Kansas 2023-2024 Regular Session

Kansas Senate Bill SB37 Compare Versions

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Version 2 (New)

Old	New		Differences
1		-	House Substitute for SENATE BILL No. 37
2		-	AN ACT concerning taxation; relating to income tax; modifying tax rates for individuals;
3		-	eliminating the income limit to qualify for a subtraction modification for social
4		-	security income; increasing the Kansas standard deduction and the Kansas personal
5		-	exemption; relating to privilege tax; decreasing the normal tax rate; relating to
6		-	property tax; increasing the extent of exemption for residential property from the
7		-	statewide school levy; decreasing the rate of ad valorem tax imposed by a school
8		-	district; abolishing the local ad valorem tax reduction fund and the county and city
9		-	revenue sharing fund and providing for certain transfers to the state school district
10		-	finance fund; relating to sales and compensating use tax; reducing the state rate of tax
11		-	on sales of food and food ingredients; modifying the percent credited to the state
12		-	highway fund from revenue collected; amending K.S.A. 65-163j, 65-3306, 65-3327,
13		-	75-2556, 79-1107, 79-1108 and 79-1479 and K.S.A. 2023 Supp. 72-5142, 74-8768,
14		-	79-201x, 79-2988, 79-32,110, 79-32,117, 79-32,119, 79-32,121, 79-3603, 79-3603d,
15		-	79-3620, 79-3703 and 79-3710 and repealing the existing sections; also repealing
16		-	K.S.A. 19-2694, 79-2960, 79-2961, 79-2962, 79-2965, 79-2966 and 79-2967 and
17		-	K.S.A. 2023 Supp. 79-2959 and 79-2964.
	1	+	Session of 2023
	2	+	SENATE BILL No. 37
	3	+	By Committee on Federal and State Affairs
	4	+	1-17
	5	+	AN ACT concerning taxation; relating to the Kansas housing investor tax
	6	+	credit act; expanding the transferability of income, privilege and
	7	+	premium tax credits issued under the act; amending K.S.A. 2022 Supp.
	8	+	79-32,313 and repealing the existing section.
18	9		Be it enacted by the Legislature of the State of Kansas:
19		-	New Section 1. On July 1, 2024, the director of accounts and
20		-	reports shall transfer all moneys in the local ad valorem tax reduction
21		-	fund to the state general fund. On July 1, 2024, all liabilities of the local
22		-	ad valorem tax reduction fund are hereby transferred to and imposed on
23		-	the state general fund, and the local ad valorem tax reduction fund is
24		-	hereby abolished.
25		-	New Sec. 2. On July 1, 2024, the director of accounts and reports
26		-	shall transfer all moneys in the county and city revenue sharing fund to
27		-	the state general fund. On July 1, 2024, all liabilities of the county and
28		-	city revenue sharing fund are hereby transferred to and imposed on the
29		-	state general fund, and the county and city revenue sharing fund is
30		-	hereby abolished.
31		-	New Sec. 3. On August 15, 2024, and each August 15 thereafter,
32		-	the director of the budget, in consultation with the director of property
33		-	valuation, shall certify to the director of accounts and reports if the tax
34		-	levied pursuant to K.S.A. 72-5142, and amendments thereto, is
35		-	decreased from 20 mills or the exemption provided by K.S.A. 79-201x,
36		-	and amendments thereto, is increased from $42,049 for any tax year.
37		-	The director of the budget shall certify to the director of accounts and
38		-	reports and shall transfer a copy of such certification to the director of
39		-	legislative research, the amount of revenue that the decrease in property
40		-	tax would have generated for the tax year if such tax was levied
41		-	pursuant to K.S.A. 72-5142, and amendments thereto, at the rate of 20
42		-	mills and the difference in the amount of revenue that the increase in
43		-	the exemption provided by K.S.A. 79-201x, and amendments thereto,
44		-	would have generated for the tax year if the exemption amount was
45		-	$42,049. Upon receipt of such certification, or as soon thereafter as
46		-	moneys are available, the director of accounts and reports shall transfer
47		-	such certified amount from the state general fund to the state school
48		-	district finance fund of the department of education.
49		-	Sec. 4. On and after July 1, 2024, K.S.A. 65-163j is hereby
50		-	amended to read as follows: 65-163j. (a) The dedicated source of
51		-	revenue for repayment of a loan to a municipality may include service
52		-	charges, connection fees, special assessments, property taxes, grants or
53		-	any other source of revenue lawfully available to the municipality for
54		-	such purpose. In order to ensure repayment by municipalities of the
55		-	amounts of loans provided under this act, the secretary, after
56		-	consultation with the governing body of any municipality which that
57		-	receives a loan, may adopt charges to be levied against individuals and
58		-	entities served by the project. Any such charges shall remain in effect
59		-	until the total amount of the loan, and any interest thereon, has been
60		-	repaid. The charges shall, insofar as is practicable, be equitably
61		-	assessed and may be in the form of a surcharge to the existing charges
62		-	of the municipality. The governing body of any municipality which
63		-	that receives a loan under this act shall collect any charges established House Substitute for SENATE BILL No. 37—page 2
64		-	by the secretary and shall pay the moneys collected therefrom to the
65		-	secretary in accordance with procedures established by the secretary.
66		-	(b) Upon the failure of a municipality to meet the repayment terms
67		-	and conditions of the agreement, the secretary may order the treasurer
68		-	of the county in which the municipality is located to pay to the
69		-	secretary such portion of the municipality's share of the local ad
70		-	valorem tax reduction fund as may be necessary to meet the terms of
71		-	the agreement, notwithstanding the provisions of K.S.A. 79-2960 and
72		-	79-2961, and amendments thereto. Upon the issuance of such an order,
73		-	the municipality shall not be required to make the tax levy reductions
74		-	otherwise required by K.S.A. 79-2960 and 79-2961, and amendments
75		-	thereto.
76		-	(c) Municipalities which that are provided with loans under this
77		-	act shall maintain project accounts in accordance with generally
78		-	accepted government accounting standards.
79		-	(d)(c) Any loans received by a municipality under the provisions
80		-	of this act shall be construed to be bonds for the purposes of K.S.A. 10-
81		-	1116 and 79-5028, and amendments thereto, and the amount of such
82		-	loans shall not be included within any limitation on the bonded
83		-	indebtedness of the municipality.
84		-	Sec. 5. On and after July 1, 2024, K.S.A. 65-3306 is hereby
85		-	amended to read as follows: 65-3306. The secretary's annual request for
86		-	appropriations to the water pollution control account shall be based on
87		-	an estimate of the fiscal needs for the ensuing budget year, less any
88		-	amounts received by the secretary from any public or private grants or
89		-	contributions and moneys in such account shall be used solely for the
90		-	purposes provided for by this act. Moneys allocated to a municipality
91		-	shall be encumbered as an expenditure of this account upon the formal
92		-	letting of a contract for the improvement notwithstanding the date on
93		-	which when actual payment is made of the state financial assistance.
94		-	Any municipality may contribute moneys to the state water pollution
95		-	control account. If there are no uncommitted or unencumbered moneys
96		-	in the water pollution control account, any municipality applying for
97		-	any water pollution control project as defined in K.S.A. 65-3302, and
98		-	amendments thereto, shall as a condition of such application certify in
99		-	writing to the secretary that a contribution in the amount of twenty-five
100		-	percent (25%) of the eligible cost of such project will be made to the
101		-	water pollution control account by such municipality prior to formal
102		-	letting of a construction contract. Upon receipt by the secretary, each
103		-	such contribution shall be retained in a subaccount of the water
104		-	pollution control account for use solely in the project for which the
105		-	municipality has made application.
106		-	Notwithstanding the provisions of K.S.A. 79-2960 and 79-2961, any
107		-	municipality applying for such a water pollution control project may
108		-	make such contribution from all or such part of its share of the local ad
109		-	valorem tax reduction fund as may be necessary for such purpose, and
110		-	to the extent such fund is pledged and used for such purpose the
111		-	municipality shall not be required to make the tax levy reductions
112		-	otherwise required by K.S.A. 79-2960 and 79-2961. Taxes levied by
113		-	any municipality by reason of its failure to make such reduction in its
114		-	levies shall not be subject to or be considered in computing the
115		-	aggregate limitation upon the levy of taxes by such municipality under
116		-	the provisions of K.S.A. 79-5003.
117		-	Sec. 6. On and after July 1, 2024, K.S.A. 65-3327 is hereby
118		-	amended to read as follows: 65-3327. (a) The dedicated source of
119		-	revenue for repayment of the loans may include service charges,
120		-	connection fees, special assessments, property taxes, grants or any
121		-	other source of revenue lawfully available to the municipality for such
122		-	purpose. In order to ensure repayment by municipalities of the amounts House Substitute for SENATE BILL No. 37—page 3
123		-	of loans provided under K.S.A. 65-3321 through 65-3329, and
124		-	amendments thereto, the secretary, after consultation with the
125		-	governing body of any municipality which receives a loan, may adopt
126		-	charges to be levied against users of the project. Any such charges shall
127		-	remain in effect until the total amount of the loan, and any interest
128		-	thereon, has been repaid. The charges shall, insofar as is practicable, be
129		-	equitably assessed and may be in the form of a surcharge to the existing
130		-	charges of the municipality. The governing body of any municipality
131		-	which receives a loan under K.S.A. 65-3321 through 65-3329, and
132		-	amendments thereto, shall collect any charges established by the
133		-	secretary and shall pay the moneys collected therefrom to the secretary
134		-	in accordance with procedures established by the secretary.
135		-	(b) Upon the failure of a municipality to meet the repayment terms
136		-	and conditions of the agreement, the secretary may order the treasurer
137		-	of the county in which the municipality is located to pay to the
138		-	secretary such portion of the municipality's share of the local ad
139		-	valorem tax reduction fund as may be necessary to meet the terms of
140		-	the agreement, notwithstanding the provisions of K.S.A. 79-2960 and
141		-	79-2961 and amendments thereto. Upon the issuance of such an order,
142		-	the municipality shall not be required to make the tax levy reductions
143		-	otherwise required by K.S.A. 79-2960 and 79-2961 and amendments
144		-	thereto.
145		-	(c) Municipalities which that are provided with loans under
146		-	K.S.A. 65-3321 through 65-3329, and amendments thereto, shall
147		-	maintain project accounts in accordance with generally accepted
148		-	government accounting standards.
149		-	(d)(c) Municipalities which that receive a grant and an allowance
150		-	under the federal act with respect to project costs for which a loan was
151		-	provided under K.S.A. 65-3321 through 65-3329, and amendments
152		-	thereto, shall promptly repay such loan to the extent of the allowance
153		-	received under the federal act.
154		-	(e)(d) Any loans received by a municipality under the provisions
155		-	of K.S.A. 65-3321 through 65-3329, and amendments thereto, shall be
156		-	construed to be bonds for the purposes of K.S.A. 10-1116 and 79-5028,
157		-	and amendments thereto, and the amount of such loans shall not be
158		-	included within any limitation on the bonded indebtedness of the
159		-	municipality.
160		-	Sec. 7. On and after July 1, 2024, K.S.A. 2023 Supp. 72-5142 is
161		-	hereby amended to read as follows: 72-5142. (a) The board of
162		-	education of each school district shall levy an ad valorem tax upon the
163		-	taxable tangible property of the school district in the school years
164		-	specified in subsection (b) for the purpose of:
165		-	(1) Financing that portion of the school district's general fund
166		-	budget that is not financed from any other source provided by law;
167		-	(2) paying a portion of the costs of operating and maintaining
168		-	public schools in partial fulfillment of the constitutional obligation of
169		-	the legislature to finance the educational interests of the state; and
170		-	(3) with respect to any redevelopment school district established
171		-	prior to July 1, 1997, pursuant to K.S.A. 12-1771, and amendments
172		-	thereto, paying a portion of the principal and interest on bonds issued
173		-	by cities under authority of K.S.A. 12-1774, and amendments thereto,
174		-	for the financing of redevelopment projects upon property located
175		-	within the school district.
176		-	(b) The tax required under subsection (a) shall be levied at a rate
177		-	of 20 19.5 mills in the school years 2023-2024 and 2024-2025 and
178		-	2025-2026.
179		-	(c) The proceeds from the tax levied by a district under authority
180		-	of this section, except the proceeds of such tax levied for the purpose
181		-	described in subsection (a)(3), shall be remitted to the state treasurer in House Substitute for SENATE BILL No. 37—page 4
182		-	accordance with the provisions of K.S.A. 75-4215, and amendments
183		-	thereto. Upon receipt of each such remittance, the state treasurer shall
184		-	deposit the entire amount in the state treasury to the credit of the state
185		-	school district finance fund.
186		-	(d) No school district shall proceed under K.S.A. 79-1964, 79-
187		-	1964a or 79-1964b, and amendments thereto.
188		-	Sec. 8. On and after July 1, 2024, K.S.A. 2023 Supp. 74-8768 is
189		-	hereby amended to read as follows: 74-8768. (a) There is hereby
190		-	created the expanded lottery act revenues fund in the state treasury. All
191		-	expenditures and transfers from such fund shall be made in accordance
192		-	with appropriation acts. All moneys credited to such fund shall be
193		-	expended or transferred only for the purposes of reduction of state debt,
194		-	state infrastructure improvements, the university engineering initiative
195		-	act, reduction of local ad valorem tax in the same manner as provided
196		-	for allocation of amounts in the local ad valorem tax reduction fund and
197		-	reduction of the unfunded actuarial liability of the system attributable
198		-	to the state of Kansas and participating employers under K.S.A. 74-
199		-	4931, and amendments thereto, by the Kansas public employees
200		-	retirement system.
