The QBS Express

Ep24_StevenJohnson_full
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Scott Heidner: [00:00:00] welcome listeners to the QBS Express, the ACEC Kansas podcast. I'm your host, Scott Heidner, and it is my pleasure to have with us today. State Treasurer Steven Johnson, treasurer Johnson, thank you for being here with us.

Steven Johnson: Well, thank you Scott and Steven is more than fine.

Scott Heidner: Steven, it shall be.

Steven Johnson: That sounds great. Very good. Good to get to talk with you.

Scott Heidner: Yeah, it's fun to have you up here. We've had the good fortune to work with Steven and a lot of his team over the years. So we've been awfully excited to get you on as a guest to the podcast. Adding to our esteemed list of elected officials, we've had the, the good fortune to chat with.

Steven Johnson: You've had a lot of great podcasts, so thanks for the chance to be with you.

Scott Heidner: Yeah, absolutely. Well, let's, let's give listeners, let's start with the bio, the Steven [00:01:00] Johnson story, as it were. VH1 would, what'd they say, before they were famous or whatever. I know you grew up in Assaria, which is more or less central Kansas ish, but tell our listeners more specifically where you grew up.

Steven Johnson: Well, near Salina on a farm, Just a little ways south. So that was, and still is home and enjoyed just being on the farm there through those years. And just spread between a couple of the counties in that area.

Scott Heidner: You say it's still home, same farm you grew up on?

Steven Johnson: Yes.

Scott Heidner: No kidding.

Steven Johnson: Yeah.

Scott Heidner: Crops, cattle.

Some of both.

Steven Johnson: Some of both. I just have crops my brother took over the cattle. Mm-hmm. And he has that side of the business and it, it goes back a ways, it'd go back to 1868 when my great-great grandparents came to settle that area. So my brother has the two original homestead, eighties, but I'm glad to be around.

Scott Heidner: That farm has been in your family since 1868.

Steven Johnson: That, that part of it has, so,

Scott Heidner: wow.

Steven Johnson: Yeah. So [00:02:00] the family history is, is fun as well, and everybody at the church, et cetera. So thankfully I'm not related to everyone anymore.

Scott Heidner: I barely can trace my family history back to 1968. That's impressive.

Steven Johnson: So, well, it was a lot easier when you grow up around it.

I am impressed with members that know the family as well, that that didn't live as much of the history. I think that's a lot harder.

Scott Heidner: Yeah, so went to high school locally at

Steven Johnson: Southeast of Saline. That was the high school.

Scott Heidner: Alright. And during childhood, and by childhood I mean everything from young, young years all the way through your high school years.

I know in, in talking to you over the years, I don't think there was much of a premium amount of free time, but to the extent you did things outta school, what did childhood look like for Steven Johnson?

Steven Johnson: Yes, well, young has changed in terms of the breadth of years that that covers.

Scott Heidner: Isn't that the gospel truth?

Steven Johnson: In the, the formative years through high school. You know, working on the farm [00:03:00] was the mainstay outside of school. And the other thing that there was at that point was four H and that was a definite blessing for me just to learn parliamentary procedure.

And as we've talked about other places, public speaking actually was a, a big deal. If you go back into the dark ages, the category that I won in for four H to go to the National Congress was actually public speaking, although beef would've been a project I enjoyed more.

Scott Heidner: Huh? I did not know that.

Steven Johnson: Yes.

Scott Heidner: You one went on to the national level in public speaking.

Steven Johnson: Well, the on a, a few things like that. Four H just has your annual record books, which is also a joy if anyone has worked through that process. But yeah, there are ser several project areas and that's ones.

Scott Heidner: It's a whole other conversation for another time.

But as you and I have visited about previously I'm appreciative of four H. Well, for a lot of reasons, but with a real focus on the public speaking [00:04:00] and the Roberts rules of order and that kind of thing. And the glass half full part as I'm extremely appreciative of four H four. The glass half empty part is as we've talked about before, I remain a little aghast at pre-high school.

How few other groups are offering that. To young people. So.

Steven Johnson: Yeah, the concept of learning by doing is, is one that I think is picking up more and more even later in the educational career. Mm-hmm. But where we get that right, and again, everything is dependent on so many people working together, the number of leaders and parents and their engagement to, to help us learn was, was really.

Critical to make it successful.

Scott Heidner: And four H is, well, again, we could probably do a whole nother separate 30 to 60 minute on that one alone. Another topic I'm sure you could do an hour on, which I'm tempted to ask but I won't, is how farming has changed from the time you were a kid riding that tractor to [00:05:00] today.

