By Gene Meyer
March 10, 2010

(KansasReporter) TOPEKA, Kan. - Kansas House Taxation committee members on Wednesday voted to indefinitely table a bill that would have doubled wholesale taxes on beer, wine and liquor to help raise $22 million for people with mental illness and developmental disabilities.

Panel members also voted to restore partial funding for a group of business and development tax credits that were cut more deeply than intended during budget balancing efforts last year. Those include a historical preservation tax credit cited by the Kansas Legislative Division of Post Audit for unexpectedly high costs, and some smaller tax credit programs created to help small-business formation and to encourage economic development. The proposal now goes to the full House for debate.

The tax credits are all among a broad group of programs to which legislators late in their 2009 legislative session tried to apply an across-the-board10 percent funding cut. But because some of the individual cuts thrown into that effort were specified in dollars and others were specified in percentages of budgeted money, some of the programs suffered proportionately much deeper cuts than others.

Those were the imbalances that panel members sought to fix Wednesday, said state Rep. Arlen Siegfreid, an Olathe Republican backing the restoration effort.

Siegfreid said that traditional legislative analysis of such plans' costs, which focus on the immediate costs to state budgets, don't adequately measure their benefits.

"People go to work when these programs are in place, they spend money, and they pay taxes," Siegfreid said.

"You have to evaluate these things on a dynamic fiscal basis, not a static one," he said. "This is not a $6.3 million hole."

Committee members voted to indefinitely table a proposal by state Rep. Kay Wolf, a Prairie Village Republican and Taxation committee member, and state Rep. Pat Colloton, a Leawood Republican to double what are known as gallonage taxes on alcohol and split the extra money raised, estimated to be about $21.8 million, between mental health and developmental disability programs hit hard by state budget cuts.

Opponents worried that doubling the taxes rates - which have been unchanged at 18 cents a gallon on beer, 30 cents on wine and $2.50 on hard liquor since 1977 - would harm bars, restaurants and other businesses along Kansas' borders.

"I know this is a hard vote for many of you," Wolf told fellow tax panel members who are reluctant to raise taxes during a recession.

"I'm not in favor of new taxes either, but I'm looking for a way to help (the mentally ill and developmentally disabled) ," she said.

"It is a worthy cause and all that," said state Rep. Stan Frownfelter, the Kansas City Democrat who proposed tabling the bill indefinitely.

"But what do I tell my School for the Blind or others out there who also have been cut. There are a lot of people who need this money," Frownfelter said.