201		-	(b) On July 1, 2021, July 1, 2022, July 1, 2023, July 1, 2024, July
202		-	1, 2025, July 1, 2026, July 1, 2027, July 1, 2028, July 1, 2029, July 1,
203		-	2030, and July 1, 2031, or as soon thereafter such date as moneys are
204		-	available, the first $10,500,000 credited to the expanded lottery act
205		-	revenues fund shall be transferred by the director of accounts and
206		-	reports from the expanded lottery act revenues fund in one or more
207		-	substantially equal amounts, to each of the following: The Kan-grow
208		-	engineering fund – KU, Kan-grow engineering fund – KSU and Kan-
209		-	grow engineering fund – WSU. Each such special revenue fund shall
210		-	receive $3,500,000 annually in each of such years. Commencing in
211		-	fiscal year 2014, after such transfer has been made, 50% of the
212		-	remaining moneys credited to the fund shall be transferred on a
213		-	quarterly basis by the director of accounts and reports from the fund to
214		-	the Kansas public employees retirement system fund to be applied to
215		-	reduce the unfunded actuarial liability of the system attributable to the
216		-	state of Kansas and participating employers under K.S.A. 74-4931 et
217		-	seq., and amendments thereto, until the system as a whole attains an
218		-	80% funding ratio as certified by the board of trustees of the Kansas
219		-	public employees retirement system.
220		-	Sec. 9. On and after July 1, 2024, K.S.A. 75-2556 is hereby
221		-	amended to read as follows: 75-2556. (a) The state librarian shall
222		-	determine the amount of the grant-in-aid each eligible local public
223		-	library is to receive based on the latest population census figures as
224		-	certified by the division of the budget.
225		-	(b) Except as provided by subsection (d), no local public library
226		-	shall be eligible for any state grants-in-aid if the total amount of the
227		-	following paragraphs is less than the total amount produced from such
228		-	sources for the same library for the previous year, based on the
229		-	information contained in the official annual budgets of municipalities
230		-	that are filed with the division of accounts and reports in accordance
231		-	with K.S.A. 79-2930, and amendments thereto:
232		-	(1) The amount produced by the local ad valorem tax levies for
233		-	the current year expenses for such library;
234		-	(2) the amount of moneys received from the local ad valorem tax
235		-	reduction fund for current year expenses for such library;
236		-	(3) the amount of moneys received from taxes levied upon motor
237		-	vehicles under the provisions of K.S.A. 79-5101 et seq., and
238		-	amendments thereto, for current year expenses for such library; and
239		-	(4)(3) the amount of moneys received in the current year from
240		-	collections of unpaid local ad valorem tax levies for prior year expenses House Substitute for SENATE BILL No. 37—page 5
241		-	for such library.
242		-	(c) Local public library districts in which the assessed valuation
243		-	decreases shall remain eligible for state grants-in-aid so long as the ad
244		-	valorem tax mill rate for the support of such library has not been
245		-	reduced below the mill rate imposed for such purpose for the previous
246		-	year.
247		-	(d) If a local public library fails to qualify for eligibility for any
248		-	state grants-in-aid under subsection (b), the state librarian shall have the
249		-	power to continue the eligibility of a local public library for any state
250		-	grants-in-aid if the state librarian, after evaluation of all the
251		-	circumstances, determines that the legislative intent for maintenance of
252		-	local tax levy support for the on-going operations of the library is being
253		-	met by the library district.
254		-	(e) The distribution so determined shall be apportioned and paid
255		-	on February 15 of each year.
256		-	Sec. 10. On and after July 1, 2024, K.S.A. 2023 Supp. 79-201x is
257		-	hereby amended to read as follows: 79-201x. (a) For taxable year 2022
258		-	2024, and all taxable years thereafter, the following described property,
259		-	to the extent herein specified, shall be and is hereby exempt from the
260		-	property tax levied pursuant to the provisions of K.S.A. 72-5142, and
261		-	amendments thereto: Property used for residential purposes to the
262		-	extent of $40,000 $100,000 of its appraised valuation.
263		-	(b) For taxable year 2023, and all taxable years thereafter, the
264		-	dollar amount of the extent of appraised valuation that is exempt
265		-	pursuant to subsection (a) shall be adjusted to reflect the average
266		-	percentage change in statewide residential valuation of all residential
267		-	real property for the preceding 10 years. Such average percentage
268		-	change shall not be less than zero. The director of property valuation
269		-	shall calculate the average percentage change for purposes of this
270		-	annual adjustment and calculate the dollar amount of the extent of
271		-	appraised valuation that is exempt pursuant to this section each year.
272		-	Sec. 11. On and after July 1, 2024, K.S.A. 79-1107 is hereby
273		-	amended to read as follows: 79-1107. (a) Every national banking
274		-	association and state bank located or doing business within the state
275		-	shall pay to the state for the privilege of doing business within the state
276		-	a tax according to or measured by its net income for the next preceding
277		-	taxable year to be computed as provided in this act. Such tax shall
278		-	consist of a normal tax and a surtax and shall be computed as follows:
279		-	(a)(1) For tax year 2024, and all tax years thereafter, the normal
280		-	tax shall be an amount equal to 2
	10	+	Section 1. K.S.A. 2022 Supp. 79-32,313 is hereby amended to read as
	11	+	follows: 79-32,313. (a) (1) For tax year 2022 and all tax years thereafter, a
	12	+	credit against the income tax liability imposed pursuant to the Kansas
	13	+	income tax act, the privilege tax liability imposed upon any national
	14	+	banking association, state bank, trust company or savings and loan
	15	+	association pursuant to article 11 of chapter 79 of the Kansas Statutes
	16	+	Annotated, and amendments thereto, or the premium tax liability imposed
	17	+	upon an insurance company pursuant to K.S.A. 40-252, and amendments
	18	+	thereto, shall be allowed to:
	19	+	(A) A qualified investor for a cash investment in a qualified housing
	20	+	project that has been approved and issued a tax credit by the director. The
	21	+	tax credit may be claimed in its entirety in the taxable year the cash
	22	+	investment is made; and
	23	+	(B) a project builder or developer of a qualified housing project that
	24	+	has been approved and issued a tax credit by the director.
	25	+	(2) To claim such tax credit, the qualified investor or, project builder
	26	+	or developer or transferee shall provide all information or documentation
	27	+	in the form and manner required by the secretary of revenue. If the amount
	28	+	of the credit exceeds the taxpayer's tax liability in any one taxable year, the
	29	+	remaining portion of the credit may be carried forward in the succeeding
	30	+	taxable years until the total amount of the credit is used, except that no
	31	+	credit may be claimed after four taxable years next succeeding the taxable
	32	+	year that such credit was issued, and any remaining credit shall be
	33	+	forfeited. Any portion of the credit that is carried forward may be
	34	+	transferred pursuant to subsection (d) and claimed by the transferee in the
	35	+	same manner as the transferor.
	36	+	(b) (1) Tax credits may be issued by the director for a qualified
	37	+	housing project as follows:
	38	+	(A) For qualified housing projects located in a county with a
	39	+	population of not more than 8,000, in an amount not to exceed $35,000 per
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282		-	/4% 1.94% of such net income; and
283		-	(b)(2) the surtax shall be an amount equal to 2
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	75	+	36 SB 37 2
	76	+	residential unit;
	77	+	(B) for qualified housing projects located in a county with a
	78	+	population of more than 8,000 but not more than 25,000, in an amount not
	79	+	to exceed $32,000 per residential unit; and
	80	+	(C) for all other qualified housing projects, in an amount not to
	81	+	exceed $30,000.
	82	+	(2) A qualified housing project shall be limited to a total of 40 such
	83	+	residential units per year for both single-family and multi-family
	84	+	dwellings.
	85	+	(3) Tax credits may be issued to a qualified investor in the amount of
	86	+	a cash investment of up to the total amount that may be issued by the
	87	+	director under this subsection for the qualified housing project, or as
	88	+	provided in the agreement required by K.S.A. 2022 Supp. 79-32,312, and
	89	+	amendments thereto. Project builders or developers may apply to the
	90	+	director each year for tax credits for additional units or phases of a project.
	91	+	Qualified investors may be issued tax credits for cash investments in
	92	+	multiple qualified housing projects. Project builders or developers may
	93	+	apply and be approved for multiple qualified housing projects in the same
	94	+	tax year.
	95	+	(4) The aggregate amount of tax credits that may be issued under this
	96	+	section shall not exceed $13,000,000 each tax year, except that if the
	97	+	director issues an aggregate amount of tax credits in one tax year that is
	98	+	less than $13,000,000, then the director may carry forward the difference
	99	+	and issue such amount of tax credits in the immediately succeeding tax
	100	+	year in addition to the statutory amount that may be issued under this
	101	+	section. Of the aggregate amount of tax credits issued in one tax year, the
	102	+	director shall allocate:
	103	+	(A) Not less than $2,500,000 in tax credits for qualified housing
	104	+	projects located in counties with a population of not more than 8,000;
	105	+	(B) not less than $2,500,000 in tax credits for qualified housing
	106	+	projects located in counties with a population of more than 8,000 but not
	107	+	more than 25,000; and
	108	+	(C) up to $8,000,000 in tax credits for qualified housing projects
	109	+	located in counties with a population of more than 25,000 but not more
	110	+	than 75,000.
	111	+	(c) A cash investment in a qualified housing project shall be deemed
	112	+	to have been made on the date of acquisition of the qualified security, as
	113	+	such date is determined by the director.
	114	+	(d) Any qualified investor without a current tax liability at the time of
	115	+	the investment in a qualified housing project that does not reasonably
	116	+	believe such investor will owe any such tax for the current taxable year
	117	+	and who receives a tax credit pursuant to this section shall be deemed to
	118	+	acquire an interest in the nature of a transferable credit limited to the
284	119		1
285		-	/8% 2.125% of
286		-	such net income in excess of $25,000.
287		-	(b) The tax levied shall be in lieu of ad valorem taxes which might
288		-	otherwise be imposed by the state or political subdivisions thereof upon
289		-	shares of capital stock or the intangible assets of national banking
290		-	associations and state banks.
291		-	Sec. 12. On and after July 1, 2024, K.S.A. 79-1108 is hereby
292		-	amended to read as follows: 79-1108. (a) Every trust company and
293		-	savings and loan association located or doing business within the state
294		-	shall pay to the state for the privilege of doing business within the state
295		-	a tax according to or measured by its net income for the next preceding
296		-	taxable year to be computed as provided in this act. Such tax shall
297		-	consist of a normal tax and a surtax and shall be computed as follows:
298		-	(a)(1) For tax year 2024, and all tax years thereafter, the normal
299		-	tax on every trust company and savings and loan association shall be an
300		-	amount equal to 2
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	161	+	43 SB 37 3
	162	+	amount of the credit issued to the qualified investor by the director. This
	163	+	interest All or a portion of such credit may be transferred by the qualified
	164	+	investor or any subsequent transferee to any person one or more persons
	165	+	whether or not such person transferee is then a qualified investor and be
	166	+	claimed by the transferee as a credit against the transferee's Kansas tax
	167	+	liability in the same manner as the transferor beginning in the year the
	168	+	credit is transferred. The credit may be carried forward as permitted by
	169	+	subsection (a). There shall be no limit on the number of times a credit or
	170	+	any portion thereof can be transferred. No person shall be entitled to a
	171	+	refund for any interest on such tax credit that may be created under this
	172	+	section. Only the full amount of the tax credit for any one qualified
	173	+	housing project investment may be transferred and may only be transferred
	174	+	one time. A credit acquired by transfer shall be subject to the limitations
	175	+	prescribed in this section. Any such transferee succeeds to all remaining
	176	+	rights and restrictions of the transferor with respect to the credit being
	177	+	transferred on the date of such transfer. Documentation of any credit
	178	+	acquired by transfer shall be provided by the taxpayer claiming such credit
	179	+	in the manner required by the secretary of revenue. The qualified investor
	180	+	or subsequent transferee transferring such credit shall provide the director
	181	+	and the secretary of revenue with the name, address and taxpayer
	182	+	identification number of each person to whom tax credits have been
	183	+	transferred and such other information as may be required by the director
	184	+	or the secretary of revenue. The provisions of this subsection shall apply to
	185	+	credits issued for tax year 2022 and all tax years thereafter.
	186	+	(e) The secretary of revenue may adopt rules and regulations as
	187	+	necessary to implement and administer the provisions of this act.
	188	+	Sec. 2. K.S.A. 2022 Supp. 79-32,313 is hereby repealed.
	189	+	Sec. 3. This act shall take effect and be in force from and after its
	190	+	publication in the Kansas register.
301	191		1
302		-	/4% 1.93% of such net income; and
303		-	(b)(2) the surtax on every trust company and savings and loan
304		-	association shall be an amount equal to 2
305		-	1
306		-	/4% 2.25% of such net
307		-	income in excess of $25,000. House Substitute for SENATE BILL No. 37—page 6
308		-	(b) The tax levied shall be in lieu of ad valorem taxes which might
309		-	otherwise be imposed by the state or political subdivision thereof upon
310		-	shares of capital stock or other intangible assets of trust companies and
311		-	savings and loan associations.
312		-	Sec. 13. On and after July 1, 2024, K.S.A. 79-1479 is hereby
313		-	amended to read as follows: 79-1479. (a) On or before January 15,
314		-	1992, and quarterly thereafter, the county or district appraiser shall
315		-	submit to the director of property valuation a progress report indicating
316		-	actions taken during the preceding quarter calendar year to implement
317		-	the appraisal of property in the county or district. Whenever the
318		-	director of property valuation shall determine that any county has
319		-	failed, neglected or refused to properly provide for the appraisal of
320		-	property or the updating of the appraisals on an annual basis in
321		-	substantial compliance with the provisions of law and the guidelines
322		-	and timetables prescribed by the director, the director shall file with the
323		-	state board of tax appeals a complaint stating the facts upon which the
324		-	director has made the determination of noncompliance as provided by
325		-	K.S.A. 79-1413a, and amendments thereto. If, as a result of such
326		-	proceeding, the state board of tax appeals finds that the county is not in
327		-	substantial compliance with the provisions of law and the guidelines
328		-	and timetables of the director of property valuation providing for the
329		-	appraisal of all property in the county or the updating of the appraisals
330		-	on an annual basis, it shall order the immediate assumption of the
331		-	duties of the office of county appraiser by the director of the division of
332		-	property valuation until such time as the director of property valuation
333		-	determines that the county is in substantial compliance with the
334		-	provisions of law. In addition, the board shall order the state treasurer
335		-	to withhold all or a portion of the county's entitlement to moneys from
336		-	either or both of the local ad valorem tax reduction fund and the city
337		-	and county revenue sharing fund for the year following the year in
338		-	which the order is issued. Upon service of any such order on the board
339		-	of county commissioners, the appraiser shall immediately deliver to the
340		-	director of property valuation, or the director's designee, all books,
341		-	records and papers pertaining to the appraiser's office.