But we'll have to save that for chapter two.

Steven Johnson: Yeah, that is a great topic. But even more, I think back to how much it changed during my grandparents' time in the decade of the twenties and thirties when we shifted from horses to tractors. Massive change. Yeah. And so it'll be exciting to see how it changes over the next 20 years.

Scott Heidner: Many people, now I'm completely going down a, a rabbit hole, but you will hear people occasionally wax nostalgic, you know, about the good old days and. To an extent, I get that and I embrace that. But I have to tell you truthfully, if I, if you peel back the, you know, the glamorous part and the whatever, there's a lot of.

That, that does not appeal at all. I mean, knowing that you could have been behind a, you know, a plow and a, a horse instead of sitting on a tractor that day after day after day after day,

Steven Johnson: it was hard work. Neighbors down the road kept and have a horse team. And [00:06:00] we would hook up an old binder that we had and several of us would take around.

And I remember my first turn to, to go along with the reins there, and it was amazing how well that old equipment worked to do its job. Oh, darn. I appreciated watching how it worked. Then we got to the end of the row, turned around and came back going with the wind. With everything blowing over you was not nearly as pleasant as the first trip across the field.

Scott Heidner: I'm way outta my depth here, but I'm pretty sure I heard the other day that John Deere just produced its last old style steel plow. I didn't even know they were still making them, but apparently there's.

Steven Johnson: Well, you're more up to date on that than I.

Scott Heidner: Yeah. Well, we should probably move on before I burn up all our time on the, on the ag background side.

After high school, I know you went on to K S U, I know you were a proud Wildcat graduate AG Econ. I [00:07:00] will make a confession to you until I started stalking your webpage. I did not know that you were student body President while you were there.

Steven Johnson: Well, that was a few years ago, but again, get the four H experience, helped to know a lot of folks at K State and my fraternity was a good one to get to be involved in, and they were a lot of help.

And so between those I had a chance to be in the Senate and then have that office, which was great to get to know a few people across Kansas.

Scott Heidner: All these years. I thought your first run for house was your first attempt at running for office. I am. I'm further enlightened now. Well, and also something I didn't know because you don't ever offer this being a humble guy, but graduated with honors and then went on and got your M B A from the University of Chicago.

And I know the finance or the emphasis was in finance and business. What made you pick Chicago other than it's one heck of an econ school?

Steven Johnson: Well, that everything can get to be a long story. And I guess I was just a slow [00:08:00] learner and didn't learn enough the first time around. Actually in the end, the company made that selection for me.

Scott Heidner: Okay.

Steven Johnson: I was in a program where they were sending us to get an M B A and in early nineties, it was still a time where middle management was something that they were training a few years later. Those were positions that tended to be eliminated. Mm-hmm. But it was a management development program and, and the M B A was a part of that.

So, I had surgeons, some other schools and had gotten in a, and was headed a different direction and given notice that I'd leave and they contacted me and gave me that opportunity to continue and get my M B A at Chicago.

Scott Heidner: Very cool. So you were to some extent voluntold?

Steven Johnson: Well, yes. So it was part of the discussion we had for me to give up the direction I was going.

They were exploring a relationship with the University of Chicago. This accelerated that somewhat. And I changed directions and went to that school instead. Had talked to another guy who'd been in [00:09:00] farmhouse at K State and had gone on to the Harvard School. So that was the direction I was planning to go until June when I changed to the University of Chicago for that fall.

Scott Heidner: Very cool. Winter in Chicago, I bet that was an experience unto itself for a young man.

Steven Johnson: So yes and no. The lake effect snow is certainly something that was different than what I experienced. The traffic was, you know, different than what I had experienced. I, I had spent a little time on the East Coast right before I came back to go to the M B A program, but our corporate headquarters was in Minneapolis, Minnesota, so I had a chance to get one more degree into winter up there.

Scott Heidner: Well, it's a pretty good segue. I was gonna jump from there. To your private sector professional experience before we got into your public service. And you mentioned that the M B A program really came part and parcel with your private sector experience. Where were you working? And I know you were working, excuse me, in the area of [00:10:00] asset allocation models, but I couldn't tell you much more beyond that.

So share with listeners who you worked for and what your work really consisted of.

Steven Johnson: Well, your description of it may be as thorough as most people want to listen to, but, but the company at that time was called i d s. It's now Ameriprise and and at the University of Chicago, there were some folks that had worked on mean variance analysis and building models to create efficient portfolios, but the business for Ameriprise is financial planning and, and looking at building portfolios to meet particular goals.

