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What is the Kansas Chamber of Commerce Hiding?

Wed ,13/07/2022

” The answer is, “The Truth”.

Many high-profile disasters such as the Challenger explosion, the Deepwater Horizon debacle, and the Chevrolet Corvair which asphyxiated its passengers, can be traced to a failure of ethics. For Kansans who value people’s rights, healthcare, the environment, fiscal responsibility, lower food taxes, fair courts, and good schools – the 2021/2022 legislative session was an unmitigated disaster. The ethics failure that made it all possible was that of the Kansas Chamber of Commerce (KCC). In the 2020 election, they used unethical tactics to purge the legislature of moderates, leaving a supermajority of Republicans and far right extremists.

Two core values of the KCC are to be ethical in all that the Chamber advocates for and does, and to be passionate about the economic growth of Kansas and its people. However, the KCC is not passionate about the economic prosperity of all Kansans or all businesses as the KCC does not represent the small businesses in Kansas well. Those businesses are embedded in their communities and tax cuts take money away from things they value: roads, schools, hospitals, healthcare, and social services. This caused many local chambers of commerce to become disgusted with the KCC. As the Junction City Chamber of Commerce explained: “So when the Kansas Chamber decides to endorse a tax policy that only benefits very large industries… it just stands to reason that that tax policy is not a fit for most of their members.”

Under the leadership of CEO Alan Cobb, the KCC has increasingly aligned itself with Americans for Prosperity (AFP), which favors the prosperity of the already wealthy. That is not surprising, as Mr. Cobb once managed Government Affairs for Koch Industries and he later founded the AFP organization in Kansas. Not only does the KCC now favor the wealthy, but it has acquired questionable ethics.

After the 2020 elections, Don Hineman, past Majority Leader of the Kansas House, wrote an article, What is the Kansas Chamber of Commerce Hiding? Alan Cobb had recently claimed the Chamber’s political endorsements are 100% fact-based. Representative Hineman disagreed, writing “That is not the whole truth, and in some cases, it is an outright lie. Besides endorsements, the KCC sends out postcards that demonize the incumbent legislators they want to defeat. One of their most damaging postcards claims the targeted legislator voted to ‘retroactively raise our state taxes by $1.2 billion’. The card implies that, if re-elected, they would vote to raise your taxes. That is wrong, but it is only part of the story. That $1.2 billion tax increase, which passed in 2017, was deemed necessary by more than 2/3 of the Kansas Senate and 2/3 of the Kansas House. It was passed to correct earlier tax cuts that had devastated the state’s finances.”

He continued, “The state would have gone broke unless the tax increase passed. Most of the Republican Leadership and many staunch Republicans voted for the bill. However, the KCC is not targeting ALL the legislators who voted for the tax increase. The KCC’s leaders have mastered the craft of appearing unbiased and truthful when they are not. They are selectively targeting the independent-minded incumbents who do not obediently go along with whatever the Chamber wants.” My constituents received this card, even though I wasn’t even in the legislature then. So much for “100% fact-based”.

One thing the KCC really wanted was an additional tax cut for corporations who had repatriated intellectual property hidden offshore, even though those corporations had already received a lower Federal tax rate. The Republican leadership was happy to comply. They passed a tax bill which would have cost the state about $600 million over the next three years, most of that going to large corporations. The Governor vetoed it. Several moderate Republicans joined the Democrats in sustaining the veto, even though they had received severe arm twisting from the Republican leadership. One of the moderates spoke on the House floor, “We teach our children not to be bullies, yet the leadership is trying to bully us into voting for this bad bill “. He went on to explain how people had died on roads in his district because there wasn’t money to repair them, and how the state needed many things it couldn’t afford because of tax previous cuts. After the veto was upheld, the disappointed corporations proceeded to “Postcard” that legislator, flooding his district with postcards attacking him, until he had had enough and resigned in the middle of his term, citing stress as the reason.

In the next election, the KCC and AFP ran a smear campaign against many of the moderate Republicans who had voted to sustain the veto. They sent out dozens of postcards demonizing them, distorting their positions, misquoting them, and using misleading photoshopped pictures. The postcards were lies and bullying at its worst, but there was little the moderate candidates could do as political lies are considered protected speech. The negative campaigning worked, and the number of moderate Republicans in the legislature went from about thirty to just five. In the next session, the KCC got the tax cut they wanted, and Kansas is now suffering the disastrous consequences.