342		-	Any county for which the director of the division of property
343		-	valuation is ordered by the state board of tax appeals to assume the
344		-	responsibility and duties of the office of county appraiser shall
345		-	reimburse the state for the actual costs incurred by the director of the
346		-	division of property valuation in the assumption and carrying out of
347		-	such responsibility and duties, including any contracting costs in the
348		-	event it is necessary for the director of property valuation to contract
349		-	with private appraisal firms to carry out such responsibilities and
350		-	duties.
351		-	(b) On or before June 1 of each year, the director of property
352		-	valuation shall review the appraisal of property in each county or
353		-	district to determine if property within the county or district is being
354		-	appraised or valued in accordance with the requirements of law. If the
355		-	director determines the property in any county or district is not being
356		-	appraised in accordance with the requirements of law, the director of
357		-	property valuation shall notify the county or district appraiser and the
358		-	board of county commissioners of any county or counties affected that
359		-	the county has 30 days within which to submit to the director a plan for
360		-	bringing the appraisal of property within the county into compliance.
361		-	If a plan is submitted and approved by the director the county or
362		-	district shall proceed to implement the plan as submitted. The director
363		-	shall continue to monitor the program to insure that the plan is
364		-	implemented as submitted. If no plan is submitted or if the director
365		-	does not approve the plan, the director shall petition the state board of
366		-	tax appeals for a review of the plan or, if no plan is submitted, for House Substitute for SENATE BILL No. 37—page 7
367		-	authority for the division of property valuation to assume control of the
368		-	appraisal program of the county and to proceed to bring the same into
369		-	compliance with the requirements of law.
370		-	If the state board of tax appeals approves the plan, the county or
371		-	district appraiser shall proceed to implement the plan as submitted. If
372		-	no plan has been submitted or the plan submitted is not approved, the
373		-	board shall fix a time within which the county may submit a plan or an
374		-	amended plan for approval. If no plan is submitted and approved within
375		-	the time prescribed by the board, the board shall order the division of
376		-	property valuation to assume control of the appraisal program of the
377		-	county and shall certify its order to the state treasurer who shall
378		-	withhold distributions of the county's share of moneys from the county
379		-	and city revenue sharing fund and the local ad valorem tax reduction
380		-	fund and credit the same to the general fund of the state for the year
381		-	following the year in which the board's order is made. The director of
382		-	property valuation shall certify the amount of the cost incurred by the
383		-	division in bringing the program in compliance to the state board of tax
384		-	appeals. The board shall order the county commissioners to reimburse
385		-	the state for such costs.
386		-	(c) The state board of tax appeals shall within 60 days after the
387		-	publication of the Kansas assessment/sales ratio study review such
388		-	publication to determine county compliance with K.S.A. 79-1439, and
389		-	amendments thereto. If in the determination of the board one or more
390		-	counties are not in substantial compliance and the director of property
391		-	valuation has not acted under subsection (b), the board shall order the
392		-	director of property valuation to take such corrective action as is
393		-	necessary or to show cause for noncompliance.
394		-	Sec. 14. On and after July 1, 2024, K.S.A. 2023 Supp. 79-2988 is
395		-	hereby amended to read as follows: 79-2988. (a) On or before June 15
396		-	each year, the county clerk shall calculate the revenue neutral rate for
397		-	each taxing subdivision and include such revenue neutral rate on the
398		-	notice of the estimated assessed valuation provided to each taxing
399		-	subdivision for budget purposes. The director of accounts and reports
400		-	shall modify the prescribed budget information form to show the
401		-	revenue neutral rate.
402		-	(b) No tax rate in excess of the revenue neutral rate shall be levied
403		-	by the governing body of any taxing subdivision unless a resolution or
404		-	ordinance has been approved by the governing body according to the
405		-	following procedure:
406		-	(1) At least 10 days in advance of the public hearing, the
407		-	governing body shall publish notice of its proposed intent to exceed the
408		-	revenue neutral rate by publishing notice:
409		-	(A) On the website of the governing body, if the governing body
410		-	maintains a website; and
411		-	(B) in a weekly or daily newspaper of the county having a general
412		-	circulation therein. The notice shall include, but not be limited to, its
413		-	proposed tax rate, its revenue neutral rate and the date, time and
414		-	location of the public hearing.
415		-	(2) On or before July 20, the governing body shall notify the
416		-	county clerk of its proposed intent to exceed the revenue neutral rate
417		-	and provide the date, time and location of the public hearing and its
418		-	proposed tax rate. For all tax years commencing after December 31,
419		-	2021, the county clerk shall notify each taxpayer with property in the
420		-	taxing subdivision, by mail directed to the taxpayer's last known
421		-	address, of the proposed intent to exceed the revenue neutral rate at
422		-	least 10 days in advance of the public hearing. Alternatively, the county
423		-	clerk may transmit the notice to the taxpayer by electronic means at
424		-	least 10 days in advance of the public hearing, if such taxpayer and
425		-	county clerk have consented in writing to service by electronic means. House Substitute for SENATE BILL No. 37—page 8
426		-	The county clerk shall consolidate the required information for all
427		-	taxing subdivisions relevant to the taxpayer's property on one notice.
428		-	The notice shall be in a format prescribed by the director of accounts
429		-	and reports. The notice shall include, but not be limited to:
430		-	(A) The revenue neutral rate of each taxing subdivision relevant to
431		-	the taxpayer's property;
432		-	(B) the proposed property tax revenue needed to fund the
433		-	proposed budget of the taxing subdivision, if the taxing subdivision
434		-	notified the county clerk of its proposed intent to exceed its revenue
435		-	neutral rate;
436		-	(C) the proposed tax rate based upon the proposed budget and the
437		-	current year's total assessed valuation of the taxing subdivision, if the
438		-	taxing subdivision notified the county clerk of its proposed intent to
439		-	exceed its revenue neutral rate;
440		-	(D) the percentage by which the proposed tax rate exceeds the
441		-	revenue neutral rate;
442		-	(E) the tax rate and property tax of each taxing subdivision on the
443		-	taxpayer's property from the previous year's tax statement;
444		-	(F) the appraised value and assessed value of the taxpayer's
445		-	property for the current year;
446		-	(G) the estimates of the tax for the current tax year on the
447		-	taxpayer's property based on the revenue neutral rate of each taxing
448		-	subdivision and any proposed tax rates that exceed the revenue neutral
449		-	rates;
450		-	(H) the difference between the estimates of tax based on the
451		-	proposed tax rate and the revenue neutral rate on the taxpayer's
452		-	property described in subparagraph (G) for any taxing subdivision that
453		-	has a proposed tax rate that exceeds its revenue neutral rate; and
454		-	(I) the date, time and location of the public hearing of the taxing
455		-	subdivision, if the taxing subdivision notified the county clerk of its
456		-	proposed intent to exceed its revenue neutral rate.
457		-	Although the state of Kansas is not a taxing subdivision for
458		-	purposes of this section, the notice shall include a statement of the
459		-	statutory mill levies imposed by the state and the estimate of the tax for
460		-	the current year on the taxpayer's property based on such levies.
461		-	(3) The public hearing to consider exceeding the revenue neutral
462		-	rate shall be held not sooner than August 20 and not later than
463		-	September 20. The governing body shall provide interested taxpayers
464		-	desiring to be heard an opportunity to present oral testimony within
465		-	reasonable time limits and without unreasonable restriction on the
466		-	number of individuals allowed to make public comment. The public
467		-	hearing may be conducted in conjunction with the proposed budget
468		-	hearing pursuant to K.S.A. 79-2929, and amendments thereto, if the
469		-	governing body otherwise complies with all requirements of this
470		-	section. Nothing in this section shall be construed to prohibit additional
471		-	public hearings that provide additional opportunities to present
472		-	testimony or public comment prior to the public hearing required by
473		-	this section.
474		-	(4) A majority vote of the governing body, by the adoption of a
475		-	resolution or ordinance to approve exceeding the revenue neutral rate,
476		-	shall be required prior to adoption of a proposed budget that will result
477		-	in a tax rate in excess of the revenue neutral rate. Such vote of the
478		-	governing body shall be conducted at the public hearing after the
479		-	governing body has heard from interested taxpayers and shall be a roll
480		-	call vote. If the governing body approves exceeding the revenue neutral
481		-	rate, the governing body shall not adopt a budget that results in a tax
482		-	rate in excess of its proposed tax rate as stated in the notice provided
483		-	pursuant to this section. A copy of the resolution or ordinance to
484		-	approve exceeding the revenue neutral rate and a certified copy of any House Substitute for SENATE BILL No. 37—page 9
485		-	roll call vote reporting, at a minimum, the name and vote of each
486		-	member of the governing body related to exceeding the revenue neutral
487		-	rate, whether approved or not, shall be included with the adopted
488		-	budget, budget certificate and other budget forms filed with the county
489		-	clerk and the director of accounts and reports and shall be published on
490		-	the website of the department of administration.
491		-	(c) (1) Any governing body subject to the provisions of this
492		-	section that does not comply with subsection (b) shall refund to
493		-	taxpayers any property taxes over-collected based on the amount of the
494		-	levy that was in excess of the revenue neutral rate.
495		-	(2) Any taxpayer of the taxing subdivision that is the subject of
496		-	the complaint or such taxpayer's duly authorized representative may
497		-	file a complaint with the state board of tax appeals by filing a written
498		-	complaint, on a form prescribed by the board, that contains the facts
499		-	that the complaining party believes show that a governing body of a
500		-	taxing subdivision did not comply with the provisions of subsection (b)
501		-	and that a reduction or refund of taxes is appropriate. The complaining
502		-	party shall provide a copy of such complaint to the governing body of
503		-	the taxing subdivision making the levy that is the subject of the
504		-	complaint. Notwithstanding K.S.A. 74-2438a, and amendments thereto,
505		-	no filing fee shall be charged by the executive director of the state
506		-	board of tax appeals for a complaint filed pursuant to this paragraph.
507		-	The governing body of the taxing subdivision making the levy that is
508		-	the subject of the complaint shall be a party to the proceeding. Notice
509		-	of any summary proceeding or hearing shall be served upon such
510		-	governing body, the county clerk, the director of accounts and reports
511		-	and the complaining party. It shall be the duty of the governing body to
512		-	initiate the production of evidence to demonstrate, by a preponderance
513		-	of the evidence, the validity of such levy. If upon a summary
514		-	proceeding or hearing, it shall be made to appear to the satisfaction of
515		-	the board that the governing body of the taxing subdivision did not
516		-	comply with subsection (b), the state board of tax appeals shall order
517		-	such governing body to refund to taxpayers the amount of property
518		-	taxes over collected or reduce the taxes levied, if uncollected. The
519		-	provisions of this paragraph shall not be construed as prohibiting any
520		-	other remedies available under the law.
521		-	(d) On and after January 1, 2022, in the event that the 20 mills tax
522		-	levied by a school district pursuant to K.S.A. 72-5142, and
523		-	amendments thereto, increases the property tax revenue generated for
524		-	the purpose of calculating the revenue neutral rate from the previous
525		-	tax year and such amount of increase in revenue generated from the 20
526		-	mills such tax levied is the only reason that the school district would
527		-	exceed the total property tax revenue from the prior year, the school
528		-	district shall be deemed to not have exceeded the revenue neutral rate
529		-	in levying a tax rate in excess of the revenue neutral rate to take into
530		-	account the increase in revenue from only the 20 mills such tax levied.
531		-	(e) (1) Notwithstanding any other provision of law to the contrary,
532		-	if the governing body of a taxing subdivision must conduct a public
533		-	hearing to approve exceeding the revenue neutral rate under this
534		-	section, the governing body of the taxing subdivision shall certify, on or
535		-	before October 1, to the proper county clerk the amount of ad valorem
536		-	tax to be levied.
537		-	(2) If a governing body of a taxing subdivision did not comply
538		-	with the provisions of subsection (b) and certifies to the county clerk an
539		-	amount of ad valorem tax to be levied that would result in a tax rate in
540		-	excess of its revenue neutral rate, the county clerk shall reduce the ad
541		-	valorem tax to be levied to the amount resulting from such taxing
542		-	subdivision's revenue neutral rate.
543		-	(f) As used in this section: House Substitute for SENATE BILL No. 37—page 10
544		-	(1) "Taxing subdivision" means any political subdivision of the
545		-	state that levies an ad valorem tax on property.
546		-	(2) "Revenue neutral rate" means the tax rate for the current tax
547		-	year that would generate the same property tax revenue as levied the
548		-	previous tax year using the current tax year's total assessed valuation.
549		-	To calculate the revenue neutral rate, the county clerk shall divide the
550		-	property tax revenue for such taxing subdivision levied for the previous
551		-	tax year by the total of all taxable assessed valuation in such taxing
552		-	subdivision for the current tax year, and then multiply the quotient by
553		-	1,000 to express the rate in mills. The revenue neutral rate shall be
554		-	expressed to the third decimal place.
555		-	(g) In the event that a county clerk incurred costs of printing and
556		-	postage that were not reimbursed pursuant to K.S.A. 2023 Supp. 79-
557		-	2989, and amendments thereto, such county clerk may seek
558		-	reimbursement from all taxing subdivisions required to send the notice.