So building those models then became my role. The staff at the University of Chicago was a great resource. I had some great mentors at what's now Ameriprise and it was actually a lot of fun to work on that. The, the good news while the. While all of the calculations can get pretty complex, you really [00:11:00] only have three things you're dealing with.

If you're working towards any financial goal, there's money in, there's money out, and what you can earn along the way, it falls into those categories and equations balance. No matter what. I can imagine what I'd like to imagine, but if I'm short on the contribution side, it doesn't magically show up. I've gotta get from dream to plan and just make sure that the numbers can actually happen.

So, it was very much about calculating risk and all of those types of things.

Scott Heidner: Well, a fine lesson for anybody headed into state government to build budgets and manage debt, et cetera. I would say.

Steven Johnson: It is a good pro plan to follow The challenge and long-term goals is there's some degree of variance that is possible over any two year period, and sometimes we can work on the numbers as we would like them to be, and we just have to be very.

[00:12:00] Careful that we continually check that they are what we would like them to be, to make sure we're actually on, on track.

Scott Heidner: Well, I know I'll call it the numbers in, in layman's term, you know, budgeting, debt management, et cetera. I know that was always a passion of yours in your time in the House of Representatives.

So your decision to run 2009 campaign officially sworn in in 2010. If memory serves.

Steven Johnson: It would've been running in 2010, sworn in, in 11. Okay. You're exactly right. Yep.

Scott Heidner: That was, mm-hmm. A year, year off was your work in the finance world and you know, the lessons you take there and the skill sets that allows you to bring was that part of the decision to run for office?

Steven Johnson: So, Yes. So that was central for me and specifically what occurred. If we play through that whole timeframe, we had that mortgage crisis of 08, 0 9, that really really wreaked havo on the markets. And the [00:13:00] upshot of that is a lot of pensions got into trouble. They were poorly funded across the country.

Unfortunately for Kansas, we were notable in that we were second from the bottom. We were thankful for Illinois, a state that I gained some familiarity with during graduate school, and I'm very glad we don't have that pension system. But I was worried about what those billions of dollars in shortfall could mean for our budget.

Which was smaller by a meaningful measure than that shortfall and what that could do for us if we failed to plan for that. And it played out for another decade. So that afforded the motivation to consider that and go ahead and make the leap. To see if we could start taking some steps. That's a problem you don't fix in a day.

But I appreciated the chance then to yeah, to win and start having a chance to work on that.

Scott Heidner: Well, 12 years later Kansas rank certainly has changed from being second from the bottom, but without having looked [00:14:00] recently, I would almost guess that Illinois rank has not,

Steven Johnson: Well, they've, they're fortunate that some other states have done poorly but.

Their plan is on the same trajectory that it was on in 2011, unfortunately.

Scott Heidner: Yeah. Yeah. Not not quite as reactive as Kansas has been in addressing the problem. Well, that makes sense and certainly I know just I. Firsthand, your attention and, and your passion for the numbers and the state, finances and KPERS in particular.

And boy, what a lot of work has been done over the last 10 to 12 years there. But let's talk about your positions in the house, and then I want to talk a little bit about maybe some of your favorite memories from a public policy or a service standpoint. But in terms of actually serving. So you come in as a freshman legislator, Learning the ropes, et cetera, but in time you went on to chair tax insurance.

In pensions and also served on ag and natural resources and of course appropriations, which [00:15:00] is hugely impactful along with tax and served until 2022 in a variety of those roles. Tell us a little bit about your experience growing from a rookie legislator up through the ranks and chairing and, and being integral to some of those committees.

Steven Johnson: Well, all the way back to four H and knowing how to run meetings certainly helped in terms of running a committee, so that was appreciated. Other than that, as you listed most of them and you, you mentioned, I, I, Everybody has a passion for those numbers, right?

But I, I joke that, that I was awarded the simple addition and subtraction problems on, on those committees. And that was just a good natural fit from the financial planning world to the investing side on pensions. Insurance is a critical part. Insurance in planning is what you have to look at, what you can't afford to lose.

How do we make sure that that's working for the citizens of Kansas correctly? And then the ag side that just fit with. My [00:16:00] other background and I did continue after my parents passed away, I returned to the farm and had operated that until January of this year, and my nephew has now taken that over.

So as we were interrupted with a call right before we started, and I appreciate your graciousness and letting me take that. Sure. But he has been running it this year as I've transitioned to the full-time role in the Treasurer's office.

Scott Heidner: Ah, congratulations, I think.

Steven Johnson: Absolutely.

Scott Heidner: Yeah.

Steven Johnson: Well, well, He, he operating, he, it, it'll be a few years before he would buy that out, but yeah.

