2021 Kansas Legislative Updates
Producer Licensing Bill Passes Senate Committee
Senate Bill 37, the Kansas Insurance Department’s producer licensing bill, passed out of the Senate Financial Institutions & Insurance Committee on Thursday, February 26. Senator Virgil Peck, a licensed life insurance agent, offered four amendments to the bill. All but one amendment failed. The adopted amendment changes the Department’s proposal that codifies a reapplication timeline for an applicant who was denied a license and for a licensee who had had their license revoked. Of those amendments rejected, the most notable would have kept single lines agents, like Senator Peck, at 12 hours of continuing education credits instead of the bill’s proposed increase to 18 hours. Peck indicated he had other amendments, but time ran out before the committee could consider those. We expect Senator Peck will bring the rejected amendments and others if/when the full Senate considers the bill this week. CLICK HERE for the explainer of the amended SB37.
The House two weeks ago passed out HB2074, their producer licensing bill, 123-0 without any amendments. So, unless the full Senate amends SB37 back to its original version, the two chambers will have different positions on this legislation. There are several paths forward for both bills, but the easiest and cleanest way would be for the House to pass out SB37 as it has been amended. That would send the measure to Governor Kelly for her consideration. However, before that can happen, the full Senate must send the bill over this week ahead of the turnaround deadline. We will continue to monitor the bill’s progress and let you know how you can help advocate for its advancement.
In other happenings
Legislative committees were busy this week acting on bills in advance of the turnaround deadline on March 5, 2021. Turnaround is the deadline by which non-exempt bills must pass their house of origin, or those bills are dead for the year. Exempt bills—generally those bills introduced in the tax, federal and state affairs, and budget committees—remain alive if they do not emerge from a committee and pass the full House or Senate. Many non-exempt bills were left on the cutting room floor in the committees this week. Those bills are virtually dead unless legislative leaders “bless” the bill before turnaround day. With first-half committee work done on Friday, February 27, the full House and Senate are scheduled for all-day floor action every day this coming week.
This past week the two chambers began their work to reform the Kansas Emergency Management Act (KEMA). The KEMA, which generally was crafted for natural disasters like floods, fires, and tornados, has come under scrutiny in light of its application during the COVID-19 pandemic. Lawmakers are seeking comprehensive changes to KEMA in the event another pandemic emerges in the future. Many of these proposals would impose limitations on the governor's actions. Governor Kelly and her administration have expressed concern over the proposals saying they would unnecessarily slow response to future emergencies.
An audit released this week shows that the state’s unemployment trust fund was pirated at least $600 million by fraudulent claims. The House commerce committee considered a bill to make changes to the unemployment system and fund. In addition to the structural changes included in the measure, the committee amended the bill with a provision that requires the first $450 million of any new COVID-related federal relief be deposited in the unemployment fund to account for fraudulent claims losses.
Finally, in a press conference with legislative leaders, Attorney General Derek Schmidt revealed his proposal to check the power of state agency rules and regulations. Schmidt asserted that the agencies had been empowered as the "fourth house" of government with their ability to adapt and enforce rules and regulations. He proposed offering a constitutional amendment to voters to allow the legislature to suspend or repeal any agency rule or regulation.
While the weather and energy situation across Kansas dominated the legislature's discussions and practical ability to conduct business during the early part of the week, the 2021 Kansas legislative session continued the march toward a critical looming deadline.
Legislative committees continued working through numerous bills as their deadline for passing out legislation to the full-body before "turnaround." The deadline for bills to pass the house of origin is soon. Next week is the last full week for committees to complete their work before the deadline. The "turnaround" deadline is March 5, 2021. Therefore, the extensive committee work is expected to continue next week.
On the Senate side, committee work increased by including much of the work done by budget subcommittees to be completed by the regular standing committees. Therefore, much of the standard committees' work has focused on making recommendations to agency budgets over the past two weeks. That work will also wrap up by early next week.
