23 Jan 2021 Kansas Legislative Update – Week Two
Legislative Session, Week Two
Security issues with the capitol building caused a slow-down of activity for a couple of days during a week which also saw a flood of new bills introduced on dozens of issues. Many of these bills were being given new life following the shortened session last year. Of note this week, was the quick passage, by both the Senate and the House, of a bill extending the current emergency declaration under the Kansas Emergency Management Act (KEMA). That bill will be advanced to the Governor for review. In addition, the House held multiple in-depth hearings on the status of the Kansas unemployment insurance fund, receiving testimony from the Kansas Dept. of Labor on the solvency of the fund, the backlog of cases, and the issue of the burgeoning level of fraudulent unemployment claims in Kansas and other states. The House finished business this week with a lengthy and heated floor debate on a proposed constitutional amendment concerning the right to regulate access to abortion.
COVID-19 Business Liability Provision Extensions
Last week, the Senate debated, and passed, Senate Bill 14, a bill extending certain provisions of the governmental response to the pandemic in Kansas. This week, the bill was heard by the House Judiciary Committee and quickly referred to the House Committee of the Whole, where it was passed by a vote of 119-3. The bill now goes to the Governor for consideration. Specific to businesses, it provides that if the business was in compliance with public health directives then it is not liable for contraction of COVID-19. Any civil action would require injury, not merely exposure, require higher threshold of exposure than inherent risk, and offers liability limitations for companies manufacturing PPE. Your association joined with other stakeholders in support of this measure. It is expected that the legislature will use the extended timeline from this bill to make additional changes to the Kansas Emergency Management Act later this session.
Corporate Income Tax Apportionment
On Wednesday, January 27, a bill will be introduced to allow corporate taxpayers the option to elect how to apportion their corporate income tax liability between Kansas and other states. Kansas currently uses a three-factor system for apportioning income between states for corporate income tax purposes. The proposed legislation would allow certain taxpayers, based on NAICS codes, to elect to use a single-factor apportionment formula based on sales to determine corporate income tax liability.
Corporate Income Tax Decoupling
On Thursday, January 21, the Senate Tax Committee held a hearing on Senate Bill 22. This bill would exempt certain types of foreign corporate income (repatriated income and GILTI) that is now taxable at the state level following passage of the federal tax cuts and jobs and of 2017. The bill would also exclude unemployment compensation benefits from gross income if the benefits were secured with a fraudulent identity and the taxpayer did not receive the benefits. In addition, the bill would increase the amount of net operating losses deduction for corporations. The fiscal note on the bill (cost to the state) is estimated to be $330 million in the first year, and over $600 million over the first three years. Last year, Governor Kelly vetoed similar legislation due to the high fiscal note.
Economic Recovery Linked Deposit Loan Program
On Thursday, January 21, the Senate Committee on Financial Institutions held a hearing on Senate Bill 15, a bill which would create a new Economic Recovery Linked Deposit Loan Program for businesses in response to the economic downturn caused by the COVID-19 pandemic. This 10-year program will make up to $60 million available for low-interest (2% below market rate) loans to business. Renew Kansas Biofuels Association joined other industry stakeholders in supporting the bill. The House Committee on Financial Institutions and Rural Development will hold a hearing on a companion bill, House Bill 2069, on Monday, January 25.
Agency Regulations Overhaul
The Senate Committee on Federal and State Affairs will hold a hearing on Senate Bill 34, a bill that would create an automatic sunset, or repeal, of all current agency rules and regulations after five years unless the legislature passes legislation to specifically renew such rule or regulation. The hearing will be on Tuesday, January 26.
Other Bills of Interest
- SB 24: relating to public utilities, prohibiting requirements that impact customers use of energy. Hearing in Senate Utilities Committee on Wednesday, 1/27
- SB 39: relating to the KDA, Div. of Animal Health renewal deadlines for licenses, permits, and registrations. Hearing in Senate Agriculture and Natural Resources, Wednesday, 1/27
- SB 40: relating to the KDA, Division of conservation; implementing 2011 executive reorganization order No. 40, Hearing in Senate Agriculture and Natural Resources, Wednesday, 1/27
- SB 43: creating the Kansas promise scholarship act, program and fund for postsecondary education scholarships. Hearing in Senate Education on Monday, 1/25
- SB 49: extending an income tax credit for the single city port authority. Hearing in Senate Assessment and Taxation on Tuesday, 1/26
- SB 52: establishing the Sedgwick county urban area nuisance abatement act. Hearing in Senate Local Government on Tuesday, 1/26
- HB 2007: updating certain state corporation commission regulations of motor carriers to conform to federal regulations. Hearing in House Transportation on Tuesday, 1/26
- HB 2066: expanding military servicemember’s expedited licensure law to all applicants who establish or intend to establish residency in Kansas. Hearing held in House Commerce Committee
- HB 2091: providing a refundable income tax credit for purchases of food, and discontinuing the nonrefundable food sales tax credit. Hearing in House Taxation Committee on Thursday, 1/28
- HB 2097: relating to the high performance incentive fund, decoupling KIT and KIR workforce training from the program. Hearing in House Commerce Committee on Monday, 1/25
- HB 2106: extending the filing date for corporate income tax returns. Hearing in House Tax Committee on Wednesday, 1/27
Click the link below to view all of the bills being tracked by your association. You can read a brief summary of the bill, the actual text of the bill, the history of the bill and upcoming actions. If you have any problems using the Bill Tracker, please contact Trae Green (firstname.lastname@example.org).