible intend to enter the teaching profession. The nursing programs are public four-year vast majority of Kansas school districts have universities and community colleges that been represented in the Academy. A survey have nursing programs.) of 335 participants attending the 1989-1997 academies indicated the following: • Provide 22 eligible nursing programs the opportunity to purchase nursing clinical • 92 percent of the participants stayed in equipment (patient simulators), supplies, Kansas to attend college. and facility upgrades.
• 65 percent selected teacher education as their field of study. The Regent’s staff estimated that the time line to successfully increase the number of registered professional nurses in Kansas is Nursing Shortage Initiative Update 10 years.
Staff from the Kansas Board of Regents The 2006 Legislature appropriated a total provided information on activities of the of $3.4 million, which will require $2.3
Kansas Legislative Research Department 12-24 2006 LEPC million in matching funds from participating Specific data on nursing position institutions. The 10-year initiative is vacancies for Kansas indicate that, in 2006, expected to total $30.0 million, with $22.0 almost 17 percent of licensed nurses were million coming from the state and $8.0 not in the workforce. There is a vacancy million in matching funds coming from rate of 8 percent for registered professional participating educational institutions. The nurses in hospitals, which equates to 663 distribution for FY 2007 of the $3.4 million FTE nurses needed in 129 hospitals. (The is as follows: vacancy rate was 4.5 percent in 2005.) There are faculty salary disparities in certain • Nursing faculty scholarships-$200,000 parts of the state, with Western Kansas from the State General Fund, plus a having particularly low salaries. $100,000 match. According to the representative of the • Nursing faculty salaries and Nurses Association, various studies of supplies-$1.2 million from the State nursing shortages identify the same needs. General Fund, plus a $1.2 million match. These include creating and maintaining a workplace environment that retains nurses; • Nursing equipment upgrades-$2.0 increasing the nursing education million from the State General Fund, infrastructure to produce more nurses; plus a $1.0 million match. increasing salaries; and increasing staffing levels. In Kansas, there are particular efforts being made to increase the awareness of The total available in FY 2007 from the nursing as a career and to continue to work State General Fund and matching funds is toward smoother articulation policies that $5.7 million. The five eligible universities make it easier to transition from certificate with graduate nursing programs submitted a nursing programs for licensed practical proposal requesting scholarship funds based nurses to the associate and baccalaureate upon the cost of delivering a master’s degree degree programs for registered professional or doctoral degree in nursing. The 22 public nurses. universities and community colleges with eligible nursing programs competed for grants for faculty salaries and supplies, Committee Recommendation nursing equipment, and facility upgrades. The Committee’s recommendation to The Executive Director of the Kansas create the nursing faculty scholarship State Nurses Association told the Committee program by statute rather than by proviso in that the nursing shortage nationwide is an appropriations bill is contained in a latter attributable to retirements, fewer individuals section of this report that deals with opting to become nurses, and technology legislative requests of the Kansas Board of which is increasing life expectancy, Regents. resulting in more people who need nursing care. She said that, according to the Kansas Student Assistance Programs Department of Labor (2005), the number of positions for registered professional nurses The staff reviewed service-based is expected to increase by about 30 percent financial assistance programs, focusing on (from 22,120 in the year 2000 to 29,040 in eligibility requirements, the amount of 2010). In addition, 4,470 replacement awards, limitations on awards, and service nurses will be needed, for a total projected requirements. It also reviewed the increase of 11,390 over the 10-year period. provisions of 2006 HB 2864 which would establish the Chester I. Lewis Scholarship Program for ethnic minority law students
Kansas Legislative Research Department 12-25 2006 LEPC who are Kansas residents. The program • A student may not succeed would award up to 30 scholarships for academically. tuition and fees at law schools in Kansas for up to six semesters. Recipients of • A student may decide to pursue a scholarships would have to agree to practice different medical specialty, such as law in Kansas for five years on a full-time surgery or radiology. basis or repay the scholarship. In addition, staff from the Board of Regents provided • A student may decide not to return to information on the student assistance Kansas after completion of training. programs the Board administers. These activities were in connection with the following proposal assigned the Committee If any of these situations occur, a student by the LCC: is required to repay the state the amount of the scholarship received plus interest, Study the various service obligations which currently is at 13 percent. Interest of scholarships administered by the accrues from the date the scholarship money Kansas Board of Regents. Review the was first received (several years retroactive). length of service obligation and the According to information provided by the appropriateness of differences in that Kansas Board of Regents, there have been length of service. The review of 355 Osteopathic Scholarships awarded. Of service scholarships would include that total, 124 students now practice in rural those administered by the University Kansas communities and 118 students have of Kansas Medical Center and the repaid the loan with interest. Kansas State University Veterinary Medical Center. The Kansas Medical Student Loan Program which began in the late 1970s is intended to provide incentives for Currently, most service scholarships physicians to practice in underserved areas. require the recipient to work in Kansas one Preference is given students from rural year for each year of scholarship, but Kansas counties who have financial need. examples of different requirements are the The students receive tuition reimbursement Mathematics and Science Teacher Service and a $1,500 monthly stipend. Students Scholarship enacted in 2005, which requires must complete their medical degree, enter two years of service for one year of and complete a primary care residency, and scholarship, and the Special Education practice in an underserved area of Kansas Teacher Service Scholarship enacted in one year for each year they received a 2006, which requires three years of service scholarship. (“Primary care residency” for one year of scholarship. means general pediatrics, general internal medicine, family medicine, or emergency The Committee took particular note of medicine.) the Osteopathic Medical Scholarship Program, which has a lower compliance rate Since the beginning of the program, than other scholarship programs. A more than 1,200 medical students have representative of the Kansas Association of received assistance under the programs. Osteopathic Medicine told the Committee Data since 1992 when the program was that students may not meet the loan- restructured indicate that 438 students with forgiveness requirements for several reasons: obligations under the program have graduated. Of these graduates, 178 (40.6 • A student may decide that he or she percent) have fulfilled their obligations, 145 wishes to pursue a different graduate (33.1 percent) have had their obligations degree. deferred (usually to allow them to complete
Kansas Legislative Research Department 12-26 2006 LEPC their residencies in preparation for practice), Committee Recommendations 84 (19.2 percent) are currently practicing in compliance with the terms of the program Specific recommendations concerning but have not completed their obligations, several existing scholarship programs are and 31 (7.1 percent) are practicing out of found later in this report in the section compliance with the terms of their dealing with legislation requested by the agreements and are repaying their loans. Of Kansas Board of Regents. The Committee the 178 physicians who have no remaining notes that it reviewed 2006 HB 2864, which obligations, 109 (61.2 percent) fulfilled their would have established the Chester I. Lewis obligations through service in underserved Scholarship Program for ethnic minority law areas. students.
The Veterinary Training Program for Teacher Education Program Rural Kansas was established by the 2006 Preparation for Work with Legislature as an incentive for persons English Language Learners pursuing a veterinary medicine degree program at Kansas State University (KSU) to According to information presented to locate their practices in rural Kansas the Committee, in 1994 there were fewer communities and to receive specialized than 2,000 English Language Learners in training to meet the needs of livestock elementary and secondary schools, producers. Preference is given to those compared to 25,000 ten years later. In some students who are Kansas residents and who school districts well more than half of the agree to serve in specified counties. The students are English Language Learners and program is administered by the College of it is estimated that by 2025 half of all Veterinary Medicine at KSU. elementary and secondary students will be minorities. To ensure that Kansas schools Subject to appropriations, the College is are prepared to deal with these minority authorized to enter into agreements with up students, many of whom do not speak to five first-year veterinary students per year English well or at all, the Committee asked for a loan in the amount of $20,000 per year representatives of the State Department of for not more than four years for tuition, Education and teacher education institutions books, supplies, and other school expenses; to explain how teacher education programs and travel and training expenses incurred by are preparing new teachers to deal with the student. The legislation requires the English Language Learners. persons receiving the loans to complete the veterinary medicine degree program at the Professional standards set by the State College; complete all advanced training in Board of Education, which approves teacher public health, livestock biosecurity, foreign education programs, require all initial animal disease diagnosis, and other teacher preparation programs to address requirements outlined in the statutes; and diverse learners, including students whose engage in the full-time practice of veterinary first language is not English. Therefore, all medicine in any county in Kansas which has new teachers have a baseline knowledge of a population not exceeding 35,000 for a skills in dealing with English Language period of one year for each year of assistance Learners. provided. A more intensive program is the At the present time, the College is in the licensure endorsement for working with process of selecting the five students who English Language Learners titled “English for will be the first recipients of loans under the Speakers of Other Languages” (ESOL). This new program. is an add-on endorsement for individuals who already hold a teaching license and
Kansas Legislative Research Department 12-27 2006 LEPC generally requires 15 to 18 semester hours of Committee Recommendations coursework. Nine teacher education institutions offer approved ESOL programs. The Committee is concerned that the Some ESOL teachers continue to teach in need to educate an almost certain increase in their content area to classes that contain English Language Learners will be both English speaking and English Language exacerbated by an impending teacher Learner students; some are resource teachers shortage, which already is occurring in some who work with English Language Learners teaching areas and in some parts of the state. in pullout situations or as support to regular The Committee understands the position teachers; and others have classes that are taken by representatives of the teacher composed entirely of English Language education institutions who appeared before Learners. The Committee learned from one it, but suggests that perhaps bolder steps school district superintendent that an ESOL must be taken to ensure that more teachers endorsement is so important in his district are prepared to teach English Language that the district pays teachers seeking Learners. One of those steps could be to endorsement for the required coursework reconsider the configuration of teacher and materials. education programs so that they could include more coursework to prepare all Representatives of Kansas State beginning teachers to work with English University and Emporia State University Language Learners. The Committee requests described their respective programs and that the Board of Regents look at ways called attention to the increasing need for teacher education programs at the state ESOL teachers and the ongoing need for universities could be restructured to prepare professional development and additional teachers to meet the language needs of a resources. The thrust of their testimony was growing number of Kansas students. that teaching students who do not speak English is a separate content area with its In addition, the Committee recommends own methodology, in the same sense that that legislation be prefiled that would create teaching mathematics requires knowledge of the English for Speakers of Other Languages a different content area than science or Task Force, a nine member entity whose music. Their position tended to run counter charge would include considering how to the Committee’s hope that teacher preparing teachers to teach English education institutions could integrate Language Learners could be incorporated methods for teaching English Language into the basic teacher education curriculum Learners into the coursework all teachers at the state universities. Three members of take so that beginning teachers would be the Task Force would be appointed by the able to deal with increasing numbers of Governor, two by the Speaker of the House, students who do not speak English. two by the President of the Senate, and one Representatives of the teacher education each by the minority leaders of the House institutions maintained that teaching and the Senate. The Task Force would meet English Language Learners is not a matter of for two years and make annual reports to the quickly acquiring a set of skills or strategies Committee. that will prepare all new teachers to deal with the complexities they will face in the Legislative Initiatives of the classroom due to expanding numbers of Kansas Board of Regents minority students. The Board of Regents presented the following initiatives to the Committee for consideration by the 2007 Legislature:
Kansas Legislative Research Department 12-28 2006 LEPC Teacher Shortage Initiative and Teacher Committee Recommendations Scholarship Streamlining. The Board proposes two initiatives. The first would be The Committee endorses the request by to combine four existing teacher education the Board of Regents for additional funding scholarships into the new “Comprehensive for teacher education scholarships and for Teacher Scholarship Program” and to double grants to the state universities. It agrees that the amount of money appropriated for the the teacher education scholarship programs programs combined. The existing programs should be consolidated and therefore are the Teacher Service Scholarship Program recommends the introduction of legislation (one year for each year of scholarship service to combine the four existing programs into obligation in a hard-to fill discipline or the Comprehensive Teacher Scholarship underserved geographic area); the Kansas Program, as proposed by the Board. It also Math and Science Teacher Service recommends legislation to create a new Scholarship (two years of teaching math or program to provide grants to state science for each year of scholarship); the universities for programs to benefit teachers Special Education Teacher Scholarship and teacher preparation. created in 2006 (commitment to teach special education three years or six years Benefits Enhancement for University part-time); and the Teacher Education Support Staff and Classified Staff. The Scholarship Program created in 2006 for 2005 Legislature enacted legislation licensed teachers enrolled in programs authorizing a state university to convert its leading to master’s degrees or persons with classified staff to University Support Staff associate degrees enrolled in programs (USS), which allows more flexibility in leading to Bachelor’s degrees (one year terms of job classifications, salary levels, and service obligation for each 15 credit hours of salary increases. (Only the University of assistance). Funding for these programs Kansas has made the conversion.) The 2006 currently totals $962,859 in FY 2007, which Legislature enacted legislation to allow the the Board proposes be increased to $2.0 state universities to raise annual leave and million for FY 2008. The Board’s proposal to discretionary leave for classified staff up to consolidate the programs would make them the level offered to unclassified personnel. easier to administer and eliminate confusion According to staff for the Board of Regents, among applicants applying for programs that the two provisions are in conflict in that the appear very similar. Additional funding for authorization to convert staff to USS does scholarships would make it possible for the not include the authorization to raise annual Board to award more scholarships. leave and discretionary leave for classified staff up to the level offered to unclassified The second initiative would not require personnel. legislation but would require the appropriation of $2,750,000 from the State General Fund for the Board to award grants Committee Recommendations to state universities on a dollar-for-dollar matching basis for projects that would The Committee agrees that it was not the benefit teachers and teacher preparation. intent of the Legislature to set up a conflict Examples include summer institutes for high between the two enactments and school teachers and programs to enhance the recommends that a bill be prefiled to supply of elementary school teachers. conform the two policies, as requested by the Board.