Anyway, I'm really lucky to get to have him keeping everything running back at this area.

Scott Heidner: That's awesome.

Steven Johnson: Yeah.

Scott Heidner: Well, let me ask you a couple more questions on your time in the legislature, fun questions and then I want, I to get in and spend probably the balance of the time talking about the Treasurer's Office and your current job and the services you all provide to the state, but in your time in the legislature.

I guess a series of quick questions. We love giving folks a chance to recognize [00:17:00] some others that have taught and helped and, and mentored and been a friend to our guests. Anybody you would care to mention during your time in the legislature, and if you don't, that's okay. That really was impactful to you and empowered you and some of your success in learning.

Steven Johnson: You know, that list is thankfully long and the ability to collaborate is a, a, a huge benefit there. And across so many areas, all the way to the people I was lucky enough to have as a committee assistant. They were amazing at working through their jobs and Leah Gerard had to put up with a ton both in pensions and in tax to make sure everything came together and somehow magically, it would, and that was due to the staff.

And there are other legislative staff that are key as well. And that's the cogs in the machine that are key to make that work. Around the outside of the chambers are people [00:18:00] such as yourself folks that represent people across the state. So lucky to have that expertise and it's a critical part of the process and issue to issue.

That cast may change, but they're there ready and able to help and that is key. Then it is interesting how it shifts from the people who just teach you the procedure. And how to work through the process. My seatmate, Gary Haslett, when I started just to watch him was a good way to learn, but everyone was willing to share as you work through and even later in time, as you see people come in with good ideas whether it's Chris Croft with his whiteboard in his freshman year to really dig into complicated issues and break 'em down and, and try and help.

That process of really facilitating discussion has been good to see. Each person's different take on how to make that work.

Scott Heidner: That's awesome. We have the [00:19:00] opportunity to ask that question of a lot of folks, and I think you're the first one that has thought to list staff as impactful to your success.

I think that is super cool. Let me ask you two more questions, both I hope fun ones One of the things, I'll give you a bit of a shameless plug, but it's heartfelt. I've always appreciated the fact that you are approachable, not just in the sense, you know, personally approachable, but intellectually approachable.

You are a voracious consumer of data. And, and I think to your credit, very receptive to data regardless of the source, as long as that source is credible, and I'm, I'm making this a long introduction. But my question is going to be I have watched you work across the aisle or even within your own party with folks that you may not consistently have a common public policy set of beliefs or principles, but to do that effectively and, it's just not [00:20:00] something that everybody does.

It sounds intuitive. Well, of course you would want to do that, but it's not as common as it sounds. And to that, I finally find my way to the question, which is, do you have some folks from the other party or even just a decidedly different public policy set of tenets that you have appreciated working with and, and benefited from your opportunity to partner with them?

Steven Johnson: So, Absolutely. And first, thank you. I appreciate that. It's, it's easy to do in that I don't have all the information or best ideas and if I get to cheat off somebody else's paper in putting that together, that helps further on the data. If I have an assumption wrong, I would much rather figure it out during the policy making process where I have a chance to correct it than to find it out in the implementation process where I have a cost.

And so I, I appreciate folks that will challenge that and say I see this differently. [00:21:00] What it then takes is two, right? It takes somebody else that wants to engage in that same way, and then you have a great win-win that you can work with. The approach can't just be from any one person, but I was very fortunate in my first year to be a chair in 2013, I guess.

My ranking minority was Kathy Wolfe Moore. Kathy and I happened to start in the same year and it was our, both of our first chance to lead a committee. So we were both green. And we both genuinely wanted the committee work to work. A bunch of work had been done to set up a plan to make KPERS come into balance.

We were at that point where we had to make sure the implementation would follow. She was dedicated to it. I, I was dedicated to it, and we were able to, to build a lot of trust across that and those issues, even though, and sometimes it was easier to trust when we knew we [00:22:00] wouldn't agree. We, we didn't have that pretense to say we've gotta be on the same page, but we did have the, the pretense that we said we have to work with the same reality.

So that was very helpful throughout our years for me in the legislature. And there are certainly other folks as well. But I was just lucky to get assigned that. Kathy had to work on pensions, and if you ask her the same question, what I know she'll tell you is that she was not excited about being assigned pensions.

I don't know that she'll extend that necessarily to me, but I don't think that was the assignment that she was seeking out of the gate.

Scott Heidner: That's funny. Well, just a personal comment. I love that that's the name you pulled because I think she's was an absolute treasure during her time in, in the legislature.