There are not many new bills are expected to be introduced in either chamber. Only committees exempt from the bill introduction deadline can introduce bills at this point in the session.
Producer Licensing Bill Passes House
House Bill 2074, the Kansas Insurance Department’s producer licensing bill, passed the full House with a 123-0 margin. The measure passed both the committee and the full House without any amendments. The bill was sent to the Senate, where it was referred to the Senate Financial Institutions & Insurance Committee. As you will recall, KAIA worked diligently with the KID to arrive on legislation that we support and have testified as proponents. KAIA recently testified in support of SB37, the Senate version of the HB2074. That bill was scheduled to be considered for action in the senate committee on Thursday. However, action on the bill was delayed accommodating the drafting of amendments requested by committee members. The Senate may advance a version of the legislation that differs from the House position. If that happens, a conference committee of House and Senate members will negotiate a compromised agreement later in the session.
Auto Liability Insurance Bills Emerge
House Bill 2348, which would modify uninsured and underinsured motorist coverage liability limitations for bodily injury or death, was published this week. Specifically, the bill would prohibit an insurer from reducing the amount of underinsured motorist coverage available for a claim by any payment amount paid by anyone other than the insurer. Also, HB2368, which would increase the minimum policy limit for bodily injury, was published. The bill proposes to increase the minimum bodily injury limit on motorist insurance policies from $50,000 to $100,000. In recent years, these proposals have been paired together in a single bill. The bill did not receive a hearing in the 2019-20 sessions. With a new insurance committee chair and members thought, we may see these bills receive some attention this session or next year.
The Kansas Senate passed SB 22, with a vote of 24-15, a comprehensive tax reduction bill estimated to reduce Kansas revenue by $1 billion over three years. Hours before the vote, the Governor had offered a smaller tax package that the Senate rejected during a debate. SB 22 addresses many aspects of business taxes, provides tax cuts for individuals and has been characterized to restore the economy still struggling from the pandemic. The House of Representatives will now consider the bill.
- An explanation of the bill may be found here.
- Text of the bill may be found
- The fiscal note may be found
- To learn about the Governor’s plan see this.
Kansans continue to struggle with the failed unemployment system administered by the Kansas Department of Labor. The House Commerce, Labor, and Economic Development Committee heard HB 2196, a bill to modernize the state's unemployment computer systems and create additional oversight.
- Copy of the bill may be found here.
- The fiscal note and explanation of the bill may be found
- To review testimony from many representatives of businesses, see here.
- The committee also heard an information briefing on the Governor’s Framework for Growth.
Friday was the last day for non-exempt committees to introduce bills. Technically, this will slow down bill introductions as exempt committee chairs. More generally, each chamber's leadership will likely need to approve most bill introductions from this point forward. Committees will continue to work on many bills as there are effectively only two weeks left for committees to conclude their work before the turnaround deadline.
KAIA Testifies on SB37
Over the past several years, KAIA’s Government Affairs Committee has worked very closely with the Kansas Insurance Department (KID) in their effort to modernize the insurance licensing process. On Tuesday, February 2, KAIA’s Beth Smoller testified at the Senate Financial Institutions and Insurance Committee hearing on SB37. A similar bill passed out of the House Insurance Committee earlier in the week. Last year the Senate committee passed a very similar bill out, but it did not make it to the Senate floor due to the pandemic-shortened session. One primary difference from last year's bill, on which KAIA was neutral, is the CE credit requirement was reduced from 24 to 18 hours, which ultimately allowed KAIA to become a proponent and supportive of what we consider a balanced bill. We encourage members to reach out to their local legislators and encourage them to support SB37.
House and Senate committees continued to work through many different issues over the past week. Committees in both chambers began to work through agency budgets. The Senate announced that many of the budgets will be analyzed in the traditional policy committees. At the same time, the House plans to continue to work the agency budgets through the traditional budget subcommittee process. The budget work will continue through the next week or two as both chambers work toward getting a budget across their respective floors.
