Kansas politicians have enacted their first new law of 2024: a fast-tracked single-subject bill that reinstates an expired tax credit.
Gov. Laura Kelly signed Senate Bill 15 into law on Thursday after it passed the House 117-1 and 34-0. The legislation reinstates and makes changes to a tax credit designed to incentivize employment of Kansans with disabilities.
The tax credit had broad bipartisan support last session, too, but failed because of political logrolling by Republican legislators and the Democratic governor’s veto. That meant the tax credit expired at the end of 2023, prompting lawmakers to fast-track the legislation this session and make it retroactive to the start of 2024.
“Kansans with disabilities deserve a fair wage for the work they perform,” Kelly said in a statement. “I’m signing this bipartisan legislation to create more opportunities for people with disabilities, grow our workforce and ensure every Kansan can work with dignity and respect.”
The income tax credit is for goods and services purchased from qualified businesses that employ disabled workers and pay them at least as much as the minimum wage. The legislation also creates a new matching grant program to help transition sheltered workshop employers toward paying the minimum wage.
“By incentivizing businesses that purchase products from companies with integrated workforces, we are creating more jobs for Kansans with disabilities,” said Rep. Sean Tarwater, R-Stilwell, in a statement via the governor’s office. “This bill also helps those that make below minimum wage to get a pay increase. This spurs local economies across the state as the workforce grows and has additional money in their pockets.”
The minimum wage requirement was added last year following a contentious public hearing at which disability rights advocates took issue with the previous allowance for employers to pay less than $7.25 an hour.
Kansas Commission on Disability Concerns executive director Martha Gabehart said the new law is “a win-win for Kansans with disabilities and businesses.”
“The transition grants hold the opportunity to help providers switch from sheltered work to providing competitive integrated employment, enabling Kansas to join the growing list of states that have equalized the pay for people with disabilities by eliminating subminimum wage,” Gabehart said in a statement via the governor’s office.
Why lawmakers failed to get the tax credit renewed last year
Last session, the tax credit went through the normal legislative process in the House. The commerce committee, which Tarwater chairs, held a public hearing on House Bill 2275 before it was later passed by the full chamber 124-0.
But the Senate never took up the bill.
Instead, it came up in a conference committee, where top legislators on tax policy bundled dozens of separate bills into three packages.
The tax credit became part of the Senate Bill 8 bundle that was debated and voted on by the House on in the wee hours of the last day of regular session without time for legislators to read the legislation. It was passed by the Senate three weeks later.
Some of the pieces in the bundle were controversial, and Kelly vetoed it, saying the Legislature’s bundling “has made it impossible to sort out the bad from the good.” Lawmakers never attempted an override because they had already adjourned for the year, and they didn’t have veto-proof majorities anyway.
That meant the tax credit expired before legislators returned to Topeka for the 2024 session.
This session, instead of the Senate taking up HB 2275, legislators again turned to a conference committee. But this time, they didn’t bundle it with anything else. Instead, they gutted SB 15 to use as a shell for HB 2275, which was tweaked at the request of senators, who had not held a public hearing on the legislation.
Sen. Caryn Tyson, R-Parker, called it “a unique situation.”
“We know the urgency on this is because the program has sunset, and everybody understands that we are trying to get this done as quickly as possible,” Tyson said.
She initially said either the Senate tax or commerce committee could hold a hearing but acquiesced to negotiating in the conference committee.
“I don’t know why we would wait any longer,” Tarwater said.
Jason Alatidd is a Statehouse reporter for the Topeka Capital-Journal. He can be reached by email at jalatidd@gannett.com. Follow him on X @Jason_Alatidd.