She was one of the good ones in every way. No doubt. Very much missed. Well, last comment from your legislative time. Looking back on it, what do you either remember most fondly [00:23:00] or are you proudest of in terms of its impact of all the things you had the opportunity to work on?

Steven Johnson: Yeah. The most fondly would be the times to just be ourselves with each other.

It is a, there are a lot of great people that are there and that might be in our evening receptions with. Whichever group was choosing to host us. But in terms of actual movement of policy, the progress that we've been able to make together on the pension issue over a decade is one that I think will have a lasting impact.

For the state and that has so many pieces from the plan to making sure that you could fund it. There are still steps to make sure that we've got the benefits right and how do we make sure that that's as equitable as it can be across generations of taxpayers, generations of beneficiaries. And I look forward to continuing to work with the legislature on making sure that we get that.

Into a, [00:24:00] a policy that works.

Scott Heidner: Yeah, that was one large horse to subdue no doubt when you inherited it. Well, with all of that, I, I appreciate the look backwards and, and candidly, personally enjoyed it very much. 'cause that's the time that I've spent with you for the most part, and my teammates have here at B H L, but.

We also want to spend a large amount of time today on, on the current job. You are the state treasurer for Kansas, the 42nd state treasurer in state history, and the remit of your office, as with so many of our statewide offices, I think is far broader than most Kansans, including myself, are aware of.

I will make a confession. I'm gonna rattle off a, a series of things that the Treasurer's Office is responsible for. And more or less throw the floor open to you because I am now out of my education curve here. And I don't know candidly a lot about these programs, but what it does show [00:25:00] me before we even crack the lid on the details is that the treasurer's footprint is a lot broader probably than most Kansans appreciate and the lives of Kansans are touched and impacted by the work that goes on in the treasurer's office more than we would think.

Obviously the financial services of the state, the plumbing of it falls under your remit unclaimed property, which a lot of folks might be aware of just 'cause every once in a while the paper runs an article, you know, about how much unclaimed property is out there.

Savings programs, Kansas Learning Quest those are very personal to a lot of Kansans and those fall under your your remit. The Able Savings accounts P M I B KPERS Boards, the floor is all yours to talk about what your office does and how that touches the lives of Kansans.

Steven Johnson: Well, thanks for that chance.

It has been a lot of fun and it was a good time to get to step into the treasurer's [00:26:00] office as well. So starting with the fiscal services that you mentioned up front, which is central, making sure the books balance the bills get paid. And interestingly enough, right now while we have Excess revenues, which the legislature will continue to work.

We need balanced revenues. We can't have a shortage, we don't need a surplus. We need revenues that pay our expenses. But it doesn't happen every year. You ebb and flow through that process. So we're in one of the flows where we have more cash available and that combined with what has happened with interest rates.

And while the interest rate policy, I would argue was too low for too long and went too high, too quickly to be good for business. And, and I think we have to keep an eye to that impact on banks, that impact on business as well as the impact on inflation. And how suddenly I want to try and turn a ship as big as the economy.

It's even bigger [00:27:00] than the KPERS problem, right? So, turning on a dime can be a risky proposition. So again, there are a lot of people assessing those risks, but as it relates to the Treasurer's Office, we're able to invest those assets in the checking account overnight and get really handsome returns.

So right now, that's five and a quarter percent. Wow. Because the short end of the curve is where. We're the highest. Yeah, it's barely that high for a year, but with 9.4 billion today in total cash between the states float, what we have from municipal entities invested with us. That's a lot of interest.

Looking back, last fiscal year, we made 314 million roughly in interest on the state's cash. It's a lot of money.

Scott Heidner: Yes it is.

Steven Johnson: In interest on essentially checking.

Scott Heidner: Do you, do you know, I hate to interrupt you, but do you know when the last time you were getting a return on your overnight [00:28:00] investments? As high as five and a quarter?

Steven Johnson: So, I don't know. It's been a while. I. It may have been decades. Yeah. On overnight money. Yeah. Since that has happened with the consistency that is there, certainly not in any time since 2011 that I have been paying attention to it last year, and it's not. It, it's just where things were with interest rates, et cetera.

We are keeping a tighter eye on where monies are, where they are expended every day. But last year, fiscal year, the interest earned was 24 million. So over a tenfold increase.

Scott Heidner: Wow.

Steven Johnson: Due in part to the size of the balance and due mostly to the change in interest rates. And there are a couple of things that we've implemented, but those are long stories to go through as well.

Scott Heidner: Wow. Well, don't mean to fixate on the rate, but it's a for, for overnight accounts, that is a staggering number. I would almost bet that you and I. Throughout the course of our [00:29:00] career, probably haven't seen the benchmark there.

