Kansas Governor Sam Brownback joined state lawmakers Friday at a news conference in Wichita to announce legislation that will address concerns of rising property taxes. The Property Tax Transparency Act will require property tax mill levies to be automatically lowered as property valuations go up. Local units of government who have taxing authority and want to increase their property tax revenues would be required to vote to increase the mill levy.
"Kansas families and businesses are taxed every time they turn around: income tax, sales tax, use tax, gas tax, and property tax - the list goes on and on. That's why we worked together this year to provide historic pro-growth tax relief and make our state's income tax flatter and fairer after the lost decade of jobs in Kansas," Gov. Brownback said. "The next important step we must take to make our state more competitive and to improve the financial well-being of all Kansans is to make tax increases more transparent, especially when it comes to property tax."
Brownback stressed that the state would not be increasing the fixed property taxes it collects for school districts (20 mills) and for public property (1.5 mills). St. Sen. Susan Wagle (Wichita), Kansas House Majority Leader Arlen Siegfried (Olathe) and St. Reps. Steve Brunk, Joe Scapa and Les Osterman, all of Wichita, joined the Governor at the news conference.
A long-time advocate and sponsor of property tax reform legislation, Rep. Brunk said the bill will change the presumption of who benefits from rising property values because if values increase, mill levies will decrease to result in zero increase in property tax revenues.
"Now, instead of taxing bodies benefiting, we will protect and benefit the taxpayers," Rep Brunk said. "Just because the value of your home or business has gone up, doesn't mean that local governments' spending should go up. Voters should know when local elected officials increase local government spending. This transparency legislation will keep property taxes steady for Kansas families and businesses."
Sen. Wagle said this is the perfect time for the state to require transparency in property taxes.
"From 1997 to 2010, property tax revenues collected in the state went from $1.97 billion to $3.8 billion. That's nearly a 94% increase," Sen. Wagle said. "This transparency bill will give Kansas property owners confidence that their property taxes aren't going to increase the way they have in the past while still giving local units of government flexibility to increase property taxes if they need more tax money. They just have to vote for it publically."
The lawmakers said property tax revenue increases because of new construction or gains in personal property are not included in the comparison to the prior year's revenues from property tax, and budgets funded by property taxes could increase by the amount derived from the new construction gains.
"The Property Tax Transparency Act represents the next logical step in our systematic reduction of the overall tax burden on Kansans. It benefits our residents and business owners by creating stability, and establishing proper accountability for board members of local taxing jurisdictions," House Majority Leader Siegfried.
The Property Tax Transparency Act comes after the Kansas Legislature and Governor Brownback lowered individual state income tax rates by 14% - 24% and eliminated the state tax income tax on non-wage business income for most small business owners. Beginning in January, hardworking Kansans will see an increase in their take home pay. Those who use the standard deduction when filing their state tax returns also will see their deductions increase from $4,500 to $9,000 for head of household filers and from $6,000 to $9,000 for married filers.