Audit finds fiscal-note inaccuracies tied to bill changes; budget office outlines limits of 7-day rule

Legislative auditors and the state's budget office told the Committee on Legislative Modernization that discrepancies between fiscal notes and later fiscal outcomes most often result from changes to bills after the fiscal notes are prepared, and staff described the statutory and practical limits on updating those notes.

Andy Branzo of Legislative Post Audit summarized the office's 2023 review, saying the audit looked at 10 enacted bills from 2018–2019 and 10 bills that failed in 2021–2022. "Changes made to bills after the fiscal notes were submitted resulted in most of the inaccuracies that we saw," Branzo said, noting that the audit judged a fiscal note "accurate" when it was within roughly 20% of later actuals.

Adam Prophet, secretary of administration and director of the Division of the Budget, told the committee that KSA 75 37 15a sets a seven-calendar-day deadline for producing fiscal notes after a bill is read in. He described the division's workflow—10 analysts assigned across functions, outreach to impacted agencies, a template for fiscal contacts, and an internal two-reader review—and said agencies provide the underlying estimates while the division performs reasonableness checks. "We have 7 days from the bill being read in," Prophet said, adding that in practice agencies sometimes have only 48 hours to deliver information for an on‑time note.

Prophet emphasized distinctions among three frequently used terms. A revised fiscal note is republished when new information becomes available before a hearing; a corrected fiscal note fixes an error in a published official note; and an amended fiscal note is issued on request after an amendment is actually adopted. Because statute requires an official fiscal note only for the original bill, the division does not automatically reissue notes for every amendment. "Once a bill is amended, there ceases to exist any relationship between this bill and that fiscal note," Prophet said. "Therefore, this fiscal note should be ignored in its entirety." He said his office will produce an amended fiscal note when a chair or another legislator formally requests one and when the office determines the amendment is materially different.

Branzo said the audit found three of 10 enacted bills had fiscal notes that were accurate by the audit's measure and that the remaining seven were not; four of the seven involved amendments after the fiscal note was created and others involved subsequent changes in agency processes or unpredictable new programs. For the 10 bills that died, the audit used GAO best practices to assess method and found seven used reasonable methods while three reflected one-off problems such as invalidated data or omitted costs.

Shirley Morrow, director of legislative research, told the committee that Legislative Research and the Division of the Budget agreed last year on a process to request revised fiscal notes and that Legislative Research can now post revised fiscal notes on the legislative website alongside the bill line so users can see both the original and any revised note. She also described an omnibus memo Legislative Research prepares for bills in conference or on the governor's desk that compiles updated fiscal impacts when time permits.

Committee members pressed both conferees on the effects of a compressed, shortened legislative schedule. Prophet said the statutory seven-day calendar window can leave agencies with only about 48 hours to provide information; the division issued about 800 fiscal notes in 2023, handled roughly 464 hearing dates that year, and reported issuing only a handful of corrected or revised notes (four corrected notes in 2023, two in 2025). Staff and members agreed longer lead time or targeted thresholds for when amended fiscal notes are warranted could reduce inaccuracies, but members—particularly members of the minority—warned against creating processes that would deny timely review to bills that receive fewer procedural advantages.

The committee did not adopt any formal changes at the hearing. Members and staff identified options to explore administratively (prioritizing amended notes for materially changed bills, improving outreach to county and municipal associations, and discussing modest increases in budget-office staffing to add a policy/research function) and Prophet volunteered to discuss with his team and with associations whether sampling or illustrative county data could be used in some cases.

The committee recessed after hearing from both agencies and said it would meet again on Wednesday.