This article is specific to Kansas, but If your state has a chapter of Americans for Prosperity or a state Chamber of Commerce like the KCC, then you should try to to elect independent-minded legislators who will vote for legislation in the best interest of the average citizens. There is really no requirement for being a Chamber of Commerce. The Kansas City Greater Chamber of Commerce takes great pains to be sure they are not confused with the KCC.

Please note: This article was taken from one published in the Kansas Reflector at https://kansasreflector.com/2022/05/25/where-did-the-kansas-legislatures-moderates-go-the-kansas-chamber-targeted-them/.

Who Is Responsible for High Electric Rates in Kansas?

Tue ,15/03/2022

“Evergy is responsible for the high electric rates in Kansas, but the Kansas Legislature is to blame for nothing being done about it. “

In 2008, Kansas disbanded the Kansas Energy Council, which sought to take a strategic approach to the development of the state’s energy system. This left the three-member Kansas Corporation Commission (KCC) responsible for regulating electric rates in the state, along with regulating all the other state corporations. Besides being overloaded, the KCC is reactive rather than proactive. That is, Evergy brings their rate requests to the KCC and they decide how much of the rate request is justified. Neither the KCC nor any other state agency is responsible for proactively planning how to develop the electricity needs of the state in such a way as to balance Evergy’s needs with those of the consumers.

Until recently, the KCC had a majority of members who looked unfavorably on renewable energy. Mark Ruelle, past CEO of Evergy, attended an ALEC meeting where a strategy was devised to discourage net energy metering (NEM) customers from installing their own wind turbines or solar panels. The idea was to convince other customers that they were subsidizing NEM customers. That is not true. An independent study in California found that NEM customers provide a benefit both for other ratepayers and for the electric company. NEM customers allow utilities to avoid costs of generation and fuel, maintenance and upgrade of transmission and distribution infrastructure, transmission losses (which account for 7% of losses), capacity purchases, and compliance with renewable energy standards. NEM also reduces peak loads, transmission losses, and the need for new power plants. Similar research studies in Vermont, New York, California, Texas, Missouri, and Nevada also concluded that net metering provided a net positive benefit for utility companies and their customers. Still, the KCC allowed Evergy to impose an extra charge on those customers, even though they are helping to reduce electric rates. That policy was finally struck down by a court ruling which found it discriminatory to charge different rates for NEM customers.

The KCC has been generous with Evergy. Residential customers now pay a customer fee, an electricity fee, a fuel charge, a distribution fee, an environmental fee, an energy efficiency charge, and even Westar’s property taxes. Evergy has submitted 22 rate cases since 2008, and the KCC has allowed rate increases in most of those. In 2008, electricity in Kansas was 7.49 cents per kilowatt-hour but it has since grown to 12.7 cents per kilowatt-hour. That is less than inflation, but still much more than it needs to be. A decision was made by Evergy a decade ago to invest in coal-fired energy production, ignoring environmental concerns. Since then environmental regulations have escalated the costs of operating coal plants. Over 50% of Evergy’s energy is now produced from non-carbon sources, which are much less expensive than coal-fired power plants. Yet Evergy is still running their coal-fired power plants because they can charge more for fuel costs.

In 2019, the Kansas Legislature commissioned London Economics to study why Kansas had higher electric rates than the surrounding states*. Their main findings were that areas that need improvement are:

  • Residential rates of IOUs (investor-owned utilities) are high compared to similarly regulated utilities in regional states;
  • Ratepayers continue to pay for utility investments that are underutilized;
  • IOU cost recovery through surcharges and riders without a comprehensive ratemaking process is contributing to rising costs to ratepayers; and
  • Kansas lacks a mandated IRP ( integrated resource plan), as found in other states.

To correct this the London study offered four near-term recommendations:

  • Adopt a state energy plan;
  • Create a competitive procurement framework and require regulated utilities to submit integrated resource plans at regular intervals;
  • Allow KCC to explore the development of performance-based regulation mechanisms to incentivize efficiency and alignment with customer benefits and state policy objectives; and
  • Establish a framework for the retirement and securitization of assets where cost-benefit analysis demonstrates clear benefits to customers.

