Selzer v. Colyer: A Battle Over Kansas Funds


As the primary race for the Republican nomination in the 2018 Kansas Governor Election approaches, a new battle has erupted in Topeka this past week. Kansas State Insurance Commissioner, Ken Selzer, and his counsel have filed a suit against current Kansas Governor Jeff Colyer and others over funds scheduled to be swept from the Kansas Insurance Department (KID) to the State General Fund (SGF).

Selzer and attorneys Diane Minear and Susan Ellmaker filed the petition in Shawnee County on Friday, July 20. The suit names Governor Colyer, Director of Budget Larry Campbell, and Secretary of the Department of Administration Sarah L. Shipman.

According to legal documents sent by KID to TMN, previous Governor Sam Brownback signed the  Kansas Senate Substitute for House Bill 2002. The substitute authorized a transfer of $8,000,000 to the SGF in the fiscal year of 2018 and $8,125,000 in the fiscal year of 2019.  The state legislature “…took appropriate action to remedy the unauthorized sweep…when it approved an $8,000,000 reduction of the sweep” in the past legislative session. However, Colyer line-item vetoed the reduction on May 15.

“The bottom line issue,” said Selzer in a phone interview on Thursday, June 26, “these funds are paid by insurance agents and by companies operating in Kansas for the regulation of insurance. They’re not paid to be taken into the general fund to be used for general state purposes as a tax.”

A motion has also been filed by the commission for a Temporary Injunction to prevent further sweeps. According to legal documents, “A Temporary Injunction is in the public interest because consumers will be harmed if companies are forced to pass additional assessments on to them increased premiums. Furthermore, even if funds are transferred back, the sweep will create uncertainty in the insurance market.”

At this time, TMN has not received any statement or information from the governor’s office.

With both Colyer and Selzer competing for the Republican nomination in the 2018 General Election for the next Kansas Governor, there is speculation that this move is politically motivated.

“It’s absolutely not political,” said Selzer. “It is a protection for insurance consumers. And you can go back through the timeline again. The law was passed in 2017. The legislature did the right thing and passed a budget this year that complied with that law. The governor chose to line-item veto that provision in the budget this year. That’s why we provided a demand letter to prevent the sweep prior to July 1 but made the sweep anyway. So we then filed suit. The timeline is very straightforward, it has nothing to do with…it’s not political at all.”

The hearing on the Temporary Injunction is scheduled for this Thursday, August 16.

Stay tuned with Tiger Media Network for future updates on this developing story.

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