Nurse Educator Scholarship Program. The 2006 Legislature created the Nurse Educator Scholarship Program by proviso in
Kansas Legislative Research Department 12-29 2006 LEPC an appropriations bill and appropriated Committee Recommendations $200,000 for scholarships, to be matched with $100,000, for the purpose of preparing Committee members can recall no time nurses with master’s degrees or doctoral when the Legislature has failed to approve a degrees in nursing. The scholarships are requested transfer. For that reason, it intended to help address the nursing recommends that legislation be prefiled to shortage by preparing nurses to become give the Board and the state universities the nurse educators to train new nurses. authority to transfer property to state Because the program was created in an university investing agents. (Some state appropriations bill, it will expire on June 30, universities have endowment associations 2007. The Board requests that the program and others have foundations. The term he created statutorily so that it will not “investing agent” is inclusive.) terminate at the end of the current fiscal year. Capital Improvements Exemption Law Amendments. Current law provides Regents institutions an exemption from state Committee Recommendations construction and contracting laws for projects under $1.0 million if the projects are The Committee believes the nursing funded by nonstate moneys. The Board of shortage is serious and that a program to Regents maintains that conforming to make it possible for nurses to get their construction and contracting laws delays the master’s and doctoral degrees in nursing in project and increases planning and order to teach is important. Therefore, it construction costs. In addition, the Board recommends the introduction of legislation would like the exemption expanded to to make the Nurse Educator Scholarship include restricted fees collected by Program statutory. universities for construction and renovation of state educational institutional buildings. Transfer of Property to Endowment Associations. Currently, individuals often donate property to state universities in their Committee Recommendations wills. The universities manage the land to generate income for the intended The Committee recommends that philanthropic purposes as defined by the legislation be prefiled that would eliminate individual donating the property, but the the $1.0 million limit on capital universities’ endowment associations are improvements projects and expand the better structured and have more expertise to source of revenues to include restricted fees manage bequests than are the universities. collected by universities for construction If a state university wants to transfer and renovation of state educational property to its endowment association, it buildings. presently is necessary for the university to get legislative approval on a case by case Amendments to the Medical Student basis. The Board of Regents is requesting an Loan Program. The $1,500 monthly stipend amendment to current law which would for medical students who participate in the allow it or the state universities to transfer Medical Student Loan Program has not been title of willed property to an endowment increased since 1992. The Board of Regents association without having to get approval is requesting that the stipend be increased to from the Legislature for each transaction. $2,000 per month. In addition, the Board is requesting that medical students who do not select primary care as their area of specialization until their third or fourth year of medical school be eligible to participate in
Kansas Legislative Research Department 12-30 2006 LEPC the program and that they be retroactively Most alarming is the condition of paid the full stipend and refunded their campus facilities. The buildings that are on previously-paid tuition. Upper class the six state university campuses represent medical students who enter the program and two out of every three buildings that the receive full stipends retroactively would be State of Kansas owns. Because of a lack of subject to the same service obligations as all state resources dedicated to campus other medical students who participate in facilities, the Regents report a deferred the program. maintenance backlog that totals $727.0 million. Limited funding for building and maintenance is exacerbated by the fact that Committee Recommendations approximately 80 percent of the buildings are at least 20 years old. Deferred The Committee agrees that the monthly maintenance needs range from more than stipend needs to be increased and also $200.0 million each at the University of supports the Board’s request that upper class Kansas and Kansas State University to under medical students who select primary care as $100.0 million at each of the remaining their area of specialization be allowed to campuses. The Regents estimate that $84.0 participate in the program retroactively. The million will be needed each year to Committee recommends that legislation be adequately maintain university campuses prefiled to implement the Board’s request. and note that only $15.0 million is available It also recommends that an escalator (the in FY 2007 and that the Educational CPI-U) be added to the stipend so that there Building Fund (EBF), which was established would be an inflationary increase in the cap. in 1941 and is the primary revenue source for university maintenance, was raised to Overview of Postsecondary Education 1.0 mill in 1955 and has not been increased since. As part of its charge to monitor the implementation of the Higher Education In the current fiscal year, state support of Coordination Act, the Committee received a $15.0 million from the EBF will permit only report on the condition of postsecondary 18 percent of the goal of $84.0 million education from the President and Chief annual facilities maintenance to be reached. Executive Officer of the Kansas Board of For FY 2008, the Regents estimate the same Regents. Central to the report was the amount of state support ($15.0 million) and concern that state funding for postsecondary intend to dedicate $8.5 million in tuition education, including facilities, has declined. revenues to facilities needs, leaving $60.5 For example, in 1985 state aid totaled 51 million (72 percent) of the $84.0 million percent of state university operating budgets maintenance goal unfunded. Paradoxically, and tuition and other revenues totaled 49 the “Crumbling Classrooms” initiative in percent. The projection is that, unless state 1996 which dedicated significant resources aid increases as a proportion of the total, by to building maintenance on the university the year 2010 state aid will amount to only campuses has had the impact of reducing 24 percent of university operating budgets, funding available for maintenance because with student tuition and other revenues the initiative allowed the Board of Regents to making up 76 percent. On a per student borrow money from the EBF and pay it back basis, state support for an FTE student in on an ongoing basis until the year 2012. 1985 was $7,354 compared to $5,719 in Thus, money that might have been used for 2005. (In “today’s dollars,” it would have maintenance is being used to retire the taken an additional $284.6 million in FY Crumbling Classrooms debt. 2005 to maintain funding at the FY 2000 level.) To address its maintenance needs, the Board proposed a plan to the 2006
Kansas Legislative Research Department 12-31 2006 LEPC Legislature that included a temporary will continue to grow as buildings age unless increase in the state sales tax, a bond issue, addressed. Particularly alarming is the fact an increase in the statewide EBF mill levy, that a considerable number of needs involve and new campuses administrative practices bringing buildings up to safety codes and that would alleviate future maintenance making them handicapped accessible. To obligations. None of the proposals that address its concerns, the Committee requests would have required legislative action was that the Joint Committee on State Building adopted. Construction, the Senate Ways and Means Committee, and the House Appropriations Committee carefully review the Board of Committee Recommendations Regents’ facilities request and perhaps develop a multi-year plan to address the The Committee shares the Board’s building needs of the campuses. The concern about the deteriorating condition of Committee believes the review should the state buildings located on university include a consideration of the cost campuses and notes that the deferred effectiveness of maintaining each facility maintenance backlog has increased by and an evaluation of whether the facility $140.0 million in just the last two years and continues to be needed.
Kansas Legislative Research Department 12-32 2006 LEPC Joint Committees
Report of the Joint Committee on Pensions, Investments, and Benefits to the 2007 Kansas Legislature
CHAIRPERSON: Senator Stephen Morris
VlCE-CHAIRPERSON: Representative John Edmonds
OTHER MEMBERS: Senators Anthony Hensley, Laura Kelly, Ruth Teichman, and Dwayne Umbarger; and Representatives Richard Carlson, Ray Cox (replaced by Robert Olson in December), Geraldine Flaharty, Vaughn Flora, Margaret Long, Bill McCreary, and Melvin Neufeld
St u d y T o pics
The Committee is directed to monitor the operations of KPERS, to review public retirement benefits, and to consider Governor’s nominees to the KPERS Board of Trustees, with a recommendation to the Senate regarding confirmation.
LCC Referred Topics:
• Proposed Alternative Retirement Plan. Review a plan being developed by the KPERS Board of Trustees to address a long-term funding issue for the KPERS plan that covers state, school and local public employees. The KPERS Board has undertaken a study of the funding status, changing demographics and plan design options for future members and will report on development of alternative plans during the 2006 Interim period.
• State’s Deferred Compensation Plan. Review the current status of the State’s deferred compensation plan. Review if any changes need to be made in the plan.
December 2006 Joint Committee on Pensions, Investments, and Benefits
Proposed Alternative Retirement Plan
Conclusions and Recommendations
The Committee recommends legislation to implement an alternative retirement plan for new state, school, and local public employees who begin work on or after July 1, 2009. In addition, the Committee recommends revisions to the present Kansas Public Employees Retirement System (KPERS) plan for current public employees who work for state, school, or local government employers.
Proposed New Plan
• First-day membership. • Five-year vesting. • 1.75 percent defined benefit multiplier. • Final average salary based on five highest years. • Normal retirement at age 65 with five years or age 60 with 30 years of service. • Early retirement at age 55 with 10 years of service. • Automatic 2.0 percent cost-of-living adjustment at age 65. • Employee contribution rate of 6.0 percent. • Employer contribution rate at actuarial level, but not less than employee rate. • Partial lump sum option of 10.0, 20.0 or 30.0 percent at retirement.
Modifications to Current Plan
• First day membership for all state, school, and local members. • Five year vesting, effective July 1, 2009.
In addition, the Committee recommends separate consideration of an automatic cost-of-living adjustment for active public employees who work for state, school, or local government employers covered by KPERS. This item would not impact retired public employees. The proposal would provide:
• An automatic 2.0 percent cost-of-living adjustment at age 65 financed by a 2.0 percent additional employee contribution and by an actuarially determined employer contribution of 0.66 to 0.81 percent.
Proposed Legislation: The Committee recommends introduction of two bills.
Background Council with direction to review alternative plans being developed by the KPERS Board The Joint Committee on Pensions, of Trustees to address a long-term funding Investments, and Benefits was assigned this issue for the current KPERS plan that covers study topic by the Legislative Coordinating state, school, and local public employees.
Kansas Legislative Research Department 13-3 2006 Pensions The KPERS Board undertook a study of the • Approving a series of scheduled funding status, changing demographics, and employer contribution rate increases; plan design options for future members. • Issuing pension obligation bonds;
Committee Activities • Making actuarial changes; and
The Committee met on July 24, • Reviewing possible plan design changes September 26, November 15, and December for future employees. 15, 2006. The minutes and attachments for all meetings are available from the Division of Legislative Administrative Services. The first three steps have been KPERS staff presented periodic reports to the completed and the final step was the subject Committee during these meetings about the of Interim study this year. The focus is the study and recommendations from the plan that covers state, school, and local KPERS Board of Trustees. public employees. Other plans under KPERS, including the Kansas Police and For the last several years, the highest Firemen’s Retirement System and the priority for KPERS has been developing a Retirement System for Judges are not comprehensive plan to address the long-term included in this study since both are funded funding shortfall that impacts state, school, on an actuarial basis. and local public employees. Funding improvements made in recent years Funding Status. In the most recent represented important steps toward KPERS actuarial valuation dated December improving the System’s financial condition 31, 2005, the consulting actuary reported and securing funds for all future benefit that the plan’s funding condition continues payments for retired state, school, and local to show improvement. The plan remains in public employees and their beneficiaries. actuarial balance and the unfunded actuarial liability increased from $4.74 billion as of December 31, 2004, to $5.15 billion as of The 1993 Kansas Legislature provided December 31, 2005. With this increase, the enhanced KPERS retirement benefits and plan’s overall funding ratio fell from 70 adopted a 40-year payment plan that percent to 69 percent. gradually would increase employer contributions to pay for the enhancements. The unfunded actuarial liability will Several years after implementing the continue to increase until statutory graduated employer contribution increases, employer contribution rates catch up with the KPERS consulting actuary advised that the actuarially required contribution rates. the planned rate increases were insufficient Employer contribution rates are projected to to fund future promised benefits, creating a meet the actuarially required rates in the long-term funding problem. Over the last next 15 years, if there is continued positive five years, the KPERS Board, staff, and investment experience. consulting actuary worked closely with the Legislature and the Governor’s Office to Alternative Plans. Consideration of develop and implement a comprehensive alternative plan designs for future members funding plan that covers state, school, and represents the remaining component of the local public employees. long-term funding plan. KPERS funding is leveraged for approximately 15 years until Key steps taken to implement the long- the incremental employer rate increases range funding plan include: allow actual employer contributions to reach the actuarially-required rates. Although
Kansas Legislative Research Department 13-4 2006 Pensions implementation of an alternative plan design Board stressed that tradeoffs will need to be for future members will not significantly made and compromises reached to balance impact the projected cost and timing of competing objectives such as benefit levels reaching actuarially-required levels, an for career employees versus those for non- alternative plan design would significantly career employees and acceptable levels of reduce liabilities and employer additional complexity created by an contributions beginning in approximately 20 alternative plan’s administrative and years. educational components.
Following discussion and analysis of The Board recommended that the plan design alternatives over the 2002, 2003, following objectives and features should be and 2004 Interims, the Committee incorporated into any plan design changes introduced an alternative retirement plan for future members. during the 2005 Legislature. SB 281 incorporated a basic defined benefit plan Financial Soundness along with a defined contribution component for future KPERS members. Establish an actuarial funding plan with After 2005 subcommittee hearings on behalf an affordable mix of employer and employee of the Senate Ways and Means Committee, contribution rates that ensures the financial SB 281 was carried over to the 2006 Session. soundness of the plan over the long-term. At that time, KPERS recommended that action be deferred until a comprehensive Retirement Benefit Adequacy review and analysis of alternative plan designs could be completed during the 2006 Provide benefits that, when combined Interim. with Social Security benefits and personal savings, sustains the retiree’s standard of In January 2006, KPERS staff and the living in retirement. consulting actuary began developing the framework and timetable for completing a Workforce Incentives plan design review, culminating with an in- depth series of six presentations to the Provide sufficient incentives to attract KPERS Board. The Board’s discussion and and retain high quality employees as part of analysis of plan design options included the total compensation and benefits package. detailed examinations of KPERS funding status and outlook, demographic projections, The Board recommended the following key plan design objectives and features, and general plan design changes for future cost estimates. members.
The Board, recognizing the tenuous • Adopt retirement planning framework of nature of the funding projections, coupled 40-year working life and 30-year career. with revised demographic predictions that members will live longer in retirement, • Establish minimum retirement income decided to recommend plan design replacement ratio goal of 80 percent. objectives and general features to be considered before establishing an alternative • Adopt basic financial planning principle plan design. The Board believed that such that retirement income should come factors should be thoughtfully considered from three main sources: Social Security, and systematically addressed in order to KPERS benefits and personal savings. establish appropriate and affordable retirement benefits for future public • Place greater emphasis and direct employees. Throughout the process, the resources toward encouraging personal
Kansas Legislative Research Department 13-5 2006 Pensions savings and educating members about employees which are designed to retirement planning. complement retirement income from Social Security and personal savings. • Increase normal retirement age above current levels. • Higher normal retirement age and lower early retirement subsidies provide • Reduce early retirement subsidies. incentives for future members to work until they reach Social Security • Eliminate year of service requirement for eligibility. state and local members. • Projected income replacement ratio at • Reduce vesting period to five years. retirement from KPERS and Social Security of 81 percent for career • Provide automatic cost-of-living employees retiring under normal adjustments funded by increased retirement provisions (age 65 with 30 employee contributions. years of service) which is the same as the projected ratio under the current plan.
Based on the recommended objectives • Employee-funded cost-of-living and general design features, the Board adjustments that help maintain the examined a range of design alternatives. purchasing power of KPERS benefits Using the SB 281 plan design as a during retirement as demonstrated by framework, the Board selected two preferred projected income replacement ratios 10 plan design alternatives. years after retirement from KPERS and Social Security of: Modified Current Plan o 76 percent for career employees Traditional defined benefit plan with retiring at age 65 with 30 years of higher retirement eligibility, reduced early service versus 68 percent under the retirement subsidies, and automatic cost-of- current plan. living adjustments funded by increased employee contributions. o 64 percent for career employees retiring at age 62 with 30 years of Retirement Savings Plan service versus 60 percent under the current plan. Reduced defined benefit component including higher retirement eligibility, reduced early retirement subsidies, and • Higher levels of employee contributions automatic cost-of-living adjustments funded and interest returned to non-career by increased employee contributions along employees who terminate membership with separate, interest-bearing accounts for versus amounts returned under the each member. current plan.
The KPERS Board recommended • Improvements in the long-term financial legislative consideration of the modified soundness of the plan as demonstrated current plan design. The Board’s by: recommendation is based on the following key evaluation factors for the modified o Projected actuarially-required current plan. employer contribution rate of 11.75 percent in FY 2017 for the State and • Continuation of guaranteed lifetime School Groups under the modified benefit payments for future public
Kansas Legislative Research Department 13-6 2006 Pensions current plan versus 12.82 percent in • Normal retirement at age 65 with five FY 2019 under the current plan. years or age 60 with 30 years of service. Under the current plan, normal o Lower employer contributions for the retirement may be at age 65, age 62 with modified current plan compared 10 years, or with 85 points (age plus with the current plan, resulting in years of service], projected savings of approximately $2.7 billion through 2033 and $6.2 • Early retirement at age 55 with 10 years billion through 2050 for the State of service. The current plan has the and School Groups. The Committee same provision. met on July 24, September 26, November 15, and December 15, • Automatic 2.0 percent cost-of-living 2006. The minutes and attachments adjustment at age 65. New provision for all meetings are available from partially funded by additional 2.0 the Division of Legislative percent employee contribution. Administrative Services. KPERS staff presented periodic reports to the • Employee contribution rate of 6.0 Committee during these meetings percent. Under the current plan, about the study and members contribute 4.0 percent. recommendations from the KPERS Board. • Employer contribution rate at actuarial level, but not less than employee rate. No floor on employer contributions Conclusions and Recommendations under the current plan.
