17 Jan 2026 Kansas Capitol Review – Week One
The 2026 Kansas legislative session began on Monday, Jan. 12 as members of the House of Representatives and Senate returned to Topeka ahead of fall elections where statewide offices and 125 House seats stand for election. Senate President Ty Masterson (R-Andover) and Speaker of the House Dan Hawkins (R-Wichita) gaveled in their respective chambers for what could be the final time as Masterson embarks on a race for governor, while Hawkins is seeking to be elected as the state’s insurance commissioner.
Both chambers look to take advantage of their Republican Party supermajority (88-37 in the House, 31-9 in the Senate) on providing property tax relief. With elections looming, legislative leadership has quickly begun unfurling its plans addressing taxes, embracing the One, Big Beautiful Bill Act signed by President Donald Trump, parental freedom in education, water funding, and tort reform as committees started meeting immediately on Tuesday.
Similarly, in the final year of her two terms, Governor Laura Kelly presided over her final State of the State Address on Tuesday, unveiling the administration’s proposed budget and highlighting fiscal priorities including: water, cell phone policies in schools, mental health and special education. Regarding water policy in particular, the administration is seeking to identify a dedicated long-term funding source.
House Speaker Hawkins provided the GOP rebuttal, stating that legislators are prioritizing Kansans’ cost-of-living affordability through effective policies on taxes and inflation. The two-term speaker praised the legislature’s efforts on its attention to water issues throughout the previous three sessions.
Following the legislature’s opening ceremonies, lawmakers dug in on the committee process to advance the aforementioned policies. A full recap of bills is available below.
Seed Retailer/Wholesaler Registration Fees
KDA has requested introduction of a bill that would increase maximum annual registration fees for seed wholesalers and retailers. The maximum seed wholesaler fee would be increased from $300 to $400, and the maximum seed retailer fee would be increased from $30 to $50. The bill would also institute a $25 fee for failing to timely renew your license. The fees had not been increased for many years. The proposed fees would be used to cover the cost of the seed program.
Pesticide Product Labeling Protections
At the request of the Kansas Agribusiness Retailers Association, legislation was introduced in the House Agriculture Committee to protect EPA-registered pesticide products from tort litigation under claims of insufficient label warning language. The bill has not yet been assigned a bill number, but a hearing is tentatively scheduled for Wed., January 21, at 3:30 pm.
Rural Opportunity Zone Income Tax Credit
A Legislative Audit of the state’s Rural Opportunity Zone economic development program demonstrated that while the program had been used successfully in various sections of the state, the program’s benefits appeared limited. For this reason, there will likely be legislation introduced to either repeal or amend the program.
State Revenue Forecast
Of significant interest this session will be balancing the state budget given the anticipated reduction in state revenues following passage of tax cut legislation (Senate Bill 1) during the 2024 Special Session. As recently as last August, the state had projected deficit of $405 million by the end of FY 2029. In November, however, the state’s Revenue Estimating Group projected a new positive state ending balance of nearly $1.4 billion in Fiscal Year 2029. According to the new budget profile, the state’s ending balance will decrease from $2.3 billion to $1.2 billion in FY 2030 as the state spends more than it takes in over the next few years. Budgetary pencils will continue to be sharpened to reduce the existing $200 million annual budget deficit. On a positive note, a combination of increased federal Medicaid matching funds ($50 million a year for five years) and decreased state spending on education ($160 million less each year for the next five years due to 10,000 fewer students) has righted the state’s financial ship to a large degree. Another positive note is that the state’s Budget Stabilization Fund (our “rainy day fund”) is expected to be just under $2.0 billion by the end of the fiscal year 2029.
Governor’s 2027 Proposed Budget
Governor Kelly’s 2027 proposed budget recommends a 1.6 percent spending increase over the previous year, at $10.8 billion in state general funds expenditures, including the following: full funding of the State Water Plan Fund, including $2.3 million for water quality in the Equus Beds Aquifer, an additional $1.1 million for Water Planning and Project Development, and $870,000 in annual funding for aid to conservation districts. The budget seeks to fully fund K-12 education and increase funding for special education by $50.6 million. The budget provides $2.5 million to fund free lunches for 34,400 Kansas students. The budget allocates $30.9 million for mental health services, $5 million for adult inpatient behavioral health services, $15 million for children’s access to critical health services, $8.6 million to fund the Kansas Blueprint for Literacy, $12.6 million to fund the new Community Support Waiver, $10 million for Technical Assistance Waivers, and funding for a 2.5 percent pay increase for qualifying state employees.
Legal
Legislation will soon be introduced in the Judiciary Committees focused on the prohibition on practice of “jury anchoring” – placing a large damages amount in the jury’s mind in order to be able to negotiate a better final amount later. The bill will also seek to adopt recent changes in the federal rules of evidence in tort litigation.