Steven Johnson: Yeah. Since the nineties I would've seen it, but not, not recently. So one of the things I, I will mention in the checking account, the account had been set up and our bank is a great partner.

But. The account was one that was set where the interest would pay the expenses on the account. Well, that was very different of the interest rates last year than the interest rate this year. So, just changing that from the account that it was to making sure it's actually at work, earning the cash that we can will.

Make a difference in the five to 6 million range of interest earned. Wow. So, the little things can really make a difference in this year.

Scott Heidner: Talk to me a little bit about the P M I B and KPERS boards and your role there.

Steven Johnson: So, the P M I B board is the one that makes the decisions of exactly where we put that cash that I was talking about, what goes into the overnight to keep us liquid, what we can put into commercial paper to [00:30:00] try and drive the yield a little bit more. Right now we're using more in treasuries and agency notes just because of that short curve and there's not a lot of premium over that. So that board makes those decisions and through our executive director actually implements it, but oversees.

How that cash is working. They had some heavy lifting. We are again, blessed with great board members. Rod and Steve had a huge lift this year. Our director left at the end of last year. We've got a great director in Joel Oliver who we're lucky to get to have, and things are working great, but our board had to do a lot of work along with us to keep everything working from January to April when we had another executive director. Yeah. Making sure day to day things were being invested correctly. The KPERS Board oversees 25 billion. Currently, we still have a liability of some amount. Again, it all depends on where your assumptions are. It's about [00:31:00] 9 billion on our current assumptions. Those are invested much more aggressively.

There we're looking out through people's retirements and through the retirements of somebody who's only in their twenties and thirties. So our timeframe on that is the opposite of the pooled money where we've gotta be liquid in days to. We know we've gotta have money in 50, 60, 70 years, and that's a very different planning problem.

So that has a portfolio. There are nine members on that board. And that group historically has done a very good job of managing those assets. We, we've had a, a few stormy seas to work with recently, both in terms of volatility and also in terms of approach that the legislature has helped us with and others to make sure that.

Our focus has to remain on the best return for risk taken for those beneficiaries. And that was reinforced as, as other. Other objectives could [00:32:00] be introduced to say, well, I want to see us advance energy policy in this way, or I want to see us advance other agendas. While those can be considered on the part of the groups that want to look at it in the interest of our investors, we have to make sure that first it is the best return.

Scott Heidner: Yeah. Being on that board sure has the feel of that classic most important job most people have never heard of. You know, I think most people probably have not heard of the P M I B board, but boy, the consequences of those decisions, those tentacles go deep, deep, deep into the Kansas economy.

Steven Johnson: And it's good if you haven't, if you hear about those often it's because they've been done wrong.

So, we wanna make sure we continue to do them right.

Scott Heidner: We had former attorney General Derek Schmidt was on during his time in the ags office, and one of the memorable things he said that I remember is, The more you hear about me in my office, probably the worse we're doing the job. Very, very similar sentiment to what you're expressing here.[00:33:00]

Steven Johnson: Well, there are a couple of areas I do want people to hear about that you mentioned also the unclaimed property people know, but it's amazing how much we still don't know and how close it can be to find unclaimed property. I was at an event on this past Saturday in Dickinson County, and the three people who I was sitting around each had unclaimed property.

One only had it for immediate family members, but not only did we find unclaimed property for them, we found it for their entities. Oh, for heaven's sakes. Including, Since I was in Dickinson County, some for the Eisenhower Library. Oh, no way.

Scott Heidner: So how does the Eisenhower Library wind up with unclaimed property?

Steven Johnson: That is a great question. You'd think you could find the Eisenhower Library? Yes. Yeah. One, I think so.

Scott Heidner: I, I, I know you can because you might be tickled to know. The Eisenhower Library is a former podcast guest.

Steven Johnson: Very good. Yes. So anyway, so I did find it. Yes. So, just making that search [00:34:00] trying to return that $500 million of Kansans assets to Kansans actually is a lot of fun.

It is a lot of work. But people can sure help us out just by going to Kansas cash.ks.gov. Click on that search button, throw in maiden names. Throw in cities that you lived in before throw in business entities that you used to have and our county treasures have been great to work with us this year.

We started in January. They, they came to Topeka and they contacted me and said we'd, we'd like to tour the treasurer's office and, and see the vault. We went to the K B I last year and they had a great tour. I. And K B I has a great tour, so I'm like, I'm gonna bore these folks to death. But thankfully our treasurer partners are very engaged in what we do from bond services, where we work with them to the unclaimed property.

