TOPEKA — The Senate and House narrowly passed a bill giving 10% of registered voters in a taxing area the ability to stop some property tax increases, a move one senator called “tyranny of the minority.”
Both chambers debated House Bill 2745 Friday. It passed the Senate 22-18 and the House 63-59. It now advances to Gov. Laura Kelly.
Another proposal attempting to change the Kansas Constitution to limit property tax increases was shot down by the House but referred to a conference committee for more discussion. Senate Concurrent Resolution 1603, which needed support from two-thirds of both chambers, failed in the House 63-59.
The resolution, which would have been on the August ballot for voters to decide, limits the assessed valuation of residential, commercial, and agricultural property from jumping more than 9% in any one year.
What passed
HB 2745 was rewritten on the last day of the session by the Senate Committee on Assessment and Taxation and then passed by the Senate that same day. The speed made changes not only difficult to follow but difficult to get behind, said Rep. Tom Sawyer, a Wichita Democrat.
The bill changed from its first introduction, which passed the House 76-45 on Feb. 26.
“The changes the Senate made, I can’t support this any longer,” Sawyer said. “I think it’s too harsh on cities. We have growing areas. To not allow new construction, that’s very, very difficult for cities that are growing like my county.”
Under the bill, if any taxing entity, such as a city or county, plans a tax increase higher than the Consumer Price Index averaged from the previous year, or an increase in excess of 3%, then voters can circulate a petition to stop property taxes from going up.
Once 10% of registered voters in the affected taxing district sign the petition, the taxing entity can’t raise taxes and can only pass a revenue neutral budget, meaning it can’t exceed the previous year’s spending level.
Sen. Bill Clifford, a Garden City Republican, said the bill would affect growing cities, which may need to invest in large utility projects or other services, and could see “millions of dollars impeded by this approach.”
“What I see happening is a very activist, vocal minority will get this petition every single time, on the school, on the community college, on the county, on the city,” he said. “Whether it’s good policy or not, they will act to get a petition against whatever budget comes out and then stop it.”
Clifford said the bill would then push the taxing entity back to last year’s revenue, which doesn’t even allow for consumer price index growth. Sometimes, he said, insurance may go up 10% and benefit packages for emergency personnel increase.
“We are not allowing those entities to be able to have the flexibility of knowing their local situation way better than we do here at Topeka in order to make those adjustments,” Clifford said. “I really see this as an opportunity for tyranny of the minority.”
Others raised concerns about how taxing entities will get their budgets done earlier than current deadlines because they have to notify the public when they are going to exceed last year’s revenue.
Lansing Republican Sen. Jeff Klemp said guardrails can be helpful and taxing entities can still make their case through public education when a tax increase is necessary.
“Can they raise the mill rates to whatever they want? They have to sell that,” he said. “When we have that conversation around the tyranny of a minority, I don’t think those words are inaccurate. But it’s not as imbalanced as what it seems.”