Upcoming House Water Committee Agenda
Agenda for upcoming meetings of the House Water Committee:
Tuesday, Jan. 20: Update from Kansas Department of Health and Environment, Kathy Gleason, and an Update from Kansas Water Office
Thursday, Jan. 22: Hearings on HB 2424 and HB 2462
State Water Plan Funding
The legislature has increased funding to the state water plan fund by $35 million each year for five years. Last year, the state budget provided state water plan fund appropriations: $2.0 million for High Plains Aquifer partnerships, $2.0 million for streambank stabilization projects, $2.6 million for irrigation technology, $5.3 million for conservation district aid, and $3.1 million for contamination remediation. This year, Governor Kelly says she will seek a comprehensive, long-term, sustainable strategy to fund Kansas water projects. We anticipate additional funding requests from KDA for irrigation technology cost-share grants and increased funding for water structures for inspections and dam rehabilitation cost-share grants. The Kansas Water Authority proposes an increase of $22 million to the state water plan next year to implement water projects and programs.
Notifications for Water Right Changes
KDA has indicated it will seek legislation to amend the notice language requirements on change of use water applications for stakeholders within a certain distance from the water right. House Water Committee Chairman Minnix has indicated he will hold a hearing on the bill soon after it is introduced. The draft language is not yet available. According to the agency, the legislation is intended to do the following: (1) clarify that the agency will notify all surrounding landowners. The agency seeks to notify all surrounding landowners to ensure that all potentially affected residents and water right holders are notified. The current process involves identifying all surrounding water right holders, including domestic well users, many of whom are unregistered. (2) Post a map of the affected areas on the agency website for applications rather than posting the entire application. This is intended to protect privacy while still providing the relevant information for potentially affected water rights holders. (3) Update and delete statutory references that are no longer accurate or necessary.
Water Structures
Last year, KDA introduced HB 2114 to amend the Stream Obstruction Act in various ways. The bill would have allowed the state to provide inspections on a cost for service basis and provide for the certification of non-state entities to perform inspections for the state. The legislation would have created application fees based on hazard class for new construction or modifications. It would also have allowed civil enforcement actions to protect the public. KDA indicates it will introduce a new bill this year.
Pump Installation Contractor License
HB 2424, introduced by Rep. Gary White, would establish a new license requirement for any pump installation contractor and require such pump installation contractor to pass qualification examinations. The bill would also create new record-keeping requirements for licensed pump installation contractors and water well contractors.
Hays and R9 Water Legislation
Rep. Barbara Wasinger (R-Hays) introduced HB 2433 to clarify county authority over the transfer or appropriation of water by placing such authority, except for domestic use, with the chief engineer and water transfer hearing panel. Initially referred to the House Water Committee, the bill was re-referred to the House Committee on Local Government.
Reuse of Treated Water
HB 2462, introduced by Representative Pickert, would require the Secretary of Health and Environment to adopt rules and regulations that allow for the direct and indirect potable reuse of treated wastewater.
Property Tax Relief
Property tax relief is a top priority for Republican legislators in the House and Senate. This week, the Senate Tax Committee held a hearing on SCR 1616, a bill that proposes to amend the Kansas Constitution to limit increases in the assessed value of residential and commercial property (for tax purposes) to no more than 3 percent annually. The bill has broad support from Senate Leadership. As a constitutional question, the bill requires passage by a supermajority of the legislature but does not require the Governor’s signature. If passed by the legislature, the measure would appear as a ballot question on the next statewide ballot and become effective in 2027. Last year, a similar bill was passed by the Senate but did not advance in the House. The Tax Committee will take final action on the bill soon.
Property Tax Rebate
SB 319 would provide a property tax rebate for certain residential or commercial property when such property sells for less than 97 percent of the county appraised value. A hearing is scheduled in the Senate Tax Committee for Wednesday, January 21st.
Expansion of M&E Property Tax Exemption
SB 320 would expand the commercial and industrial machinery and equipment property tax exemption to property transferred into use prior to 2006.
Property Tax Levy Approval
Introduced by Rep. Ken Corbet (R-Topeka) HB 2458 would require certain property tax levies and bond issuances to receive the approval of an elected body or the electorate.
Global Intangible Low-Taxed Income (GILTI)
Legislation is likely to be introduced in Kansas this year decouple the state from on specific portions of the federal code regarding GILTI and NCTI following passage of the federal OBBB. GILTI is a US tax provision aimed at ensuring that US taxpayers pay a minimum level of tax on foreign earnings, particularly those derived from intangible assets. KS tax experts are drafting the bill language. NCTI is the new tax on international income, which is the follow-on from its predecessor (GILTI), which Kansas previously decoupled from. NCTI is intended as a minimum tax and uses foreign tax credits to achieve this. NCTI is far more aggressive than GILTI because states don’t offer tax credits for foreign income. Kansas is one of only four states in line to tax NCTI, even if unintentionally. The proposed legislation would avoid state tax on NCTI.
HPIP Reform
Stakeholder groups worked with legislators over the summer break to draft proposed amendments to the state HPIP economic development program. Legislation is still being finalized but should be ready for introduction soon.
Income Tax Credits
The legislature will seek to repeal existing income tax credits that have gone unused for many years.
Angel Investor Tax Credit
HB 2466 was introduced this week to extend the 2026 sunset on the Angel Investor Tax Credit to 2031.