And they have really stepped up and worked to share in small counties. The county [00:35:00] treasurer knows virtually everybody mm-hmm. And are able to reach out in Sedgwick County. The county treasurers really work to employ technology. To reach folks and so it's been a great partnership to see if we can find yet a few more people and get more of those dollars back to work.

Scott Heidner: Well, an unenviable position for you to have to follow the year with the K B I lab tour 'cause there aren't many that can, can compete with something on the coolness factor with that.

Steven Johnson: I would generally recommend if you get to do one tour when you come between us. Make sure you catch the K B I tour.

Scott Heidner: Reminds me when the. Austin Powers movies came out. Those slapstick comedy movies. The teaser for those that would be in the movie theaters, you'd see this big thunderous language. If you only see one movie this year, You should probably actually go see the Star Wars remake. But if you're gonna see two movies this year, go see Austin Powers.

That's, that's the Treasurer's office in the K B I. Well, if I'm not careful, we're gonna run [00:36:00] over the time your staff graciously allotted here. So I wanna focus on one more thing. Before we leave the treasurer's office. And that is the Kansas Learning Quest is so important for so many Kansans.

I don't know what the investment, the participation rate is, but it's gotta be very significant. And I wanna close with a little discussion about Able, but if you would touch on the learning quest first for just a minute, and then we'll close with some talk about the ABLE Accounts.

Steven Johnson: Absolutely. So the chance to save for education and the plans have been broadened over time to look at not only college, but career, whatever education or technical training someone is looking at.

If you need to buy tools when you attend diesel mechanic school and be able to participate in those classes and be set up for business. This is a way you can save, have your money grow tax free for that purpose, for your child's purpose for your grandchild's future. So it's, it's a, [00:37:00] a real win in that savings feature.

In Kansas, you can get up to a $3,000 deduction. On your state income tax for making those contributions. So if you take advantage of the chance to plan a little to set some aside, over time, you can get rewarded immediately with that tax deduction. And why not take it if you're eventually going to have to lay out the cash?

Let's get it done as we work towards that. Be in good shape to be able to work forward. They continue to make it more attractive. One of the reasons was, well, I don't necessarily know what the future looks like. What will they need, et cetera. This year they added a feature that you can convert that to a Roth up to 35,000 at the end, which gives you a lot of flexibility.

Why not get a $3,000 state tax deduction for each account, each beneficiary that you contribute to? And then convert it to a Roth if you don't need it. I can't get a tax [00:38:00] deduction on my Roth contribution any other way. Mm-hmm. So again, the plan is for education, but there are just a lot of ancillary things that can work on that.

And each of our programs has that $3,000 deduction so that theme will ring true. All the way from 5 29 through more recently, the first time home buyers account, and it's just a good number to know as as someone plans for that. Yeah, there are a couple ancillary programs to that, that are useful.

There are a couple of grants out there. The Kids Matching grant program for folks that are under 200% of poverty can get a match up to $600 of a contribution to that plan to try and help. Related, but not through the Treasurer's Office. This year is the Keep Program, which is a thousand dollars per beneficiary. But again, it is set to 300% of poverty and that is just a great way to be able to pick up some money for educational expenses. So a number of things. And [00:39:00] then of course, the ABLE program is a key part.

Scott Heidner: So yeah, a couple of Personal anecdotes, one to close out the learning quest and then one to bring us into able, it is so funny.

Couldn't have scripted this. If we'd put our heads together. When you were talking about the Learning Quest account, I could tell you were wanting to focus on, it's not just college tuition in the most traditional sense. It's so broad. The irony is that the anecdote you chose to offer was you could be a go to school to be a diesel mechanic and use it to pay tools.

You wouldn't believe me if I told you, but in my house over the last two years, the Learning Quest account has been used to pay for tools. At, they don't call it diesel mechanic, but at a John Deere school.

Steven Johnson: Oh yes.

Scott Heidner: Where they're learning basically those things. So that anecdote that you just made up off the top of your head is literally what's happening in my home over the last two years.

That is [00:40:00] ironic in the highest degree and kind of awesome. The other personal plug. I wanna make, and I want to end our, our talk about the, the duties of the treasurers or, or, or bring us to a close on that. Part of it is the ABLE accounts. And that's another one that's very, very personal in my house.

And I will tell you on a very personal level how important the program is and how much we appreciate what the Treasurer's Office does to keep it going. Tell our listeners it's, it's just a wonderful story.

Steven Johnson: Well, it is a wonderful story and, and you can share even more so to make sure that our our loved ones with a disability continues to get those critical federal payments, their income thresholds.