The Unemployment Insurance trust fund continued to dominate much of the discussion in the Statehouse throughout the week. The Kansas Department of Labor announced that they had blocked nearly 540,000 fraudulent attempts to log in to file for unemployment in the first 24 hours of operation of an updated system. Kansas has been hit hard with many fraudulent claims for unemployment. Legislators are still trying to wrap their heads around how much money has been distributed to fraudsters. The Governor and her administration have been unable to provide that information to date. It continues to shape up to be one of the most significant issues of this legislative session.
On Monday, Governor Kelly announced her plan to expand Medicaid (Kancare) and provide health insurance for 165,000 Kansans. The proposed legislation also establishes a regulatory framework to make Kansas the 48th state to legalize medical marijuana. The proposed legislation will expand Medicaid to the full 138% Federal Poverty Line at 90% to 10% match from the federal government. Individuals will be required to pay a premium not to exceed $25 per person or $100 per family. It is unclear how the administration plans to link Medicaid with medical marijuana or plan to use any receipts from the drug to offset costs associated with expansion. While the concept of medical marijuana is seemingly growing in popularity among some who currently oppose expansion, we don’t see a path for expansion this session.
Later in the week, Kelly released her administration’s comprehensive economic development and growth plan. The plan, Framework for Growth, outlines some broad plans that focus on talent and innovation to support the state’s workforce. The plan was created through data analysis and input from Kansans, according to the release. The administration touts Framework for Growth as the state’s first comprehensive economic development strategic plan in over 30 years. It is unclear which specific policies or legislation the administration will pursue to accomplish the goals of the plan. FULL REPORT HERE
Finally, the State of Kansas saw a nearly 10% performance increase in total tax collections with $795.8 million collected. That is a 12.8%, or $90.2 million, increase from the estimate. Those collections are $70.4 million, or 9.7%, more than January of Fiscal Year 2020. The Consensus Revenue Estimating Group sharply reduced revenue estimates in the early stages of the COVID-19 pandemic. While the increase above estimates is welcome news, we don’t expect the Governor will warmly embrace any of the current tax bills that the legislature is considering. FULL NUMBERS HERE
The third week of the 2021 Kansas legislative session began to have a more normal feel as committees began slogging through several issues after the first two weeks focused on some of the "big ticket" items from both a policy and political perspective. The constitutional amendment clarifying the state's ability to regulate abortion has now passed both chambers and will head to the voters in August 2022. Additionally, the emergency powers extension related to COVID-19 through the end of March has become law with the Governor's signature. Now the legislature will focus on other items, including analyzing and amending the Governor's budget proposal.
The Kansas Department of Labor's current status dealing with the unemployment insurance trust fund reached a crescendo this week in numerous committees. The Department is under bipartisan legislative scrutiny for not providing adequate communication with both the businesses affected by what appears to be massive fraud and the individuals needing to file legitimate unemployment claims. The Governor announced that the unemployment insurance system would be shut down for a few days over the weekend and next week to make necessary upgrades to eliminate many fraudulent claims. Many statehouse insiders expect this to continue to be a significant discussion issue through the remainder of the legislative session.
The vaccine rollout in Kansas continues to be top of mind as the Kansas Department of Health and Environment once again updated the health committees in each chamber. Most statehouse activity continues to be virtual unless a person/industry is directly involved in the matter being discussed. A vast majority of bills will need to be introduced in the next two weeks as committees begin to accelerate toward the turnaround deadline in early March.
This week, the House and Senate Insurance committees held hearings and moved perfunctory legislation related to annual risk-based capital updates and an update to reinsurance statutes. These measures were introduced and supported by the Kansas Insurance Department (KID).
On January 20, 2021, the House Insurance Committee held a hearing on HB2074, the KID bill updating producer licensing statutes about appointments, fees, licensing, renewal dates, continuing education, suspension, revocation, and denial of licensure and reinstatement. Among others, KAIA and IMA Financial Group testified in support of the bill. You can find the links to the bill brief and other testimonies HERE. The committee has not considered the bill yet. However, we expect the bill will take up action on HB2074 this week. The Senate Insurance Committee is set to hold a hearing on the sister bill, SB37, on Tuesday of this week, and KAIA's Beth Smoller will be providing proponent testimony on behalf of our members.
