Finance

Disappearing Dues in Kansas

Bankers, barbers and doctors in Kansas, who pay a fee to support the state organizations that monitors their professions, might want to take a close...
by | September 30, 2009

Bankers, barbers and doctors in Kansas, who pay a fee to support the state organizations that monitors their professions, might want to take a close look at where their money is going. The odds are that some of it has been scooped up by the legislature to help cover the state deficit.

It's not just a couple of professions; it's most of them. Dozens of Kansas agencies, boards and commissions raise money through fees imposed on the professional groups that they regulate. Because those fees are collected annually, their accounts can look temptingly full at certain times of the year to legislators who are turning over every couch cushion in a quest for cash.

This year, the legislature swept $20 million from its partially self-financing units of government, or roughly 5 percent of their budgets. "We asked them to cut their normal spending back and then transfer the savings produced to the state general fund," says Duane Goossen, who is the state budget director. "It was a way to get all of the state agencies involved in solving the financial issues we were facing."

Needless to say, the fee-funded agencies--and the professionals who support them--didn't like it. They claimed they were being double-taxed. The fees, they maintain, are meant to pay for licensing and regulation of their industries, not for the schools and roads that their taxes already support.

"Those monies were never general fund money," says Chuck Stone, of the Kansas Bankers Association. "Now, agencies are either going to have to shut down part of their operations or charge higher fees."

The legislature ultimately exempted from its sweep the agencies that receive no state general funds, including the banking commission. But it lifted sizable amounts of money out of others, such as the state medical board, which had received legislative approval for expanded hiring and operations just last year in response to complaints of weak oversight.

All of this is rather embarrassing for the state to try to defend. But at a time when all agencies were being cut, insists Jay Emler, who chairs the state Senate Ways and Means Committee, "holding harmless the professional boards was not a viable option." Emler admits that if the state is going to have fee-based agencies, then the fees should be used to run the agencies, not diverted to the general treasury. "But," he says, "we had to get the money from somewhere."

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