And unfortunately there was also a savings threshold that you could not exceed prior to the ABLE Act being passed, which really limited the opportunity to do anything else and take ownership of a financial [00:41:00] future. But the ABLE Plan affords that chance where I now can save in that it is the money either.

It's my money if I'm saving Intuit. It is the money I save for my loved one, however, that is to better provide for a future. As we've talked on other occasions on the ABLE program, it just does so many positive things. The ability to work, to have that job, to see the benefits of the income, to have that.

Purpose is a very valuable thing that we'd want to have part of a program. Not only that, what we find, these are very good employees. They show up, they want to do their job, and they keep doing their job in a time where the labor market is tight. I know those employers who are lucky enough to be matched with those capable workers.

Are very happy to rely on them. So there are a bunch of win-wins that can come out of the [00:42:00] ABLE program. Yeah,

Scott Heidner: there really are. And I will say just philosophically too, in my opinion you know, the ABLE program is a complex structure and it's a complex public policy question, but in my opinion, it really brought consistency.

You know what we try to teach. All of our kids out there without a disability is save, save save, you know, be responsible, save money. That money can provide you opportunities to start your own business or to do whatever. I mean, we teach that critical lesson. But for folks, you know, with disabilities, with those federal thresholds, well, you can't save very much or it becomes a penalty, you know?

And it is, it was such an inconsistency and such a disincentive to these folks to be able to, to strive and succeed and work hard. So yeah, it is, it's just what you said. It's a, it's a win-win, win and then some [00:43:00] killer program. I. Well with that I know I have already looped past what I promised your team.

We would budget for time, so let me ask you a couple of quick questions on the way out the door. Back on the personal side. Well, one more, one last professional question. Looking back over all your public service, legislative and now statewide office. What are some of your favorite memories of, of the work you've done and the learning opportunities you've had, the folks you've met, what springs to mind?

Steven Johnson: You know, I'll may, I'll maybe keep it short since I went a little longer on the legislative side. One of the things I have enjoyed in the Treasurer's office is decisions can be made faster. Collaboration is a huge help on a number of things, but when we wanted to implement the change with how we handled the account balance with the bank, moving to a sweep, we could do it.

That was our charge. And it was fun to charge [00:44:00] ahead. Interestingly enough, in some ways and this isn't necessarily a positive overall, but with the increased compliance that I'd have to do financial services in the private sector versus what we do here. There's absolutely oversight. But I'd say there's not always as much red tape to go through and do.

What I might argue is not value added documentation. Then the ability to just say, okay, this makes sense. Have we got the right authority? What the statutes say, and how are we making sure our objective is crystal clear? And given that, how do we achieve that? And our partners have been very helpful. In that as well.

Again, as I mentioned, whether it's the bank and offering us a competitive rate or, or whatever it is that we needed to optimize.

Scott Heidner: Being able to streamline and work efficiently is a joy unto itself. Is it not?

Steven Johnson: It is. Absolutely. So part of the encouraging part is I think all of us, even in [00:45:00] government, can be critical of government to that end.

But it was great to get kind of to those day-to-day workings and be able to really move, move the ball.

Scott Heidner: Yeah. Well, final question, this back on the personal side, but I know days off are few and far between, assuming they exist at all for you, but if you'll humor me in a hypothetical what do you do for fun outside of work?

What does Steven Johnson, the, the non-public servant do? For his own enjoyment?

Steven Johnson: Yeah. Well, so. I actually do enjoy to get back on the farm and work most of the time. There are times when it doesn't turn out to be as much fun, but just to be there to enjoy a sunset, to jump in the side by side and go, zip over the river banks that I grew up playing on to check irrigation.

As long as it's working is fun. When it's not working, it's not quite as much fun, but that is a joy. Then if I had a day to just do something fun, I would generally like to jump on a pair of skis. So whether that's behind a [00:46:00] boat in the summer the legislative session has really gotten in the way of snow skiing.

Scott Heidner: Yeah, that is not conducive to snow ski.

Steven Johnson: So I haven't, I've kind of fallen down on that in the last decade, but I'd still take advantage of that if I ever had a day.

Scott Heidner: Yeah. Well, Steven, I can't thank you enough for making time to come over and visit with us. It's sure. Been a joy to have you here and I.

Thanks for, for sharing your story and spending time with our listeners.

Steven Johnson: Well, great to be with you today and great to work with you always.

Scott Heidner: Yeah. Ladies and gentlemen state treasurer Steven Johnson. We thank you for joining us as we've had the chance to visit with him. Stay tuned for the next edition of the podcast.