SB 385, as amended, makes adjustments to the approved FY 2002 budgets of most state agencies. Specific adjustments are made to the budgets of the Judicial Branch, the Department of Education, the Department of Social and Rehabilitation Services, the Regents Institutions and the Board of Regents office, the Department of Health and Environment, and the Kansas Department of Transportation. The remaining state agencies, with some limited exceptions, would see an across the board reduction of 2.0 percent to their current year approved budgets. The specific provisions of the bill as introduced and as amended are reflected in the table below.

Reductions in the bill total $72.8 million, and are partially offset by $55.0 million in supplemental State General Fund appropriations for three agencies: the Judicial Branch ($0.5 million in operating expenditures); the Department of Education ($20.3 million in additional funding for local option budgets of school districts); and the Department of Social and Rehabilitation Services ($34.2 million for caseload adjustments). Specific reductions totaling $49.3 million are made in the budgets of the Department of Education ($13.7 million to hold excess costs for special education at 85.0 percent); and the Board of Regents and the Regents institutions (a total of $9.1 million including savings of $0.6 million by folding the remaining liability for a small group of TIAA-KPERS members into the main KPERS unfunded liability, and $8.5 million from a 1.2 percent across the board reduction); and the Kansas Department of Transportation ($26.5 million reflecting $20.0 million in offsetting bond authorization and a $6.5 million operating expenditure reduction). The reductions in the Department of Transportation had been approved by the 2001 Legislature, but were vetoed by the Governor. The veto was not directed at these two specific reductions, however. An additional reduction of $23.5 million is the result of a 2.0 percent across the board reduction for all other state agencies. Exceptions are made for: KPERS School employer contributions; state payments to local school districts for general state aid, supplemental state aid or special education; the Judicial Branch; debt service payments; the Department of Corrections (which is reduced 1.0 percent), and selected items in the budget of the Kansas Department of Health and Environment.

The bill as amended reduces currently approved FY 2002 State General Fund expenditures by a net $17.8 million, for revised expenditures of $4.494 billion, an increase of $64.6 million (1.5 percent) above actual FY 2001 State General Fund expenditures of $4.430 billion.

	FY 2002 State General Fund Impact of SB 385
	(In Millions)

		As	As
Sec.		Introduced	Amended	Difference
2	Judicial Branch
	Increase FY 02 Judiciary budget	$ 0.5	$ 0.5	$ 0.0
3	Department of Education
	Additional FY 2002 funding for local option budget	20.3	20.3	0.0
	Lapse $39 Base State Aid Per Pupil	(22.6)	0.0	22.6
	Fund FY 2002 special education excess costs at 85.0 percent	(13.7)	(13.7)	0.0
	Subtotal-Department of Education	(16.0)	6.6	22.6
4	Department of Social and Rehabilitation Services
	Fund FY 2002 supplemental for SRS Caseloads	34.2	34.2	0.0

5	All Agencies
	Reduce approved State General Fund budgets by 2.0 percent	(25.7)	(25.7)	0.0
	Except: KPERS employer contributions
	General, supplemental, and special education aid
	Regents institutions
	State Board of Regents
	Debt service payments
	Judicial Branch
	Partial funding for Corrections (1.0 percent reduction)	0.0	2.0	2.0
	Partial funding for KDHE vaccines, etc.	0.0	0.2	0.2
	Subtotal - All Agencies	(25.7)	(23.5)	2.2
6 - 15	Regents Institutions and Board of Regents
	Fold remaining TIAA-KPERS liability into KPERS	(5.8)	(0.6)	5.2
	Reduce FY 2002 State General Fund by 1.2 percent	(8.5)	(8.5)	0.0
	Subtotal - Regents	(14.3)	(9.1)	5.2
16	Kansas Department of Transportation
	Reduce funding for bond offset and other operating expenditure	(26.5)	(26.5)	0.0
	reduction approved by 2001 Legislature and vetoed by Governor

	Total FY 2002 Impact of SB 385	$ (47.8)	$ (17.8)	$ 30.0

The Director of the Budget, three cabinet secretaries, representatives of the State Board of Regents and the State Department of Education, and other interested parties testified in opposition to the bill. A representative of the Kansas Taxpayer’s Network testified in support of the bill.

The Senate Committee amendments to the bill restored $30.0 million in reductions contained in the bill as introduced. Among the items restored was $22.6 million to restore a $39 reduction in Base State Aid Per Pupil for local school districts, and $2.0 million to restore half of the reduction made to the budgets of the Department of Corrections and the Correctional Facilities.