559		-	Such costs shall be shared proportionately by all taxing subdivisions
560		-	that were included on the same notice based on the total property tax
561		-	levied by each taxing subdivision. Payment of such costs shall be due
562		-	to the county clerk by December 31.
563		-	(h) The department of administration or the director of accounts
564		-	and reports shall make copies of adopted budgets, budget certificates,
565		-	other budget documents and revenue neutral rate documents available
566		-	to the public on the department of administration's website on a
567		-	permanently accessible web page that may be accessed via a
568		-	conspicuous link to that web page placed on the front page of the
569		-	department's website. The department of administration or the director
570		-	of accounts and reports shall also make the following information for
571		-	each tax year available on such website:
572		-	(1) A list of taxing subdivisions by county;
573		-	(2) whether each taxing subdivision conducted a hearing to
574		-	consider exceeding its revenue neutral rate;
575		-	(3) the revenue neutral rate of each taxing subdivision;
576		-	(4) the tax rate resulting from the adopted budget of each taxing
577		-	subdivision; and
578		-	(5) the percent change between the revenue neutral rate and the
579		-	tax rate for each taxing subdivision.
580		-	Sec. 15. On and after July 1, 2024, K.S.A. 2023 Supp. 79-32,110
581		-	is hereby amended to read as follows: 79-32,110. (a) Resident
582		-	individuals. Except as otherwise provided by K.S.A. 79-3220(a), and
583		-	amendments thereto, a tax is hereby imposed upon the Kansas taxable
584		-	income of every resident individual, which tax shall be computed in
585		-	accordance with the following tax schedules:
586		-	(1) Married individuals filing joint returns.
587		-	(A) For tax year 2012:
588		-	If the taxable income is: The tax is:
589		-	Not over $30,000 3.5% of Kansas taxable income
590		-	Over $30,000 but not over $60,000 $1,050 plus 6.25% of excess
591		-	over $30,000
592		-	Over $60,000 $2,925 plus 6.45% of excess
593		-	over $60,000
594		-	(B) For tax year 2013:
595		-	If the taxable income is: The tax is:
596		-	Not over $30,000 3.0% of Kansas taxable income
597		-	Over $30,000 $900 plus 4.9% of excess over
598		-	$30,000
599		-	(C) For tax year 2014:
600		-	If the taxable income is: The tax is:
601		-	Not over $30,000 2.7% of Kansas taxable income
602		-	Over $30,000 $810 plus 4.8% of excess over House Substitute for SENATE BILL No. 37—page 11
603		-	$30,000
604		-	(D) For tax years 2015 and 2016:
605		-	If the taxable income is: The tax is:
606		-	Not over $30,000 2.7% of Kansas taxable income
607		-	Over $30,000 $810 plus 4.6% of excess over
608		-	$30,000
609		-	(E) For tax year 2017:
610		-	If the taxable income is: The tax is:
611		-	Not over $30,000 2.9% of Kansas taxable income
612		-	Over $30,000 but not over $60,000 $870 plus 4.9% of excess over
613		-	$30,000
614		-	Over $60,000 $2,340 plus 5.2% of excess over
615		-	$60,000
616		-	(F) For tax year years 2018, and all tax years thereafter through
617		-	2023:
618		-	If the taxable income is: The tax is:
619		-	Not over $30,000..................................3.1% of Kansas taxable income
620		-	Over $30,000 but not over $60,000......$930 plus 5.25% of excess
621		-	over $30,000
622		-	Over $60,000........................................$2,505 plus 5.7% of excess
623		-	over $60,000
624		-	(B) For tax year 2024, and all tax years thereafter:
625		-	If the taxable income is: The tax is:
626		-	Not over $46,000…..............................5.2% of Kansas taxable income
627		-	Over $46,000........................................$2,392 plus 5.57% of excess
628		-	over $46,000
629		-	(2) All other individuals.
630		-	(A) For tax year 2012:
631		-	If the taxable income is: The tax is:
632		-	Not over $15,000 3.5% of Kansas taxable income
633		-	Over $15,000 but not over $30,000$525 plus 6.25% of excess
634		-	over $15,000
635		-	Over $30,000 $1,462.50 plus 6.45% of excess
636		-	over $30,000
637		-	(B) For tax year 2013:
638		-	If the taxable income is: The tax is:
639		-	Not over $15,000 3.0% of Kansas taxable income
640		-	Over $15,000 $450 plus 4.9% of excess over
641		-	$15,000
642		-	(C) For tax year 2014:
643		-	If the taxable income is: The tax is:
644		-	Not over $15,000 2.7% of Kansas taxable income
645		-	Over $15,000 $405 plus 4.8% of excess over
646		-	$15,000
647		-	(D) For tax years 2015 and 2016:
648		-	If the taxable income is: The tax is:
649		-	Not over $15,000 2.7% of Kansas taxable income
650		-	Over $15,000 $405 plus 4.6% of excess over
651		-	$15,000
652		-	(E) For tax year 2017:
653		-	If the taxable income is: The tax is:
654		-	Not over $15,000 2.9% of Kansas taxable income
655		-	Over $15,000 but not over $30,000$435 plus 4.9% of excess over
656		-	$15,000
657		-	Over $30,000 $1,170 plus 5.2% of excess over
658		-	$30,000
659		-	(F) For tax year years 2018, and all tax years thereafter through
660		-	2023:
661		-	If the taxable income is:The tax is: House Substitute for SENATE BILL No. 37—page 12
662		-	Not over $15,000…............................3.1% of Kansas taxable income
663		-	Over $15,000 but not over $30,000....$465 plus 5.25% of excess
664		-	over $15,000
665		-	Over $30,000.......................................$1,252.50 plus 5.7% of excess
666		-	over $30,000
667		-	(B) For tax year 2024, and all tax years thereafter:
668		-	If the taxable income is: The tax is:
669		-	Not over $23,000…..............................5.2% of Kansas taxable income
670		-	Over $23,000........................................$1,196 plus 5.57% of excess
671		-	over $23,000
672		-	(b) Nonresident individuals. A tax is hereby imposed upon the
673		-	Kansas taxable income of every nonresident individual, which tax shall
674		-	be an amount equal to the tax computed under subsection (a) as if the
675		-	nonresident were a resident multiplied by the ratio of modified Kansas
676		-	source income to Kansas adjusted gross income.
677		-	(c) Corporations. A tax is hereby imposed upon the Kansas
678		-	taxable income of every corporation doing business within this state or
679		-	deriving income from sources within this state. Such tax shall consist of
680		-	a normal tax and a surtax and shall be computed as follows unless
681		-	otherwise modified pursuant to K.S.A. 2023 Supp. 74-50,321, and
682		-	amendments thereto:
683		-	(1) The normal tax shall be in an amount equal to 4% of the
684		-	Kansas taxable income of such corporation; and
685		-	(2) the surtax shall be in an amount equal to 3% of the Kansas
686		-	taxable income of such corporation in excess of $50,000.
687		-	(d) Fiduciaries. A tax is hereby imposed upon the Kansas taxable
688		-	income of estates and trusts at the rates provided in subsection (a)(2)
689		-	hereof.
690		-	(e) Notwithstanding the provisions of subsections (a) and (b): (1)
691		-	For tax years 2016 and 2017, married individuals filing joint returns
692		-	with taxable income of $12,500 or less, and all other individuals with
693		-	taxable income of $5,000 or less, shall have a tax liability of zero; and
694		-	(2), for tax year years 2018, and all tax years thereafter through 2023,
695		-	married individuals filing joint returns with taxable income of $5,000
696		-	or less, and all other individuals with taxable income of $2,500 or less,
697		-	shall have a tax liability of zero.
698		-	(f) No taxpayer shall be assessed penalties and interest arising
699		-	from the underpayment of taxes due to changes to the rates in
700		-	subsection (a) that became law on July 1, 2017, so long as such
701		-	underpayment is rectified on or before April 17, 2018.
702		-	Sec. 16. On and after July 1, 2024, K.S.A. 2023 Supp. 79-32,117
703		-	is hereby amended to read as follows: 79-32,117. (a) The Kansas
704		-	adjusted gross income of an individual means such individual's federal
705		-	adjusted gross income for the taxable year, with the modifications
706		-	specified in this section.
707		-	(b) There shall be added to federal adjusted gross income:
708		-	(i) Interest income less any related expenses directly incurred in
709		-	the purchase of state or political subdivision obligations, to the extent
710		-	that the same is not included in federal adjusted gross income, on
711		-	obligations of any state or political subdivision thereof, but to the
712		-	extent that interest income on obligations of this state or a political
713		-	subdivision thereof issued prior to January 1, 1988, is specifically
714		-	exempt from income tax under the laws of this state authorizing the
715		-	issuance of such obligations, it shall be excluded from computation of
716		-	Kansas adjusted gross income whether or not included in federal
717		-	adjusted gross income. Interest income on obligations of this state or a
718		-	political subdivision thereof issued after December 31, 1987, shall be
719		-	excluded from computation of Kansas adjusted gross income whether
720		-	or not included in federal adjusted gross income. House Substitute for SENATE BILL No. 37—page 13
721		-	(ii) Taxes on or measured by income or fees or payments in lieu of
722		-	income taxes imposed by this state or any other taxing jurisdiction to
723		-	the extent deductible in determining federal adjusted gross income and
724		-	not credited against federal income tax. This paragraph shall not apply
725		-	to taxes imposed under the provisions of K.S.A. 79-1107 or 79-1108,
726		-	and amendments thereto, for privilege tax year 1995, and all such years
727		-	thereafter.
728		-	(iii) The federal net operating loss deduction, except that the
729		-	federal net operating loss deduction shall not be added to an
730		-	individual's federal adjusted gross income for tax years beginning after
731		-	December 31, 2016.
732		-	(iv) Federal income tax refunds received by the taxpayer if the
733		-	deduction of the taxes being refunded resulted in a tax benefit for
734		-	Kansas income tax purposes during a prior taxable year. Such refunds
735		-	shall be included in income in the year actually received regardless of
736		-	the method of accounting used by the taxpayer. For purposes hereof, a
737		-	tax benefit shall be deemed to have resulted if the amount of the tax
738		-	had been deducted in determining income subject to a Kansas income
739		-	tax for a prior year regardless of the rate of taxation applied in such
740		-	prior year to the Kansas taxable income, but only that portion of the
741		-	refund shall be included as bears the same proportion to the total refund
742		-	received as the federal taxes deducted in the year to which such refund
743		-	is attributable bears to the total federal income taxes paid for such year.
744		-	For purposes of the foregoing sentence, federal taxes shall be
745		-	considered to have been deducted only to the extent such deduction
746		-	does not reduce Kansas taxable income below zero.
747		-	(v) The amount of any depreciation deduction or business expense
748		-	deduction claimed on the taxpayer's federal income tax return for any
749		-	capital expenditure in making any building or facility accessible to the
750		-	handicapped, for which expenditure the taxpayer claimed the credit
751		-	allowed by K.S.A. 79-32,177, and amendments thereto.
752		-	(vi) Any amount of designated employee contributions picked up
753		-	by an employer pursuant to K.S.A. 12-5005, 20-2603, 74-4919 and 74-
754		-	4965, and amendments thereto.
755		-	(vii) The amount of any charitable contribution made to the extent
756		-	the same is claimed as the basis for the credit allowed pursuant to
757		-	K.S.A. 79-32,196, and amendments thereto.
758		-	(viii) The amount of any costs incurred for improvements to a
759		-	swine facility, claimed for deduction in determining federal adjusted
760		-	gross income, to the extent the same is claimed as the basis for any
761		-	credit allowed pursuant to K.S.A. 79-32,204, and amendments thereto.
762		-	(ix) The amount of any ad valorem taxes and assessments paid and
763		-	the amount of any costs incurred for habitat management or
764		-	construction and maintenance of improvements on real property,
765		-	claimed for deduction in determining federal adjusted gross income, to
766		-	the extent the same is claimed as the basis for any credit allowed
767		-	pursuant to K.S.A. 79-32,203, and amendments thereto.
768		-	(x) Amounts received as nonqualified withdrawals, as defined by
769		-	K.S.A. 75-643, and amendments thereto, if, at the time of contribution
770		-	to a family postsecondary education savings account, such amounts
771		-	were subtracted from the federal adjusted gross income pursuant to
772		-	subsection (c)(xv) or if such amounts are not already included in the
773		-	federal adjusted gross income.
774		-	(xi) The amount of any contribution made to the same extent the
775		-	same is claimed as the basis for the credit allowed pursuant to K.S.A.
776		-	74-50,154, and amendments thereto.
777		-	(xii) For taxable years commencing after December 31, 2004,
778		-	amounts received as withdrawals not in accordance with the provisions
779		-	of K.S.A. 74-50,204, and amendments thereto, if, at the time of House Substitute for SENATE BILL No. 37—page 14
780		-	contribution to an individual development account, such amounts were
781		-	subtracted from the federal adjusted gross income pursuant to
782		-	subsection (c)(xiii), or if such amounts are not already included in the
783		-	federal adjusted gross income.
784		-	(xiii) The amount of any expenditures claimed for deduction in
785		-	determining federal adjusted gross income, to the extent the same is
786		-	claimed as the basis for any credit allowed pursuant to K.S.A. 79-
787		-	32,217 through 79-32,220 or 79-32,222, and amendments thereto.
788		-	(xiv) The amount of any amortization deduction claimed in
789		-	determining federal adjusted gross income to the extent the same is
790		-	claimed for deduction pursuant to K.S.A. 79-32,221, and amendments
791		-	thereto.
792		-	(xv) The amount of any expenditures claimed for deduction in
793		-	determining federal adjusted gross income, to the extent the same is
794		-	claimed as the basis for any credit allowed pursuant to K.S.A. 79-
795		-	32,223 through 79-32,226, 79-32,228 through 79-32,231, 79-32,233
796		-	through 79-32,236, 79-32,238 through 79-32,241, 79-32,245 through
797		-	79-32,248 or 79-32,251 through 79-32,254, and amendments thereto.