The Committee makes the following • Partial lump sum option of 10.0, 20.0 or recommendations regarding a new plan and 30.0 percent at retirement. The current modifications to the current plan: plan allows up to 50.0 percent in 10.0 percent increments for this option. Proposed New Plan
• First day membership for state, school Modifications to Current Plan and local KPERS members. Under the current plan, some members, such as • First-day membership for all state, school district employees, have first day school, and local members. Some local coverage and others, such as state units and all state government members employees, must wait one year. covered by KPERS have a one-year waiting period under the current plan. • Five-year vesting. Under the current plan, members have a 10-year vesting • Five-year vesting, effective July 1, 2009. period. Vesting period is 10 years under the current plan. • 1.75 percent defined benefit multiplier. The current plan also uses a 1.75 percent multiplier. In addition, the Committee recommends separate consideration of an automatic cost- • Final average salary based on five of-living adjustment for current public highest years. The current plan, employees who work for state, school, or depending on whether sick and annual local government employers covered by leave payments are added, uses either KPERS. Retired public employees would three or four years. receive no adjustments in benefits.
Kansas Legislative Research Department 13-7 2006 Pensions • Automatic 2.0 percent cost-of-living members of new plan: all members first adjustment (COLA) at age 65 financed by employed on, or after, July 1, 2009; former 2.0 percent additional employee members who withdrew contributions contribution and an actuarially before July 1, 2009, and commenced new determined employer contribution of membership on or after July 1, 2009; and 0.66 to 0.81 percent. No automatic inactive, non-vested members who COLAs are provided under tbe current commence active membership on, or after, plan. The Committee expressed concern July 1, 2009. about the increases in unfunded actuarial liability: $182 million for local Employers and employees shall share governments, and $762 million for the future rate increases on a 50/50 basis if state and school group. The employer required in the future. contribution rate increases that would address the unfunded actuarial liability Compensation caps are set at 7.5 percent would be 0.38 percent of local before participating employers are billed for governments and 0.76 percent for the inflated final average salaries that increase state in paying for the state and school the retirement benefits. groups’ combined cost. The KPERS Board will be given more The Committee also agreed to other flexibility in adjusting joint survivor factors details of the proposed new plan generally as and in setting them to actuarially recommended by the KPERS Board. determined standards.
For correctional officers, early retirement The Committee also asked for further for corrections officers and supervisors KPERS review of rollovers as related to the would be age 50 with 10 years of service and partial lump sum option. Information was early retirement for support personnel who requested about the possibility of allowing have regular contact with inmates would be rollovers up to 100.0 percent of the KPERS age 55 with 10 years of service. benefit, provided such transfers were to qualified plans and not used for other If the new plan begins on July 1, 2009, purposes. then the following individuals would be
Kansas Legislative Research Department 13-8 2006 Pensions Joint Committee on Pensions, Investments, and Benefits
State’s Deferred Compensation Plan
Conclusions and Recommendations
The Committee recommends:
• Administration of the state’s deferred compensation plan should be transferred from the Department of Administration to the Kansas Public Employees Retirement System (KPERS).
Proposed Legislation: The Committee recommends introduction of a bill transferring supervision of the state’s deferred compensation plan to KPERS.
Background an increase of $32.0 million from $386.6 million the previous December 31. During The Joint Committee on Pensions, CY 2005, contributions (deferrals) totaled Investments, and Benefits was directed by $26.7 million. As of the end of CY 2005, the Legislative Coordinating Council to there were 15,105 state participants who had study the status of the state's deferred investments in one or more funds utilized by compensation plan and to review if any the plan. changes needed to be made in the plan. As of December 31, 2005, the assets for local employees in the deferred compensation program totaled $199.3 Committee Activities million, an increase of $38.4 million from $160.9 million the previous December 31. The Committee met on July 24, During CY 2005, contributions (deferrals) September 26, November 15, and December totaled $4.4 million. As of the end of CY 15, 2006. The minutes and attachments for 2005, there were 10,677 local participants all meetings are available from the Division who had investments in one or more funds of Legislative Administrative Services. utilized by the plan. The state’s deferred compensation plan The Deputy Secretary of Administration, includes both state and local employees with Department of Administration, reviewed the total assets of almost $618.0 million and program for the Committee as representative 25,782 participants as of December 31, 2005. of the Deferred Compensation Oversight Local units of government contract Committee which was established by KSA separately for participation in the program, 75-5529c in 1998. Members are appointed hence a distinction between state and local by the Secretary of Administration and components of the plan that includes the currently include the Director of Accounts state and 238 other entities. and Reports, the Executive Director of KPERS, and the Deputy Secretary of As of December 31, 2005, the assets for Administration. state employees in the state’s deferred compensation plan totaled $418.6 million,
Kansas Legislative Research Department 13-9 2006 Pensions She noted that the plan was administration of the plan from the implemented in 1980, with Aetna selected as Department of Administration to KPERS. the first plan service provider. Enabling Under the proposal, the KPERS Board of legislation passed originally in 1976 Trustees would assume responsibility for authorizing the plan. In 2000, the deferred administering the plan. compensation division of Aetna was purchased by ING Life Insurance and The Executive Director of KPERS Annuity Company (ING). Over the past 26 indicated that the KPERS Board had years, Aetna and ING have been selected as approved the proposal and that the transfer the plan service provider through two would accomplish the following initiatives: competitive procurement negotiations, with the most recent award of contract in 2002. • Provide state and local employees with The current contract began January 1, 2003 coordinated retirement education and and will expire on December 31, 2007. planning information. This would be accomplished by integrating the plan’s The Oversight Committee selected Segal educational and retirement planning and Company to assist as its investment information into KPERS publications. consultant and in selection of a plan service provider for the period beginning in January • Increase the emphasis on personal of 2008. The Deputy Secretary indicated savings as a component of retirement that a request for proposals would be planning. KPERS retirement planning released in early January of 2007 and that a seminars would be expanded to include negotiated contract with a service provider savings education and a deferred would be finalized as early as July 1, 2007, compensation components. in case there was a transition from one firm to another firm. The KPERS Executive Director would The Committee also heard a report from provide leadership for the plan, while a new the Kansas Securities Commissioner manager would handle the daily operations concerning regulatory actions in New in conjunction with the plan’s service Hampshire involving ING. The provider. The administrative costs would Commissioner related that there were continue to be self-funded by plan serious allegations in New Hampshire. participant fees and there would be separate However, after initial review of the ING accounting for the plan and the regular contract and operation in Kansas, the KPERS retirement related operations. Commissioner stated that there was no cause for concern about ING activities in Kansas.
Conclusions and Recommendations At a subsequent meeting during the 2006 Interim, the Deputy Secretary of T h e Committee recommends Administration, Department of introduction of legislation to transfer the Administration, and the Executive Director deferred compensation plan to KPERS for of KPERS, provided recommendations for administrative purposes, effective January 1, changes in the program. The primary 2008. recommendation is for legislation to transfer
Kansas Legislative Research Department 13-10 2006 Pensions Joint Committee on Pensions, Investments, and Benefits
Statutory Study
Conclusions and Recommendations
The Committee recommends legislation:
• To void two Department of Revenue notices for taxation of lump sum rollovers from Kansas Public Employees Retirement System (KPERS) and the Regents Retirement Plan of retirement benefits.
• To allow direct payments from KPERS on behalf of retired public safety officers for health insurance or long-term care providers, as permitted by federal law.
• To update the earnings limitation from $10,000 to $20,000 for certain Kansas Police and Firemen Retirement System members who are disabled but return to other kinds of non duty work.
• To clarify statutory language for improper withdrawals and portability of service credits between different systems.
Proposed Legislation: The Committee recommends introduction of 3 bills to modify current KPERS statues.
Background coverage groups are defined benefit, contributory retirement plans, and have as The Joint Committee on Pensions, members most public employees in Kansas. Investments, and Benefits is directed by KSA KPERS also administers several other 46-2201 to monitor, review, and make employee benefit and retirement programs: recommendations relative to investment a public employee death and long-term policies and objectives formulated by the disability benefits plan for active employees; KPERS Board of Trustees; to review and an optional term life insurance program; a make recommendations related to KPERS Kansas City, Kansas annuitant program; and benefits; and to consider and make a closed legislative session-only employees recommendations on the confirmation of retirement program. members nominated by the Governor to serve on the KPERS Board of Trustees. Committee Activities KPERS administers three statewide coverage groups: KPERS state, school, and The Committee met on July 24, local (for regular state and local public September 26, November 15, and December employees, school and community college 15, 2006. The minutes and attachments for employees, and state correctional officers); all meetings are available from the Division the KP&F Retirement System; and the of Legislative Administrative Services. Kansas Retirement System for Judges. All
Kansas Legislative Research Department 13-11 2006 Pensions Governor’s Nominations. There was no managers not retained included Lazard vacancy during the 2006 Interim on the Freres Asset Management and Alliance KPERS Board of Trustees that required the Capital Management. The KPERS Board of Committee to review a gubernatorial Trustees contracts with 14 management nominee pursuant to KSA 46-2201. firms to manage 20 different sectors of the KPERS portfolio. KPERS Investment Performance. For the calendar year (CY) 2005, ending Investment reports for CY 2006 through December 31, 2005, total portfolio September 30, 2006, indicate that KPERS performance was a gain of 9.7 percent based earnings of 9.4 percent since January 1, on market value; the total portfolio reflects a 2006, with the portfolio growing in value to gain of $0,731 billion of investment income an estimated $12,702 billion. and the total portfolio value was $11,909 billion. During the spring of 2004, KPERS Investments in Sudan. KPERS staff received $440.2 million in bond proceeds reviewed information about the extent of that were invested across the different areas investments in companies identified as without trying to time the market in any either doing business with the Sudanese particular area. government or having a presence in that country. In late CY 2005, the KPERS Chief Investment Officer announced his departure, Currently, six states have passed some and the KPERS Executive Director reported form of divestment legislation pertaining to that a national search for a replacement was the Sudan. These states include California, undertaken. A new Chief Investment Officer Connecticut, Illinois, Maine, New Jersey, was hired in the Spring of 2006. and Oregon.
Also in CY 2005, the KPERS Board of KPERS Actuarial Valuation. The KPERS Trustees adopted a number of changes in the actuary presented the annual valuation portfolio, including a new category of Global report for CY 2005. The process used to Equity for investments and new target quantify the assets and liabilities of the allocations for all categories. The asset KPERS plans was reviewed. The actuary allocation targets include: explained that there has been a substantial improvement in the long-term funding of • Domestic Equity 31.0 percent KPERS, and that action taken by the last • International Equity 18.0 percent three legislative Sessions has resulted in that • Global Equity 8.0 percent improved long-term funding, with the state, • Fixed Income 19.0 percent school and local groups considered in • Treasury Inflation Protected Securities actuarial balance. (TIPS) 10.0 percent • Real Estate 8.0 percent The total unfunded actuarial liability for • Alternative Investments 5.0 percent all KPERS plans increased $0,410 billion, • Cash Equivalents 1.0 percent from $4,743 billion on December 31, 2004, to $5,153 billion on December 31, 2005. The funded ratio for all plans, a more meaningful In addition, changes in the managers measure of the health of a retirement plan engaged to assist with KPERS investments according to the actuary, decreased from 70 were made in realigning the portfolio during percent to 69 percent over the same one-year CY 2005. New contracts were made with period. Quantitative Management Associates, Payden and Regel, Capital Guardian Global, The KPERS state and school portion of and Wellington Global. Investment the unfunded actuarial liability was divided
Kansas Legislative Research Department 13-12 2006 Pensions into separate components for each group as retirement limitation of $20,000 enacted by a result of 2004 legislation that requires a the 2006 Legislature. separate actuarial valuation for each group —state, school, and local. The December 31, The third change would make technical 2005, unfunded actuarial liability for the modifications to revise vague or ambiguous state group was $471 million, the amount for provisions on improper withdrawals and the school group was $3,455 billion, and the portability of service credits between amount for the local group was $869 million. systems. The Board of Trustees The funded ratio for the state group was 85 recommended the technical changes. percent, the ratio for the school group was 61 percent, and the ratio for the local group State Taxation of Retirement Payments. was 67 percent. Representatives from the Department of Revenue provided information to the In conclusion, the KPERS actuary Committee during the 2005 Interim about stressed that the three largest KPERS groups the tax status of rollovers from KPERS and (state, school and local) should reach the Regents Retirement System. The agency actuarial balance before 2020. Projections provided copies of two 2005 agency notices suggest that as a result of the major steps regarding the state tax treatment of taken in a long-range funding, coupled with distributions in the form of direct one-time strong investment returns, the funding payments, monthly payments, and roll-over outlook has improved dramatically. payments. Basically, the same information is contained in the KPERS Notice 05-04 and KPERS Legislative Request. Pertaining the Regents Retirement Notice 05-05. to proposed 2007 legislation, the K P E R S Generally, the agency indicates that in order Board of Trustees requested three changes in to qualify for an exemption from Kansas current statutes. income tax, payments received by a KPERS or Regents Retirement Plan participant must First, the Committee heard a report on be: the impact of a recent federal law, the Pension Protection Act of 2006. A number 1. Received directly from KPERS or from of provisions may impact public employees companies authorized by the State Board and retirees in Kansas. One particular of Regents to be plan sponsors; and provision probably needs legislative action, according to the KPERS Executive Director. 2. Included in the member's federally That provision allows up to $3,000 annually adjusted gross income in the year that it to pay premiums for health insurance and is received. long-term care directly by KPERS on behalf of retired public safety officers. A change in state law will be required to permit direct The agency states in the notices that any payments by KPERS. The Board of Trustees payments that are not included in the recommended this change. member's federally adjusted gross income in the year of receipt and that are not received The second change would increase for either from KPERS or a Regents Retirement disabled KP&F members in tier II the Plan sponsor company are not exempt from earnings limitation that is capped at $10,000 state income taxes. by statute. The Board of Trustees recommended an increase, and suggested a range in the amount of $15,000 to $20,000. The Committee discussed an appropriate amount and decided on the higher amount that would match the working after
Kansas Legislative Research Department 13-13 2006 Pensions Conclusions and Recommendations Regarding KP&F earnings limitation for Regarding the Department of Revenue disabled tier II members, the Committee notices, the Committee recommends recommends : introduction of a bill to: • Increasing the earnings limitation from • Void two Department of Revenue notices $10,000 to $20,000. for taxation of lump sum rollovers from KPERS and Regents Retirement Plan of retirement benefits. Regarding the technical changes, the Committee recommends introduction of a bill to: Regarding the tax-free distributions for retired public safety officers, the Committee • Clarify statutory language for improper recommends introduction of a bill to: withdrawals and portability of service credits between different systems. • Allow direct payments from KPERS on behalf of retired public safety officers for health insurance or long-term care providers, as permitted by federal law.
Kansas Legislative Research Department 13-14 2006 Pensions Joint Committees
Report of the Joint Committee on State-Tribal Relations to the 2007 Kansas Legislature
CHAIRPERSON: Representative Becky Hutchins
VICE-CHAIRPERSON: Senator Pete Brungardt
OTHER LEGISLATIVE MEMBERS: Senators Les Donovan, Mark Gilstrap, David Haley, and John Vratil; and Representatives John Edmonds, Tom Sawyer, Bonnie Sharp, and Arlen Siegfreid
NONLEGISLATIVE MEMBERS: Governor’s Representative—Matt All; Attorney General’s Representative—Julene Miller
STUDY TOPICS
• Congressional bills prohibiting Native American lands from being taken into trust for Class III gaming purposes;
• The provisions of SB 9 dealing with Native American liability insurance for tribes which have state police powers on reservations;
• The U.S. Supreme Court’s Decision on the motor fuel tax case involving the Prairie Band Potawatomi Nation and the State of Kansas and the subsequent appeal decision by the courts;
• Court cases dealing with the recognition of the tribal reservation license plates;
• The court’s decision dealing with the authority of the State of Kansas to seize gaming equipment from the Wyandotte Tribe in Kansas City, Kansas, and the Secretary of the Interior’s decision to recognize the Wyandotte Tribe’s request for lands to be placed in trust for gaming purposes; and
• State-Tribal Cooperation.
