Kansas Governor Laura Kelly is proposing a state level plan aimed at addressing the issue of property tax relief for Kansas taxpayers.

 

In Kansas, the majority of property taxes are levied at the local level, including by cities, counties, and school districts. These taxes pay for services such as police and fire protection, road maintenance and public schools. In recent years,  increased valuations and rising costs have placed an undue burden on property owners across the state.

 

Kelly's has proposed a three step plan. The plan’s first step is passing Senate Bill 378, which would grant a one-time $250 vehicle tax credit to all vehicle owners upon registration. The credit would be funded using surplus money from the budget stabilization fund, providing immediate financial relief in Fiscal Year 2027. Because it is a one-time measure, it is designed to avoid long-term impact on the state’s reserves.

 

The second part of the plan establishes a state-funded pool to support cities and counties that maintain responsible budget growth, recommended at no more than 3 percent annually. The fund would start with a $60 million deposit and grow by 2 percent each year, with eligible local governments receiving distributions based on population and assessed value. This approach aims to fairly allocate resources while encouraging fiscal discipline across both rural and urban communities.

 

The third part of the plan would increase the property tax exemption for the 20-mill school levy from $75,000 to $150,000 of a home’s appraised value. To maintain full funding for public education, the state would offset the lost revenue with transfers from the State General Fund to the School District Finance Fund.

 

Kelly has urged state lawmakers to consider her tax reform package as the 2026 Legislative Session comes to a close.