Kansas Gov. Kelly pushes for highway plan, Medicaid expansion in State of the State address

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TOPEKA, Kan. — Kansas Gov. Laura Kelly on Wednesday called for a new program to improve the state’s roads and bridges, urged state lawmakers to approve a bipartisan Medicaid expansion plan and warned she is likely to veto the income tax cuts that Republicans are pursuing.

The Democratic governor provided the outlines of her agenda for the GOP-controlled Legislature’s annual 90-day session during her State of the State address.

But her second address since taking office a year ago was often a look back on her first year in office and a Republican predecessor’s tax-cutting experiment that was followed by persistent budget woes.

Kelly promised her own tax cuts but signaled they would be modest initiatives to ease the burden of the state’s sales tax on groceries for low-income families and to provide state aid to cities and counties in hopes that they’ll decrease their property taxes.

She also emphasized her support for a new trade agreement with Canada and Mexico approved by the U.S. House, and she urged the U.S. Senate to pass it.

Kelly spent much of her speech arguing that Kansas is starting to recover from nationally notorious income-tax cuts championed by former GOP Gov. Sam Brownback. Legislators reversed most of the cuts in 2017 and Kelly won the 2018 governor’s race largely by campaigning against Brownback’s policies.

“We have so many reasons to be hopeful tonight,” Kelly said in her televised address. “But make no mistake: One year of progress cannot erase a decade of damage.”

Kelly’s administration plans to release details Thursday morning of her proposed state budget for the fiscal year beginning July 1. The current state budget is $18.4 billion.

House Speaker Ron Ryckman Jr., a Kansas City-area Republican, said in the GOP’s response, which was prepared before hearing the speech, that Kelly is determined to grow state government.

“No difference in our visions is more stark than this one,” Ryckman said. “She wants to grow spending and hopes that will grow the state.”

Lawmakers convened with a bipartisan plan waiting for them to expand the state’s Medicaid health coverage for up to 150,000 additional people. Kelly reached agreement last week with Senate Majority Leader Jim Denning, another Kansas City-area Republican.

Denning and other GOP leaders blocked an expansion plan that Kelly favored last year, citing concerns about its potential costs and how it would be administered. His deal with Kelly is expected to clear the way for Kansas to become the 37th state to expand Medicaid.

“We are so close,” Kelly said. “Let’s get this done.”

Her call for a new transportation program came with the state winding down projects promised under a 10-year plan started in 2009, financed with bonds, vehicle registration, gasoline tax and sales tax revenues.

The program was supposed to be worth $8 billion, but lawmakers siphoned off $2 billion to plug holes elsewhere in the budget.

Transportation Secretary Julie Lorenz and her staff have held months of community meetings and identified $18 billion in infrastructure needs.

“It’s time for us to develop a new, comprehensive transportation plan so that we can rebuild roads and bridges across our state,” Kelly said.

But the governor added what she called a “critical” condition: “stable state revenues.”

The Democratic governor and Republican leaders already were headed for another confrontation over income tax cuts after she vetoed two GOP tax bills last year.

GOP leaders want to cut taxes for individuals and businesses now paying more in income taxes to the state because of changes in the federal tax code at the end of 2017 championed by President Donald Trump.

Kelly promised to veto “any tax bill” that “throws our state back into fiscal crisis.” She had argued that last year’s GOP tax bills would “decimate” state government.

“We simply cannot go back,” she said.

Kelly, an abortion rights supporter, didn’t mention an issue of prime importance to many Republicans: Overturning a Kansas Supreme Court decision last year protecting abortion rights.

They’re pursuing an amendment to the state constitution to allow lawmakers to regulate abortion as they have in the past, with a raft of restrictions before Kelly took office.

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