In response to the London study, the Governor submitted an Executive Reorganization Order (ERO) to develop a State Energy Plan and create an Independent State Energy Office. This would have given Kansas the ability to proactively plan for our long-term energy needs and to look for ways to decrease our electric rates. EROs routinely go into effect 60 days after submission, unless they are rejected by the legislature. However, when the Governor’s ERO was submitted to the legislature, they voted it down. The Republican majority did not want a Democratic Governor to get credit for creating the office or to be able to appoint members to it.

So there you have it. The legislature spent almost $1 million on the London study, but refused to implement its recommendation because of partisan politics. When your electric bill gets really high next summer, remember who is responsible.

*The Kansas Legislative Research Department has a guide to how electric rates are set and lists the history of legislative action on electric rates. It also contains a summary of the London study.

Partisan Politics Kills People: When Covid Came to Kansas

Tue ,18/01/2022

“Had the United States Republican leaders developed strong guidelines for dealing with Covid 19, the Kansas Legislature would probably have followed them. However, no guidelines were forthcoming, and the pandemic became a partisan political issue. “

Covid-19 first appeared in the United States in January of 2020. It spread rapidly and by early March cases began to appear in Kansas. Two legislators were required to quarantine because they had been exposed to the virus. Governor Kelly declared a state of emergency and issued a series of executive orders designed to keep the virus from spreading. When cases began to appear in Topeka, some members of the Kansas House of Representatives became alarmed. Several of them had health problems that put them at risk. They realized that if they were exposed, the virus would be carried to all parts of Kansas when the legislature adjourned. They decided to pass the budget and adjourn as soon as possible.

To make sure someone was in charge of the virus response when the Legislature was not in session, the House passed a bill giving the Governor emergency powers to manage the virus response until January 2021. The Senate, however, did not want to give that much power to the Governor, saying she might take private property or take your guns away. She could not and would not, but that set up a week of haggling before the Legislature finally passed SB 40 which limited the Governor’s emergency powers. It put a time limit on the emergency declaration and gave the Legislative Coordinating Council, (LCC), whose majority is the Republican Leadership, the right to veto any of the Governor’s emergency orders.

The LCC and the Governor were able to reach acceptable compromises on most issues. However, with Easter coming up, the LCC canceled her executive order that limited the size of gatherings to 10. The Governor sued, and the court ruled she had the power to make decisions under the emergency declaration until April 25th. That prompted the Republican Leadership to call a Special Session to pass legislation to restrict the Governor’s powers. She vetoed it, and there were not enough votes to override her veto. Later, the Governor had to call another Special Session as it was necessary to extend the disaster declaration. There, the legislature passed legislation extending the emergency declaration, but it also gave counties the control of COVID restrictions. The Governor could not veto this, as it would have ended Kansas’s emergency declaration and cost the state billions of dollars in disaster aid. Giving the counties control of the Covid response turned out to be a disaster as many counties refused to enforce public health guidelines.

The Kansas Legislature did not set a good example. Our public health experts said we could stop the spread of Covid by wearing masks, following good hygiene practices, socially distancing, and avoiding mass gatherings. The first Special Session had rules for following those health guidelines, but the Republican leadership did not enforce them. It soon ended up with over 100 legislators, with few wearing masks, packed together in the House chamber. This was in violation of the public health restrictions, but the Republican leaders seemed not to care. By bad example, bad legislation, and inflammatory rhetoric, the Legislative Leadership politicized a public health issue and destroyed Kansas‘s opportunity to contain the virus. Those who complain about damage to the economy and the mental health issues caused by isolation have only the Legislative Leadership to blame. They managed to nullify the Governor’s plan to control the virus in the state, and that has been a disaster. By giving the counties control of the COVID-19 response, Kansas ended up with a patchwork of regulations across the state with 25 counties that followed the public health guidelines and 80 counties that did not.

For example, the Sedgwick County Commissioners immediately voted to relax the health guidelines. The number of Covid cases in Sedgwick County soon grew to over 11,000 with over 130 deaths – and the toll is still increasing. It is now at 75,671 cases with 891 deaths. The virus toll soon grew in Kansas to over 75,000 cases and over 1000 deaths and is now at 500,400 cases with 6,900 deaths. Humans are the virus’ main host, so every case increases the chance of further spread – or even mutation of the virus. This did not have to happen. Our Republican Leadership has shown that they are incapable of keeping us safe.

