Division of the Budget
Landon State Office Building Phone: (785) 296-2436
900 SW Jackson Street, Room 504 adam.c.proffitt@ks.gov
Topeka, KS 66612 http://budget.kansas.gov
Adam C. Proffitt, Director Laura Kelly, Governor
Division of the Budget
January 29, 2025
The Honorable Adam Smith, Chairperson
House Committee on Taxation
300 SW 10th Avenue, Room 346-S
Topeka, Kansas 66612
Dear Representative Smith:
SUBJECT: Fiscal Note for HB 2059 by House Committee on Taxation
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2059 is
respectfully submitted to your committee.
Calculations for Kansas income taxes are based on Kansas adjusted gross income, which
is calculated by adding or subtracting certain types of income from federal adjusted gross income.
HB 2059 would allow the amounts paid during the tax year as a member of a health care sharing
ministry to be subtracted from income for Kansas income tax purposes beginning in tax year 2026.
The bill includes the requirement that the amount paid to the health care sharing ministry be
included in federal adjusted gross income for federal income tax purposes. The bill includes the
requirements to be classified as a health care sharing ministry.
Estimated State Fiscal Effect
FY 2025 FY 2026 FY 2027
Expenditures
State General Fund -- $84,870 --
Fee Fund(s) -- -- --
Federal Fund -- -- --
Total Expenditures -- $84,870 --
Revenues
State General Fund -- ($1,000,000) ($3,400,000)
Fee Fund(s) -- -- --
Federal Fund -- -- --
Total Revenues -- ($1,000,000) ($3,400,000)
FTE Positions -- -- -- The Honorable Adam Smith, Chairperson
Page 2—HB 2059
The Department of Revenue estimates that HB 2059 would reduce State General Fund
revenues by $1.0 million in FY 2026, and by $3.4 million in both FY 2027 and FY 2028. An exact
count of Kansans using health care sharing ministries is not available. To formulate these
estimates, the Department of Revenue reviewed data from the Alliance of Health Care Sharing
Ministries and the Colorado Division of Insurance’s annual count of sharing plans, and estimates
that there are 32,466 Kansans taking part in a health care sharing ministry. Industry data suggests
a typical plan will cost $3,010 a year. At an effective tax rate of 3.5 percent, this would reduce
State General Fund revenues by approximately $3.4 million per tax year. The estimate for FY
2026 includes 30.0 percent of tax year 2026 tax liability. The estimate for FY 2027 includes 70.0
percent of tax year 2026 tax liability and 30.0 percent of tax year 2027 tax liability.
The Department indicates that the bill would require $84,870 from the State General Fund
in FY 2026 to implement the bill and to modify the automated tax system. The required
programming for this bill by itself would be performed by existing staff of the Department of
Revenue. In addition, if the combined effect of implementing this bill and other enacted legislation
exceeds the Department’s programming resources, or if the time for implementing the changes is
too short, additional expenditures for outside contract programmer services beyond the
Department’s current budget may be required. Any fiscal effect associated with HB 2059 is not
reflected in The FY 2026 Governor’s Budget Report.
Sincerely,
Adam C. Proffitt
Director of the Budget
cc: Lynn Robinson, Department of Revenue