Grain Theft
Introduced by Rep. Schwertzfeger, HB 2422 would increase the presumptive criminal penalty for theft of at least 400 bushels of grain to a severity level 6, non-person felony. This is a “border-box” penalty allowing either presumptive probation or imprisonment based on the defendant’s criminal history. The bill is scheduled for a hearing in the House Judiciary Committee on Tuesday, January 20, 2026, at 3:30 pm.
Theft of Livestock and Implements of Husbandry
Introduced by Rep. Steele, HB 2413 would increase the presumptive criminal penalty for the theft of livestock or implements of husbandry to a severity level 5, non-person felony, which is presumptive imprisonment. The bill is scheduled for a hearing in the House Judiciary Committee on Tuesday, January 20, 2026, at 3:30 pm.
EV Equity Road Repair Tax
HB 2414 was introduced to establish the stablish the EV energy equity road repair tax act and provide for a road repair tax on electricity distributed from a public charging station for electric vehicles.
Shortline Income Tax Credit
HB 2469 was introduced this week to expand the transferability of the existing income tax credit for qualified shortline railroad track maintenance expenditures.
Food Ingredient Restrictions
HB 2425, introduced by Rep. Kevin Schwertzfeger, would amend the Kansas Food, Drug, and Cosmetic Act (KSA 65-657, et seq) to cause foods containing specific color dyes and additives to be deemed adulterated. The bill increases the maximum civil penalties under the act to $500,000 per violation for the adulteration of a drug or device with any “poisonous or deleterious substance”. The bill also would make adulteration of a drug with a synthetic color additive subject to sentencing as a drug severity level 5 felony. Specifically, House Bill 2425 (page 5, line 6) states that “A food shall be deemed to be adulterated if: such food is, bear, or contains:” Butylated hydroxyanisole; Propylparaben; FD&C blue No. 1; FD&C blue no. 2; FD&C green no. 3; FD&C red no. 3, FD&C red no. 40; FD&C yellow no. 5; or FD&C yellow no. 6. A similar bill, introduced in the Senate, would prohibit use of state funds to purchase food for schools that contains certain ingredients.
City and County Food Sales Tax
HB 2456 would authorize cities and counties to levy a 0 percent sales tax on food and food ingredients.
Utilities
A broad stakeholder coalition will be introducing legislation soon seeking to lower electric utility rates for all rate payers.
Natural Gas Infrastructure
HB 2435 was introduced to enact the natural gas infrastructure availability act to authorize natural gas public utilities to defer to a regulatory asset all depreciation expense and carrying cost for any new plant, facilities, or equipment that such utility has put into service, and authorize recovery of such regulatory asset via an interim rate adjustment mechanism.
Human Resources
Legislation is being discussed that would allow for up to six months of “temporary unemployment” under the Kansas Unemployment Insurance program. In addition, there is an organization “Paid Leave for All Kansans” that is seeking possible legislation to require paid leave for all sizes of businesses (co-funded by employers/employees), based on legislation that was passed in Minnesota and other states.
Penny Shortage
It has been reported that the Kansas Dept. of Revenue will be introducing legislation to correct “rounding errors” for when the U.S. penny coin is dissolved from circulation.
Gift Card Fraud Penalties
Legislation will soon be introduced to increase criminal penalties for widespread fraudulent use of gift cards, which is thought to be harming Kansas retailers.
Additional Bills:
HB 2011 decreasing rate of property tax imposed by a school district and increasing the residential property tax exemption
HB 2183 adopting LoperBright by removing Court deference to agency interpretation of regulations
HB 2432 creating a large employer excise tax on federal benefits
HB 2434 supplemental appropriations for 2026, appropriations 2027, 2028
HB 2439 Kansas geoengineering and weather modification prohibition act
HB 2448 requiring citizenship status be listed on driver’s license.
HB 2455 supplemental appropriations for 2026 and appropriations for 2027, 2028, 2029
HB 2457 restricting homestead property taxes for individuals 65 years of age and older – eliminating prop tax exemption for certain commercial healthcare properties
HB 2465 professionals’ freedom of expression act to provide protection for professionals and businesses against adverse action as a result of an expression of beliefs
SB 303 retailers’ sales tax authority for Labette County fire depts.
SB 305 making DUI in a commercial vehicle as person crime
SB 309 increasing residential prop tax exemption from statewide school levy
SB 311 eliminating state income tax on qualified overtime compensation
SB 315 supp appropriations for 2026, appropriations 2027, 2028
SB 323 defining earnings to include paid compensation for wage garnishment exemption purposes
SB 324 prohibiting mobile telephone use while operating motor vehicle in school or construction zones
SB 329 requiring county appraiser to submit a single property appraisal report at the BOTA valuation appeal
SB 322 excluding buyer’s premiums from the sale price of property purchased at auction for real estate sales validation questionnaire and property tax valuation purposes
SB 333 prohibiting fluoride additives in public water supplies
SB 337 supplemental appropriations for 2026 and appropriations for 2027, 2028 and 2029 for state agencies