Division of the Budget
Landon State Office Building Phone: (785) 296-2436
900 SW Jackson Street, Room 504 adam.c.proffitt@ks.gov
Topeka, KS 66612 http://budget.kansas.gov
Adam Proffitt, Director Laura Kelly, Governor
Division of the Budget
February 13, 2023
The Honorable Jim Minnix, Chairperson
House Committee on Water
300 SW 10th Avenue, Room 218-N
Topeka, Kansas 66612
Dear Representative Minnix:
SUBJECT: Fiscal Note for HB 2302 by House Committee on Water
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2302 is
respectfully submitted to your committee.
Under current law, $6.0 million from the State General Fund and $2.0 million from the
Economic Development Initiatives Fund is transferred to the State Water Plan Fund (SWPF) each
fiscal year. HB 2302 would replace these statutory transfers with a transfer from the State General
Fund to the SWPF equivalent to 1.231 percent of all sales and compensating use tax collections
from FY 2024 through FY 2028. Of this amount, $5.0 million per year would be transferred to
the newly created Water Technical Assistance Fund, $15.0 million per year would be transferred
to the newly created Water Projects Grant Fund, and at least $15.0 million per year would be used
to retire water supply storage debt for Milford and Perry Lake. The bill would require the Kansas
Water Office to create rules and regulations relating to the administration of these new funds.
Estimated State Fiscal Effect
FY 2023
SGF
FY 2023
All Funds
FY 2024
SGF
FY 2024
All Funds
Revenue -- -- -- --
Expenditure -- -- -- $46,100,000
FTE Pos. -- -- -- --
Based on the November 2022 Consensus Revenue Estimate, the Department of Revenue
estimates that the bill would result in a $54.1 million transfer from the State General Fund to the
SWPF in FY 2024, including $41.4 million of sales tax receipts and $12.7 million of compensating The Honorable Jim Minnix, Chairperson
Page 2—HB 2302
use tax receipts. This transfer would replace the existing statutory transfers to the SWPF totaling
$8.0 million, resulting in a net expenditure increase of $46.1 million from the SWPF in FY 2024.
The Department of Revenue indicates that the following amounts would be transferred to the
SWPF in subsequent fiscal years:
FY 2025 FY 2026 FY 2027 FY 2028
Sales Tax $42,000,000 $42,700,000 $43,200,000 $43,600,000
Compensating Use Tax 13,500,000 14,200,000 14,900,000 15,600,000
$55,500,000 $56,900,000 $58,100,000 $59,200,000
The Kansas Water Office, the Kansas Department of Agriculture, and the Kansas
Department of Health and Environment are the primary recipients of State Water Plan Fund
appropriations, so enactment of HB 2302 would likely increase the expenditures of all three
agencies by unknown amounts. According to the Kansas Water Office, administration of HB 2302
would cost $246,650 in FY 2024 and $200,000 in subsequent fiscal years. These expenditures
would be made to fill 2.00 vacant FTE positions and contract with outside counsel to draft rules
and regulations. The Kansas Department of Health and Environment indicates that enactment of
HB 2302 could decrease agency revenues from loan service fees as water storage debt is paid off,
but the size of this reduction is unknown. Any fiscal effect associated with HB 2302 is not
reflected in The FY 2024 Governor’s Budget Report.
The League of Kansas Municipalities indicates that the new local grant opportunities
authorized by HB 2302 would increase municipal revenues by unknown amounts. The Kansas
Association of Counties indicates that HB 2302 would not have a fiscal effect on counties.
Sincerely,
Adam Proffitt
Director of the Budget
cc: Lynn Robinson, Department of Revenue
Debra Jones, Kansas Water Office
Kellen Liebsch, Department of Agriculture
Amy Penrod, Department of Health & Environment
Jay Hall, Kansas Association of Counties
Wendi Stark, League of Kansas Municipalities
Scott Miller, Pooled Money Investment Board