The 2021 Session kicked off Monday with a lot of questions asked regarding COVID-19 protocols at the Statehouse and acclimating to a hybrid session where attendance at hearings and sessions is only encouraged for those who have a direct interest in the issue being discussed. Legislators, staff, and lobbyists were all trying to figure out how they would adequately do their jobs while the technology to allow virtual monitoring and testimony had fits and starts. There is a lot of angst amongst all involved as the session begins.
Most legislative committees were introductory and informative if they met at all. There will still be a significant amount of informational hearings over the next couple of weeks.
On Tuesday, Governor Kelly offered the first virtual “State of the State” address. In her speech, Kelly mostly avoided partisan fanfare and stuck to the nuts and bolts of what she was proposing for this legislative session. The Governor urged passage of Medicaid expansion, which is highly unlikely to pass with a more conservative legislature sworn in. Kelly also announced she would be pursuing a tax policy that would begin applying sales tax on more purchases made online. She also stated that she would continue to curb transfers from the "bank of KDOT" to the state's general fund.
Following the speech, attention quickly turned to her budget recommendation, which was released the following morning. The budget proposal looked very similar to her proposal last year, including the amortization of KPERS funds. Many of these items, including the amortization plan, met with quick resistance from conservative legislators as they had voted these concepts down last year. The Governor's budget did meet the statutory requirement to have a 7.5% ending balance, but there are likely to be many tweaks as the budget makes its way through the legislative process.
Both the House Appropriations Committee and the Senate Ways and Means Committee began meeting this week to review the Governor's proposed budget and the financial profile of the state. You can find the Governor’s entire budget recommendation at this link.
The Senate Taxation Committee started the session out at a sprint. The committee held a hearing on SB 13. This bill would repeal the property tax lid on local units of government and replace it with a notification procedure for local units of government, excluding K-12 schools, when they will increase spending above the previous year's spending. Kansas Farm Bureau provided testimony in favor of the legislation. The bill was passed out of committee and passed the Senate floor by an overwhelming bipartisan vote of 34-1. The bill is similar to a bill that was vetoed by the Governor last year.
Numerous committees held informational hearings on different aspects of the COVID-19 pandemic. Both chambers also began work on their respective bills that would extend the emergency disaster declaration set to expire on January 26. The bills would extend the declaration through March 31. The Senate's version of the bill passed the full Senate and headed to the House for consideration.
The legislature will begin its work on legislation and the budget. Committees will be holding substantive hearings on actual legislation in the coming week. Specific to the budget, it will be interesting to see how budget committees contend with Kelly’s budget recommendation. Legislative leadership was more than skeptical of Governor Kelly’s budget recommendation, particularly drawing a bright line, once again, on their opposition to the administration's proposal to amortize KPERS.
Access to the Statehouse will be minimal next week, with expected protests and rioting potential due to the Biden inauguration. Lobbyists must have a specific invite from a legislator to access the building. This is just another interesting development in what will likely be an interesting legislative session.
Legislative Hearings. Next week the House Insurance and Pensions Committee will hold a hearing on the Kansas Insurance Department’s Producer Licensing bill. That bill has yet to receive a bill number and is pending referral. But, if all goes as planned, the hearing will be held on Wednesday, January 20. KAIA will be testifying in support of the legislation.
Work Comp Decision. The Kansas Supreme Court on January 8 unanimously reversed the Court of Appeals' 2018 ruling that had found the updated law unconstitutional. In today's opinion, the court ruled that the law does not violate Section 18 of the Kansas Bill of Rights because the use of medical evaluation guidelines only serves as a base for determining compensation, while the law still requires “competent medical evidence.”