December 2006 Joint Committee on State-Tribal Relations
Y early Report
Conclusions and Recommendations
The Joint Committee on State-Tribal Relations recommends that:
• A Senate bill, be prefiled, that would require insurance companies to report liability insurance for state police powers on reservations to the Attorney General’s Office. It would establish a cap of two million dollars on the liability insurance, and delete the sunset clause of state police powers as contained in KSA 2005 Supp. 22-2401a.
• The Kansas Legislative Research Department and the Department of Revenue obtain information on resolution of the license plate issue in other states and report that information to Joint Committee members by December 15, 2006.
• The Senate Transportation Committee reach consensus with interested parties to solve the Indian license plate problem and to recommend a bill to accomplish this task during the 2007 Legislative Session.
Proposed Legislation: The Committee recommends one bill.
Background • Recommend modification of proposed gaming compacts submitted by the The Joint Committee is authorized by Governor and introduce resolutions statute to: approving proposed gaming compacts and recommend that such resolutions be • Establish and transmit to the Governor adopted or not adopted. Or report such proposed guidelines reflecting the public resolutions without recommendation, policies and state interests that the Joint and notify the Governor, in writing, of Committee will consider in reviewing the Joint Committee’s action; proposed compacts; • Meet, discuss, and hold hearings on • Recommend to the Governor that any issues concerning state-tribal relations; gaming compact provide for the imposition and collection of state sales • Make recommendations on issues of and excise taxes on sales of nongaming state-tribal relations; and goods and services to persons other than tribal members and imposition and • Introduce such legislation as deemed collection of state income tax on necessary in performing its functions. revenues derived from sales on nongaming goods and services; Annually, the Committee elects its • Hold public hearings on proposed chairperson and vice-chairperson. The gaming compacts submitted to the Joint chairperson alternates between the House Committee by the Governor; (even yearsj and the Senate (odd years). The
Kansas Legislative Research Department 14-3 2006 State-Tribal Relations ranking minority member is from the same discussed the need for a maximum aggregate chamber as the chairperson. liability limit in SB 320 and if there was a need to delete the sunset clause on the tribes having police powers. Committee Activities State-Tribal Litigation. A Special The Joint Committee met for two days Assistant Attorney General briefed the Joint during the interim, September 26-27, 2006, Committee on the US Supreme Court’s in Topeka, Kansas. ruling dealing with the motor fuel taxes involving the Prairie Band Potawatomi The Joint Committee elected Nation and the State of Kansas. The Representative Becky Hutchins as the Committee members learned that the Court Chairperson and Senator Pete Brungardt as upheld the Kansas motor fuel tax on a non- the Vice-Chairperson. tribal distributor who was delivering motor fuel to the Prairie Band Potawatomi Nation. Bills Prohibiting Lands Placed Into Trust. Staff from the Revisor of Statutes The conferee then updated the members Office briefed the Joint Committee on the of the Joint Committee on the Indian license status of two federal bills which would plate case, stating that the case is before the prohibit Indian gaming on lands placed in court. The Chairperson of the Prairie Band trust. HR 4893 by Representative Richard Potawatomi Nation testified that the Nation Pombo of California would prohibit a tribe wanted to cooperate with the State on the from conducting gaming in any other state license plate issue, but problems arose other than the state where the tribe had a between the Nation and the Kansas reservation on the date Indian Gaming Department of Revenue. Regulatory Act (IGRA) was enacted (1988). SB 2078 by Senator John McCain of Arizona After discussion, the Joint Committee would eliminate the exception to IGRA for requested the Legislative Research gaming on land placed into trust after the Department and the Department of Revenue enactment of IGRA. Representative Pombo’s obtain information from other states to see bill was defeated, and Senator John how they handled the issue of tribal license McCain’s bill is being considered. plates. The Joint Committee requested the information be submitted to the members by 2004 SB 9 and 2006 SB 320- State Police December 15, 2006. Powers on Reservations. Staff briefed the Joint Committee on 2004 SB 9 and 2006 SB Another representative from the 320. SB 9 was enacted to provide state law Attorney General’s Office updated the enforcement powers to tribal police on the members of the Joint Committee on the reservations. The Legislature had concerns court’s decision dealing with seizure of dealing with the liability insurance reporting money and gaming equipment by the state requirements to the Attorney General’s from the Wyandotte Tribe in Kansas City, Office. SB 320, which failed to pass, would Kansas. The Committee members learned have rectified the situation by requiring the that the federal court ruled that the State of insurance company to certify to the Attorney Kansas had no right to seize the money and General’s Office that a tribe had liability equipment because the authorization for insurance. Tribal Council Chairpersons and gaming to take place at the Kansas City site the Brown County and Jackson County was a federal government matter. The Sheriffs’ Department representatives testified conferee also informed the members of the that the police powers were working Joint Committee that the decision to place effectively for the reservations and for the lands into trust for the Wyandotte Tribe was sheriffs’ departments. The Joint Committee appealed by the National Indian Gaming
Kansas Legislative Research Department 14-4 2006 State-Tribal Relations Commission and the US Department of outstanding issues to be resolved which justice. included:
State-Tribal Cooperation. The Joint • Excise tax credit—there should be a Committee heard testimony from the Kansas tribal excise tax credit for Indian Department of Transportation (KDOT) and businesses on reservations; the Prairie Band Potawatomi Nation dealing • Tax exemption—there should be state with the construction of the US Highway 75 and local government tax exemptions for and 150th Road interchange. The Indian tribes; Committee members heard from the • Vehicle titles and registration—there Chairperson of the Prairie Band Potawatomi should be a recognition of Indian tribe Nation that the Nation and Jackson county vehicle titles and registration; had signed a cooperative agreement for the • Health care funds—funds should flow costs of the right-of-way, utility relocation, from the federal government, through and preliminary engineering of the highway the state government to the tribes; and the interchange. However, due to rising • Grants—arbitration for grants should be costs, Jackson County had requested the granted to Indian tribes, so they can Nation pay additional costs, hut the county retain their sovereignty; and and Nation could not come to an agreement • Gaming—the Prairie Band Potawatomi on those costs. A representative of KDOT, Nation supports reservation-based testified that Jackson County was gaming and is opposed to other forms of responsible for 100 percent of the costs for gaming. preliminary engineering, utility relocation, and right-of-way. He said KDOT is 100 percent responsible for costs of construction The Executive Director of the State and inspection. Gaming Agency testified that the agency has a hands-on program to educate agents and The Chairperson of the Kickapoo Tribe tribal employees on the proper use of testified that there are outstanding issues to gaming machines. The program is be resolved between the state and the tribe conducted at the agency’s office in Topeka. which included: This voluntary state-tribal program trains over 730 casino employees per year. • Motor fuel tax—there could be further progress made between the tribe and the Federal Rules and Regulations Defining state on motor fuel tax, even if the fuel Class II and Class III Gaming. The Chief tax case had been decided; Counsel from the Governor’s Office gave a • Gaming in Kansas City—the Kickapoo presentation on the tentative federal Tribe wants to pursue a gaming compact Department of Interior’s rules and in Kansas City; regulations dealing with the difference • Water—there is a federal lawsuit between Class II and Class III electronic and pending over the tribe’s right to obtain electromechanical facsimile gaming water rights; machines. • Property taxes—Tribal members should not have to pay property taxes; and • Veterans’ Services—Tribal veterans are Conclusions and Recommendations not receiving services in a fair and equitable manner. The Joint Committee On State-Tribal Relations recommends:
The Chairperson of the Prairie Band • A Senate bill, to be prefiled, that would Potawatomi Nation testified that there are require insurance companies to report
Kansas Legislative Research Department 14-5 2006 State-Tribal Relations liability insurance for state police Revenue obtain information on powers on reservations to the Attorney resolution of the license plate issue in General’s Office. It would establish a other states and report that information cap of two million dollars on the liability to Joint Committee members by insurance, and delete the sunset clause December 15, 2006. of state police powers on the reservations as contained in KSA 2005 Supp. 22- • The Senate Transportation Committee 2401a. reach consensus with interested parties to solve the Indian license plate problem • The Kansas Legislative Research and recommend a bill to accomplish this Department and the Department of task during the 2007 Legislative Session.
Kansas Legislative Research Department 14-6 2006 State-Tribal Relations Commissions
Report of the 2010 Commission to the 2007 Kansas Legislature
CHAIRPERSON: Ms. Rochelle Chronister
VICE-CHAIRPERSON: Dr. Ray Daniels
OTHER MEMBERS: Senator Jean Schodorf; and Representatives Kathe Decker and Sue Storm
NON-LEGISLATIVE MEMBERS: Carolyn Campbell, Stephen Iliff, Dennis Jones, Barbara Mackey, Attorney General Phill Kline (or designee), Barb Hinton, Post Auditor (or designee)
St u d y T o pics
The Commission has authority to:
• Conduct ongoing monitoring of the school district finance act; • Evaluate the school district finance act and determine if there is a fair and equitable relationship between the costs of the weighted components and assigned weightings; • Determine if additional school district operations should be weighted; • Review the amount of base state aid per pupil and determine if the amount should be adjusted; • Evaluate the system of financial support, reform and restructuring of public education in Kansas and in other states to ensure that the Kansas system is efficient and effective; • Conduct hearings and receive and consider suggestions for improvements in the educational system from teachers, parents, the Kansas Department of Education, the State Board of Education, other governmental officers and agencies and the general public; • Make recommendations it deems is necessary to guide the Legislature to fulfill goals established by the Legislature in meeting its constitutional duties.
LCC Referred Topics:
• School Transportation Weighting Formula - Study the current school transportation weighting formula. Review the recent recommendations of the Legislative Division of Post Audit transportation weighting analysis. Consider child transportation safety issues, especially if the current 2.5 miles’ mileage reimbursement is adequate.
December 2006 2010 Commission
2006 Report
Conclusions and Recommendations
• The 2010 Commission recognizes that many successful schools improve students’ performance through all-day kindergarten and programming for at-risk four year olds. The Commission recommends that all-day kindergarten expand to include all children eligible to attend. The Commission also recommends that flexibility in school funding continue to allow for the growth of at-risk programming for four year olds. In addition, the Commission recommends that the second level of funding for at-risk students, the high density formula, be based on the prior year’s data and implemented using a linear transition calculation.
• The 2010 Commission observed a variety of innovative programs used in schools across the state to improve students’ performance. Two showing great promise are professional learning communities and schools within schools. The Commission recommends that these programs, and others like them, continue to be researched and used in schools across the state.
• The Commission acknowledges that much debate and review has taken place regarding how best to identify students at risk of failure. To date, the best method to distribute funding to school districts for at-risk student programming is based upon the numbers of students eligible for the federal free lunch program in each district. As funding for at-risk services increases, the number of students who qualify for the free-lunch program becomes an increasingly important factor in the state’s school finance formula. In light of a recent performance audit on this topic, the Commission recommends that the Legislature review this issue to ensure that at-risk funding is provided to those students for whom it was intended. The Commission does not support any cuts in funding at-risk programming.
• The 2010 Commission heard many concerns about English Language Learners (ELL). Issues included problems surrounding the proficiency of ELL students on state assessment tests, lack of teachers with ELL teaching endorsements, and the potential lack of adequate funding for ELL programs because of problems with the school finance bilingual weighting formula. The Commission requests the Legislature send a letter to the U.S. Department of Education requesting that more than one year be allowed between the time an ELL students enters a bilingual program and the time the student must take an assessment test. The Commission also recommends that teacher education in the state be reviewed and a consideration be made to require all teachers receive an ELL endorsement to their teaching certificate. The Commission also recommends that the Legislature continue to review best practices in training ELL students. And, finally, the Commission recommends that the bilingual weighting in the school finance formula be changed from a full-time equivalent weighting with contact hours to headcount and adjusted to 0.2 from the present 0.395.
• A second theme heard by the Commission in its tours of the state was the importance of staff. Several programs shown successful in attracting, retaining, and developing staff include enhancement of leadership academies, especially for school principals, mentoring new teachers, and providing improved and increased professional development opportunities for teachers. The Commission recommends expansion of these programs. The Commission recommends that $500,000 of annual and on-going funding be approved
Kansas Legislative Research Department 15-3 2006 2010 Commission for leadership academies, that an additional $1.0 million be added to the state’s Mentor Teacher Program, and the Professional Development (In-service Education) Aid Fund be increased to $4.0 million.
• The Commission believes that informing the public of the progress of their schools is vital to ensure confidence in our system of public education. To this end, the Commission recommends that every school make test scores from No Child Left Behind testing available to the local public and all students’ parents. In addition, the Commission applauds the Department’s work in development of the state database project which will include student and teacher information and allow more efficient tracking of student progress.
Proposed Legislation: None.
Background public education in Kansas and in other states to ensure that the Kansas system is The 2005 Legislature created the 2010 efficient and effective; Commission, which is composed of eleven members, nine voting and two serving as ex • Conducting hearings and receiving and officio nonvoting members. The statutory considering suggestions from teachers, duties of the Commission include: parents, the Department of Education, the State Board of Education, other • Monitoring the implementation and governmental officers and agencies and operation of the School District Finance the general public concerning suggested and Quality Performance Act and other improvements in the educational system provisions of law relating to school and the financing thereof; finance and the quality performance accreditation system; • Making any recommendations it deems is necessary to guide the Legislature to • Evaluating the School District Finance fulfill goals established by the and Quality Performance Act and Legislature in meeting its constitutional determine if there is a fair and equitable duties of the Legislature to: provide for relationship between the costs of the intellectual, educational, vocational and weighted components and assigned scientific improvement in public schools weightings; and make suitable provision for the finance of the educational interest of the • Determining if existing weightings state; should be adjusted; • Examining the availability of revenues to • Determining if additional school district ensure adequate funding of elementary operations should be weighted; and secondary education in the state;
• Reviewing the amount of base state aid • Examining voluntary activities, per pupil and determine if the amount including extracurricular activities, should be adjusted; which affect educational costs; and
• Evaluating the reform and restructuring • Monitoring and evaluating associations components of the Act and assess the and organizations that promote or impact thereof; regulate voluntary or extracurricular activities including, but not limited to, • Evaluating the system of financial the Kansas State High School Activities support, reform and restructuring of Association.
Kansas Legislative Research Department 15-4 2006 2010 Commission • Providing direction to the Legislative • Completing personnel and retirement Division of Post Audit school finance forms transferring staff to the new audit team and receiving performance district. audits conducted by the team. • Notifying vendors of the name change.
The Commission will sunset on • Changing letterhead, purchase orders, December 31, 2010. and all forms.
