May 2003
May 29, 2003
(Distributed to Kansas newspapers May 26, 2003)Investing in people
The state of Kansas is making a big shift in its continual effort to invest in Kansans, and from up close, it’s hard to tell whether legislators fully understand the importance of what they have done in the past two sessions.
They have opted for a policy under which they will issue bonds to pay for not just bricks and mortar which is traditionally what the state has issued bonds for, but for research, development and ultimately, ideas.
You know the drill for bonds: someone wants to build something for the state, the state figures whatever it is will last for years–or at least until the bonds are paid off–and the state identifies a source of funds with which to make the bond payments. It’s a good way to get money all of a sudden so that it can be used for a construction project. It’s like making payments on a house.
Well, this session, and last session, the Legislature stirred some new elements into the consideration of bonds. Sure, it’s still borrowed money, and it will have to be repaid with interest to people who buy those bonds. But this year instead of just bricks and mortar, bonds are being used for ideas.
The latest issue that has been approved is $500 million for Boeing in Wichita to design, engineer and research what it will take to build big pieces of Boeing’s new 7E7 jetliner. The specific deal is that Boeing now has authority to ask the Kansas Development Finance Authority, the agency which issues bonds for the state, to issue bonds for up to $500 million. Boeing will pay back the $500 million and the state will pay the interest on those bonds. The money for the interest payments will come from the state income tax withholding of up to 4,000 Boeing workers expected to work on the 7E7 if Boeing Wichita is clever enough to figure how to build its pieces of the plane better, faster and more economically than anyone else in the world.
Complicated, sure, but what we have the state participating in is the research, the design, the science and the ability to build major parts of the 7E7. Now, that’s something worth investing in.
The Legislature did nearly the same thing last year, when it issued $115 million in Regents Research facilities bonds. Sure, the bonds go toward bricks and mortar. But the important difference is that the state is helping to finance construction of buildings where Kansans will do research for the federal government and private businesses–and probably do a little pure research–that will draw brain power and research projects into Kansas.
After the first five years of payments, the research gurus at Kansas State University in Manhattan, the University of Kansas at Lawrence and Wichita State University are confident they will be able to attract research projects and funding–enough to pay off about $65 million of the bonds. The state is paying the first five years worth of bond payments, about $50 million in total, while the buildings are going up.
What feels good about the change is that instead of just issuing bonds for buildings, Kansas is now issuing bonds that are essentially backed by the intelligence, the skills and the work of Kansans.
It’s the difference between your child wanting to borrow money for a new car, and wanting to borrow money for tuition. It’s still money, it’s still your child, but what parent wouldn’t feel better about forking over the cash for tuition than for a car?
That’s what bonds are for. Investment. And while there are a lot of investments that we make personally and as a state, the ones we feel best about five or 10 years out are the ones we made in people.
Is this a big deal? Probably. Is the investment in Boeing and in research facilities the start of a change in attitude when it comes to putting Kansas’ reputation and dollars on the line? We can only hope so.
May 22, 2003
(Distributed to Kansas newspapers May 19, 2003)Looking behind sofa cushions
When you’re scurrying around checking behind the sofa cushions for change you often find stuff that has been long-forgotten.
Such is the tale of the Firefighters’ Relief Associations.
The Legislature, remember, has been looking through sofa cushions for change and Senate President Dave Kerr, R-Hutchinson, wondered what happens to the money from the 2 percent tax that we all pay on fire and lightning insurance.
Turns out, Kerr, through the Legislative Division of Post Audit, did some checking and there is about $6.3 million in that fund. Suddenly, we’re talking real money.
And not only is $6.3 million a lot of money, but because insurance premiums have been rising lately, it looks like fire departments are going to get more, probably $7.6 million next year.
Just from that little tax on fire insurance premiums that nobody noticed? Yes
And that means that Kerr and Post Audit have identified the start of what might be a good thing for some big and little fire districts. That’s what the Legislature, probably, is supposed to be doing. Looking in nooks and crannies and finding what state-collected monies (under the dome, they are called "revenue streams") amount to and what they’re spent for and whether we’re getting the maximum benefit from those dollars.
There are about 580 relief associations for firefighters in the state; every little fire department and every big fire department has one. And they get money from the fund ranging, last year, from $468,000 in Wichita to $1,459 for Clark County District No. 1.
