DALLAS — Faced with an unprecedented decline in tax revenue, Kansas Gov. Mark Parkinson on Monday slashed almost $260 million from the state’s fiscal 2010 budget.
The latest cuts of $258.9 million, along with four earlier ones, will lower spending by $750 million from the fiscal 2010 budget approved earlier this year. State expenditures for public and higher education will be reduced to fiscal 2006 levels.
“After this fifth round of budget cutting, there will not be a single agency or a single branch of government that has not been affected by this incredible reduction in revenues,” Parkinson said.
The governor said the cuts were necessary because the state is experiencing an unprecedented revenue crisis.
“This is the most challenging budget time in Kansas history,” he said. “We can’t find a time when state revenues declined for two years in a row. We are now in our fourth year of revenue declines.”
Earlier this month, the state’s Consensus Revenue Estimating Group revised its official prediction of fiscal 2010 revenue by $235.2 million. The new estimate of $5.3 billion in state general fund collections represents a 5% drop from final fiscal 2009 revenues of $5.6 billion and a 4.2% drop from April’s estimate. General fund revenues from July through October total $1.6 billion, $109 million less than the April revenue estimate and $242.5 million less than collected in the same period of fiscal 2009.
The latest cuts will affect vital state and local functions, according to Parkinson.
“This latest round of budget reductions will mean that class sizes will again increase in Kansas schools,” he said. “These cuts mean that our universities will have fewer professors, offer fewer classes, and critical investments in our future are in jeopardy. These budget cuts will force us to reduce supervision of released prisoners, increase the number of disabled citizens waiting for services, and reduce road maintenance.”
The reductions would have been more acute without the use this year of $85.9 million of federal stimulus funds that had been reserved for the fiscal 2011 budget. The shift leaves Kansas with $189.6 million of stimulus funds for next year.
Aid to local school districts will be cut by $36 million, and the state will not fund a scheduled payment to local districts of $155.6 million to make up for reduced local property tax collections and unexpected higher enrollments. The cuts bring total reductions for public education to $200 million in fiscal 2010.
Gary Sherrer, vice chairman of the Kansas Board of Regents, said the $2 million in cuts brings the total reduction for higher education to $106 million.
“We’re now beyond the point where cuts are undermining the quality and quantity of the education our institutions are able to offer,” Sherrer said.
Parkinson also cut $50 million from highway maintenance and $22 million in Medicaid reimbursements. State agency cuts include $3.8 million from the Department of Corrections and $818,000 from the Commission on Veterans’ Affairs.
Kansas is rated AA-minus by Fitch Ratings, Aa1 by Moody’s Investors Service, and AA-plus by Standard & Poor’s.