The Commission is to submit an annual Conferees told the Commission that report to the Legislature on the work of the money savings from consolidation occur Commission. when buildings are closed and staff reduced. Consolidations have occurred to enhance educational opportunities, stabilize and Committee Activities create longer-term viability for a combined district. School District Consolidation Special Education Material from the Kansas Association of School Boards entitled Student Enrollment Conferees presented information on and the Demographics of Change described current challenges of special education. a peak in Kansas school enrollment in Judy Denton, Director of the Northeast school year 1973-74. The decline since then Kansas Education Service Center, discussed has been constant because children born to concerns of the conferees which included “baby boomers” have moved through the the following: school system. Nevertheless, almost 30 percent of Kansas counties have six or fewer • Fewer individuals are being licensed in residents per square mile and more than half special education, at the same time the of the counties in Kansas ended the century number of special education students is with fewer residents than at the beginning. increasing.
Representatives from rural school • More special education services are districts, education cooperatives, and being provided in regular classrooms, education service centers presented which can be more expensive than “pull testimony on this topic. out” services.
The USD 104 White Rock • The cost of special education materials Superintendent Bill Walker told the has increased because of the need to Commission that his district and USD 278 provide “specially-designed instruction.” Mankato were consolidating. Mr. Walker said both districts have serviceable bus • In some cases, special education fleets, so no new buses will be purchased. students are transported to special He estimated that travel time for some classroom in other districts, incurring students will increase by 15 minutes. additional cost. Teachers will be shared and will travel to several facilities in two different towns. • The use of paraprofessionals has increased. Mark Wolters, Superintendent of USD 105 Rawlins County provided a checklist of consolidation issues to consider. They Another issue regarding special included: education funding is the strong possibility that federal Medicaid funds paid to school • Reviewing matters relating to insurance. districts for services to special education
Kansas Legislative Research Department 15-5 2006 2010 Commission students will be dramatically reduced in Other education entities visited or future years. The amount of reduction could providing testimony included: be as much as $25 million in FY2008. The Legislative Educational Planning Committee • Southwest Plains Regional Service (LEPC) held hearings on this issue during Center; the 2006 interim session. The LEPC 2006 • High Plains Educational Cooperative; Report provides detailed information on this and topic. • Southeast Kansas Education Service Center (Greenbush). Vocational Education
Conferees from USD 336 Holton, USD While schools visited by the 2010 259 Wichita, and USD 373 Newton Commission provided valuable insight into described the importance of vocational a number of challenges facing all Kansas education. The told the Commission that schools, there were several common many vocational education programs, such challenges voiced by school officials across as trade and industrial programs, are more the state, including the importance of costly than traditional academic programs. retaining and developing staff and This fact should be kept in mind when increasing numbers of special education vocational education weighting is discussed students and English Language Learners. related to the school finance formula. All conferees indicated they work closely with Retaining and developing staff is a major the business community to provide workers issue in many districts, especially in light of needed to promote a community’s economic increasing staff retirements. Commission development. members clearly saw the benefits of energetic and committed teachers and In addition to conducting activities administrators at schools visited during the during the 2006 Interim relating to its interim session. statutory charges, the Commission visited school districts across the State. The The number of students with special following USDs were visited: needs are increasing in Kansas schools, including special education students and • USD 500 Kansas City; English Language Learners. School districts • USD 512 Shawnee Mission; face increasing challenges meeting the needs • USD 233 Olathe; of these students, not the least of which • USD 215 Lakin; regards students’ proficiency on No Child • USD 259 Wichita; Left Behind-required assessment tests. This • USD 499 Galena; and became very clear to Commission members • USD 508 Baxter Springs. visiting with teachers and administrators • USD 250 Pittsburg during the districts’ tour.
In addition while in Lakin, the The 2010 Commission saw many Commission received information and impressive projects and programs while testimony from superintendents of the traveling across the state visiting Kansas following districts: school districts. A few of those particularly noteworthy items are mentioned in the • USD 457 Garden City; following paragraphs. • USD 363 Holcomb; • USD 216 Deerfield; The Southeast Kansas Education Service • USD 214 Ulysses; Center (Greenbush) highlighted many • USD 477 Ingalls; and innovative programs for 2010 Commission • USD 494 Syracuse. members review. One particularly impressive program was Virtual Prescriptive
Kansas Legislative Research Department 15-6 2006 2010 Commission Learning (VPL) described by Sharon Hoch, the state talking with school officials in rural VPL Director at Greenbush. VPL creates and urban schools and visiting schools individualized learning plans for a student. having high state assessment scores and Schools used this program to diagnose a schools trying a variety of programs to student's educational gap benchmarked improve the performance of their students, against state standards, create individualized common themes among many successful assignments designed to fill gaps, and districts included the following items: continually monitor progress. Many schools have found this an efficient way to help • All-Day Kindergarten: and students gain proficiency and regain credit. • Programming for At-Risk Four Year Olds
2010 Commission members viewed vocational education programming as well. All-Day Kindergarten Baxter Springs High School showed Commission members a product of its Approximately 64 percent of Kansas vocational building trades program. Baxter kindergartners in the 2005-06 school year Springs high school students gained were enrolled in all-day kindergarten experience in and were exposed to all programs. Kansas Department of Education components of residential construction staff indicated that more school districts while participating in the construction of a likely would offer all-day kindergarten if house. classroom facilities were available.
2010 Commission members saw a Research has shown that full-day particularly noteworthy school security kindergarten, if appropriate scheduling and system at Meadowlark Elementary School in curricula are used, can boost academic Pittsburg. Anyone entering this elementary performance and bring social benefits. This school were required to pass through an is particularly true when considering entry system, gaining access via the school children from educationally disadvantaged office. This seemed to provide a desirable backgrounds. Children with full-day level of security for students and school kindergarten experience score higher on personnel. standardized tests and have fewer grade retentions and higher attendance rates. All items considered by the Commission There is also clear evidence that during the 2006 Interim are reviewed in the participation in full-day kindergarten has a following material, along with Commission significant impact on classroom behavior. conclusions, recommendations, and special notes. School district officials recognized the importance of all-day kindergarten to the extent that it has been funded even when no Conclusions and Recommendations specific state funding was available for it. (Beginning with the current school year, The Commission’s conclusions and school districts could use their state- recommendations are organized into three provided at-risk funds to pay for all-day major categories of “Early Education and kindergarten.) Educational Reform, Improving the Quality of Staff, and Improved Information.” In Four-Year Old At-Risk Programs addition, a section of “Special Notes” is included. Children qualify for four-year old at-risk services when a child meets one of the Early Education and Educational following criteria: Reform Conclusion • Lives in poverty (qualifies for the federal As the 2010 Commission traveled across free lunch program);
Kansas Legislative Research Department 15-7 2006 2010 Commission • Member of a single-parent family; • Schools Within Schools; and • Receives a Department of Social and Rehabilitation Services referral; • At-Risk and English Language Learner Programs. • Has teen parents;
• Has either parent lacking a high school Professional Learning Communities diploma or GED; The concept of professional learning • Qualifies for migrant status; communities is based on a premise from the business sector regarding the capacity of • Has limited English proficiency; and organizations to learn. Modified to fit the world of education, this concept involves the • Is considered developmentally- or development of collaborative work cultures academically-delayed. for teachers. The essential characteristics of professional learning communities include:
In the spring of 2006, the Kansas • Shared values and norms are developed Department of Education evaluated the with regard to views on children’s ability state’s four-year old at-risk program at the to learn, school priorities, and the roles request of the Legislature. In this of teachers, parents, and administrators. evaluation’s sample of over 400 students, children served by a variety of at-risk • The focus is on learning instead of on programs showed growth in skills across the teaching. school year. In addition, tests revealed that those children who came into programs with • Teachers have continuing and extensive lower level skills overall had larger change conversations about curriculum, scores than those who came in with greater instruction, and student development. skill. • Teaching becomes public and The 2006 Legislature allowed school collaborative rather than “private”. districts flexibility in using at-risk funding for needed programs such as all-day kindergarten and expansion of preschool The 2010 Commission saw examples of and four-year old at-risk programming. The professional learning communities working Commission commends this effort and is in a variety of ways in several of the school fully supportive of services now provided by districts visited. Examples include teams of current law to all four-year old at risk teachers and other school professionals, e.g. students in the state. the school counselor, school social worker, and administrators meeting on a regular Innovations in Education basis discussing a student’s progress and developing plans, methods, and tools for While touring the state’s school districts, helping students achieve their greatest the Commission became aware of potential. The key in this involves a team innovations in education designed to working with individual students. Implicit improve student outcomes as well as a in this concept is the idea that the variety of programs working to improve professional learning community will have educational opportunities for the community ample time to plan and work with each of diverse students in the state’s schools. student. In some schools visited, an “early Those innovations and programs included: out” program was used which allowed students to leave school early giving teachers • Professional Learning Communities; more planning time. Other schools are able
Kansas Legislative Research Department 15-8 2006 2010 Commission to arrange teacher planning time so that At-Risk Education and English teachers can do planning during the school Language Learners day. At-Risk Education A review of studies done on the impact of professional learning communities on The Commission supports programs that student achievement found that student address the needs of at-risk students who are learning improved. In some studies, not attaining proficiency. Examples are achievement scores for low and extended school days, summer school, underachieving students rose dramatically tutorials, and programs that involve parents over a three-year period. in helping their children improve.
The development of professional The Commission acknowledges that learning communities also prompts much debate and review has taken place continuous teacher learning as teachers over the years regarding how best to identify search for educational efforts that will help students at-risk of failure. To date, the best them accomplish the goals of the method to distribute funding to school “community.” districts for at-risk student programming is based upon the numbers of students eligible School Within a School for the federal free lunch program in each district. The school within a school is one model used in some districts to help make As funding for at-risk services increases, classroom instruction more personal, the number of students who qualify for the motivate students to excel, and develop free-lunch program has become an relationships between school staff, students, increasingly important factor in the state’s and their parents. school finance formula. A performance audit entitled K-12 Education: Reviewing One example of the school within a Free-Lunch Student Counts Used as the school is grouping students in a small Basis for At-Risk Funding, Part I by the learning community or group so that the Legislative Division of Post Audit found that group can stay together for several grades. about 17 percent of free-lunch students in its Another example is students having the statewide, random sample were ineligible for same teacher for several consecutive grades. free lunches. The random sample was of 500 students out of nearly 135,000 free-lunch Several studies show that low student- students in school year 2005-06. The teacher ratios prove very successful in Division indicated this was a statistically- providing individual attention to each child valid random sample. whether in the professional learning community setting or in small class sizes. English Language Learners According to the U.S. Department of Education, a four-year longitudinal study of In extensive travels and discussions with smaller class sizes in Tennessee concluded school officials across the state, it became that smaller classes yield educationally and apparent that English Language Learners statistically significant gains in student (students for whom English was not their achievement. native language) were becoming a growing concern. Issues included problems It is likely that additional funding surrounding the proficiency of ELL students provided by the Legislature in its recently on state assessment tests, lack of teachers enacted three-year plan (2006 SB549) could with ELL teaching endorsements, and the be used to reduce class sizes. potential lack of adequate funding for ELL programs because of problems with the school finance bilingual weighting formula.
Kansas Legislative Research Department 15-9 2006 2010 Commission Recommendations arising from these these two issues, Legislative Post Audit conclusions begin below. recommended that the House Select Committee on School Finance and the Committee Recommendations: Senate Education Committee should hear testimony regarding instituting an • The Commission supports the growth in age limit for free-lunch students for the all-day kindergarten until it is available purpose of at-risk funding and changing in every Kansas public school. The the at-risk funding count from a Kansas Department of Education headcount to an FTE count. estimated it will cost approximately $74 million to provide all-day kindergarten
statewide in the next school •/ vear. While the Commission supports a During the 2006 Session, the Legislature Legislative review of this recommendation, gave school districts the flexibility to use the Commission does not recommend any at-risk funding to be used to provide all cuts in funding at-risk programming. The day kindergarten. The Commission Commission strongly recommends that the recommends that this flexibility be at-risk weighting included in 2006 SB 549 be continued. maintained for the full three years of the law. • In support of the recommendations made by the At-Risk Education Council, the In its performance audit K-12 Education: Commission recommends that the Reviewing Free-Lunch Student Counts Used second level of funding for at-risk as the Basis for At-Risk Funding, Part I, students, which is the high density Legislative Post Audit did not address formula, be based on the prior year’s whether at-risk funding should be removed data and implemented using a linear from the school finance formula based on transition calculation. the number of students estimated ineligible for free lunches. • The Commission recognizes that the needs of at-risk students have not The 2010 Commission recommends that changed over time and, in fact, are the $19 million be retained and the increasing. weighting be adjusted for both the free lunch and high density weighting proportionately. • The Commission recommends that the Legislature review the Legislative Post • Regarding English Language Learners, Audit study entitled K-12 Education: the Commission makes a four-pronged Renewing Free-Lunch Student Counts recommendation. Used as the Basis for At-Risk Funding, Part I, concerning free-lunch students to o Request that the Legislature send a ensure at-risk funding is provided to letter to the U.S. Department of those students for which it was intended. Education requesting that more than This performance audit noted that at one year be allowed between the eight alternative schools reviewed by the time an English Language Learner auditors, nearly forty percent of free- student enters a bilingual program lunch students reviewed were over the and the time the student must take age of 20. In addition, auditors found an assessment test. that school districts receive full at-risk funding for part-time students, primarily o Request the Kansas Board of Regents kindergarten students. The performance review higher education instruction audit noted that changing this count to a for students studying to become full-time equivalent count would reduce teachers. All students completing the amount of at-risk funding the state instruction to become public school pays to school districts. Addressing teachers should be instructed in
Kansas Legislative Research Department 15-10 2006 2010 Commission teaching English Language Learners, leadership, the Commission supports and furthermore, should be required statewide continued and improved to gain an ELL endorsement to their leadership programs. teaching certification. A July 2006 Legislative Post Audit report o Recommend the Legislature continue entitled K-12 Education: Reviewing Issues to look at best practices in educating Related to Developing and Retaining ELL students. Teachers and School Principals reviewed literature on attracting and retaining school ° Because the current bilingual principals. The report described three “best weighting probably under reports the practices” for principal professional number of children who need development: English language assistance, the Commission recommends that the • Provide practical training, such as weighting be changed from a full training on budgets, case studies, and time equivalent weighting with problem solving; contact hours to headcount and adjusted to 0.2 from the present • Include opportunities for peer support 0.395 weight. and leadership coaching, such as support groups and training with peer principals; and Improving the Quality of Staff Conclusion • Offer development through a variety of providers, such as outside agencies, A second theme heard by the university personnel, or national Commission in its tours of the state was the conferences. importance of staff. Specific items relevant to staff include the following: The Commission believes that these • Leadership Academies; academies are an efficient and practical way • Mentoring New Teachers; to provide good practices for present and • Professional Development of Current future principals. Teachers; and • Attracting, Developing, and Retaining Teachers. Mentoring New Teachers
The Commission notes input it received Leadership Academies in the field from teachers who stressed the importance of mentoring. The Commission The Commission recognizes the efforts of also notes information provided by the State the State Department of Education in Department of Education to the effect that providing small grants to school districts and the Teacher Mentor Program, in the years it service centers to fund a variety of was funded, resulted in attrition rates for leadership workshops and trainings. This new teachers of approximately ten percent, type of funding is done on a statewide basis according to information from the Kansas prior to this time. Department of Education.
In its tour of school districts, the The above-referenced performance audit Commission formed the impression that the report on developing and retaining teachers skills, knowledge, commitment, and cited mentoring programs as one of the best dedication of administrators to educational strategies described in educational literature improvement is vital to improving student to retain new teachers. Through mentoring proficiency. To enhance the quality of programs, such as the one in Kansas, new
Kansas Legislative Research Department 15-11 2006 2010 Commission teachers are paired with experienced offering more time for job-imbedded teachers to receive guidance and support. professional development.