798		-	(xvi) The amount of any amortization deduction claimed in
799		-	determining federal adjusted gross income to the extent the same is
800		-	claimed for deduction pursuant to K.S.A. 79-32,227, 79-32,232, 79-
801		-	32,237, 79-32,249, 79-32,250 or 79-32,255, and amendments thereto.
802		-	(xvii) The amount of any amortization deduction claimed in
803		-	determining federal adjusted gross income to the extent the same is
804		-	claimed for deduction pursuant to K.S.A. 79-32,256, and amendments
805		-	thereto.
806		-	(xviii) For taxable years commencing after December 31, 2006,
807		-	the amount of any ad valorem or property taxes and assessments paid to
808		-	a state other than Kansas or local government located in a state other
809		-	than Kansas by a taxpayer who resides in a state other than Kansas,
810		-	when the law of such state does not allow a resident of Kansas who
811		-	earns income in such other state to claim a deduction for ad valorem or
812		-	property taxes or assessments paid to a political subdivision of the state
813		-	of Kansas in determining taxable income for income tax purposes in
814		-	such other state, to the extent that such taxes and assessments are
815		-	claimed as an itemized deduction for federal income tax purposes.
816		-	(xix) For taxable years beginning after December 31, 2012, and
817		-	ending before January 1, 2017, the amount of any: (1) Loss from
818		-	business as determined under the federal internal revenue code and
819		-	reported from schedule C and on line 12 of the taxpayer's form 1040
820		-	federal individual income tax return; (2) loss from rental real estate,
821		-	royalties, partnerships, S corporations, except those with wholly owned
822		-	subsidiaries subject to the Kansas privilege tax, estates, trusts, residual
823		-	interest in real estate mortgage investment conduits and net farm rental
824		-	as determined under the federal internal revenue code and reported
825		-	from schedule E and on line 17 of the taxpayer's form 1040 federal
826		-	individual income tax return; and (3) farm loss as determined under the
827		-	federal internal revenue code and reported from schedule F and on line
828		-	18 of the taxpayer's form 1040 federal income tax return; all to the
829		-	extent deducted or subtracted in determining the taxpayer's federal
830		-	adjusted gross income. For purposes of this subsection, references to
831		-	the federal form 1040 and federal schedule C, schedule E, and schedule
832		-	F, shall be to such form and schedules as they existed for tax year 2011,
833		-	and as revised thereafter by the internal revenue service.
834		-	(xx) For taxable years beginning after December 31, 2012, and
835		-	ending before January 1, 2017, the amount of any deduction for self-
836		-	employment taxes under section 164(f) of the federal internal revenue
837		-	code as in effect on January 1, 2012, and amendments thereto, in
838		-	determining the federal adjusted gross income of an individual House Substitute for SENATE BILL No. 37—page 15
839		-	taxpayer, to the extent the deduction is attributable to income reported
840		-	on schedule C, E or F and on line 12, 17 or 18 of the taxpayer's form
841		-	1040 federal income tax return.
842		-	(xxi) For taxable years beginning after December 31, 2012, and
843		-	ending before January 1, 2017, the amount of any deduction for
844		-	pension, profit sharing, and annuity plans of self-employed individuals
845		-	under section 62(a)(6) of the federal internal revenue code as in effect
846		-	on January 1, 2012, and amendments thereto, in determining the federal
847		-	adjusted gross income of an individual taxpayer.
848		-	(xxii) For taxable years beginning after December 31, 2012, and
849		-	ending before January 1, 2017, the amount of any deduction for health
850		-	insurance under section 162(l) of the federal internal revenue code as in
851		-	effect on January 1, 2012, and amendments thereto, in determining the
852		-	federal adjusted gross income of an individual taxpayer.
853		-	(xxiii) For taxable years beginning after December 31, 2012, and
854		-	ending before January 1, 2017, the amount of any deduction for
855		-	domestic production activities under section 199 of the federal internal
856		-	revenue code as in effect on January 1, 2012, and amendments thereto,
857		-	in determining the federal adjusted gross income of an individual
858		-	taxpayer.
859		-	(xxiv) For taxable years commencing after December 31, 2013,
860		-	that portion of the amount of any expenditure deduction claimed in
861		-	determining federal adjusted gross income for expenses paid for
862		-	medical care of the taxpayer or the taxpayer's spouse or dependents
863		-	when such expenses were paid or incurred for an abortion, or for a
864		-	health benefit plan, as defined in K.S.A. 65-6731, and amendments
865		-	thereto, for the purchase of an optional rider for coverage of abortion in
866		-	accordance with K.S.A. 40-2,190, and amendments thereto, to the
867		-	extent that such taxes and assessments are claimed as an itemized
868		-	deduction for federal income tax purposes.
869		-	(xxv) For taxable years commencing after December 31, 2013,
870		-	that portion of the amount of any expenditure deduction claimed in
871		-	determining federal adjusted gross income for expenses paid by a
872		-	taxpayer for health care when such expenses were paid or incurred for
873		-	abortion coverage, a health benefit plan, as defined in K.S.A. 65-6731,
874		-	and amendments thereto, when such expenses were paid or incurred for
875		-	abortion coverage or amounts contributed to health savings accounts
876		-	for such taxpayer's employees for the purchase of an optional rider for
877		-	coverage of abortion in accordance with K.S.A. 40-2,190, and
878		-	amendments thereto, to the extent that such taxes and assessments are
879		-	claimed as a deduction for federal income tax purposes.
880		-	(xxvi) For all taxable years beginning after December 31, 2016,
881		-	the amount of any charitable contribution made to the extent the same
882		-	is claimed as the basis for the credit allowed pursuant to K.S.A. 72-
883		-	4357, and amendments thereto, and is also claimed as an itemized
884		-	deduction for federal income tax purposes.
885		-	(xxvii) For all taxable years commencing after December 31,
886		-	2020, the amount deducted by reason of a carryforward of disallowed
887		-	business interest pursuant to section 163(j) of the federal internal
888		-	revenue code of 1986, as in effect on January 1, 2018.
889		-	(xxviii) For all taxable years beginning after December 31, 2021,
890		-	the amount of any contributions to, or earnings from, a first-time home
891		-	buyer savings account if distributions from the account were not used
892		-	to pay for expenses or transactions authorized pursuant to K.S.A. 2023
893		-	Supp. 58-4904, and amendments thereto, or were not held for the
894		-	minimum length of time required pursuant to K.S.A. 2023 Supp. 58-
895		-	4904, and amendments thereto. Contributions to, or earnings from,
896		-	such account shall also include any amount resulting from the account
897		-	holder not designating a surviving payable on death beneficiary House Substitute for SENATE BILL No. 37—page 16
898		-	pursuant to K.S.A. 2023 Supp. 58-4904(e), and amendments thereto.
899		-	(c) There shall be subtracted from federal adjusted gross income:
900		-	(i) Interest or dividend income on obligations or securities of any
901		-	authority, commission or instrumentality of the United States and its
902		-	possessions less any related expenses directly incurred in the purchase
903		-	of such obligations or securities, to the extent included in federal
904		-	adjusted gross income but exempt from state income taxes under the
905		-	laws of the United States.
906		-	(ii) Any amounts received which are included in federal adjusted
907		-	gross income but which are specifically exempt from Kansas income
908		-	taxation under the laws of the state of Kansas.
909		-	(iii) The portion of any gain or loss from the sale or other
910		-	disposition of property having a higher adjusted basis for Kansas
911		-	income tax purposes than for federal income tax purposes on the date
912		-	such property was sold or disposed of in a transaction in which gain or
913		-	loss was recognized for purposes of federal income tax that does not
914		-	exceed such difference in basis, but if a gain is considered a long-term
915		-	capital gain for federal income tax purposes, the modification shall be
916		-	limited to that portion of such gain which is included in federal
917		-	adjusted gross income.
918		-	(iv) The amount necessary to prevent the taxation under this act of
919		-	any annuity or other amount of income or gain which was properly
920		-	included in income or gain and was taxed under the laws of this state
921		-	for a taxable year prior to the effective date of this act, as amended, to
922		-	the taxpayer, or to a decedent by reason of whose death the taxpayer
923		-	acquired the right to receive the income or gain, or to a trust or estate
924		-	from which the taxpayer received the income or gain.
925		-	(v) The amount of any refund or credit for overpayment of taxes
926		-	on or measured by income or fees or payments in lieu of income taxes
927		-	imposed by this state, or any taxing jurisdiction, to the extent included
928		-	in gross income for federal income tax purposes.
929		-	(vi) Accumulation distributions received by a taxpayer as a
930		-	beneficiary of a trust to the extent that the same are included in federal
931		-	adjusted gross income.
932		-	(vii) Amounts received as annuities under the federal civil service
933		-	retirement system from the civil service retirement and disability fund
934		-	and other amounts received as retirement benefits in whatever form
935		-	which were earned for being employed by the federal government or
936		-	for service in the armed forces of the United States.
937		-	(viii) Amounts received by retired railroad employees as a
938		-	supplemental annuity under the provisions of 45 U.S.C. §§ 228b(a) and
939		-	228c(a)(1) et seq.
940		-	(ix) Amounts received by retired employees of a city and by
941		-	retired employees of any board of such city as retirement allowances
942		-	pursuant to K.S.A. 13-14,106, and amendments thereto, or pursuant to
943		-	any charter ordinance exempting a city from the provisions of K.S.A.
944		-	13-14,106, and amendments thereto.
945		-	(x) For taxable years beginning after December 31, 1976, the
946		-	amount of the federal tentative jobs tax credit disallowance under the
947		-	provisions of 26 U.S.C. § 280C. For taxable years ending after
948		-	December 31, 1978, the amount of the targeted jobs tax credit and work
949		-	incentive credit disallowances under 26 U.S.C. § 280C.
950		-	(xi) For taxable years beginning after December 31, 1986,
951		-	dividend income on stock issued by Kansas venture capital, inc.
952		-	(xii) For taxable years beginning after December 31, 1989,
953		-	amounts received by retired employees of a board of public utilities as
954		-	pension and retirement benefits pursuant to K.S.A. 13-1246, 13-1246a
955		-	and 13-1249, and amendments thereto.
956		-	(xiii) For taxable years beginning after December 31, 2004, House Substitute for SENATE BILL No. 37—page 17
957		-	amounts contributed to and the amount of income earned on
958		-	contributions deposited to an individual development account under
959		-	K.S.A. 74-50,201 et seq., and amendments thereto.
960		-	(xiv) For all taxable years commencing after December 31, 1996,
961		-	that portion of any income of a bank organized under the laws of this
962		-	state or any other state, a national banking association organized under
963		-	the laws of the United States, an association organized under the
964		-	savings and loan code of this state or any other state, or a federal
965		-	savings association organized under the laws of the United States, for
966		-	which an election as an S corporation under subchapter S of the federal
967		-	internal revenue code is in effect, which accrues to the taxpayer who is
968		-	a stockholder of such corporation and which is not distributed to the
969		-	stockholders as dividends of the corporation. For taxable years
970		-	beginning after December 31, 2012, and ending before January 1, 2017,
971		-	the amount of modification under this subsection shall exclude the
972		-	portion of income or loss reported on schedule E and included on line
973		-	17 of the taxpayer's form 1040 federal individual income tax return.
974		-	(xv) For all taxable years beginning after December 31, 2017, the
975		-	cumulative amounts not exceeding $3,000, or $6,000 for a married
976		-	couple filing a joint return, for each designated beneficiary that are
977		-	contributed to: (1) A family postsecondary education savings account
978		-	established under the Kansas postsecondary education savings program
979		-	or a qualified tuition program established and maintained by another
980		-	state or agency or instrumentality thereof pursuant to section 529 of the
981		-	internal revenue code of 1986, as amended, for the purpose of paying
982		-	the qualified higher education expenses of a designated beneficiary; or
983		-	(2) an achieving a better life experience (ABLE) account established
984		-	under the Kansas ABLE savings program or a qualified ABLE program
985		-	established and maintained by another state or agency or
986		-	instrumentality thereof pursuant to section 529A of the internal revenue
987		-	code of 1986, as amended, for the purpose of saving private funds to
988		-	support an individual with a disability. The terms and phrases used in
989		-	this paragraph shall have the meaning respectively ascribed thereto by
990		-	the provisions of K.S.A. 75-643 and 75-652, and amendments thereto,
991		-	and the provisions of such sections are hereby incorporated by
992		-	reference for all purposes thereof.
993		-	(xvi) For all taxable years beginning after December 31, 2004,
994		-	amounts received by taxpayers who are or were members of the armed
995		-	forces of the United States, including service in the Kansas army and
996		-	air national guard, as a recruitment, sign up or retention bonus received
997		-	by such taxpayer as an incentive to join, enlist or remain in the armed
998		-	services of the United States, including service in the Kansas army and
999		-	air national guard, and amounts received for repayment of educational
1000		-	or student loans incurred by or obligated to such taxpayer and received
1001		-	by such taxpayer as a result of such taxpayer's service in the armed
1002		-	forces of the United States, including service in the Kansas army and
1003		-	air national guard.
1004		-	(xvii) For all taxable years beginning after December 31, 2004,
1005		-	amounts received by taxpayers who are eligible members of the Kansas
1006		-	army and air national guard as a reimbursement pursuant to K.S.A. 48-
1007		-	281, and amendments thereto, and amounts received for death benefits
1008		-	pursuant to K.S.A. 48-282, and amendments thereto, to the extent that
1009		-	such death benefits are included in federal adjusted gross income of the
1010		-	taxpayer.
