Kansas Gov. Kelly anticipates budget woes from coronavirus

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TOPEKA, Kan. — Kansas Gov. Laura Kelly announced Monday that she has directed state agencies to avoid filling open positions not essential to dealing with the coronavirus pandemic and to eliminate discretionary spending as she and other officials brace for a more pessimistic fiscal forecast.

State officials, legislative researchers and university economists were expected Monday evening to slash the state’s official projections for tax collections for the rest of the current 2020 budget year, which ends June 30, and for the 2021 budget year that begins in July.

Kelly issued a stay-at-home order for all of the state’s 2.9 million residents that took effect March 30, and Kansas has seen a surge in claims for unemployment benefits from jobless workers since mid-March.

The Democratic governor and Republican-controlled Legislature expect those moves to cut into state revenues. Kelly also delayed this year’s income tax filing deadline three months, to July 15, and that move will lessen revenues in the short-term.

Kelly said Monday that besides directing agencies to hold positions open and end discretionary spending, she directed them to avoid expanding non-essential programs and to avoid proposing pay increases for employees. She said agencies will begin this week to develop detailed budget plans.

“Some impacts of this economic crisis won’t be felt right away,” she said. “Although we hope for the best, we are preparing for the worst.”

The state’s current fiscal forecast was issued in November and projected general tax revenues of $7.7 billion for the current budget year and more than $7.9 billion for the 2021 budget year.

State finances had been in relatively good shape going into the pandemic. The state expected to have $927 million in cash reserves on June 30, and tax collections were running 3.2% ahead of expectations for the current budget year.

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