The Kansas Mentor Teacher Program Legislation requires school districts to was established hy the 2000 Legislature provide professional development programs. beginning with the 2001-02 school year. It is School districts may use local money and a voluntary program and provides receive matching state aid for education probationary teachers with professional approved by the State Board of Education. support and continuous assistance by an on There is a limitation placed on the amount site teacher. A mentor teacher is a of state aid a USD can receive. The certificated teacher who has completed at limitation is one-half of one percent of the least three consecutive school years of individual school’s general fund budget. For employment in the district, has been the current fiscal year and FY 2008, the selected by the school board as having Legislature appropriated $1.75 million for demonstrated exemplary teaching ability, professional development. Actual and has completed training provided by the expenditures by school districts in the 2005- school district in accordance with Kansas 06 school year totaled nearly $12 million in Department of Education criteria. Each state and local funds combined. mentor teacher may receive a grant not to exceed $1,000 per school year for up to two Attracting, Developing, and probationary teachers. Fiscal year (FY) Retaining Teachers 2002 was the first vear the Mentor Teacher Program was funded. That year, the The Commission reviewed the 2006 Legislature limited grants to support only Teacher Working Condition Survey beginning teachers in their first year of sponsored by Governor Sebelius, Kansas teaching. No funding was approved for this National Education Association, United program from FY 2003 through FY 2005. School Administrators, and the Center for Subsequent years’ funding was $1,050,000 Teaching Quality. Approximately 22,000 in FY 2006, $1.2 million in FY 2007, and $1 teachers and administrators (53 percent of million in FY 2008. Kansas educators) responded to the survey. Among survey findings was the importance Professional Development of adequate planning time for teachers as of Current Teachers well as empowering them as decision makers in their schools. The Commission supports professional development efforts and believes these The Commission supports activities efforts must be related to the curriculum (job intended to attract, develop, and retain high imbedded), be consistent, and be on-going. quality teachers and school principals as The Commission recognizes the importance identified in the above-referenced survey as of professional development in well as the Legislative Division of Post Audit implementing reforms that have proven performance audit report regarding teacher successful in improving student proficiency, and principal retention entitled K-12 such as the professional learning Education: Reviewing Issues Related to communities, noted above. The recent Developing and Retaining Teachers and performance audit, K-12 Education: School Principals. Reviewing Issues Related to Developing and Retaining Teachers and School Principals, The performance audit describes best noted that one of the overarching best practices for attracting and retaining practices for teacher professional teachers. development is the commitment of adequate resources to professional development by For attracting teachers, education earmarking funds for training, paying literature includes: advanced education training costs, and
Kansas Legislative Research Department 15-12 2006 2010 Commission • Improving compensation; • In recognition of the importance of • Increasing recruitment efforts; and professional teacher and administrator • Reducing barriers to becoming a teacher. development in understanding and implementing education reforms, such as professional learning communities, For retaining and developing teachers, the Commission recommends that the education literature includes: Professional Development (In-service Education) Aid Fund he increased to • Establishing mentoring programs; $4.0 million in FY 2008.
• Developing teacher preparation and transition programs; Improved Information Conclusion
• Improving working conditions; The Commission supports the recommendation of the At-Risk Education • Increasing pay; and Council development of the Kansas Department of Education data system. This • Dedicating adequate resources to system will be a critical component in the training specifically targeted to teachers’ ongoing understanding of the achievement needs. gap of at-risk
The Commission applauds the Committee Recommendations: Department’s work of the state database project which will include student and • In recognition of the importance and teacher information. The recommendation success of leadership training and past below takes this database further. leadership academies in the state, the Commission recommends that $500,000 Committee Recommendation: of annual and on-going funding be approved for leadership academies. The • The Commission supports the state funding will be awarded to districts and database project being developed by the service centers that apply to and are Kansas Department of Education to approved by the Kansas Department of include both student and teacher Education (KSDE). Furthermore, the information. Commission recommends that KSDE evaluate the leadership academies that receive funding to measure their success The Commission recommends the in improving student proficiency over continued support of the data system being three, five, and ten-year periods. developed by the Kansas State Department of Education so that tracking a student’s • In recognition of the success of teacher proficiency can be easily done. mentoring programs, the Commission recommends that an additional $1.0 The Commission adds the following million be added to the state’s Mentor special notes: Teacher Program so the Program can be extended to the second year of a new • No child should be required to ride on a teacher’s probationary period. The school bus - one way - more than 60 additional $1.0 million would provide minutes per day. If it requires additional the second year of mentoring to a bus routes, the state and federal potential of .01,000 new teachers in government should be prepared to pay Kansas. for them. The Commission heard a report of one family whose children were on the bus for one hour and forty
Kansas Legislative Research Department 15-13 2006 2010 Commission minutes - one way - and several families families who failed to attend parent- having children who ride a bus over an teacher conferences. hour. • The Commission believes that informing • The Commission recognizes the the public of the progress of their schools importance of ensuring our state’s is vital to ensure confidence in our schools are safe for all children. The system of public education. Therefore, school tour recognized a particularly the Commission recommends that every innovative strategy for ensuring safety school provide local newspapers with through a single, secured entrance the scores resulting from No Child Left observed at Meadowlark Elementary in Behind (NCLB) testing for each school, Pittsburg on the interim Commission by class; that parents receive copies of tour of schools. This “air-locked” area their child’s NCLB test results by school, required every visitor to the school to class, and their child at parent-teacher enter the school at one, secure location. conferences; and that if a child is nonproficient in a subject, the parent be • One very important concept recognized given a written report describing what is by the Commission is that parental being done to ensure the child becomes involvement in school activities is proficient. If a parent does not attend crucial to a child’s success. Some of the the parent-teacher conference, the school most successful schools went to should make other arrangements to see extraordinary lengths to involve their that the parents receive the information. parents, including making home visits to
Kansas Legislative Research Department 15-14 2006 2010 Commission Following is a Minority Report filed by
2010 Commission Member, Steve Iliff
2006 Committee Reports - 2010 Commission Minority Report Recommendation for a Comprehensive Standardized Consistent, Accounting System
Subtitle: No Legislator Left Behind
A proposal for the 2010 Commission by Steve Iliff December 18, 2006
Introduction ...... 1 Issues in Funding and Spending Education D ollars...... 1 Therefore I recommend:...... 2 Reasons Why Implementation is so important: ...... 3 It will improve Education in Kansas ...... 3 Data Mining will highlight Best Practices...... 3 Find out where the heroes are and reward them...... 4 It will Encourage Competition among the public schools...... 4 It is Good Business ...... 5 An Accounting System is a good Internal Control...... 5 It would be easier in the long run for administrators ...... 5 Legislators would be fulfilling their responsibilities ...... 5 Taxpayers must believe in the system ...... 5 It will truly give board members and taxpayers local control...... 5 District efficiency depends upon good accounting that is easily understood by the common taxpayer...... 6 Auditors and Accountants Believe a System should be Required...... 6 Barb Hinton, Post Auditor Recommends Accounting System ...... 6 Standard and Poor’s Audit ...... 6 Dale Dennis, Deputy Commissioner of Education...... 6 Generally Accepted Accounting Principles (GAAP) ...... 6 Nature of the Accounting System ...... 7 Simple and Thorough Systems ...... 7 Track Individual Students...... 7 Nature of our world...... 7 Objections to an Accounting System ...... 8 Objection 1: But we want local control!...... 8 Local Control vs. Centralize accounting functions...... 8 Objection 2: We need to do more Study and have a presentation...... 8 Objection 3: But it will cost too much!...... 9 Philosophical Resources and References ...... 10 Recommendation: Fix the Free and Reduced Lunch Under Reporting Problem...... 11 Recommendation: All money provided must have measuring tools to prove results...... 11
2006 Committee Reports - 2010 Commission Minority Report Introduction Every child must have the opportunity to receive an education. In America we recognize education as a basic right and value it as an essential in accomplishing liberty and happiness. In Kansas things are no different. Governor Sebelius has again challenged us to continue to search for the means by which the educational system can improve and flourish. We would all embrace a plan guaranteed to educate every child. Crafting such a plan is the goal of countless think-tanks, bureaucracies, private- institutions, individuals and commissions. However, other than a heaving and shifting from one ideology to another, not much has been accomplished. Not only is success in education measured differently, but the avenue to that success has huge variants. A child, not a product, is the outcome, and herein lies the rub.
As a member of the 2010 Commission I have had the privilege of being able to observe first hand the complexity of designing and implementing a solid educational foundation for Kansas children. Each of us on the commission has our own biases as to what we would like to see addressed or changed. My colleagues on the commission know I have strong opinions regarding what creates a successful school but I offer those along with everyone else’s opinions. However, regarding the area of budgeting and financial accountability, I offer expertise not rhetorical opinions and I believe the state must make substantial changes. I offer this recommendation in a minority report because the 2010 Commission initially recommended it then reversed their position and chose not to re c o m m e n d .
Issues in Funding and Spending Education Dollars Educational revenue and expenses are very difficult to understand for either the layman or the expert not intimately involved with operations. Legislators are required to fund the public schools in Kansas adequately and equitably across the state but must know where the money goes in order to make this determination.
Legislators are continually being asked to provide more funds for education and do not understand where the money is going or how it is being used. This is like writing a blank check to the school system by the taxpayers.
All legislators and taxpayers have a strong desire to have the best education possible for each student in the system delivered at the most affordable price. Governor Sebelius has recognized the taxpayer’s concern and stated it as one of the reasons she hired Standard and Poor’s to perform their evaluations.
The State of Kansas is responsible to comply with Federal Guidelines and be able to show that Federal money has been used according to the purposes it was given.
The legislature holds in trust all the money taxed from the people to be used in the best interest of the people and take no more than is absolutely necessary to provide for e d u c a tio n .
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 1 The only way anyone (legislator, commissioner, taxpayer, administrator or educator) can possibly know how well the educational system is doing in general or particular is by having an accurate accounting system for both financial, demographic and educational assessments that are consistently applied from year to year, school to school and district to district and then to the industry as a whole.
All parties from principals, superintendents, board members, legislators, taxpayers and even members of the Department of Education and Post Audit Division agree that there is no consistent or comparable accounting in the school systems of Kansas even at the district level and consequently no one can truly understand where money is going or compare one school building to another in the State of Kansas Education System, a 4 billion dollar business. You can’t hold people accountable if you can’t account.
Our 2010 Commission Chairperson, Rochelle Chronister, has been repeatedly quoted saying, “Show me the data.” before she will make recommendations. This recommendation will provide a system for showing the financial, demographic and testing data in a coherent manner in order that sound decisions and recommendations can be made in a timely fashion.
At least 6 out of the 12 duties given to the 2010 Commission include words like determine, evaluate, monitor, review, and ensure the Kansas system is efficient and effective. All of these words and duties are meaningless without a system that will capture information in a comprehensive, methodical, orderly and consistent fashion.
Therefore I recommend: A comprehensive accounting system with appropriate chart of accounts with clear definitions and well trained coders that should be begin effective with the 2007-2008 school year down to the school level.
The system would be designed and put into place by a small group of independent accountants, information technology consultants with the aid of retired principals and superintendents and post auditors.
The key to the success of this system would be a bipartisan approach with the full support of the governor and the leaders of both houses.
The Accounting Manual will be reviewed and put into place for all schools and districts. Be aware that since this has not been done intensively before that there will be significant changes over the next 2 years as schools implement and retrain their staffs or review the possibility of outsourcing this one function to a centralized accounting firm or state organization.
Reasons Why Implementation is so important: Tax dollars are a trust and should be used very carefully and effectively. No more tax dollars should be requested or approved unless a compelling cause can be demonstrated.
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 2 The disbursement of funds calls for their use in an efficient and effective manner. This cannot be judged unless it can be measured. It can’t be measured unless there is an accounting system. And one cannot determine who is doing better than whom unless the system is comparable among the schools. And one cannot determine if there is improvement unless the system can compare one year to the next and is consistent in its coding.
It will improve Education in Kansas In order to get the best results in the classroom we must be able to provide resources where they will be most effective. We must understand costs, methods and personnel that produce those results. Ideally we would build a model. But since we already have schools in operation we can find which ones are operating most effectively and observe how they do it.
Data Mining will highlight Best Practices Researchers are looking for best practices as well as poor practices. The only way they can confirm their hypothesis is with good data. They must be able to access the exact same data that is available to all those in the education community. If they can’t get good data they will waste time, get false results, or open themselves to the accusation that they are comparing apples to oranges. But who can blame them when the current accounting system is so designed that it renders the apples to apples comparison impossible.
Data mining is used constantly by investors, scientific researchers, the military and businesses of all kinds. Sound decisions depend on good data.
Capturing the data should be neutral. Republican and Democrat, principal and board member, taxpayer and legislator should all want accurate data. If the data is captured well and available then the real debate can begin about what is best for the children of Kansas. Without it, we can never know what is best for the children. This was one of the goals mentioned by Governor Sebelius in the new initiative she passed in 2004.
Find out where the heroes are and reward them The only way anyone can really know who the heroes are is by comparison. Which principals and teachers are getting more results with less money and more challenging student population? The only way to know is to have a reporting system that highlights them. They are out there. It will Encourage Competition among the public schools Districts and schools should compete with other districts and schools for better methods, outcomes and costs. Each will vie for efficiencies, lower turnover ratios, faster training and on going development and assessments that will be accurate and fair and continually improving.
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 3 In America we all believe that competition brings out the best in each of us. We see this on the field of athletics, fine arts, commerce and the military. Education is no different. The best run schools and districts should be rewarded publicly and financially and become the models and trainers of the districts that are struggling.
It is Good Business All businesses run better when they can measure how well they are doing against a budget, against previous years and against other like entities in their industry. The number one reason businesses in the free market fail is because of poor financial business planning and controls. Schools will not fail because they have access to tax dollars but they will waste time and money. But it will still cause them to fail in delivering the scarce resources to where it is most needed.
An Accounting System is a good Internal Control Good accounting records are an essential part of good internal controls to protect the money that has been entrusted to you. A four billion dollar industry should have them.
It would be easier in the long run for administrators Once the system is in place and coders are trained, the request for audits would only be to verify source documents and even these could be scanned and put on a hard drive so auditors would not have to bother the schools for more information. It is the only way to ensure the money is getting into the classroom every year and in every school. Currently when auditors and legislators request details there is an intense amount of administrative work to produce such documents.
Legislators would be fulfilling their responsibilities Legislators can’t legitimately fulfill their responsibilities unless they are voting for or against measures which they understand and get reports on.
Taxpayers must believe in the system Our system is based upon voluntary compliance. Compliance is based on trust in the system and our governors and legislators to administer taxes and use funds for the general welfare while controlling costs. Governor Sebelius desired the school districts to be more accountable to the taxpayers when she initiated the Standard and Poor’s audit in 2004. But Standard and Poor’s only audited 4-6 of the 300 districts in Kansas. A good accounting system will make much easier and more comprehensive.
It will truly give board members and taxpayers local control You can’t control what you don’t know. Everyone is crying out for information. They want to know where their money is going and wonder if it is being used effectively. Every board member should have their eye on other schools and be asking questions like: How can ABC school be getting such good scores? ABC has the same demographics as we have and don’t receive any more money. How can they be so excellent?
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 4 Where is ABC spending their money? W hy are their turnover ratios so much lower than ours? W hy did they get more money than we did? ABC’s parents just rave about their principal and teachers. Why?
You must be able to compare to see the difference. But you can’t compare without comparable data.