1011		-	(xviii) For the taxable year beginning after December 31, 2006,
1012		-	amounts received as benefits under the federal social security act which
1013		-	are included in federal adjusted gross income of a taxpayer with federal
1014		-	adjusted gross income of $50,000 or less, whether such taxpayer's filing
1015		-	status is single, head of household, married filing separate or married House Substitute for SENATE BILL No. 37—page 18
1016		-	filing jointly; and (A) For all taxable years beginning after December
1017		-	31, 2007, and ending before January 1, 2024, amounts received as
1018		-	benefits under the federal social security act which are included in
1019		-	federal adjusted gross income of a taxpayer with federal adjusted gross
1020		-	income of $75,000 or less, whether such taxpayer's filing status is
1021		-	single, head of household, married filing separate or married filing
1022		-	jointly.
1023		-	(B) For all taxable years beginning after December 31, 2023,
1024		-	amounts received as benefits under the federal social security act that
1025		-	are included in federal adjusted gross income of a taxpayer.
1026		-	(xix) Amounts received by retired employees of Washburn
1027		-	university as retirement and pension benefits under the university's
1028		-	retirement plan.
1029		-	(xx) For taxable years beginning after December 31, 2012, and
1030		-	ending before January 1, 2017, the amount of any: (1) Net profit from
1031		-	business as determined under the federal internal revenue code and
1032		-	reported from schedule C and on line 12 of the taxpayer's form 1040
1033		-	federal individual income tax return; (2) net income, not including
1034		-	guaranteed payments as defined in section 707(c) of the federal internal
1035		-	revenue code and as reported to the taxpayer from federal schedule K-
1036		-	1, (form 1065-B), in box 9, code F or as reported to the taxpayer from
1037		-	federal schedule K-1, (form 1065) in box 4, from rental real estate,
1038		-	royalties, partnerships, S corporations, estates, trusts, residual interest
1039		-	in real estate mortgage investment conduits and net farm rental as
1040		-	determined under the federal internal revenue code and reported from
1041		-	schedule E and on line 17 of the taxpayer's form 1040 federal
1042		-	individual income tax return; and (3) net farm profit as determined
1043		-	under the federal internal revenue code and reported from schedule F
1044		-	and on line 18 of the taxpayer's form 1040 federal income tax return;
1045		-	all to the extent included in the taxpayer's federal adjusted gross
1046		-	income. For purposes of this subsection, references to the federal form
1047		-	1040 and federal schedule C, schedule E, and schedule F, shall be to
1048		-	such form and schedules as they existed for tax year 2011 and as
1049		-	revised thereafter by the internal revenue service.
1050		-	(xxi) For all taxable years beginning after December 31, 2013,
1051		-	amounts equal to the unreimbursed travel, lodging and medical
1052		-	expenditures directly incurred by a taxpayer while living, or a
1053		-	dependent of the taxpayer while living, for the donation of one or more
1054		-	human organs of the taxpayer, or a dependent of the taxpayer, to
1055		-	another person for human organ transplantation. The expenses may be
1056		-	claimed as a subtraction modification provided for in this section to the
1057		-	extent the expenses are not already subtracted from the taxpayer's
1058		-	federal adjusted gross income. In no circumstances shall the subtraction
1059		-	modification provided for in this section for any individual, or a
1060		-	dependent, exceed $5,000. As used in this section, "human organ"
1061		-	means all or part of a liver, pancreas, kidney, intestine, lung or bone
1062		-	marrow. The provisions of this paragraph shall take effect on the day
1063		-	the secretary of revenue certifies to the director of the budget that the
1064		-	cost for the department of revenue of modifications to the automated
1065		-	tax system for the purpose of implementing this paragraph will not
1066		-	exceed $20,000.
1067		-	(xxii) For taxable years beginning after December 31, 2012, and
1068		-	ending before January 1, 2017, the amount of net gain from the sale of:
1069		-	(1) Cattle and horses, regardless of age, held by the taxpayer for draft,
1070		-	breeding, dairy or sporting purposes, and held by such taxpayer for 24
1071		-	months or more from the date of acquisition; and (2) other livestock,
1072		-	regardless of age, held by the taxpayer for draft, breeding, dairy or
1073		-	sporting purposes, and held by such taxpayer for 12 months or more
1074		-	from the date of acquisition. The subtraction from federal adjusted House Substitute for SENATE BILL No. 37—page 19
1075		-	gross income shall be limited to the amount of the additions recognized
1076		-	under the provisions of subsection (b)(xix) attributable to the business
1077		-	in which the livestock sold had been used. As used in this paragraph,
1078		-	the term "livestock" shall not include poultry.
1079		-	(xxiii) For all taxable years beginning after December 31, 2012,
1080		-	amounts received under either the Overland Park, Kansas police
1081		-	department retirement plan or the Overland Park, Kansas fire
1082		-	department retirement plan, both as established by the city of Overland
1083		-	Park, pursuant to the city's home rule authority.
1084		-	(xxiv) For taxable years beginning after December 31, 2013, and
1085		-	ending before January 1, 2017, the net gain from the sale from
1086		-	Christmas trees grown in Kansas and held by the taxpayer for six years
1087		-	or more.
1088		-	(xxv) For all taxable years commencing after December 31, 2020,
1089		-	100% of global intangible low-taxed income under section 951A of the
1090		-	federal internal revenue code of 1986, before any deductions allowed
1091		-	under section 250(a)(1)(B) of such code.
1092		-	(xxvi) For all taxable years commencing after December 31, 2020,
1093		-	the amount disallowed as a deduction pursuant to section 163(j) of the
1094		-	federal internal revenue code of 1986, as in effect on January 1, 2018.
1095		-	(xxvii) For taxable years commencing after December 31, 2020,
1096		-	the amount disallowed as a deduction pursuant to section 274 of the
1097		-	federal internal revenue code of 1986 for meal expenditures shall be
1098		-	allowed to the extent such expense was deductible for determining
1099		-	federal income tax and was allowed and in effect on December 31,
1100		-	2017.
1101		-	(xxviii) For all taxable years beginning after December 31, 2021:
1102		-	(1) The amount contributed to a first-time home buyer savings account
1103		-	pursuant to K.S.A. 2023 Supp. 58-4903, and amendments thereto, in an
1104		-	amount not to exceed $3,000 for an individual or $6,000 for a married
1105		-	couple filing a joint return; or (2) amounts received as income earned
1106		-	from assets in a first-time home buyer savings account.
1107		-	(d) There shall be added to or subtracted from federal adjusted
1108		-	gross income the taxpayer's share, as beneficiary of an estate or trust, of
1109		-	the Kansas fiduciary adjustment determined under K.S.A. 79-32,135,
1110		-	and amendments thereto.
1111		-	(e) The amount of modifications required to be made under this
1112		-	section by a partner which relates to items of income, gain, loss,
1113		-	deduction or credit of a partnership shall be determined under K.S.A.
1114		-	79-32,131, and amendments thereto, to the extent that such items affect
1115		-	federal adjusted gross income of the partner.
1116		-	Sec. 17. On and after July 1, 2024, K.S.A. 2023 Supp. 79-32,119
1117		-	is hereby amended to read as follows: 79-32,119. (a) The Kansas
1118		-	standard deduction of an individual, including a husband and wife who
1119		-	are either both residents or who file a joint return as if both were
1120		-	residents, shall be equal to the sum of the standard deduction amount
1121		-	allowed pursuant to this section, and the additional standard deduction
1122		-	amount allowed pursuant to this section for each such deduction
1123		-	allowable to such individual or to such husband and wife under the
1124		-	federal internal revenue code.
1125		-	(b) For tax year 1998, and all tax years thereafter, the additional
1126		-	standard deduction amount shall be as follows: Single individual and
1127		-	head of household filing status, $850; and married filing status, $700.
1128		-	(c) (1) For tax year 2013 through tax year 2020, the standard
1129		-	deduction amount of an individual, including husband and wife who
1130		-	are either both residents or who file a joint return as if both were
1131		-	residents, shall be as follows: Single individual filing status, $3,000;
1132		-	married filing status, $7,500; and head of household filing status,
1133		-	$5,500. House Substitute for SENATE BILL No. 37—page 20
1134		-	(2) For tax year years 2021, and all tax years thereafter through
1135		-	2023, the standard deduction amount of an individual, including
1136		-	husband and wife who are either both residents or who file a joint
1137		-	return as if both were residents, shall be as follows: Single individual
1138		-	filing status, $3,500; married filing status, $8,000; and head of
1139		-	household filing status, $6,000.
1140		-	(2) For tax year 2024, and all tax years thereafter, the standard
1141		-	deduction amount of an individual, including husband and wife who
1142		-	are either both residents or who file a joint return as if both were
1143		-	residents, shall be as follows: Single individual filing status, $3,605;
1144		-	married filing status, $8,240; and head of household filing status,
1145		-	$6,180.
1146		-	(d) For purposes of this section, the federal standard deduction
1147		-	allowable to a husband and wife filing separate Kansas income tax
1148		-	returns shall be determined on the basis that separate federal returns
1149		-	were filed, and the federal standard deduction of a husband and wife
1150		-	filing a joint Kansas income tax return shall be determined on the basis
1151		-	that a joint federal income tax return was filed.
1152		-	Sec. 18. On and after July 1, 2024, K.S.A. 2023 Supp. 79-32,121
1153		-	is hereby amended to read as follows: 79-32,121. (a) An individual For
1154		-	tax year 2024, and all tax years thereafter, a taxpayer shall be allowed
1155		-	a Kansas exemption of $2,250 for each exemption as follows:
1156		-	(1) In the case of married individuals filing a joint return, a
1157		-	personal exemption of $18,320;
1158		-	(2) in the case of all other individuals with a filing status of single,
1159		-	head of household or married filing separate, a personal exemption of
1160		-	$9,160; and
1161		-	(3) in addition to the amount allowed pursuant to paragraph (1)
1162		-	or (2), a personal exemption of $2,320 for each dependent for which
1163		-	such individual taxpayer is entitled to a deduction for the taxable year
1164		-	for federal income tax purposes.
1165		-	(b) In addition to the exemptions provided in subsection (a), any
1166		-	individual who has been honorably discharged from active service in
1167		-	any branch of the armed forces of the United States and who is certified
1168		-	by the United States department of veterans affairs or its successor to
1169		-	be in receipt of disability compensation at the 100% rate, if the
1170		-	disability is permanent and was sustained through military action or
1171		-	accident or resulted from disease contracted while in such active
1172		-	service, such individual shall be allowed an additional Kansas
1173		-	exemption of $2,250 for tax year 2023 and all tax years thereafter.
1174		-	Sec. 19. K.S.A. 2023 Supp. 79-3603 is hereby amended to read as
1175		-	follows: 79-3603. For the privilege of engaging in the business of
1176		-	selling tangible personal property at retail in this state or rendering or
1177		-	furnishing any of the services taxable under this act, there is hereby
1178		-	levied and there shall be collected and paid a tax at the rate of 6.5%. On
1179		-	and after January 1, 2023, 17% and on and after January 1, 2025 July
1180		-	1, 2024, 18% of the tax rate imposed pursuant to this section and the
1181		-	rate provided in K.S.A. 2023 Supp. 79-3603d, and amendments thereto,
1182		-	shall be levied for the state highway fund, the state highway fund
1183		-	purposes and those purposes specified in K.S.A. 68-416, and
1184		-	amendments thereto, and all revenue collected and received from such
1185		-	tax levy shall be deposited in the state highway fund.
1186		-	Within a redevelopment district established pursuant to K.S.A. 74-
1187		-	8921, and amendments thereto, there is hereby levied and there shall be
1188		-	collected and paid an additional tax at the rate of 2% until the earlier of
1189		-	the date the bonds issued to finance or refinance the redevelopment
1190		-	project have been paid in full or the final scheduled maturity of the first
1191		-	series of bonds issued to finance any part of the project.
1192		-	Such tax shall be imposed upon: House Substitute for SENATE BILL No. 37—page 21
1193		-	(a) The gross receipts received from the sale of tangible personal
1194		-	property at retail within this state;
1195		-	(b) the gross receipts from intrastate, interstate or international
1196		-	telecommunications services and any ancillary services sourced to this
1197		-	state in accordance with K.S.A. 79-3673, and amendments thereto,
1198		-	except that telecommunications service does not include: (1) Any
1199		-	interstate or international 800 or 900 service; (2) any interstate or
1200		-	international private communications service as defined in K.S.A. 79-
1201		-	3673, and amendments thereto; (3) any value-added nonvoice data
1202		-	service; (4) any telecommunication service to a provider of
1203		-	telecommunication services which will be used to render
1204		-	telecommunications services, including carrier access services; or (5)
1205		-	any service or transaction defined in this section among entities
1206		-	classified as members of an affiliated group as provided by section
1207		-	1504 of the federal internal revenue code of 1986, as in effect on
1208		-	January 1, 2001;
1209		-	(c) the gross receipts from the sale or furnishing of gas, water,
1210		-	electricity and heat, which sale is not otherwise exempt from taxation
1211		-	under the provisions of this act, and whether furnished by municipally
1212		-	or privately owned utilities, except that, on and after January 1, 2006,
1213		-	for sales of gas, electricity and heat delivered through mains, lines or
1214		-	pipes to residential premises for noncommercial use by the occupant of
1215		-	such premises, and for agricultural use and also, for such use, all sales
1216		-	of propane gas, the state rate shall be 0%; and for all sales of propane
1217		-	gas, LP gas, coal, wood and other fuel sources for the production of
1218		-	heat or lighting for noncommercial use of an occupant of residential
1219		-	premises, the state rate shall be 0%, but such tax shall not be levied and
1220		-	collected upon the gross receipts from: (1) The sale of a rural water
1221		-	district benefit unit; (2) a water system impact fee, system enhancement
1222		-	fee or similar fee collected by a water supplier as a condition for
1223		-	establishing service; or (3) connection or reconnection fees collected by
1224		-	a water supplier;
1225		-	(d) the gross receipts from the sale of meals or drinks furnished at
1226		-	any private club, drinking establishment, catered event, restaurant,
1227		-	eating house, dining car, hotel, drugstore or other place where meals or
1228		-	drinks are regularly sold to the public;
1229		-	(e) the gross receipts from the sale of admissions to any place
1230		-	providing amusement, entertainment or recreation services including
1231		-	admissions to state, county, district and local fairs, but such tax shall
1232		-	not be levied and collected upon the gross receipts received from sales
1233		-	of admissions to any cultural and historical event which occurs
1234		-	triennially;
1235		-	(f) the gross receipts from the operation of any coin-operated
1236		-	device dispensing or providing tangible personal property, amusement
1237		-	or other services except laundry services, whether automatic or
1238		-	manually operated;
1239		-	(g) the gross receipts from the service of renting of rooms by
1240		-	hotels, as defined by K.S.A. 36-501, and amendments thereto, or by
1241		-	accommodation brokers, as defined by K.S.A. 12-1692, and
1242		-	amendments thereto, but such tax shall not be levied and collected upon
1243		-	the gross receipts received from sales of such service to the federal
1244		-	government and any agency, officer or employee thereof in association
1245		-	with the performance of official government duties;
1246		-	(h) the gross receipts from the service of renting or leasing of
1247		-	tangible personal property except such tax shall not apply to the renting
1248		-	or leasing of machinery, equipment or other personal property owned
1249		-	by a city and purchased from the proceeds of industrial revenue bonds
1250		-	issued prior to July 1, 1973, in accordance with the provisions of
1251		-	K.S.A. 12-1740 through 12-1749, and amendments thereto, and any House Substitute for SENATE BILL No. 37—page 22
1252		-	city or lessee renting or leasing such machinery, equipment or other
1253		-	personal property purchased with the proceeds of such bonds who shall
1254		-	have paid a tax under the provisions of this section upon sales made
1255		-	prior to July 1, 1973, shall be entitled to a refund from the sales tax
1256		-	refund fund of all taxes paid thereon;
1257		-	(i) the gross receipts from the rendering of dry cleaning, pressing,
1258		-	dyeing and laundry services except laundry services rendered through a
1259		-	coin-operated device whether automatic or manually operated;
1260		-	(j) the gross receipts from the rendering of the services of washing
1261		-	and washing and waxing of vehicles;
1262		-	(k) the gross receipts from cable, community antennae and other
1263		-	subscriber radio and television services;
1264		-	(l) (1) except as otherwise provided by paragraph (2), the gross
1265		-	receipts received from the sales of tangible personal property to all
1266		-	contractors, subcontractors or repairmen for use by them in erecting
1267		-	structures, or building on, or otherwise improving, altering, or repairing
1268		-	real or personal property.
