25 Apr 2025 Kanas Statehouse Insider – Post Session Update
During the Kansas Legislature’s brief veto session earlier this month, a handful of bills were passed and sent to the Governor for consideration. Because the legislature adjourned sine die on April 11th, there was no opportunity for the legislature to attempt to override any bill that was vetoed by the governor.
Below is a brief update of bill activity following the Veto Session. Next year’s legislative session is scheduled to begin on January 12, 2026.
Single Sales Factor Apportionment of Corporate Income Tax
Governor Laura Kelly signed into law House Bill 2231 concerning Single Sales Factor Apportionment(SSFA) methodology forcorporate income tax. Beginning January 1, 2028, the bill requires all corporations to use a single sales factor apportionment method rather than the current three-factor system. The bill also replaces cost of performance requirements with market-based sourcing. Originally introduced as HB 2336, members of a Tax Conference Committee placed the contents of the bill into a conference committee report on HB 2231. The House and Senate passed the bill during the short Veto Session on April 10, and the bill was then sent to Governor Kelly. Find more details about the bill here: CCR HB 2231.
Kansas Promise Scholarship Program
As introduced, Senate Bill 44 would expand the Kansas promise scholarship programto allowprivate postsecondary educational institutions to participate. In a conference committee, the contents of the bill were placed into CCR on SB 24. After passing the House 76-48, and the Senate 40-0, Governor Kelly vetoed the bill and there was no remaining opportunity for the legislature to override the veto.
Water Program Task Force
CCR on HB 2172 established a water program task force to evaluate the state’s water programs and funding for the water plan. Members of the Task Force are to be appointed by April 30, 2025. The task force will submit an initial report to the Legislature and Governor on or before January 31, 2026, and a final report the following year. The Senate amended the bill through amendments offered by Senator Kenny Titus. The amendments reduced the task force from 23 members down to 12, and removed reference to various stakeholder groups, such as “groundwater management district, water assurance district, or ditch districts.”The Senate also changed the language in paragraph (g)(2) to remove the phrase “an on-going multigenerational promise” and replaced it with “achieve a future supply”. The Senate added a 5-person “water planning work group” that will function as a subcommittee of the Task Force. Members of the work group must have relevant experience with Kansas water issues and will be appointed by June 30, 2025. The work group will review the water resource planning act, KSA 82a-901 et seq, and recommend proposed legislation in the 2026 legislative session to modernize the act, and modernize the state water plan, how the water plan is created, what the water plan should prioritize, and how the water plan should be implemented.
Scrap Metal Theft Reduction Act
As introduced, House Bill 2349 would authorize law enforcement officers to conduct investigations of violations of the scrap metal theft reduction act, and would establish criminal
penalties for certain violations of the act. It would also permit municipalities to enact or enforce ordinances, resolutions and regulations relating to scrap metal that are not in conflict with
the act. In a conference committee between the House and Senate, the contents of the bill were placed into CCR on SB 237. Governor Kelly has signed the bill into law.
Discounted Electric Rates Prohibited for Data Centers
Initially introduced as SB 51, CCR on SB 98 provides sales tax exemptions on purchases made by firms constructing qualified “data centers” in the state. The sales tax exemption applies on purchases made for the development, acquisition, construction, and operation of qualified data centers, such as for land, improvements, buildings, equipment, lease payments, etc. The bill was amended to specifically prohibit the data centers from receiving discounted electric utility rates so that those costs would not be shifted onto other industrial users. On April 24th, Governor Kelly signed the bill into law.
Income Tax Rate Trigger Legislation
Legislation was introduced to add a state revenue growth trigger that would automatically decrease individual and corporate income tax rates when state revenues exceed revenues received in fiscal year 2024. The bill would reduce the two existing individual income tax rates until both individual rates reached 4 percent and would then reduce corporate income tax rates to 4 percent. In a conference committee between the House and Senate, the contents of the bill were placed into CCR on SB 269. After being passed by the House and Senate, Governor Kelly vetoed the bill. During the veto session, the bill was passed into law by a supermajority of the House and Senate overriding the Governor’s veto.
Energy Storage Systems Property Tax Exemption
House Bill 2083 would amend Kansas personal property tax law on machinery and equipment, for new energy storage systems installed after January 1, 2026, by replacing the permanent property tax exemption with a 10-year property tax exemption. Stakeholders of non-utility ESS equipment are working with proponents to ensure thermal heat energy storage equipment would qualify for the new property tax exemption. The House passed the bill 90-29. After receiving a hearing in the Senate Tax Committee, the bill did not advance further.
BOTA Filing Fees
As introduced, Senate Bill 269 would prohibit filing fees paid by a taxpayer, on appeal to the Board of Tax Appeals, when a previous appeal by the taxpayer, for the same property, remains pending before the board. In a House and Senate conference committee, the contents of the bill were placed into CCR HB 2125, which also reauthorizes 1.5 mills to be collected by the state to fund K-21 education. Governor Kelly has signed the bill into law.
Personal Property Tax Exemptions
As introduced, Senate Bill 10 would exempt particular personal property from property taxation, such as ATVs, watercraft, and certain trailers. In a House and Senate conference committee, the contents of the bill were placed into CCR on HB 2231. The bill was then passed unanimously by the Senate, and with strong support in the House (118-4). Governor Kelly signed the bill into law.
County Sales Tax Authority
CCR HB 2275 authorizes the submission of local sales taxes to voters in Finney, Jackson, Pawnee, and Seward counties. Governor Kelly has signed the bill into law.
Prohibiting Guaranteed Income Programs
House Bill 2101 would prohibit cities and counties from adopting an ordinance or enforcing a resolution that establishes or provides for the operation of a guaranteed income program. The bill passed the House (86-37) and the Senate (29-11). On April 10, the bill was allowed to become law without the Governor’s signature.