District efficiency depends upon good accounting that is easily understood by the common taxpayer. According to the January 2006 Post Audit Study there are 2 variables that help to make a District efficient. The first is when money is hard to come by. The second is when voters watch carefully how their tax dollars are spent. Both of these require good information systems.
Auditors and Accountants Believe a System should be Required
Barb Hinton, Post Auditor Recommends Accounting System Barb Hinton supported a comprehensive system for the whole education community at the 11/14/06 Commission meeting. She later referred to her Post Audit Report dated March 2002 which exposes problems with the current system.
Standard and Poor’s Audit Standard and Poor’s has done a very good audit at the request of Governor Sebelius and paid for with private money from the Kauffman Foundation. During testimony, they mentioned that they could not establish building indicators State wide with any accuracy because the accounting was too inconsistent from school to school and year to year.
Governor Sebelius is to be commended for commissioning such an audit and finding a way to pay for it from the private sector. She was criticized by the Educational establishment at the time but stood her ground. Standard and Poor’s is doing a very helpful service to the citizens of Kansas and for our Educational Institutions.
Dale Dennis, Deputy Commissioner of Education Dale Dennis said to the 2010 Commission on several occasions that although we have a chart of accounts for the State, no one really uses it consistently from school to school or year to year. Generally Accepted Accounting Principles (GAAP) These are the standards, principles, rules that govern Certified Public Accountants. All private companies, government and non profits follow these rules; the education community should be no different.
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 5 The reason our government and the American Institute of Certified Public Accountants require GAAP that it would be impossible to loan money to or invest in companies without a reliable and standardize accounting system. The taxpayers are investing in public education and must be able to determine if their local schools are using their money wisely.
Kansas School Accounting is done with a variety of different methods so that no one can compare their financials to other schools, districts or States. This makes auditing more difficult and makes real financial management for the State impossible.
Nature of the Accounting System The idea is that each school (elementary, secondary, charter or alternative) would be run like a business franchise (a W al-Mart, Barnes and Noble, W endy’s or Sylvan). The franchise would be received from and monitored by each district and the department of education. There would be a standard chart of accounts that would be consistent throughout all the schools and districts in Kansas. All finances would be accounted for including grants, gifts and other critical income that would help a school be successful.
Simple and Thorough Systems Systems should be established to get all the information from parents one time, entered into the computer and then only updated with changes. The system would monitor the location of each parent and child as long as they reside in Kansas and would follow them throughout the State. It would capture all necessary demographic information to provide good comparable data. Each year the parent would update his/her form for those things that are likely to change; address, phone numbers, income if requesting free or reduced lunch.
Track Individual Students Each student when they begin a school year will be checked in and be followed by the system no matter how many schools they attend. This will avoid the problems which occur when seasonal jobs or changes in residence cause students to transfer schools. Each student should be given a test at the beginning of the year and another at the end of the year to note improvement. This would give us better assessment data that could travel with the student from school to school. No one would fall through the cracks.
Nature of our world We have all watched the headlines as Enron, WorldCom, and our own Westar have been gutted by top management. The damage was so vast because both top management and their accountants were working together. There was no independent accounting and control.
W e have also recently seen with the 501 School district’s poor accounting and internal controls and policies how outsiders were able to take more than $500,000 over 18 months out of the checking account without anyone noticing. This was due to poor accounting and management practices.
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 6 Oskaloosa School District recently appears to have lost money and the superintendent has been relieved.
No system can prevent all crime, but a good system using standard best practices is the best defense. This is not to point out problems with Public Schools for Private Schools have the same problems and issues. The difference between Public and Private here is that a Private School’s funding can drop dramatically if the patrons lose faith and they could go out of business.
Objections to an Accounting System
Objection 1: But we want local control! This recommendation would not affect how the money is spent or the control on the school or district. In fact, I am for more local control not less. But it would cause each school to be accountable for costs and outcomes so they could be compared. If a school spent more but got better outcomes with a more difficult population, who would complain? If it turned out that one board was spending millions more and getting very poor assessments scores compared to a district ten miles away with the same demographics, the parents and taxpayers might like to get real local control of the board members. In fact this would be the only way they could get local control. You can’t control what you don’t know.
Local Control vs. Centralize accounting functions The State would leave local control in the hands of the individual school board on how money is spent, but the accounting system, coding and internal controls would be subject to best practices and regulated by the state (i.e. the accounting function would be centralized into a home office similar to many franchises in the commercial world). All bills would be sent by the vendor to the school or district administration for approval but then be forwarded for payment to the home office for proper coding and payment.
Payroll would be handled in a similar fashion. Financials would then be posted to the internet handling confidential information confidentially.
Objection 2: We need to do more Study and have a presentation. The Legislative Post Audit Division did a Performance Audit back in March of 2002, which looked closely at the accounting and budgeting issue. They discovered and pointed out many practices among the Kansas School Districts that vary widely from standard best practices of accounting, budgeting and internal controls. The following is their summary:
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 7 Audit Title
School District Budgets: Determining Ways to Structure the Budget Document to Make It Understandable and Allow for Meaningful Comparisons Audit Number Audit Date 02PA10 3/2002 Audit Abstract The laws, policies, and practices related to school district budgets are flawed in some areas. Because of the requirem ents or interpretations of State law, districts are overstating some expenditures and excluding other expenditures altogether. Staffing, enrollm ent, and expenditure information districts report in their budgets don't tie together, and aren't always reported consistently. In some local budget documents expenditures aren't summarized or grouped into categories, making it difficult to know how much money a district is taking in, or how moneys are being spent. We developed a new form at for districts' local budget documents that realigns and summarizes categories of information, includes all revenues and expenditures, and tries to address most of the problems we identified. The new budget form at ultim ately can be used as a tool to help identify where a district's costs may be out of line compared with peer districts, Statewide averages, or other benchmarks. District officials and board members can use it to explore the reasons for differences in greater detail, and to consider any adjustments they may need to make to increase their district's efficiency. The form at presented will need to be reviewed and refined to make it as m eaningful and useful as possible. 1 Objection 3: But it will cost too much! First of all, no one knows how much it will cost. No other person would even think of running a business without good accounting no matter what the cost. But, in fact, it will cost less, probably much less than we are spending now. Instead of each school or district having their own part-time accountants or part time bookkeepers who are underpaid and under trained, this function would be centralized allowing the benefit of those who would perform these functions to concentrate, be better trained and using the best accounting systems and controls. It should be similar to a Franchise accounting like McDonalds, Sylan, W almart, of Starbuck.
In addition, good accounting will show where money is misallocated so it can be better spent to improve results. 1
1 http://www.accesskansas.org/srv-postaudit/results.do
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 8 A recent Wall Street Journal article reported that the NEA fought disclosure of their income and expense reports using this same argument. They said it would cost too much-possibly more than a billion dollars. In fact it only cost $54,000. The accounting disclosure did show one thing; where they spent their money. Once you look at their expenditures you can see why they fought full disclosure. You can go to www.union- reports.dol.gov to see the NEA reports now that they have full disclosure.2 Philosophical Resources and References
The Fiefdom Syndrome by Robert J Herbold; This book outlines the installation of a detailed accounting system at Microsoft at a time when all their departments in each separate countries in which they represented were not communicating well with one another. They lacked a comprehensive accounting system and Bill Gates could not tell how his company was doing until months after the quarter or y e a r e n d . Who Says Elephants Can’t Dance by Lou Gerstner (Gerstner was appointed CEO of IBM when it was having serious financial trouble Story behind the IBM turnaround. In Search of Excellence by Tom Peters Made In America by Sam Walton Behind the Arches by John F Love The Effective Executive by Peter Drucker Managing the Non-Profit Organization by Peter Drucker The E -M yth by Michael Gerber
2 http://www.opinionjournal.com/editorial/feature.html7id 110007761
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 9 Recommendation: Fix the Free and Reduced Lunch Under-Reporting Problem Using Technology
Steve Iliff recommended fixing the current problem uncovered by the Post Audit by using technology. Using the computer and secured servers, all individuals who apply for a free lunch could enter their data on to a computer in a secure private location at the school, public library or even on the web while they are at home. They could enter their personal information, address, social security and income of their household. The computer would go to the State of Kansas computers and check the income, payroll tax returns and 1099’s on file with the State for all the members of the household and return a yes or no answer. If they do qualify, they could print out a qualification sheet with a unique number on it for the parent to turn in or mail to the school. The school secretary would enter that number into the school computer and it would confirm with the State of Kansas that this individual was indeed eligible. This would have the benefit of cutting staff time, rendering auditing unnecessary, improving confidentiality and accuracy, make lying more difficult and take the administrator out of the impossible situation of confronting a cheating parent, denying his child $600 worth of free food and, in addition, losing $2,000 per year for his school district or following his conscience.
In addition, some penalty, other than just losing your free lunch status, should be imposed on the parent for false reporting and the administration for failure to audit and enforce the system.
Recommendation: All money provided must have measuring tools to prove results. I believe and therefore recommend that no extra money be given to schools or districts without measuring tools that will make sure that the money given is managed effectively and with corresponding results.
Money is a Scarce Resource: It Must be Carefully Distributed and Measured for Results I, the one CPA on the commission, do not know if any individual schools, school districts, or groups within the education establishment, really need more money. W e as a commission have not studied individual schools close enough to make such a determination. I do not know whether special education students, English language learners or at-risk students need more money. Maybe they do, but I can’t recommend more money because I do not know that it is necessary. I do not want the legislature to believe that I or the commission has been given enough information to confidently make any recommendation about adding more money to the current school systems.
Giving money across the board to schools when there is no measuring tool to determine if this money was effective does not make sense. Some will spend it like a homeless drunk who has just been given $1,000 in cash. Others will use it very wisely and get some incremental improvement.
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 10 Salary increases across the board guarantee no improvement in education. It will garner appreciation from good teachers but will make it that much more difficult to remove poor teachers or teachers that do not really like to teach. The best teachers don t teach for money. It is their mission. For the worst teachers; money is a major fa c to r.
Money in the hand of certain people will do more than in the hands of others. The Blue Ribbon Schools that testified before the Commission and the Education Committee never mentioned money as an issue. To them the No Child Left Behind Program has been a positive challenge and a motivator to help teachers find better more creative ways to improve scores.
Money is better used when it is difficult to come by and it is carefully watched and accounted for. In the Jan 2006 Cost Study Analysis done by the Post Audit Committee, District Efficiency was mentioned several times. When I asked Scott Frank, Legislative Post Audit’s Manager of School Audits assigned to the 2010 Commission, what he meant by “district efficiency”, he gave the following answer:
In conducting the statistical analysis behind the cost study, we had to control for district efficiency. Because efficiency is very difficult to impossible to observe directly at a global level, we included indirect measures that tend to be associated with efficiency. Those variables fell into two broad categories:
1) Fiscal capacity variables. All other things being equal, districts for whom money comes more easily tend to spend more. To measure this, we looked at income per pupil (for the citizens, not the district), assessed valuation per pupil, the ratio of State and federal aid to income (again for the citizens), and the local tax share (roughly, how much of the property tax in a district is the typical household responsible for?). Except for the local tax share, each of these measures was significantly related to spending.
2) Voter monitoring variables. All other things being equal, districts that have a large number of voters who are likely to pay attention and hold them accountable are likely to spend less. To measure this, we looked at the percent of adults who are college educated, the percent of the population that is 65 or older, and the percent of housing units that are owner occupied (as opposed to rentals). All of these measures were significantly related to spending.
My conclusion based on that information: Districts use their money more efficiently if they find money more difficult to come by and they have a population of interested parents and taxpayers who are willing to hold them accountable. This should not surprise us for businesses and families tend to run the same way.
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 11 Standard and Poor’s said: A vital part of achieving higher standards is effective resource management— attention to w h a t to spend resources on, how to spend them, and how much to spend. Allocating resources, making trade-offs, investing and directing effort toward student- achievement..1
W e don’t currently have the measuring tools in place to ensure that we have effective resource management and the reports that follow the money we currently give to the s y s te m .
1 Standard and Poor’s Kansas Education Resource Management Study, Phase III, Winter 2006
2006 Committee Reports - 2010 Commission Minority Report No Legislator Left Behind - Page 12 Oversight Committees
Report of the KAN-ED Oversight Committee to the 2007 Kansas Legislature
CHAIRPERSON: Senator Pete Brungardt
VlCE-CHAIRPERSON: Representative Joe McLeland
OTHER MEMBERS: Senators Karin Brownlee, Tim Huelskamp, Janis Lee, Jean Schodorf, and Dwayne Umbarger; and Representatives John Faber, Tom Hawk, and Ann Mah
St u d y T o p ic s
Pursuant to Senate Sub. for HB 2968 the Committee was created to study the original objectives and goals of KAN-ED and whether those objectives and goals have been accomplished. The Committee also is directed to make recommendations for:
• Statutory changes needed to make KAN-ED a more viable program; • Consolidation of KAN-ED with other state networks; • The funding of KAN-ED; and • The possible addition of other entities to the list of entities served by KAN-ED.
December 2006 KAN-ED Oversight Committee
2006 Report
Conclusions and Recommendations
Regarding consolidation of state networks, the Committee concluded that:
• The Board of Regents and the Department of Administration should continue the effort that resulted in the Network Study prepared pursuant to KSA 2006 Supp. 75-7228 and should pursue recommendations made in that report.
• The time line presented by the Board of Regents in its proposal to the Committee is adequate and should guide the effort leading up to the March 1 report to the Legislature.
• All three networks examined in the Network Study should participate in additional planning and study to ensure establishment and maintenance of a common focus for state netw orks.
• The three network organizations should create a consolidation plan that, in addition to the issues identified in the Network Study, addresses:
o backbone cost analysis o last mile access o premise equipment and local area networks o public/private partnering o funding source o permissible traffic [i.e., Internet, voice over Internet protocol, video, data) o permissible constituent access (adding additional state agencies and health care institutions) o proposed statutory changes o current commodity Internet pricing
Based on these conclusions, the Committee recommends that:
• The Board of Regents, DISC, and KanREN pursue the recommendations made in the 2005 Network Study as outlined in that report and in the proposal presented to the Committee.
• The Board of Regents, KanREN, and DISC conduct a feasibility study of the three consolidation models presented to the Committee and present a specific recommendation no later than March 1, 2007 to the standing committees on Utilities, Education, Health, Commerce, Ways and Means, and Appropriations; and to the Joint Committee on Information Technology.
The Committee concluded that the Legislature would have an opportunity to consider additional statutory changes necessary to facilitate implementation of KAN-ED’s goals during the 2007 Session after the proposed consolidation plan is presented along with suggested statutory changes.
Kansas Legislative Research Department 16-3 2006 KAN-ED • The March 1, 2007 report include drafts of any legislation required to implement the recommendations.
In regard to the membership of KAN-ED, the Committee concluded that additional state agencies would benefit from membership. Specifically, the Committee concluded that the Department of Corrections and the Department of Health and Environment would benefit from KAN-ED membership.
• Based on that conclusion, the Committee recommends that the Legislature enact amendments to the KAN-ED Act that would allow the Department of Corrections and the Department of Health and Environment to become members of KAN-ED. The bill containing those amendments accompanies this report.
Proposed Legislation: The Committee recommends one bill.