1269		-	(2) Any such contractor, subcontractor or repairman who
1270		-	maintains an inventory of such property both for sale at retail and for
1271		-	use by them for the purposes described by paragraph (1) shall be
1272		-	deemed a retailer with respect to purchases for and sales from such
1273		-	inventory, except that the gross receipts received from any such sale,
1274		-	other than a sale at retail, shall be equal to the total purchase price paid
1275		-	for such property and the tax imposed thereon shall be paid by the
1276		-	deemed retailer;
1277		-	(m) the gross receipts received from fees and charges by public
1278		-	and private clubs, drinking establishments, organizations and
1279		-	businesses for participation in sports, games and other recreational
1280		-	activities, but such tax shall not be levied and collected upon the gross
1281		-	receipts received from: (1) Fees and charges by any political
1282		-	subdivision, by any organization exempt from property taxation
1283		-	pursuant to K.S.A. 79-201 Ninth, and amendments thereto, or by any
1284		-	youth recreation organization exclusively providing services to persons
1285		-	18 years of age or younger which is exempt from federal income
1286		-	taxation pursuant to section 501(c)(3) of the federal internal revenue
1287		-	code of 1986, for participation in sports, games and other recreational
1288		-	activities; and (2) entry fees and charges for participation in a special
1289		-	event or tournament sanctioned by a national sporting association to
1290		-	which spectators are charged an admission which is taxable pursuant to
1291		-	subsection (e);
1292		-	(n) the gross receipts received from dues charged by public and
1293		-	private clubs, drinking establishments, organizations and businesses,
1294		-	payment of which entitles a member to the use of facilities for
1295		-	recreation or entertainment, but such tax shall not be levied and
1296		-	collected upon the gross receipts received from: (1) Dues charged by
1297		-	any organization exempt from property taxation pursuant to K.S.A. 79-
1298		-	201 Eighth and Ninth, and amendments thereto; and (2) sales of
1299		-	memberships in a nonprofit organization which is exempt from federal
1300		-	income taxation pursuant to section 501(c)(3) of the federal internal
1301		-	revenue code of 1986, and whose purpose is to support the operation of
1302		-	a nonprofit zoo;
1303		-	(o) the gross receipts received from the isolated or occasional sale
1304		-	of motor vehicles or trailers but not including: (1) The transfer of motor
1305		-	vehicles or trailers by a person to a corporation or limited liability
1306		-	company solely in exchange for stock securities or membership interest
1307		-	in such corporation or limited liability company; (2) the transfer of
1308		-	motor vehicles or trailers by one corporation or limited liability
1309		-	company to another when all of the assets of such corporation or
1310		-	limited liability company are transferred to such other corporation or House Substitute for SENATE BILL No. 37—page 23
1311		-	limited liability company; or (3) the sale of motor vehicles or trailers
1312		-	which are subject to taxation pursuant to the provisions of K.S.A. 79-
1313		-	5101 et seq., and amendments thereto, by an immediate family member
1314		-	to another immediate family member. For the purposes of paragraph
1315		-	(3), immediate family member means lineal ascendants or descendants,
1316		-	and their spouses. Any amount of sales tax paid pursuant to the Kansas
1317		-	retailers sales tax act on the isolated or occasional sale of motor
1318		-	vehicles or trailers on and after July 1, 2004, which the base for
1319		-	computing the tax was the value pursuant to K.S.A. 79-5105(a), (b)(1)
1320		-	and (b)(2), and amendments thereto, when such amount was higher
1321		-	than the amount of sales tax which would have been paid under the law
1322		-	as it existed on June 30, 2004, shall be refunded to the taxpayer
1323		-	pursuant to the procedure prescribed by this section. Such refund shall
1324		-	be in an amount equal to the difference between the amount of sales tax
1325		-	paid by the taxpayer and the amount of sales tax which would have
1326		-	been paid by the taxpayer under the law as it existed on June 30, 2004.
1327		-	Each claim for a sales tax refund shall be verified and submitted not
1328		-	later than six months from the effective date of this act to the director
1329		-	of taxation upon forms furnished by the director and shall be
1330		-	accompanied by any additional documentation required by the director.
1331		-	The director shall review each claim and shall refund that amount of
1332		-	tax paid as provided by this act. All such refunds shall be paid from the
1333		-	sales tax refund fund, upon warrants of the director of accounts and
1334		-	reports pursuant to vouchers approved by the director of taxation or the
1335		-	director's designee. No refund for an amount less than $10 shall be paid
1336		-	pursuant to this act. In determining the base for computing the tax on
1337		-	such isolated or occasional sale, the fair market value of any motor
1338		-	vehicle or trailer traded in by the purchaser to the seller may be
1339		-	deducted from the selling price;
1340		-	(p) the gross receipts received for the service of installing or
1341		-	applying tangible personal property which when installed or applied is
1342		-	not being held for sale in the regular course of business, and whether or
1343		-	not such tangible personal property when installed or applied remains
1344		-	tangible personal property or becomes a part of real estate, except that
1345		-	no tax shall be imposed upon the service of installing or applying
1346		-	tangible personal property in connection with the original construction
1347		-	of a building or facility, the original construction, reconstruction,
1348		-	restoration, remodeling, renovation, repair or replacement of a
1349		-	residence or the construction, reconstruction, restoration, replacement
1350		-	or repair of a bridge or highway.
1351		-	For the purposes of this subsection:
1352		-	(1) "Original construction" means the first or initial construction
1353		-	of a new building or facility. The term "original construction" shall
1354		-	include the addition of an entire room or floor to any existing building
1355		-	or facility, the completion of any unfinished portion of any existing
1356		-	building or facility and the restoration, reconstruction or replacement of
1357		-	a building, facility or utility structure damaged or destroyed by fire,
1358		-	flood, tornado, lightning, explosion, windstorm, ice loading and
1359		-	attendant winds, terrorism or earthquake, but such term, except with
1360		-	regard to a residence, shall not include replacement, remodeling,
1361		-	restoration, renovation or reconstruction under any other
1362		-	circumstances;
1363		-	(2) "building" means only those enclosures within which
1364		-	individuals customarily are employed, or which are customarily used to
1365		-	house machinery, equipment or other property, and including the land
1366		-	improvements immediately surrounding such building;
1367		-	(3) "facility" means a mill, plant, refinery, oil or gas well, water
1368		-	well, feedlot or any conveyance, transmission or distribution line of any
1369		-	cooperative, nonprofit, membership corporation organized under or House Substitute for SENATE BILL No. 37—page 24
1370		-	subject to the provisions of K.S.A. 17-4601 et seq., and amendments
1371		-	thereto, or municipal or quasi-municipal corporation, including the land
1372		-	improvements immediately surrounding such facility;
1373		-	(4) "residence" means only those enclosures within which
1374		-	individuals customarily live;
1375		-	(5) "utility structure" means transmission and distribution lines
1376		-	owned by an independent transmission company or cooperative, the
1377		-	Kansas electric transmission authority or natural gas or electric public
1378		-	utility; and
1379		-	(6) "windstorm" means straight line winds of at least 80 miles per
1380		-	hour as determined by a recognized meteorological reporting agency or
1381		-	organization;
1382		-	(q) the gross receipts received for the service of repairing,
1383		-	servicing, altering or maintaining tangible personal property which
1384		-	when such services are rendered is not being held for sale in the regular
1385		-	course of business, and whether or not any tangible personal property is
1386		-	transferred in connection therewith. The tax imposed by this subsection
1387		-	shall be applicable to the services of repairing, servicing, altering or
1388		-	maintaining an item of tangible personal property which has been and
1389		-	is fastened to, connected with or built into real property;
1390		-	(r) the gross receipts from fees or charges made under service or
1391		-	maintenance agreement contracts for services, charges for the providing
1392		-	of which are taxable under the provisions of subsection (p) or (q);
1393		-	(s) on and after January 1, 2005, the gross receipts received from
1394		-	the sale of prewritten computer software and the sale of the services of
1395		-	modifying, altering, updating or maintaining prewritten computer
1396		-	software, whether the prewritten computer software is installed or
1397		-	delivered electronically by tangible storage media physically
1398		-	transferred to the purchaser or by load and leave;
1399		-	(t) the gross receipts received for telephone answering services;
1400		-	(u) the gross receipts received from the sale of prepaid calling
1401		-	service and prepaid wireless calling service as defined in K.S.A. 79-
1402		-	3673, and amendments thereto;
1403		-	(v) all sales of bingo cards, bingo faces and instant bingo tickets
1404		-	by licensees under K.S.A. 75-5171 et seq., and amendments thereto,
1405		-	shall be exempt from taxes imposed pursuant to this section;
1406		-	(w) all sales of charitable raffle tickets in accordance with K.S.A.
1407		-	75-5171 et seq., and amendments thereto, shall be exempt from taxes
1408		-	imposed pursuant to this section; and
1409		-	(x) commencing on January 1, 2023, and thereafter, the state rate
1410		-	on the gross receipts from the sale of food and food ingredients shall be
1411		-	as set forth in K.S.A. 2023 Supp. 79-3603d, and amendments thereto.
1412		-	Sec. 20. K.S.A. 2023 Supp. 79-3603d is hereby amended to read
1413		-	as follows: 79-3603d. (a) There is hereby levied and there shall be
1414		-	collected and paid a tax upon the gross receipts from the sale of food
1415		-	and food ingredients. The rate of tax shall be as follows:
1416		-	(1) Commencing on January 1, 2023, at the rate of 4%;
1417		-	(2) commencing on January 1, 2024, at the rate of 2%; and
1418		-	(3) commencing on January 1, 2025 July 1, 2024, and thereafter,
1419		-	at the rate of 0%.
1420		-	(b) The provisions of this section shall not apply to prepared food
1421		-	unless sold without eating utensils provided by the seller and described
1422		-	below:
1423		-	(1) Food sold by a seller whose proper primary NAICS
1424		-	classification is manufacturing in sector 311, except subsector 3118
1425		-	(bakeries);
1426		-	(2) (A) food sold in an unheated state by weight or volume as a
1427		-	single item; or
1428		-	(B) only meat or seafood sold in an unheated state by weight or House Substitute for SENATE BILL No. 37—page 25
1429		-	volume as a single item;
1430		-	(3) bakery items, including bread, rolls, buns, biscuits, bagels,
1431		-	croissants, pastries, donuts, danish, cakes, tortes, pies, tarts, muffins,
1432		-	bars, cookies and tortillas; or
1433		-	(4) food sold that ordinarily requires additional cooking, as
1434		-	opposed to just reheating, by the consumer prior to consumption.
1435		-	(c) The provisions of this section shall be a part of and
1436		-	supplemental to the Kansas retailers' sales tax act.
1437		-	Sec. 21. K.S.A. 2023 Supp. 79-3620 is hereby amended to read as
1438		-	follows: 79-3620. (a) All revenue collected or received by the director
1439		-	of taxation from the taxes imposed by this act shall be remitted to the
1440		-	state treasurer in accordance with the provisions of K.S.A. 75-4215,
1441		-	and amendments thereto. Upon receipt of each such remittance, the
1442		-	state treasurer shall deposit the entire amount in the state treasury, less
1443		-	amounts withheld as provided in subsection (b) and amounts credited
1444		-	as provided in subsections (c), (d) and (e), to the credit of the state
1445		-	general fund.