Altogether, the district associations spent, in 2001, 96 percent of their distributions of money on life insurance and annuity premiums and other benefits for firefighters who are injured or killed on the job—as long as they showed up for at least 75 percent of the fires in the district. There are full-time firefighters, part-time firefighters and volunteer firefighters in the mix.
The idea for the tax is undoubtedly a good one. At the turn of the last century, and now, it is a good idea for firefighters to have some financial protection should they be hurt or killed on the job saving lives and property. It’s just the right thing to do.
But how we do it is worth a look every, say, 108 years, which is how old the Firefighters’ Relief Fund Act is.
Is this sounding like something that could benefit from a little central buying, like one master policy instead of 500-plus smaller policies, some with just a handful of lives insured? That’s what it sounds like from here. We’re talking economies of scale.
It’s just a little corner of the state budget, of course, but wouldn’t you figure that it is worth a look to determine whether the same $5.4 million in premiums in 2001 might have either bought more insurance for firefighters, or the same amount of insurance for less money?
That would translate into lower taxes on fire insurance premiums, which is probably not a bad deal for everyone who isn’t a firefighter.
Or, it could turn out that we’ve been spending most of the 2 percent tax on fire premiums for a system that really isn’t buying enough insurance for firefighters, and the premiums tax ought to be 3 percent?
Someone, somewhere—excuse us, we have a Legislature for this sort of decision, don’t we—ought to be able to decide how much insurance we ought to be buying for firefighters, and then by working the numbers backward figure out how best to provide it. After all, things are different now than they were in 1895 when the Firefighters’ Relief Fund Act was passed by the Kansas Legislature.
Now, you can rest assured that the firefighters' fund isn’t the biggest issue facing legislators, this year or next in terms of money or tax policy or insurance costs or big global issues. But it’s worth a look.
What started as a search for extra money might actually turn out to be the start of an investigation that will benefit the state, the firefighters who protect our property and lives, and even the insurance companies which benefit from damage averted by skilled firefighters.
A big deal? Maybe, maybe not. But worth looking at for a couple good policy reasons.
May 15, 2003
(Distributed to Kansas newspapers May 12, 2003)Time to roll the dice?
It may take a few weeks for them to realize it, but the 2003 session of the Kansas Legislature demonstrated that legislators aren’t going to approve expanded gambling in Kansas unless they are forced to.
That may be the real political lesson from the just-adjourned session of the Legislature. Yes, legislators will be crowing that they completed the 2003 session in just 85 days and that they didn’t raise taxes and that they didn’t cut funding to elementary and secondary education. They may even be proud that the Kansas Power of Attorney act, which only a handful of Kansans ever knew existed, was substantially rewritten.
But for most Kansans, there wasn’t a lot done that stirs the emotions, that we’re even going to notice.
And there won’t be any more gaming in Kansas when the Legislature convenes next January than there is now.
Oh, that’s not to say there wasn’t a lot of talk, a lot of posturing about the economic good and the potential revenue to the state from gaming, or the evils of gambling.
There was plenty of that.
But we’ve heard that discussion for years now and so far, it is the double-whammy of the House passing a gaming bill that is incredibly amended-up so that we can’t tell what it would really do and the Senate holding out for an immaculately conceived gaming bill that is the roadblock.
The real solution to the fate of gaming in Kansas, the way to settle the issue, is probably a statewide vote on a constitutional amendment that would allow the Kansas Legislature to devise a system of casino-style gaming in the state.
Say Kansans vote on this issue in the 2004 election when all state Senate and House of Representative seats are on the ballot, too; there would probably be a good turnout. If voters say yes then the Legislature starts writing the bill in the 2005 legislative session. If the voters say no, then the issue would be dead.
The decision to put expanded gambling on the ballot won’t be an easy one to make. Legislators would be turning over to the people who elect them a major policy decision. Legislators, by nature, hate to turn over issues to the public that elected them.
It happened once recently in Kansas, though. Remember 1986, when voters approved a constitutional amendment that brought pari-mutuel wagering (that’s horse- and dog-racing) to Kansas? They voted for the concept before there was the nuts-and-bolts bill in place. They approved the concept and left it to the Legislature to type up.
The problem that the Legislature has had with gambling, which this session came down pretty much to slots-at-tracks or nearby with a potential casino tossed in at Dodge City and in Geary County, is that everyone who introduces a gaming bill wants his or her own personal deal.
