Governor Laura Kelly Signs Budget, Makes Record Investment in Rainy Day Fund and Law Enforcement, Invests in Housing, Workforce, and Economic Development

~~Budget Closes Bank of KDOT, Fully Funds State Water Plan, Increases Funding for Higher Education and Home and Community Based Services~~

TOPEKA – Today Governor Laura Kelly signed the state’s budget, House Substitute for Substitute for Senate Bill 267, for Fiscal Year 2022 and Fiscal Year 2023. This budget passed with overwhelming bipartisan support and allows the state to continue its path of economic growth through targeted investments in core services, higher education, and workforce development.

“This budget delivers on promises I made when I was first elected, including investing in our economic development tools, funding higher education, stopping the irresponsible practice of robbing from our highway fund, and much more,” Governor Laura Kelly said. “Kansas is stronger than it was four years ago, and as a result, we can confidently make critical investments in our state while at the same time eliminating the state food tax to help Kansans have more room in their own family budgets.”

Highlights from Governor Kelly’s budget:

• The budget closes the Bank of KDOT and ends other extraordinary transfers from the State Highway Fund.
• Restores full funding for the State Water Plan Fund for the first time since 2008.
• Makes a historic $500 million deposit in the state’s budget stabilization fund. This is the largest investment in the budget stabilization fund in the state’s history, and it also leaves a balance that is more than five times higher than the state’s rainy day fund has ever been.
• Restores Higher Education funding and makes significant one-time investments in need-based aid, deferred maintenance, and workforce development through community and tech college funding.
• Increases the state’s funding for housing by $65 million over two years. This funding will be dedicated to the development and renovation of moderate-income housing and the creation of a state revolving loan program to support the state’s workforce needs and close the financing gap in rural communities.
• Increases funding for the Office of Broadband Development, Kansas Tourism, small business research and development grants, work-based learning, registered apprenticeships, agricultural economic development, and the Job Creation Fund.
• Provides $3 million in scholarships for aspiring teachers attending Kansas universities and who are committed to teaching in Kansas upon graduation.
• Provides $35 million in matching funds over 5 years for workforce and economic development through the NIAR/WERX aircraft conversion program at Wichita State University.
• Provides $85 million in funding for agriculture innovation, health sciences, and economic development through the University of Kansas, Kansas State University, and Wichita State University.
• Provides $95 million in higher education workforce development grants with a private match requirement, including $10 million for community colleges, tech colleges, and Washburn University and $10 million for Private and Independent Colleges.
• Provides $28.5 million in matching funding for Community College program and facility enhancements.
• Includes significant salary enhancements for Kansas Highway Patrol officers and Kansas Bureau of Investigation officers and employees to ensure that the state remains competitive in its ability to recruit and retain the men and women that protect the state of Kansas.
• Continues funding for state employees working in 24/7 facilities including those serving in the state’s hospitals for mental health and developmental disabilities, correctional facilities, and veterans’ homes.
• Increases coverage for post-partum mothers from 60 days to 12 months after birth and funds the Maternal and Child Home Visiting Program.
• Approves additional enhancements for Emergency Medical Services, adult dental services, cancer screening, pediatric primary care, and newborn screening.
• Reimburses volunteer and part-time fire departments for PPE and fire bunker and wildland fire fighting gear.
• Increases funding for our state’s Kansas Commission on Veterans Affairs Office to improve and expand services for our veterans.
• Increases funding for several home and community-based services, including care provided for mental health, specialized nursing, frail and elderly Kansans and those living in nursing homes, and Kansans with intellectual and developmental disabilities.
• Increases the assistive services cap, empowering individuals who need assistive technology.
• Makes significant facility improvements for the School for the Deaf and the School for the Blind.
• Focuses additional resources on behavioral crisis stabilization services for Kansans with intellectual and developmental disabilities, staffing at psychiatric residential treatment facilities, diversion from state hospitals through community crisis intervention centers, and suicide prevention.
• Addresses the state’s competency evaluation and restoration backlog.
• Continues funding for Families First Prevention grants and services and includes funding for recruitment and retention incentives for child placing agencies.
• Makes one-time capital investments in the state’s infrastructure for mental health, corrections, law enforcement, and National Guard.
• Restores full funding for the state’s evidence-based juvenile justice prevention and rehabilitation programs.
• Increases funding for the state’s grants to local judicial districts for community corrections grants.
• Funds new geriatric and substance use programs at Lansing and Winfield Correctional Facilities.
• Provides funding for stab vests, facility improvements, equipment, body cameras, and additional security for law enforcement and those who work in the state’s secure facilities.
• Increases funding for meat and poultry inspections, water programs, and for the Animal Facility Inspection Program in the Department of Agriculture.
• Makes a one-time $80 million payment on the state’s water storage contracts with the Army Corps of Engineers—safeguarding this resource for future generations.

Below please find the message from the Governor regarding House Substitute for Substitute for Senate Bill 267:

“I want to thank the Legislature for their work and bi-partisan collaboration to pass House Substitute for Substitute for Senate Bill 267 – a budget that allows us to continue to improve core services while investing in our future and setting the stage for additional economic growth.

“This budget completes a promise I made to close the Bank of KDOT, it restores and renews the state’s commitment to higher education, it fully funds the state water plan, it provides historic funding for the most vulnerable and those who care for them, and it invests in our law enforcement and public safety officers.

“Enhancements for workforce and economic development will allow Kansas to continue our record-breaking success in attracting and retaining businesses. The historic investment in moderate income housing will ensure that we have quality housing to recruit and retain families throughout the state.

“Funding for state employee pay increases, updated equipment and resources, and facility upgrades will benefit the public and make a down payment toward appropriately rewarding Kansans who dedicate their lives to public service.

“Finally, this budget preserves the funding necessary to eliminate the state food sales tax on groceries, benefiting all Kansans, while making a $500 million deposit in the state’s Budget Stabilization Fund—by far the largest Rainy Day Fund investment in state history.

“With all that this budget does accomplish, it could do more to ensure that all communities in the state have the access to healthcare that Kansans deserve and that prospective new residents expect. Given how new business growth requires a healthy workforce, I will continue to urge the Legislature to make the commonsense decision to expand Medicaid and return Kansas’ federal tax dollars to our communities.

“Therefore, pursuant to Article 2, Section 14(b) of the Constitution of the State of Kansas, I hereby return House Substitute for Substitute for Senate Bill 267 with my signature approving the bill, except for the items enumerated below.”

Kansas Public Employees Retirement System—Exclusive Opportunity for Legislators
Section 43(d) has been vetoed in its entirety.

Legislators must make an irrevocable decision when they begin public service to either join or decline enrollment in the Kansas Public Employees Retirement System (KPERS). The policy in Section 43(d) would create an exclusive opportunity for legislators to reverse the irrevocable decision that they consciously made when they elected not to join KPERS. Other public employees including teachers, public safety officers, and nurses are not allowed this special election under law. Further, this provision likely would not be approved by the Internal Revenue Service if reviewed.

State Board of Regents—Special Line Item for Single Program
The portion of Section 109(a) that reads as follows has been line-item vetoed: Benedictine college engineering program: $200,000

Under the State Board of Regents budget, $200,000 is appropriated for a college engineering program at Benedictine College. This budget includes many enhancements for higher education, including significant increases in funding for grant programs for public and private postsecondary institutions. One of these appropriations is a $10,000,000 grant program in Section 29(f) that is reserved exclusively for the state’s private and independent colleges. Benedictine College should apply for public funding for the college engineering program through this specifically designated appropriation for similar programs.

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