SESSION OF 2019
SUPPLEMENTAL NOTE ON HOUSE BILL NO. 2043
As Amended by House Committee on Taxation

Brief*
HB 2043, as amended, would require the Kansas
Insurance Department, Kansas Department of Commerce,
and Kansas Department of Revenue to periodically present to
the appropriate Senate and House committees a review of
certain tax credits, incentives, and sales tax exemptions.

Kansas Insurance Department Review Schedule
The bill would require the Commissioner of Insurance,
on or before February 1 of each year, to present to the
Senate Committee on Financial Institutions and Insurance
and the House Committee on Insurance a review of the
following tax credits, incentives, and sales tax exemptions, by
year:
● In 2020, employee salary credits, business
investment credits, and the Kansas Insurance
Department Service Regulation Fund Credit;
● In 2021, the Health Insurance Association
Assessment Credit, the Small Insurance Company
Credit, and the Property and Casualty Insurance
Guaranty Association Credit; and
● In 2022, the Fire Fighters Relief Fund Credit, the
Fire Marshal Credit, the Life and Health Insurance
Guaranty Association Credit, and the Disabled
Accessibility Credit.
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*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
Kansas Department of Commerce Review Schedule
The bill would require the Secretary of Commerce, on or
before February 1 of each year, to present to the Senate
Committee on Commerce and the House Committee on
Commerce, Labor and Economic Development a review of
the following tax credits, incentives, and sales tax
exemptions, by year:
● In 2020, Sales Tax and Revenue (STAR) Bonds,
the High Performance Incentive Program, and
venture capital investment credits;
● In 2021, the Promoting Employment Across
Kansas (PEAK) Act, Job Creation Fund
expenditures, venture capital investment credits,
and local seed capital pool investment credits, and
● In 2022, Rural Opportunity Zone Credits and
student loans paid, Angel Investor Credits, and
Individual Development Account Program Credits.
Kansas Department of Revenue Review Schedule
The bill would require the Secretary of Revenue, on or
before February 1 of each year, to present to the Senate
Committee on Assessment and Taxation and the House
Committee on Taxation a review of the following tax credits,
incentives, and sales tax exemptions, by year:
● In 2020, the Adoption Credit, the Earned Income
Tax Credit, the Research and Development Credit,
and property tax exemptions;
● In 2021, the Business and Job Development
Credit, the Historic Preservation Credit, the Film
Production Credit, and sales tax exemptions;


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 ● In 2022, the Community Service Contribution
Credit, the Environmental Compliance Credit, the
Assistive Technology Contribution Credit, and the
Low-Income Student Scholarship Credit, and
● In 2023, the tax credit on food purchases, the
Telecommunications Property Tax Credit, and the
Higher Education Differed Maintenance Credit.
The State Historical Society would assist the Kansas
Department of Revenue with the presentation on the
Historical Preservation Credit.

Presentation and Report Requirements
The bill would require the presentations by the Kansas
Insurance Department, Kansas Department of Commerce,
and Kansas Department of Revenue to include:
● A description of the incentive, its history, and its
goals;
● An assessment of the incentive’s design and
administration; and
● An estimate of the incentive’s economic and fiscal
impact.
After the presentations by the Kansas Insurance
Department, Kansas Department of Commerce, and Kansas
Department of Revenue, the Senate and House committees
would report to the Kansas Legislature a summary of each
committee’s findings, conclusions, and recommendations.
The bill would require the committees’ reports to be published
on each respective agency’s website.

Background
The bill was introduced by Representative Gartner.
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 In the hearing held on January 30, 2019, by the House
Committee on Taxation, Representative Gartner testified as a
proponent, stating evaluation is a proven way to improve the
effectiveness of incentives. A representative of the Kansas
Center for Economic Growth submitted written-only
proponent testimony, outlining the three steps that should be
used to evaluate tax incentives.
No opponent or neutral testimony was provided.
The House Committee amended the bill to:
● Allow for unspecified or obsolete credits to be
added or excluded, as requested by committee
chairpersons; and
● Authorize the Kansas Historical Society to assist
the Kansas Department of Revenue in the
presentation of a Historical Preservation Credit.
According to the fiscal note prepared by the Division of
the Budget on the bill, as introduced, Legislative
Administrative Services (LAS) indicated the bill would have a
negligible fiscal effect on LAS to produce reports to
summarize each committee’s findings, conclusions, and
recommendations. The Kansas Department of Commerce,
Kansas Department of Revenue, and Kansas Insurance
Department indicated the bill would have a negligible fiscal
effect on each respective agency.


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