Kelly warns budget crunch will return to Kansas without ‘significantly more’ federal aid

Gov. Laura Kelly told a congressional committee Thursday that “significantly more support” is needed from the federal government, saying that Kansas’ experience with sweeping cuts to state services should be a warning shot.

In her testimony before the House Financial Services Committee, Kelly drew on her opposition to sweeping income tax cuts pushed by then-Gov. Sam Brownback that led to years of budget strain.

That led to millions of dollars in cuts to education and state agencies as the state grappled with the resulting budget shortfall.

“The bottom line is years of austerity hurt our business owners, our farmers, our children, our teachers, our essential workers and our families,” Kelly said.

The state is staring down an even bigger shortfall due to lost revenue from COVID-19-mandated shutdowns, with state estimates projecting a $1.4 billion shortfall next fiscal year.

Nationally, Rep. Maxime Waters, D-Calif., said the shortfall for state and local governments was in the order of $1 trillion.

Kelly said that without federal aid states will be forced to make similar decisions as Kansas did in recent years, which would be disastrous for residents.

“Severe budget cuts do not create small government, they create failed government," she said.

The hearing was part of an effort by U.S. House Democrats to increase pressure on their Senate colleagues to pass stimulus legislation they passed in May.

That legislation, the HEROES Act, included $950 billion in relief for state, local and tribal governments, as well as extended unemployment benefits and direct aid to Americans.

The measure has been panned in the Republican-controlled Senate as too expensive and is unlikely to receive a vote.

Instead, lawmakers in the Senate attempted to pass a much narrower, $500 billion relief bill Thursday. The legislation, which failed to reach the 60 vote threshold needed to advance, does not contain any direct support for state governments.

Republicans have argued that many states’ budget issues are self-inflicted.

Moreover, they have contended that some states have not used the full allotment of CARES Act funds, which must be used for COVID-19-related expenses by Dec. 30.

But in Kansas, the state is nearing a decision on doling out the remaining $290 million of share of CARES Act funding, which totaled over $1 billion.

After next week, when a final decision is reached on the remaining funding, all of that money will be accounted for.

Kelly said this ratcheted up the urgency for federal action further.

“We need a coherent, top-down strategy that will reassure businesses and Americans that our government has a plan to keep our economy stable until we have a vaccine in place," she said.