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The Associated Press May 13, 2011, 3:18PM ET

Legislature approves $13.8B Kansas budget

Kansas legislative leaders share a difference of opinion over the impact of the $13.8 billion budget they sent to Gov. Sam Brownback early Friday.

The bill finances state government starting July 1, making cuts in public schools, social services and general government administration. Kansas will spend $881 million less than it will in the current year, erasing a one-time shortfall of nearly $500 million and creating a $50 million surplus in 2012.

"They got their work done on time and under budget," Brownback said in a statement Friday.

Much of the reductions reflect the decision not to replace one-time federal stimulus dollars used in the past two years to support education and social services.

Unlike 2010 when legislators also raised the state sales tax rate to balance the ledger, the Republican-controlled Legislature turned to a sharp knife to keep government in business.

"There's a lot of heartburn with the things we did," said House Appropriations Committee Chairman Marc Rhoades, a Newton Republican, in passing the bill before the 90-day session closed shortly before dawn.

None of the 33 House or eight Senate Democrats voted for the budget. They argued that the cuts would lead to larger class sizes and teacher layoff, as well as eliminate services for thousands of developmentally disabled residents.

"No Democrat was willing to sacrifice Kansas citizens so the state can stash money away in its bank account," said House Minority Leader Paul Davis of Lawrence.

Added Senate Democratic leader Anthony Hensley of Topeka: "Average Kansans will be the true loser if this budget is signed into law."

For some of the House Republican freshmen, the cuts weren't deep enough.

"I'm a fiscal conservative. I encourage our governor to liberally use his line-item veto," said Rep. John Rubin, a Shawnee Republican.

House Speaker Mike O'Neal said legislators and school districts anticipated the $232 per student cut in state aid from the outset of the session, proposed by Brownback two days after taking office in January. Legislators were able to approve a bill giving the state's 289 school districts flexibility in using reserve accounts to offset the reductions.

"I don't think it was a surprise to anybody that it was probably going to take Republican votes to pass the budget. And it did," said O'Neal, a Hutchinson Republican.

Rural legislators worried about the lasting effects on education and if the state would restore funding when the economy recovered.

"I'm not questioning motives, I support a balanced budget. I simply cannot support these cuts," said Sen. Allen Schmidt, a Hays Democrat.

Kansas revenues collections beat the April estimate by $25 million, a figure not included in the budget calculations over Republican concerns that it might be a one-time increase.

Rhoades said May and June projections suggest that the state could realize as much as $50 million in additional funds before the current fiscal year ends June 30.

"This has been a tough year, but I hope things are starting to turn," said Senate Ways and Means Committee Chairwoman Carolyn McGinn, a Sedgwick Republican. "We need to continue to make good policy decision to keep our economy rebounding."

Brownback said legislators made progress on his goal to create mechanism for creating jobs. It includes a business expensing provision that will allow firms to take advantage of tax breaks immediately when making capital investments.

Legislators also approved establishing Rural Opportunity Zones that provide income tax incentives for residents moving to Kansas from out of state to counties that have seen dramatic population declines in the past decade.

"These initiatives will improve the environment for businesses of all sizes in Kansas and get unemployed Kansans back to work," Brownback said.

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