In 2013, the legislature amended the Kansas Workers' Compensation Act to require the use of the Sixth Edition of the American Medical Association (AMA) Guides to the Evaluation of Permanent Impairment to rate the impairment of injuries sustained after January 1, 2015. The Kansas Court of Appeals in 2018 had struck down that amendment as unconstitutional, instead of requiring that the Fourth Edition of the AMA Guides, which was in place under the law before the 2013 change, be reinstated going forward.
The Kansas Supreme Court today reversed the Court of Appeals and upheld the updated statute that mandates the use of the 6th Edition
Bills of Interest. Several bills were introduced relating to workers comp, including measures that would: 1) replace prevailing factor standard with a substantial factor standard; 2) amending the not work-related horseplay/fighting provisions, and 3) changing the disqualifying drug impairment presumption and removing the presumption concerning marijuana. These bills are unlikely to receive a hearing, but we will continue to monitor.
The Kansas Legislature convened for its 2021 regular session on January 11. The 2021 edition of the legislature will look different than last year, particularly in the wake of the COVID-19 landscape. Exactly how the legislature navigates the business of running this session is not completely clear and will be tested depending upon the pandemic's status. We know the legislature will be meeting in-person, but committees will be operating in a “hybrid” status, allowing remote participation. Also, all 125 House seats and 40 Senate seats were up for reelection this past year. With retirements and incumbent election losses, the legislature saw over 25% turnover. New legislative leaders, committee chairs, and committee make-up will impact matters, particularly early in the session.
In addition to the many new faces in the statehouse, the Republican grip on control of the legislature grew in the House and became more conservative in both chambers. Republicans enjoy a supermajority in the House and Senate, which provides enough votes to potentially override any veto made by Democrat Governor Laura Kelly. In year three of Governor Kelly’s first term, she has become familiar with contending with a Republican-controlled legislature. The Governor will need to lean on this experience to achieve some of the administration’s policy goals. Otherwise, Kelly will need strong bipartisan support to sustain any veto she makes.
The legislative response to COVID-19 is at the front and center of the 2021 Session. To date, some of Governor Kelly’s methods and recommendations to deal with the pandemic have been met with an icy reception by Republicans in the statehouse. With many of the COVID-related provisions, such as health care provider and business liability protections, set to expire on January 26, Kelly's administration will be challenged in securing continued executive authorities unless a compromise with Republican leaders is made. In the meantime, the legislature is determined to pass an extension of the governmental response to COVID-19 set to expire. In addition to COVID policy, the legislature will face several challenging pieces of legislation, including legislative redistricting, budget adjustments, tax and legal reform, and resolutions to amend the Kansas Constitution on matters related to abortion and judicial selection.
WHAT TO EXPECT THE FIRST WEEK…
As noted above, the session kicks off today, January 11. The first week of every session is mostly organizational as legislators return to Topeka, move into their offices, and hold introductory committee meetings. The House and Senate will gavel in at 2:00 pm, with the swearing-in of all members. The real work will start later in the week when Governor Kelly delivers her State of the State Address remotely to the House and Senate on Tuesday evening. We don't expect her to present many details, but she will paint a broad picture of her agenda. We expect she will focus on her legislative successes from 2020 and their work in response to the pandemic. The Governor will, of course, urge the legislature to work on the other priorities she established in her campaign, such as Medicaid Expansion. The administration will publicly release their budget recommendation to the legislature on Wednesday morning to a joint meeting of the House and Senate budget committees.
Legislative Calendars: Calendars - January 2021 | Kansas State Legislature (kslegislature.org)
There are have been several bills pre-filed by legislators in the House and Senate. In Kansas, like many states, individual lawmakers are permitted to write and submit legislation before the legislative session's official start. These bills are generally pet projects or political statements for the legislator prefiling the legislation. Links to the full list of pre-filed bills are below.