The couple of guys who have struggling racetracks in Kansas want the slots at their facilities, the people who don’t own tracks want the chance to put up casinos or slot machine parlors on land they own. Everyone wants to get into the lucrative business of managing casinos.
Nobody willing to front mileage and meal money for a lobbyist in the Statehouse doesn’t have an angle on the deal.
So, maybe there should be a referendum with some broad language, maybe defining where whatever the state’s "take" from the gambling profits will go. It’s probably not a good idea to put in the Constitution how much money the state would take, leaving that for some hard-nosed negotiation for legislators and casino types to haggle over.
The obvious objection to a statewide referendum would be that—golly—people who favor gaming will spend money to campaign for the approval of the ballot question. And, because they may make money from the deal, they will spend a lot of money on the campaign and whipsaw poor Kansas voters who can barely find their way to the polls, anyway.
Yes, that’s an argument. But it also denies the built-in advantage that those who oppose gaming hold, but don’t talk about. The folks who don’t like gaming really don’t like gaming. They’re not going to be influenced, and they’re going to spend money, too. And, there are large numbers of voters in the state who merely have to drive to an Indian casino, or find their way across a bridge to Missouri, to gamble all they want.
And do you think the land of the bland, Johnson County, is interested in garish casino lights towering over the shake-shingle roofs of the quiet, upper-scale neighborhoods they cherish?
It might be an interesting campaign. But it would certainly get the issue off dead-center, where it is now, and where every legislative session without a gaming law passed is a victory for some number of Kansans, whether it is a majority of Kansans who don’t want more gambling, or just a majority of their legislators...
May 8, 2003
(Distributed to Kansas newspapers May 5, 2003)Teaching about sex
Looks like the Legislature has finally ended its fascination with the issue that has become, in Statehouse slang, the "dirty professor" law.
Maybe the shorthand that has been assigned to what some legislators believe is—and what may be—a real problem, indicates that there are just some subjects the House and Senate can’t deal with on a rational basis in debate.
The professor is Kansas University teacher Dennis Dailey, who teaches a wildly popular course in human sexuality, one that students apply to take as a freshman, and which some don’t get into until their senior year, so jam-packed is the waiting list.
Most of us who aren’t college-age anymore probably did without the benefit of a technical, social, intellectual course in sex and how it motivates people, and are more than a little titillated about just what such a course may include. It’s probably one of those things where everyone has a suspicion about what the young and limber might learn, and wonder whether it would have been helpful.
But it is a racy class. No mistake or distortion here.
That a few students believe they were made fun of or embarrassed is, of course, not good. Nobody really knows the delicate sensibilities of individuals, at what level a face-reddening experience becomes a scarring, emotional, painful event. That’s something that an experienced teacher ought to know.
But the initial solution by Sen. Susan Wagle, R-Wichita, which might have resulted in the entire School of Social Welfare at KU being de-funded, probably wasn’t the right solution.
A follow-up plan, so far nestled in an appropriations bill, probably isn’t far off the mark. It requires state universities to establish policies on use of sexually explicit materials (generally movies), the teaching about pedophilia (sex with children) and sexual harassment in human sexuality classes.
It will make for some smug conversations among faculty committees about the public stepping in to restrict teaching.
Teachers—especially tenured professors—tend to believe that they are the ones who have a corner on knowledge about what students should be taught.
They are, after all, the experts.
But the professors work for the universities and the universities are under the control of the Kansas Board of Regents and ultimately the Kansas Board of Regents is under the control of the Kansas Legislature which appropriates the money for their operation and salaries.
As distasteful as it might be for professors, at some point the people paying the bills–and that’s both student tuition and general tax revenues–get to have their say. Teachers who are greatly offended by having some guidelines on what they teach are no different than a vegetarian supermarket checker who refuses to ring up meat purchases. They need to find other work.
The most sensitive part of the proviso in the appropriations bill dealing with teaching of human sexuality is probably the part dealing with pedophilia.
Adults having sex with children happens, has happened for centuries and probably will continue to happen for centuries. And teaching about it, the motivations, the reasons, all sounds enlightening.
But it needs to stop there. Because, not just in Kansas but in the civilized world, pedophilia is not accepted, not acceptable, and can’t be merely treated as an aberration. Much as the from-a-distance detachment we expect from professors of chemistry, English literature and geography, there is absolutely no reason to accept that anyone would merely write off as a harmless character trait, sex with children.
