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Deckard Cain, Diablo series

What Just Happened?

Nearly as quickly as it started, the 2025 Kansas legislative session has ended. The votes are still being finalized (last Friday’s activities have not yet been published), and it will take a few days for the process to formally publish newly-enacted laws, but we can see the shape and color of things.

• Kansas is now transitioning to a flat tax.

• Kansas also now has a continuous budgeting mechanism.

• Unborn children (the language in the law) qualify for child support and tax deductions.

• The Attorney General’s office has several expanded investigative powers.

• Election laws are more restrictive.

• Citizens will vote on whether to institute direct elections for supreme court justices.

Because the final ink hasn’t yet dried, our data hasn’t yet caught up with Friday’s final actions, so we’re going to focus on the combined impact of two bills: Senate Bill 269, which creates automatic income tax reductions; and Senate Bill 14, which create a continuous budget mechanism. These laws amplify each other, embedding fiscal policies into statutory frameworks that will prove difficult to change.

What are the Automatic Income Tax Reductions?

Senate Bill 269 implements automatic reductions to Kansas income and corporate tax rates whenever state revenues surpass specific inflation-adjusted benchmarks and when sufficient reserves—defined as at least 15% of annual revenue—are maintained in the state's budget stabilization fund. These mandatory tax rate cuts are designed to decrease proportionally across different tax brackets, with most of the benefits falling to higher incomes and corporations.

What is the Continuous Budget Mechanism?

Senate Bill 14 establishes a budget where existing appropriations automatically continue indefinitely unless explicitly changed by the legislature. State budgets persist, unchanged, from year to year unless the legislature decides otherwise; in the context of the current conservative supermajority, you can likely envision what that may look like.

This will be particularly helpful for conservative candidates in 2026, as it’s possible to go through the entire 2026 legislative session now without needing to take any difficult budget votes.

What’s the Combined Effect?

Together, these laws establish rigid statutory budgeting requirements, deeply embedding fiscal policies that could prove challenging to adjust or reverse. Here are five major long-term consequences to these laws.

• Revenue Volatility: By directly tying tax rates to revenue, Kansas has amplified the volatility of its tax structure. Coupled with the continuous budget provision—which automatically extends prior appropriations indefinitely—the state will see inertia in fiscal policy. It will be harder to spend excess revenues during good years, and harder to respond to recessions.

• Long-Term Budget Stability Concerns: The automatic tax cuts work by permanently reducing tax rates whenever revenue exceeds past years. There is no automatic tax increase, however, when the state suffers a shortfall. The revenue formula is frozen in law, and the expense formula is also frozen in law.

• Unequal Benefits and Deepening Inequality: The tax cut structure heavily favors higher earners and large corporations, disproportionately benefiting those least in need of tax relief. Economic inequality may widen significantly.

• Entrenched Political Polarization: The override of Governor Kelly's vetoes underscores a persistent partisan divide in Kansas politics. Republicans likely see these measures as victories for fiscal conservatism and economic liberty, while Democrats and moderate observers may view them as ideological rigidity. By locking in core budget philosophy during a window of supermajority status, the Republican party has essentially extended their mandate for into the future–in ways that will be immune to elections.

• Limited Democratic Recourse: Given the current conservative supermajority, there is effectively no genuine legislative pathway to amend or repeal these laws in the short term. The embedding of fiscal policy in statutory law significantly reduces the flexibility traditionally available through standard budgetary processes and cuts the Governor’s office out.

What Happens Next?

Looking forward, Kansas faces several clear risks and potential pitfalls:

• Recession Vulnerability: Given historical cycles (and current troubles at the national level), an economic downturn within the next few years is likely inevitable. When this happens, we will struggle mightily to respond. It will look and feel like Brownback. This is almost inevitable¹ .

• Declining Public Service Quality: Prolonged restrictions on state funding could lead to gradual degradation in the quality of public education, healthcare, and infrastructure—key determinants of long-term prosperity. This degradation may cause talented individuals and businesses to seek opportunities elsewhere, contributing to a demographic and economic spiral that could be difficult to reverse.

• Entrenched Inequality and Economic Polarization: Continued automatic reductions in progressive taxation, combined with static budgets favoring established interests, will increase disparities. When budgets must be cut in response to revenue shortfalls, schools and healthcare will be the biggest victims.

• Whither School Vouchers? I’m befuddled on this one, as there remains a very expensive shelved proposal to expand private school vouchers. I expect to see it resume its journey in 2026, but how that gets funded with these budget laws enacted I haven’t quite figured out yet.

Recommendations and Call for Vigilance

Given these significant risks, we must remain vigilant and proactive. And we must continue talking about these risks during the quiet months between now and the 2026 election season.

Ultimately, the enactment of these two laws offered short-term political wins for conservative legislators at substantial long-term risk to Kansas’s fiscal health and democratic responsiveness.

Coming Soon: A Full 2025 Teardown

Once the legislative office has fully published the remaining documents and votes from last week, we’ll dig deeper into the rest of the session. Until then, enjoy the break in your inbox!

1  Nothing is truly, 100% inevitable. But this is what I would plan for.