SALINA JOURNAL: Gov. again wants to securitize

January 18, 2017 

For the fourth time, Gov. Sam Brownback has announced his desire to dismantle one of the smartest investments in Kansas history — the Children’s Initiatives Fund — as a way to shore up his leaky budget.

On the heels of a historic lawsuit against tobacco companies, Kansas lawmakers in 1999 established the Kansas Endowment for Youth and the Children’s Initiative Fund with the design that money from the settlement would pay for children’s programs in the state — forever. Annual payments of between $55 million and $60 million pay for childhood programs such as Parents as Teachers, Infants and Toddlers, Healthy Start and more — and alleviate the burden on taxpayers.

Brownback, however, hopes to securitize the fund by selling it off to Citigroup for a lump sum payment. His budget anticipates raising $530 million by the sell-off of a fund, which would pay upwards of $60 million a year in perpetuity.

Last year, the Kansas Legislature blocked his attempt to dismantle the fund. This year’s Legislature is sure to do the same, without a second thought. Little is more fiscally irresponsible than selling off an asset that creates income year after year after year, simply because the governor has underperformed during his time in office. That this idea requires the literal stealing from children makes it loathsome.

Just consider the simple math. In 10 years, the state will have received in payments what the governor hopes to raise today. In 20 years, twice the amount — over $1 billion — will be routed to childhood programs. These programs are the product of sound leadership by people who recognized the unique circumstances of the day and sought to use a financial windfall in the most helpful and responsible way possible — by making a lifetime investment in future Kansas children. What Brownback proposes would turn annual income for Kansas into, essentially, an annual payment to Citibank.

The repeated efforts by the governor to dismantle these programs and sell them off to a Wall Street bank are indefensible. It’s the worst example of Brownback’s willingness to sacrifice the future well-being of the state — and its children — so he can save his own skin today. Such a practice isn’t consistent with Kansas sensibility, nor is it consistent with any notion of logical or sound financial management.

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