Absolutely none.
The implication that Dailey is unwilling or unable to make a judgment call on that topic is serious. There is evidence both ways. And that, too, is troubling.
All the lofty discussion about absolute academic freedom stops right there.
So, is anyone teaching about pedophilia to college students? Yes, and that’s something that students ought to know exists, why it exists and the motivations involved. But the point of the Wagle amendment is that someone ought to be teaching that it is wrong. And that’s something that the university councils, when they put together their policies on just what happens in human sexuality classes, need to make sure is there.
It might be embarrassing for them on a national level. It might be one of those items that "goes without saying."
But it better be said and printed.
Because it’s not just the intellectuals who finance state universities.
May 1, 2003
(Distributed to Kansas newspapers April 28, 2003)The 13th Check
This is the time of year in the Kansas Statehouse when big numbers are tossed around casually and small numbers are important.
It’s Omnibus Appropriations Bill time, and it’s closely coupled with someone in the building figuring out a plan to raise about $255 million in either money or debt or something that can be put on the balance sheet and at least on paper make the state look solvent.
But the big stuff, eventually, works itself out. Legislators and the governor know they can’t cap this session without making the budget balance. That’s Job. 1, and it’ll get done.
But lower to the ground, in the area of relatively smaller numbers, one issue stands out: Finding a way to finance the so-called "13th check" for state pensioners.
The 13th check involves about 15,000 Kansans who retired from jobs for which the Kansas Public Employees Retirement System provided a pension. The 13th check is literally that, an extra month’s pension payment each year.
Now, why would the state have ever started a program that provides a bonus check, deviating from the steady, dependable check-a-month pension that most retirees receive?
It came as a result of a major sweetening of the KPERS pension program in the 1990s that boosted benefits of public employees including city and county workers, schoolteachers and state employees. Those who retired prior to July 2, 1987, weren’t included in the pension increase, and in the spirit of "no retiree left behind," were granted a 13th check to sort-of catch up. It was a decent thing to do, when times were flush at the pension fund.
The group now is down to about 15,000 people who have been retired for 16 years, which means if they worked until the traditional 65, they’re mostly 81 or older.
And, they’ve been getting that 13th check in October, for, well, 16 years. It’s almost theirs by adverse possession.
Problem this year is that the KPERS fund didn’t earn enough money to throw off the profits needed to pay for the 13th check as it always has in the past. There is a way to produce that extra income but it would be complicated and require ordering the fund’s money managers to do stuff that really isn’t good business practice, maybe sell some stocks before the optimum time to sell them. It’s messing with stuff that really ought not be messed with, sorta like keeping a dog but barking yourself.
The bottom line is about $5.7 million, which the Legislature could either just appropriate from general funds, or roll over into the billion dollar-plus unfunded liability of the pension program, or smart guys could issue bonds to pay this year’s shortfall over probably longer than the 13th check club members are going to live.
There are lots of ways to get that 13th check out, and politically, legislators have a lot of ways to beat themselves up doing it.
Is the 13th check club, which is losing about 1,000 members a year through death—these are 80-year-olds, remember—going to care how the Legislature makes sure they get their 13th check?
That’s hard to say. But the wrangling over money that they have come to count on is sure to be distasteful to them. After all, when the KPERS fund earned big bucks in the late 1990s, their 13th check wasn’t expanded while headlines were describing how much money the pension fund was earning.
And it is hard to say whether the pensioners are going to feel that they have become a burden to the government they served for years before retiring, and made to feel that they are begging this year for the benefit that in prior years was almost thoughtlessly tossed to them.
Sebelius has proposed paying the checks from the pension fund which will see robust growth again.Some legislators are taking a hard stand: the money isn’t there, the benefit isn’t an entitlement, and there’s only enough money in the dedicated account to pay maybe 15 percent of the usual 13th check.
And, then there are the legislators who are probably making the whole deal a lot harder than it has to be by issuing bonds to raise the $5.7 million needed for the checks this year, and keeping track of the expense for years.
Easy way; tough luck way, complicated way.
It’s going to be an interesting issue to watch because it is not a big, multibillion dollar scrap, just a little thing that the state has done for years, that a group of the state’s oldest people have come to count on and probably on some level a little test of humanity on the part of the Legislature.
How will it come out? We’ll be watching...