- House Prefiled Bill List: kslegislature.org/li/documents/2021_Prefiled_Bills.pdf
- Senate Prefiled Bill List: 2021_senate_prefiled_bills.pdf (kslegislature.org)
- Speaker – Ron Ryckman Jr. (R-Olathe)
- Speaker Pro Tem – Blaine Finch (R-Ottawa)
- Majority Leader – Dan Hawkins (R-Wichita)
- Assistant Majority Leader – Les Mason (R-McPherson)
- Republican Caucus Chair – Ken Rahjes (R-Agra)
- Republican Caucus Whip – Blake Carpenter (R-Wichita)
- Minority Leader – Tom Sawyer (D-Wichita)
- Assistant Minority Leader – Jason Probst (D-Hutchinson)
- Minority Whip – Stephanie Clayton (D-Overland Park)
- Democrat Caucus Policy Chair – Rui Xu (D-Westwood)
- Democrat Caucus Chair – Barbara Ballard (D-Lawrence)
- Democrat Agenda Chair – Brandon Woodard (D-Lenexa)
- President – Ty Masterson (R-Augusta)
- Vice President – Rick Wilborn (R-McPherson)
- Majority Leader – Gene Suellentrop (R-Wichita)
- Assistant Majority Leader – Larry Alley (R-Winfield)
- Majority Whip – Richard Hilderbrand (R-Galena)
- Minority Leader – Dinah Sykes (D-Lenexa)
- Assistant Minority Leader – Oletha Faust-Goudeau (D-Wichita)
- Minority Whip – Pat Pettey (D-Kansas City)
- Democrat Agenda Chair – Marci Francisco (D-Lawrence)
- Democrat Caucus Chair – Jeff Pittman (D-Leavenworth)
Updated Legislative Rosters and Committee Lists
The Kansas Legislature's website has been updated to include the most current roster of members and committee memberships. The rosters and committee pages provide pertinent information, like contact information and meeting times and locations. Below are links to interest areas that we hope you'll find useful as we kick-off the 2021-22 cycle.
- House Roster: http://kslegislature.org/li/b2021_22/members/csv/house/
- Senate Roster: http://kslegislature.org/li/b2021_22/members/csv/senate/
- Committee Lists: Committees | Kansas State Legislature (kslegislature.org)
2021 Legislative Session Deadlines
The following dates are the deadlines for the introduction and consideration of bills for the 2021 Session, pending adoption as part of the Senate and House of Representatives' Joint Rules.
Monday, February 1
Last day for a member or members to REQUEST bill drafts from Revisor's Office.
Monday, February 8
Last day for non-exempt Committees to REQUEST bill drafts from the Revisor’s Office. NOTE: This is the last day requests for introduction can be on non-exempt committee agendas
Wednesday, February 10
Last day for Individuals to INTRODUCE bills in the originating chamber. NOTE: Bills must be submitted to chamber staff during the daily session for the introduction.
Friday, February 12
Last day for non-exempt Committees to INTRODUCE bills in the originating chamber. NOTE: Bills must be submitted to chamber staff during the daily session for the introduction.
Monday, February 26
Last day for committees to meet before Turnaround Day.
Friday, March 5 (Turnaround Day)
Last day to consider non-exempt bills in House of origin.
Friday, March 26
Last day non-exempt committees can meet, consider bills.
Thursday, March 31
Last day to consider non-exempt bills, not in the originating chamber.
Friday, April 9 (Drop Dead Day)
No bills considered after this date except bills vetoed by the Governor, omnibus appropriations act, and omnibus reconciliations spending limit bill.
Monday, May 3 (Veto Session Begins)
Veto Session where the legislature considers gubernatorial vetoes and puts finishing touches on budget.
Exempt committees: House and Senate Federal and State Affairs, Senate Ways and Means, Senate Assessment and Taxation, House committees on Calendar and Printing, Appropriations, Taxation or select committees of either House when so authorized. Exempt bills are those sponsored by, referred to, or acted upon by an exempt committee.
Exempt bills are those sponsored by, referred to, or acted upon by an exempt committee.
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