Opponents Object To ‘Convoluted Method’ Of Aiding Businesses

By Noah Taborda, Kansas Reflector

March 23, 2021

TOPEKA — Opponents testifying Monday on a proposal to use federal aid to compensate businesses impacted by the pandemic expressed a need to look at all variables before taking further action.

Senate Bill 286 would establish a $100 million fund administered by the Attorney General’s Office to pay court judgments or settlement fees for businesses harmed by local restrictions on their capacity or hours of operation during a disaster declaration. Any business can also request an income tax refund or loan forgiveness to offset these losses through the Kansas Department of Commerce.

All deals would be brokered by the attorney general, rather than through claims filed in district court across the state’s 105 counties. All deals would need to be approved by the governor and legislators on the State Finance Council.

Jay Hall, of the Kansas Association of counties, opposed the bill in part because the claims process detailed in the measure appears duplicative to an existing process in the Kansas Emergency Management Act.

Hall said this process has not been used often, as it is difficult to hold the government responsible for more common disasters like tornados, floods and fires. He also raised concerns this bill was a 360 from discussions last summer about local authorities’ ability to assess their communities’ respective needs.

“It’s important that we maintain those types of things that allow those local communities to make those types of decisions, avoiding a one size fits all type of approach throughout the state,” Hall said. “Going with that idea of local control is just allowing local officials to have the ability to apply the restrictions that they determine are necessary within their communities based on what they’re seeing at their own ground level.”

The hearing Monday was a continuation from last week, when proponents testified to the need for such a fund and financial relief. The bill is a response to a lawsuit filed on behalf of a fitness gym in Wichita last year seeking compensation as outlined in KEMA.

The attorney who filed the suit agreed in December to put the lawsuit on hold as the Legislature considered ways to settle these potential claims from businesses across the state. A second measure currently circulating in the Statehouse would force county governments to reimburse businesses for property taxes.

Trey Cocking, deputy director of the Kansas League of Municipalities, expressed concerns with repayment through tax refunds.

“It just seems like a convoluted method instead of I legally owe you money for taking your property, you pay,” he said. “When you buy somebody’s property, you don’t say, we’re not going to let you pay property taxes for the next 10 years. That’s not how you do it. You go in, you figure out what the appraiser says the fair market is, and you acquire the property, and you pay for it.”

Cocking said the inclusion of a clause dictating any facemask mandate enforced beyond May 1 of this year would be sufficient to warrant compensation was out of place as a matter of public safety.

He said not all struggles with business have derived from government restrictions. Some people were concerned with their health.

“I think somehow we need to work through that process as we figure out what this bill should look like,” Cocking said.

Sen. Molly Baumgardner, R-Louisburg, said businesses struggling despite a lack of imposed governmental regulation could be due to emphasis from the governor and KDHE secretary Lee Norman to remain at home unless absolutely necessary. She wondered at what specific date both officials stopping using those talking points.

“When we’re saying that there are no regulations, I think that we need to be careful,” Baumgardner said. “When I heard from the businesses in rural Miami County, it was that they were damaged because people were afraid to come. They were afraid to come, even though they follow the mask mandate, even though they were taking all the steps of precaution.”

Cocking noted this would indicate culpability by the state, not counties and cities, but Baumgardner said some blame still falls on county governments.

“When counties and cities remain silent, no action is an action. When you do not stand out in opposition, then you are saying that is the message that we’re following,” she said.