1446		-	(b) A refund fund, designated as "sales tax refund fund" not to
1447		-	exceed $100,000 shall be set apart and maintained by the director from
1448		-	sales tax collections and estimated tax collections and held by the state
1449		-	treasurer for prompt payment of all sales tax refunds. Such fund shall
1450		-	be in such amount, within the limit set by this section, as the director
1451		-	shall determine is necessary to meet current refunding requirements
1452		-	under this act. In the event such fund as established by this section is, at
1453		-	any time, insufficient to provide for the payment of refunds due
1454		-	claimants thereof, the director shall certify the amount of additional
1455		-	funds required to the director of accounts and reports who shall
1456		-	promptly transfer the required amount from the state general fund to the
1457		-	sales tax refund fund, and notify the state treasurer, who shall make
1458		-	proper entry in the records.
1459		-	(c) (1) On January 1, 2023, the state treasurer shall credit 17% of
1460		-	the revenue collected and received from the tax imposed by K.S.A. 79-
1461		-	3603, and amendments thereto, at the rates provided in K.S.A. 79-3603,
1462		-	and amendments thereto, and K.S.A. 2023 Supp. 79-3603d, and
1463		-	amendments thereto, and deposited as provided by subsection (a),
1464		-	exclusive of amounts credited pursuant to subsection (d), in the state
1465		-	highway fund.
1466		-	(2) On January 1, 2025 July 1, 2024, and thereafter, the state
1467		-	treasurer shall credit 18% of the revenue collected and received from
1468		-	the tax imposed by K.S.A. 79-3603, and amendments thereto, at the
1469		-	rates provided in K.S.A. 79-3603, and amendments thereto, and K.S.A.
1470		-	2023 Supp. 79-3603d, and amendments thereto, and deposited as
1471		-	provided by subsection (a), exclusive of amounts credited pursuant to
1472		-	subsection (d), in the state highway fund.
1473		-	(d) The state treasurer shall credit all revenue collected or received
1474		-	from the tax imposed by K.S.A. 79-3603, and amendments thereto, as
1475		-	certified by the director, from taxpayers doing business within that
1476		-	portion of a STAR bond project district occupied by a STAR bond
1477		-	project or taxpayers doing business with such entity financed by a
1478		-	STAR bond project as defined in K.S.A. 12-17,162, and amendments
1479		-	thereto, that was determined by the secretary of commerce to be of
1480		-	statewide as well as local importance or will create a major tourism
1481		-	area for the state or the project was designated as a STAR bond project
1482		-	as defined in K.S.A. 12-17,162, and amendments thereto, to the city
1483		-	bond finance fund, which fund is hereby created. The provisions of this
1484		-	subsection shall expire when the total of all amounts credited hereunder
1485		-	and under K.S.A. 79-3710(d), and amendments thereto, is sufficient to
1486		-	retire the special obligation bonds issued for the purpose of financing
1487		-	all or a portion of the costs of such STAR bond project. House Substitute for SENATE BILL No. 37—page 26
1488		-	(e) All revenue certified by the director of taxation as having been
1489		-	collected or received from the tax imposed by K.S.A. 79-3603(c), and
1490		-	amendments thereto, on the sale or furnishing of gas, water, electricity
1491		-	and heat for use or consumption within the intermodal facility district
1492		-	described in this subsection, shall be credited by the state treasurer to
1493		-	the state highway fund. Such revenue may be transferred by the
1494		-	secretary of transportation to the rail service improvement fund
1495		-	pursuant to law. The provisions of this subsection shall take effect upon
1496		-	certification by the secretary of transportation that a notice to proceed
1497		-	has been received for the construction of the improvements within the
1498		-	intermodal facility district, but not later than December 31, 2010, and
1499		-	shall expire when the secretary of revenue determines that the total of
1500		-	all amounts credited hereunder and pursuant to K.S.A. 79-3710(e), and
1501		-	amendments thereto, is equal to $53,300,000, but not later than
1502		-	December 31, 2045. Thereafter, all revenues shall be collected and
1503		-	distributed in accordance with applicable law. For all tax reporting
1504		-	periods during which the provisions of this subsection are in effect,
1505		-	none of the exemptions contained in K.S.A. 79-3601 et seq., and
1506		-	amendments thereto, shall apply to the sale or furnishing of any gas,
1507		-	water, electricity and heat for use or consumption within the intermodal
1508		-	facility district. As used in this subsection, "intermodal facility district"
1509		-	shall consist of an intermodal transportation area as defined by K.S.A.
1510		-	12-1770a(oo), and amendments thereto, located in Johnson county
1511		-	within the polygonal-shaped area having Waverly Road as the eastern
1512		-	boundary, 191
1513		-	st
1514		-	Street as the southern boundary, Four Corners Road as
1515		-	the western boundary, and Highway 56 as the northern boundary, and
1516		-	the polygonal-shaped area having Poplar Road as the eastern boundary,
1517		-	183
1518		-	rd
1519		-	Street as the southern boundary, Waverly Road as the western
1520		-	boundary, and the BNSF mainline track as the northern boundary, that
1521		-	includes capital investment in an amount exceeding $150 million for
1522		-	the construction of an intermodal facility to handle the transfer, storage
1523		-	and distribution of freight through railway and trucking operations.
1524		-	Sec. 22. K.S.A. 2023 Supp. 79-3703 is hereby amended to read as
1525		-	follows: 79-3703. (a) There is hereby levied and there shall be collected
1526		-	from every person in this state a tax or excise for the privilege of using,
1527		-	storing, or consuming within this state any article of tangible personal
1528		-	property. Such tax shall be levied and collected in an amount equal to
1529		-	the consideration paid by the taxpayer multiplied by the rate of 6.5%.
1530		-	(b) Commencing on January 1, 2023, and thereafter, the state rate
1531		-	on the amount equal to the consideration paid by the taxpayer from the
1532		-	sale of food and food ingredients as provided in K.S.A. 79-3603, and
1533		-	amendments thereto, shall be as set forth in K.S.A. 2023 Supp. 79-
1534		-	3603d, and amendments thereto.
1535		-	(c) On and after January 1, 2023, 17% and on and after January 1,
1536		-	2025 July 1, 2024, 18% of the tax rate imposed pursuant to this section
1537		-	and the rate provided in K.S.A. 2023 Supp. 79-3603d, and amendments
1538		-	thereto, shall be levied for the state highway fund, the state highway
1539		-	fund purposes and those purposes specified in K.S.A. 68-416, and
1540		-	amendments thereto, and all revenue collected and received from such
1541		-	tax levy shall be deposited in the state highway fund.
1542		-	(d) Within a redevelopment district established pursuant to K.S.A.
1543		-	74-8921, and amendments thereto, there is hereby levied and there shall
1544		-	be collected and paid an additional tax of 2% until the earlier of: (1)
1545		-	The date the bonds issued to finance or refinance the redevelopment
1546		-	project undertaken in the district have been paid in full; or (2) the final
1547		-	scheduled maturity of the first series of bonds issued to finance the
1548		-	redevelopment project.
1549		-	(e) All property purchased or leased within or without this state
1550		-	and subsequently used, stored or consumed in this state shall be subject House Substitute for SENATE BILL No. 37—page 27
1551		-	to the compensating tax if the same property or transaction would have
1552		-	been subject to the Kansas retailers' sales tax had the transaction been
1553		-	wholly within this state.
1554		-	Sec. 23. K.S.A. 2023 Supp. 79-3710 is hereby amended to read as
1555		-	follows: 79-3710. (a) All revenue collected or received by the director
1556		-	under the provisions of this act shall be remitted to the state treasurer in
1557		-	accordance with the provisions of K.S.A. 75-4215, and amendments
1558		-	thereto. Upon receipt of each such remittance, the state treasurer shall
1559		-	deposit the entire amount in the state treasury, less amounts set apart as
1560		-	provided in subsection (b) and amounts credited as provided in
1561		-	subsection (c), (d) and (e), to the credit of the state general fund.
1562		-	(b) A revolving fund, designated as "compensating tax refund
1563		-	fund" not to exceed $10,000 shall be set apart and maintained by the
1564		-	director from compensating tax collections and estimated tax
1565		-	collections and held by the state treasurer for prompt payment of all
1566		-	compensating tax refunds. Such fund shall be in such amount, within
1567		-	the limit set by this section, as the director shall determine is necessary
1568		-	to meet current refunding requirements under this act.
1569		-	(c) (1) On January 1, 2023, the state treasurer shall credit 17% of
1570		-	the revenue collected and received from the tax imposed by K.S.A. 79-
1571		-	3703, and amendments thereto, at the rates provided in K.S.A. 79-3703,
1572		-	and amendments thereto, and K.S.A. 2023 Supp. 79-3603d, and
1573		-	amendments thereto, and deposited as provided by subsection (a),
1574		-	exclusive of amounts credited pursuant to subsection (d), in the state
1575		-	highway fund.
1576		-	(2) On January 1, 2025 July 1, 2024, and thereafter, the state
1577		-	treasurer shall credit 18% of the revenue collected and received from
1578		-	the tax imposed by K.S.A. 79-3703, and amendments thereto, at the
1579		-	rates provided in K.S.A. 79-3703, and amendments thereto, and K.S.A.
1580		-	2023 Supp. 79-3603d, and amendments thereto, and deposited as
1581		-	provided by subsection (a), exclusive of amounts credited pursuant to
1582		-	subsection (d), in the state highway fund.
1583		-	(d) The state treasurer shall credit all revenue collected or received
1584		-	from the tax imposed by K.S.A. 79-3703, and amendments thereto, as
1585		-	certified by the director, from taxpayers doing business within that
1586		-	portion of a redevelopment district occupied by a redevelopment
1587		-	project that was determined by the secretary of commerce to be of
1588		-	statewide as well as local importance or will create a major tourism
1589		-	area for the state as defined in K.S.A. 12-1770a, and amendments
1590		-	thereto, to the city bond finance fund created by K.S.A. 79-3620(d),
1591		-	and amendments thereto. The provisions of this subsection shall expire
1592		-	when the total of all amounts credited hereunder and under K.S.A. 79-
1593		-	3620(d), and amendments thereto, is sufficient to retire the special
1594		-	obligation bonds issued for the purpose of financing all or a portion of
1595		-	the costs of such redevelopment project.
1596		-	This subsection shall not apply to a project designated as a special
1597		-	bond project as defined in K.S.A. 12-1770a(z), and amendments
1598		-	thereto.
1599		-	(e) All revenue certified by the director of taxation as having been
1600		-	collected or received from the tax imposed by K.S.A. 79-3603(c), and
1601		-	amendments thereto, on the sale or furnishing of gas, water, electricity
1602		-	and heat for use or consumption within the intermodal facility district
1603		-	described in this subsection, shall be credited by the state treasurer to
1604		-	the state highway fund. Such revenue may be transferred by the
1605		-	secretary of transportation to the rail service improvement fund
1606		-	pursuant to law. The provisions of this subsection shall take effect upon
1607		-	certification by the secretary of transportation that a notice to proceed
1608		-	has been received for the construction of the improvements within the
1609		-	intermodal facility district, but not later than December 31, 2010, and House Substitute for SENATE BILL No. 37—page 28
1610		-	shall expire when the secretary of revenue determines that the total of
1611		-	all amounts credited hereunder and pursuant to K.S.A. 79-3620(e), and
1612		-	amendments thereto, is equal to $53,300,000, but not later than
1613		-	December 31, 2045. Thereafter, all revenues shall be collected and
1614		-	distributed in accordance with applicable law. For all tax reporting
1615		-	periods during which the provisions of this subsection are in effect,
1616		-	none of the exemptions contained in K.S.A. 79-3601 et seq., and
1617		-	amendments thereto, shall apply to the sale or furnishing of any gas,
1618		-	water, electricity and heat for use or consumption within the intermodal
1619		-	facility district. As used in this subsection, "intermodal facility district"
1620		-	shall consist of an intermodal transportation area as defined by K.S.A.
1621		-	12-1770a(oo), and amendments thereto, located in Johnson county
1622		-	within the polygonal-shaped area having Waverly Road as the eastern
1623		-	boundary, 191
1624		-	st
1625		-	Street as the southern boundary, Four Corners Road as
1626		-	the western boundary, and Highway 56 as the northern boundary, and
1627		-	the polygonal-shaped area having Poplar Road as the eastern boundary,
1628		-	183
1629		-	rd
1630		-	Street as the southern boundary, Waverly Road as the western
1631		-	boundary, and the BNSF mainline track as the northern boundary, that
1632		-	includes capital investment in an amount exceeding $150 million for
1633		-	the construction of an intermodal facility to handle the transfer, storage
1634		-	and distribution of freight through railway and trucking operations.
1635		-	Sec. 24. K.S.A. 2023 Supp. 79-3603, 79-3603d, 79-3620, 79-3703
1636		-	and 79-3710 are hereby repealed.
1637		-	Sec. 25. On and after July 1, 2024, K.S.A. 19-2694, 65-163j, 65-
1638		-	3306, 65-3327, 75-2556, 79-1107, 79-1108, 79-1479, 79-2960, 79-
1639		-	2961, 79-2962, 79-2965, 79-2966 and 79-2967 and K.S.A. 2023 Supp.
1640		-	72-5142, 74-8768, 79-201x, 79-2959, 79-2964, 79-2988, 79-32,110,
1641		-	79-32,117, 79-32,119 and 79-32,121 are hereby repealed. House Substitute for SENATE BILL No. 37—page 29
1642		-	Sec. 26. This act shall take effect and be in force from and after its
1643		-	publication in the Kansas register.
1644		-	I hereby certify that the above BILL originated in the
1645		-	SENATE, and passed that body
1646		-	__________________________
1647		-	SENATE adopted
1648		-	Conference Committee Report ________________
1649		-	_________________________
1650		-	President of the Senate.
1651		-	_________________________
1652		-	Secretary of the Senate.
1653		-
1654		-	Passed the HOUSE
1655		-	as amended _________________________
1656		-	HOUSE adopted
1657		-	Conference Committee Report ________________
1658		-	_________________________
1659		-	Speaker of the House.
1660		-	_________________________
1661		-	Chief Clerk of the House.
1662		-	APPROVED _____________________________
1663		-	_________________________
1664		-	Governor.
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