Kan. Stat. § 32-862
The exercise of the powers granted by K.S.A. 32-857 through 32-864 will be in all respects for the benefit of the people of the state, for the increase of their prosperity and for the improvement of their health and living conditions, and as the operation and maintenance of projects by the department will constitute the performance of essential governmental functions, the department shall not be required to pay any taxes or assessments upon the income derived from any project or property acquired or used by the department under the provisions of K.S.A. 32-857 through 32-864. Any bonds issued under the provisions of K.S.A. 32-857 through 32-864, their transfer and the income therefrom, including any profit made on the sale thereof, shall at all times be free from taxation within the state.
K.S.A. 32-862