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 Division of the Budget http://budget.kansas.gov
Adam Proffitt, Director Laura Kelly, Governor


February 6, 2023


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 2136 by House Committee on Taxation
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2136 is
respectfully submitted to your committee.
Calculations for Kansas income taxes are based on the Kansas adjusted gross income,
which is calculated by adding or subtracting certain types of income from the federal adjusted
gross income. HB 2136 would allow the following amounts received to be subtracted from income
for Kansas income tax purposes beginning retroactively to tax year 2021:
1. An appraiser’s award or final judgment under the Eminent Domain Procedure Act, if those
amounts are included in federal adjusted gross income of the taxpayer; and
2. Payment from the sale of private property purchased by an authorized entity that would
otherwise be subject to a taking.
The Department of Revenue estimates that HB 2136 would decrease State General Fund
revenues by unknown amounts beginning in FY 2024; however, the reductions in revenues are
estimated to be negligible. The Department of Revenue does not have information on the type of
property that would qualify for this new subtraction modification to accurately estimate the impact
of this bill. If $500,000 is awarded by an appraiser or a final judgement under the Eminent Domain
Procedure Act that is included in the taxpayer’s federal adjusted gross income and using an average
tax rate of 5.0 percent, the bill would reduce tax liability for the taxpayer by $25,000.
The Department indicates that the bill would require $33,530 from the State General Fund
in FY 2024 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
The Honorable Adam Smith, Chairperson
Page 2—HB 2136

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 2136 is not
reflected in The FY 2024 Governor’s Budget Report.


Sincerely,

Adam Proffitt
Director of the Budget

cc: Lynn Robinson, Department of Revenue


Statutes affected:
As introduced: 79-32