SESSION OF 2024
SUPPLEMENTAL NOTE ON SENATE SUBSTITUTE FOR
HOUSE BILL NO. 2026
As Recommended by Senate Committee on
Assessment and Taxation

Brief*
Senate Sub. for HB 2026 would make various changes
to state fund transfers related to local governments.
The bill would combine, beginning in FY 2026, two
annual transfers of $27.0 million into a single transfer of $54.0
million made on January 15 from the State General Fund to
the Local Ad Valorem Tax Reduction Fund (LAVTRF).
The bill would provide that political subdivisions of the
state are only eligible to receive funds from the LAVTRF
when their ad valorem tax to be levied for the coming year is
equal to or less than the ad valorem tax levied the preceding
year. The amount of the tax to be levied would then be
reduced by the amount of distribution from the LAVTRF.
The bill would authorize political subdivisions to not
participate in distributions from the LAVTRF. Such
distributions that are not used by taxing entities would be
required to be returned to the State Treasurer within 30 days
of receipt by county treasurers.
The bill would also abolish the County and City Revenue
Sharing Fund (CCRSF) and eliminate statutory transfers from
the SGF to the CCRSF and the Special City and County
Highway Fund. All moneys and liabilities of the CCRSF would
be transferred to the SGF.
____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
 [Note: The Special City and County Highway Fund,
which also receives revenue from motor fuels taxes, would
not be abolished by the bill.]

Background
HB 2026 was introduced by Representative Ellis and
concerned the filing of releases for tax warrants. The
provisions were enacted by 2023 HB 2002.
The Senate Committee on Assessment and Taxation
removed the contents of the bill and inserted the amended
contents of SB 536.

SB 536
SB 536 was introduced by the Senate Committee on
Assessment and Taxation at the request of Senator Erickson.
Senate Committee on Assessment and Taxation
In the Senate Committee hearing, written-only
proponent testimony was provided by representatives of
Kansas Association of Realtors and Kansas Policy Institute.
Neutral testimony was provided by a representative of
League of Kansas Municipalities.
Written-only neutral testimony was provided by
representatives of Americans for Prosperity–Kansas and
Kansas Association of Counties.
The Senate Committee amended the bill to change the
LAVTRF transfer to a single $54.0 million transfer and to
insert the provisions eliminating transfers to the CCRSF and
Special City and County Highway Fund and abolishing the
CCRSF.

2- 2026
Fiscal Information
According to the fiscal note prepared by the Division of
the Budget on the bill, as introduced, the bill would have no
fiscal effect unless transfers from the SGF to the LAVTRF,
which have not occurred since FY 2003, are resumed.
Under current law, transfers to the LAVTRF are
scheduled to resume in FY 2026 at $54.0 million. Transfers to
the CCRSF and Special City and County Highway Fund are
also scheduled to resume in FY 2026 at $102.0 million and
$11.5 million, respectively.
The FY 2025 Governor’s Budget Report includes
resuming transfers to the LAVTRF in FY 2025.
Transfers; Local Ad Valorem Tax Reduction Fund; County and City Revenue Sharing
Fund; revenue neutral rate


3- 2026


Statutes affected:
Version 3: 79-1479, 79-2959, 79-2960, 79-2961, 79-2965, 79-2966, 79-2964, 79-3425i