Vaccines for Covid 19 became available in December of 2020 and were made free to everyone in the United States. Two doses of the vaccine and a booster have proven to be effective in preventing or lessening the severity of Covid 19 and its variants. Booster shots are very important, as they make the vaccines more effective against the Omicron strain of the virus. In spite of effective, free vaccines, the number of cases of Covid in Kansas is still increasing. The partisan battles undertaken by the Kansas legislature have shifted from size restrictions on meetings, mask mandates, testing, and contact tracing – to resisting vaccinations. Though effective vaccines have been available for almost 2 years, over 39% of eligible Kansans still remain unvaccinated.

The Federal government mandated that Federal employees, healthcare workers, and employees in large private businesses either be vaccinated or tested weekly. The Kansas Legislature leaders were so incensed by this that they wanted to call another Special Session in November to discuss how to end the Federal government’s overreach. It is strange that Speaker Ron Rychmann supported this as he had a serious case of Covid in July. Though he kept it a secret and made light of it when discovered, he spent ten days in the hospital and was quite sick. Still, he fought to hold the Special Session with the goal of ending vaccination mandates. The November Special Session required the signatures of two-thirds of the legislators, but with a little help from the Kansas Chamber of Commerce (KCC), they were able to get signatures from all the Republicans. How did that come about?

The 2017 Tax Cuts and Job Act allowed corporations who hid their intellectual assets offshore to bring them back at a reduced tax rate. During the 2019 legislative session, the Kansas Chamber of Commerce thought Kansas businesses that had hidden their assets offshore, should get a Kansas tax cut as well. The bill would have cost the state about $600 million over three years. There was little justification for doing that and it failed as a number of moderate Republicans opposed it. During the 2020 election, the KCC targeted the moderate Republicans and they were purged from the legislature. In 2021, the KCC got the tax it wanted but it had unintended consequences. The purge of moderate Republicans gave a supermajority to the far-right Republican legislators who were opposed to vaccines and public health restrictions. There is little the KCC could have done that would have hurt Kansas and its businesses more.

The Special Session to end Federal vaccine mandates ended up with a compromise bill which the Governor agreed to sign. It allowed employees to opt out of vaccines and required employers to accept medical and religious exemptions without question. If an employee is terminated for refusal to be vaccinated, they may file for unemployment. Employers who deny an exemption request or terminate an employee for not being vaccinated can be fined up to $50,000 per violation. This puts businesses in a tough position as the federal and state requirements are different. This comes in spite of the Republicans’ claimed pro-business stance, and their concerns that the depletion of unemployment funds might cause a tax increase.

Several states, including Kansas, sued the federal government to stop the vaccine mandates. This should have had little chance of success as there are precedents for vaccination mandates. A 1905 Supreme Court ruling, Jacobson v Massachusetts, upheld the state’s right to require vaccinations. Although the ruling only applied to Massachusetts, it made clear that the liberty we enjoy does not give us the right to act to the detriment of others. In December of last year, the Supreme Court refused to hear cases appealing New York’s and Massachusetts’ Covid 19 vaccination mandate for healthcare workers. These decisions reflected a long-standing precedent for upholding the ability of the government to impose mandatory vaccination requirements.

However, in January of 2022, the Supreme Court agreed to hear two cases concerning vaccine mandates, one involving businesses and one involving healthcare workers. If they had followed precedents, the Court would have upheld the mandates. Even the Justices who rely upon originalism should agree. George Washington ordered the Continental Army to be vaccinated against smallpox, and the soldiers complied. However, the Supreme Court upheld mandates for healthcare workers, but not for businesses. This ruling denied OSHA, which is charged with protecting the health of workers, the best way to protect workers from the Covid virus.

Kansas is now in the midst of another surge in Covid cases as the Omicron variant of Covid is spreading in the state. The Governor has just issued another emergency declaration, along with mandates, because the states’ ICU units and emergency rooms are filling up with Covid patients. The 2022 legislative session is just beginning, and we can only hope that the Kansas Legislature and the Governor will put aside partisan politics and form a united front to keep Kansas citizens safe.