Background o the addition of entities to the list of potential members of KAN-ED; The 2006 Legislature created the KAN- ED Oversight Committee in the Omnibus appropriation bill (2006 Sen. Sub. for HB The authorizing legislation required that 2968). The provision required that the the Committee present its report on or before Committee consist of one member from each January 1, 2007. of the following standing committees: House Appropriations, House Education, History House Health and Human Services and House Utilities; Senate Ways and Means, For nearly 20 years, the need for a Senate Education, Senate Public Health and network capable of transmitting voice, data, Welfare, Senate Commerce and Senate and video content has been recognized. In Utilities; and a member of the Joint order to meet that need, a backbone network Committee on Information Technology. had to be designed and implemented to take House members were appointed by the advantage of emerging telecommunications Speaker, Senators were appointed by the technologies for state government and President, and the member of the Joint educational institutions. Studies and task Committee on Information Technology was forces, along with agreements between appointed jointly by the Speaker and the telecommunications providers and the President. Kansas Corporation Commission (KCC), have been combined to create the required The Committee's charge includes: connectivity. Over the course of the years, numerous concepts were discussed, some • Studying the original goals and more elaborate than others. However, the objectives of KAN-ED and whether those current state expenditure for goals and objectives have been met; implementation of KAN-ED, approximately $10 million per year, is within the range • Making recommendations for: established by the various studies.
o statutory changes required to make The 2001 Legislature enacted the KAN- KAN-ED a more viable program; ED Act (KSA 75-7222, et seq.) to create “a o consolidation of KAN-ED with other broadband technology-based network to state networks; which schools, libraries, and hospitals may o funding of KAN-ED; and connect for broadband Internet access and
Kansas Legislative Research Department 16-4 2006 KAN-ED intranet access for distance learning . . . The same 2005 bill that changed KAN- (KSA 75-7223(a)) The Board of Regents was ED financing for fiscal years 2007 though required to establish a plan to implement the 2009 also required the State Board of A ct. Regents to study KAN-ED and two other statewide networks, Kansas Research and The 2001 Legislature also appropriated Education Network (KanREN) and Kansas $345,000 from the State General Fund (SGF) Wide Area Network (KanWIN). The report to finance activities of a User Advisory (Network Study), with recommendations for Council to assist with the planning effort. In eliminating duplications or inefficiencies December 2001, the Advisory Council report was completed and presented to the House was presented to the Board of Regents. This Utilities and Senate Commerce early in the plan included in the report was endorsed in 2006 Session. January 2002 by the Board of Regents and the Department of Education. The plan envisioned public funding for KAN-ED from Committee Activities all three levels of government: federal, state, and local. Local funding would provide for The Committee held two one-day infrastructure and service provider meetings and one half-dav meeting: October connection. State funding would pay for the 27, November 20, and December 4. During network backbone and access points to the those meetings the Committee received network, information databases, network information from staff of KAN-ED, KanREN, management, content development, and site KanWIN, the State Board of Regents, the subsidies. Federal funding would provide State Library, the Corporation Commission, matching funds for the backbone and the Department of Transportation, and the network access points. Kansas Hospital Association.
The 2002 Legislature enacted SB 614 The following discussion of Committee (KSA 66-2010), which provided that KAN- activities is organized to follow the ED would be financed by the Kansas Committee's statutory charge. Universal Service Fund (KUSF) until 2005, with the suggestion that future funding KAN-ED Goals and Objectives would come from the SGF. During the 2003 Interim, the Special Committee on Utilities The KAN-ED Act established an overall discussed telecommunications issues and goal of provision of a broadband network for reviewed the status of the KAN-ED network. schools, libraries and hospitals for Internet In 2004, the KAN-ED network was deployed access and an intranet for distance learning. and during the 2004 Interim, the Legislative The Act places certain limitations on the Educational Planning Committee network. The Board of Regents is recommended funding through the KUSF specifically required to contract for continue through 2008. operation and maintenance of the network. The network specifically cannot: The 2005 Legislature extended until 2009 the length of time for KAN-ED financing • Impair any existing contract for from the KUSF. During this four-year provision of telecommunications or extension, funding from the KUSF will be Internet services to any school, library or phased down to $5.5 million. After fiscal hospital; year 2009, SGF financing is to be used for KAN-ED. Consistent with that law, the 2006 • Involve state ownership or construction Legislature appropriated $8 million for KAN- of any network facilities other than those ED from the KUSF. An additional $2 million owned or being constructed by the state was appropriated for KAN-ED from the SGF. on April 26, 2001;
Kansas Legislative Research Department 16-5 2006 KAN-ED • Provide switched voice access, except to Consolidation of KAN-ED with the extent switched access was being Other Statewide Networks provided by state owned, leased or operated facilities on April 26, 2001; During its hearings, the Committee learned that the Network Study identified a • Transmit voice over Internet or voice duplication of network infrastructure and over Internet protocol (VoIP), except as management facilities among the statewide necessary to facilitate interactive two- networks. Thus, there is an opportunity for way video; or cost savings if the duplication can be reduced or eliminated. According to the • Be used for purposes inconsistent with Network Study, "consolidation of the Act. infrastructure elements could increase efficiency and potentially reduce costs. Study participants agree the systematic, The Committee received summary staged integration of existing networks into evaluations prepared by KAN-ED staff one shared core network could provide regarding fulfillment of statutory goals and improved cost-benefit performance." objectives. Those evaluations found that [Network Study, pg.l) KAN-ED has fulfilled its goals and objectives by: "Coordinating these activities could optimize benefits and allow sharing of • Providing broadband intranet expense. Other potential benefits from connectivity for Interactive Distanced consolidation include uniform availability of Learning (IDL) and other video services, increased service capability, conferencing formats, such as increased stability and reliability and the telemedicine. leveraging of expertise and manpower of the network organizations." The report also • Avoiding competition with the Kansas notes that consolidation should preserve the telecommunications industry and "unique interactions, agreements and service impairment of contracts, by not level expectations" for each network. providing commercial Internet access. [Network Study, pg.l) Instead, KAN-ED subsidizes broadband Internet connections offered by local The Network Study also found that service providers. affordable last-mile connectivity is important to achieving the goal of linking • Offering neither circuit switched voice Kansas public institutions, and that access to communication nor VoIP on the KAN-ED the public Internet remains the primary network. application required by Kansas public institutions. • Developing implementation plans and network standards for operation, Finally, the Network Study described maintenance and monitoring of the seven steps necessary to facilitate functional network. Refinement of those plans and integration of the networks without standards is ongoing. The Board of sacrificing existing, critical applications. Regents contracts with KanREN for Those steps are; engineering and management services. • Integrating network planning efforts between KAN-ED and KanREN.
Kansas Legislative Research Department 16-6 2006 KAN-ED • Developing a detailed, optimized plan each from K-12 schools, community for a consolidated KAN-ED and KanREN colleges, private colleges, and Regents' infrastructure. universities member sites. In addition, the Board includes one member from an • Studying the benefits and requirements Internet2 member university (University of to consolidate the KanWIN Kansas, Kansas State University and Wichita infrastructure and its management with State University) and three at-large the optimized KAN-ED/KanREN m em bers. network. KanREN has approximately 55 dues- • Providing a plan for potential KanWIN paying members with 70 service sites. consolidation with the optimized KAN- Approximately 62 percent of KanREN ED/KanREN network. membership fees are paid by Regents' institutions. KanREN also provides • Creating policy to support integrated technical support to KAN-ED on a contract planning and consolidation if those for services basis. Services provided under efforts result in realizable cost benefits to that contract include working with Kansas. Changes in policy, regulatory telecommunication providers and member and contract environments will he sites to support video scheduling, network necessary to enable complete management, and diagnostics and problem consolidation and enhance capabilities. resolution. KanREN also works with KAN- Without these changes significant ED to engineer connections. limitations will degrade or prevent potential benefits. KanWIN was created to serve the needs of state agencies for both intranet and • Establishing a funding mechanism that Internet services. The impetus for creation will reliably support combined network of KanWIN was support for the human requirements. resource and payroll system. The network currently serves a broad range of agency and • Developing an organizational structure e-government needs. The nature of the to operate the consolidated network business carried by KanWIN requires the while remaining responsive to individual network to be highly reliable, secure and constituent group requirements. resilient at the lowest cost possible for the agencies.
The Committee was informed that the KanWIN users are defined by statute and Board of Regents would welcome an include state agencies, contractors who work indication of the Legislature's desire for state agencies, local units of government, regarding recommendations made in the K-12 schools, and non profit organizations. Network Study. Residents of Kansas access e-government services via KanWIN. Most KanWIN users The Committee learned that KanREN is are state agencies and people doing business a private non-profit organization supported with those agencies. by membership fees and fees for services. KanREN serves elementary and secondary KanWIN is operated by the Division of schools, public libraries, non-profit Information Systems and Computing as a organizations with a research or education service. Users are charged a monthly purpose, and post-secondary educational subscription fee to connect to KanWIN. No institutions. KanREN is governed by a Board SGF moneys are appropriated directly to of Directors elected by the membership. The Board is composed of two representatives
Kansas Legislative Research Department 16-7 2006 KAN-ED support KanWIN. However, approximately assessment by KAN-ED staff is that 24 percent of KanWIN fees are paid from Model 1 would provide for the best SGF appropriations to agencies. service flexibility and the best ability to serve all the combined networks’ various Continued Exploration of Consolidation constituents now and into the future.
The Committee reviewed a proposal • Model 2 would involve modifying the presented by KAN-ED describing the KAN-ED backbone, separating the preliminary steps that could lead to network Internet/research network for institutions consolidation. The proposal, which of higher education and retention of encompasses recommendations made in the current KAN-ED capabilities. The Network Study, involves immediate proposal projected that both start-up and resumption of the examination of the annual operating costs could be covered feasibility of consolidation of KAN-ED and by the current level of appropriations for KanREN to create an “education network.” KAN-ED. Some savings might be Completion of that study is targeted in the realized. proposal for March 1, 2007. The proposal indicates that specific cost savings that may • Model 3 would involve consolidation of be achieved from consolidation would be the education network with KanWIN. included in the March report. The feasibility of this model was presented as being more uncertain than Milestone dates for the KAN-ED/KanREN the other two models. The proposal consolidation were included in the proposal. contained neither an estimate of start-up Those dates target the start of consolidation costs nor of annual costs for this model. for June 1, 2007 with completion projected Potential savings might be realized, for the end of 2007. That phase of the according to the proposal, by combining project would be followed by examination of models 2 and 3. KAN-ED staff indicated the feasibility of consolidating KanWIN with that the third model would benefit from the education network. That second study the use of state facilities, but would not would be completed by March 1, 2008. If provide as much flexibility as the other the outcome of the study shows integration two models. Model 3 would have the to be feasible, the proposal targets August 1, most stringent security requirements 2008 as the start date for the second round of because of the nature of the applications consolidation. A completion date for that that run on KanWIN. effort was not included in the proposal. KAN-ED staff informed the Committee In regard to potential cost savings that that an element of the feasibility analysis might be achieved from network would be examination of any impact consolidation, the proposal presented three consolidation would have on eligibility for e- models: rate support in the future. According to KAN-ED staff, a number of variables in any • Model 1 would involve consolidation of consolidation effort may impact the amount the Next-Generation Optically of e-rate support for which KAN-ED is Provisionable KanREN backbone and the eligible. existing KAN-ED Extended Edge backbone. The proposal characterizes Committee Conclusions Regarding startup costs for this model as Consolidation of Networks “significant” due to one-time equipment costs. Relatively little savings are Regarding consolidation of state anticipated in the operation of the networks, the Committee concluded that: consolidated network. The preliminary
Kansas Legislative Research Department 16-8 2006 KAN-ED • The Board of Regents and the The 2005 Legislature amended the law to Department of Administration should continue KUSF financing of KAN-ED in continue the effort that resulted in the declining amounts until the end of FY 2009 Network Study and should pursue at which time the financing statue will recommendations made in that report. expire.
• The time line presented by the Board of T h e Committee received Regents in its proposal to the Committee communications from the Board of Regents, is adequate and should guide the effort the Kansas Hospital Association, the State leading up to the March 1 report to the Department of Education, and the Kansas Legislature. Library Association expressing support for continued financing of KAN-ED from the • All three networks examined in the KUSF. Network Study should participate in additional planning and study to ensure The Committee learned from the Kansas establishment and maintenance of a Corporation Commission that shifting KAN- common focus for state networks. ED support from the KUSF to another source would have reduced the consumer-paid • The three network organizations should monthly KUSF fee during the current year create a consolidation plan that, in an amount in the range of $0.08 to $0.55. addition to the issues identified in the Network Study, addresses: Addition of Other Entities to the List of Potential o backbone cost analysis KAN-ED Members o last mile access o premise equipment and local area Under the KAN-ED Act, hospitals, netw orks libraries, and schools are served by the o public/private partnering network. The definition of school in the Act o funding source includes public and accredited nonpublic K- o permissible traffic [i.e., Internet, 12 schools and public, and certain private, VOIP, video, data) post secondary educational institutions. o permissible constituent access KAN-ED members comprise a subset of all (adding additional state agencies and eligible entities described in the ACT. The health care institutions) Committee learned that there are currently o proposed statutory changes 797 KAN-ED members out of a potential o current commodity Internet pricing membership of 898. "Connected members" comprise a subset of all members. Currently there are 257 connected members that are KAN-ED Financing able to utilize the KAN-ED network for video-conferencing including Interactive The amount of state money available to Distance Learning and access to Internet2 fin an ce KAN-ED operations is determined by sites. The Committee also learned that the the Legislature annually through an service issue in much of the state is cost appropriation act. In each of fiscal years rather than the absence of connectivity. 2003, 2004, and 2005, $10 million was appropriated to KAN-ED from the KUSF. The 2006 Legislature considered HB That funding stream was set to expire at the 2656 that would have extended KAN-ED end of FY 2005 w h e n KAN-ED fin an cin g membership eligibility to the Department of would have shifted to the SGF. Corrections, the Juvenile Justice Authority and the state courts and their medical and education providers. The bill was
2006 KAN-ED Kansas Legislative Research Department 16-9 introduced by the House Committee on presented along with suggested statutory Higher Education and was referred to the changes. House Utilities Committee. The bill was heard but died in Committee at the end of the 2006 Session. Committee Recommendations
Committee Conclusions Regarding Based on information presented during Expansion of KAN-ED Membership its meetings and its conclusions described above, the Committee recommended that: The Committee concluded that making additional state agencies eligible for KAN-ED • The Board of Regents and the membership would provide benefits to those Department of Administration should agencies. Specifically, the Committee continue the effort that resulted in the concluded that the Department of Network Study prepared pursuant to KSA Corrections and the Department of Health 2006 Supp. 75-7228 and pursue and Environment would benefit from KAN- recommendations made in that report. ED membership. • The Board of Regents, KanREN, and Statutory Changes Required DISC conduct a feasibility study of the to Make KAN-ED a More three consolidation models presented to Viable Program the Committee and make a specific recommendation no later than March 1, Board of Regents staff suggested two 2007 to the standing committees on statutory changes that would facilitate Utilities, Education, Health, Commerce, integration of Kansas' networks. One change Ways and Means, and Appropriations; would permit KAN-ED to utilize state-owned and to the Joint Committee on network equipment. The second would Information Technology. make additional state agencies eligible for membership in KAN-ED. • The March 1, 2007 report include drafts of any legislation required to implement Committee Conclusions the recommendations. Regarding Statutory Changes • The Legislature enact amendments to the The Committee concluded that the KAN-ED Act that will allow the Legislature would have an opportunity to Department of Corrections and the consider additional statutory changes Department of Health and Environment necessary to facilitate implementation of to become members of KAN-ED. KAN-ED’s goals during the 2007 S e ssio n after the proposed consolidation plan is
Kansas Legislative Research Department 16-10 2006 KAN-ED