Legislature(1993 - 1994)

1993-01-22 House Journal

Full Journal pdf

1993-01-22                     House Journal                      Page 0138
HB 85                                                                        
HOUSE BILL NO. 85 by the House Rules Committee by request of                   
the Governor, entitled:                                                        
"An Act relating to the public school foundation program; and                 
providing for an effective date."                                              
was read the first time and referred to the Health, Education & Social         
Services and Finance Committees.                                               
The following fiscal note applies:                                             
Fiscal note, Dept. of Education, 1/22/93                                       
The Governor's transmittal letter, dated January 22, 1993, appears             
"Dear Speaker Barnes:                                                          
Under the authority of art. III, sec. 18, of the Alaska Constitution, I am     
transmitting a bill that makes statutory changes to improve the public         
school foundation program, which aids our public schools.  The bill            
implements certain recommendations of the finance committee of                 
Alaska 2000, as approved by the state Board of Education.  Alaska              
2000 represents a year-long study of the public school system in               
Alaska by Alaskans to recommend improvements and new directions.               

1993-01-22                     House Journal                      Page 0139
HB 85                                                                        
The public school foundation program has been the subject of much              
debate in Alaska.  The public school foundation program represents a           
significant portion of Alaska's operating budget.  This bill improves          
this financing program and addresses many concerns of the school               
districts, the public, and the state Board of Education.                       
Sections 1 and 3 replace the words "area cost differential" with               
"Alaska school price index" to conform to the substantive changes              
made by new AS14.17.049.  New AS14.17.049, in sec. 7 of the bill,              
creates the Alaska school price index to replace the existing area cost        
differential in AS14.17.051 for determining public school foundation           
program support.  The index will be calculated based on a weighted             
average of actual expenditures for fiscal years 1989 and 1992 for              
educational goods and services reported by a district or group of              
similar districts.  The index will be adjusted every three years,              
beginning in fiscal year 1997, by a national elementary and secondary          
school price index as designated in regulations adopted by the                 
Department of Education.  This change should make it easier for a              
district to estimate its support from the foundation program, subject to       
legislative appropriation.  Also, the amount of the support should be          
more reflective of actual expenditure history and school needs than is         
the area cost differential currently fixed in statute.                         
The bill also makes adjustments to the way centralized correspondence          
study students are counted for determining foundation support.                 
Presently, all centralized correspondence study students are counted           
only as elementary students, even though they may be enrolled in the           
centralized correspondence study program as a secondary student.               
Section 2 of the bill allows secondary correspondence students to be           
properly classified.                                                           
The bill also addresses the need for additional vocational education in        
the public schools.  The bill revises the foundation aid program to base       
financial support on total secondary student enrollment, rather than on        
the number of students enrolled in vocational education courses.  Also,        
each district is assured of a minimum of one instructional unit for            
vocational education under the foundation program.  See sec. 5 of the          
The bill also makes adjustments to the foundation program for                  
calculation of financial support to a district for its gifted and talented     

1993-01-22                     House Journal                      Page 0140
HB 85                                                                        
program.  Under the bill, the district receives support on a flat              
percentage rate of total student count.  Presently, financial support is       
based on each student identified and served as a gifted child by the           
district.  The bill also repeals a provision (AS14.30.315) that requires       
the department to approve a district's program for gifted children in          
order for the district to be eligible for state foundation aid.  The           
changes are designed to give districts more flexibility and to remove          
incentives to identify students as gifted in order to receive additional       
state aid.  See secs. 6, 7, and 11 of the bill.                                
The bill also establishes a later date for school districts to submit to       
the department the student count estimates on which foundation                 
support is based.  This additional time should facilitate more accurate        
estimates and eliminate the need for districts to submit numerous              
amended estimates in order to reflect actual enrollment more                   
accurately.  See sec. 8 of the bill.                                           
Additionally, the bill authorizes a district to request use of a different     
20-school-day counting period to determine the student enrollment on           
which school foundation support is based.  Presently, a district must          
use a 20-school-day counting period in October or February of a                
school year or, alternatively, another 20-school-day period in the same        
school year if the district receives permission from the commissioner          
of education.  The existing counting periods provide little flexibility to     
a district that is experiencing decreased enrollment in the current            
school year.  The bill would allow the district to receive permission to       
use the preceding school year's actual enrollment during the October,          
February, or other 20-school-day counting period, in order to allow for        
more predictable financial support and less volatility in receipt of state     
aid.  This provision of the bill is intended to operate as a forward           
funding mechanism, so that districts can obligate themselves in the            
spring and summer for the following school year without fear that a            
lower actual enrollment will occur which will substantially decrease           
foundation aid, after the district has committed itself to certain             
contractual obligations.  See secs. 9 and 10 of the bill.                      
Finally, since the bill makes some major adjustments in how                    
foundation aid is calculated, sec. 12 of the bill protects a district so       
that its basic need for aid under AS14.17.021(b) for fiscal years 1994,        
1995, and 1996 will not be less than the amount calculated under the           
present formula, unless there is a reduction in student enrollment.            

1993-01-22                     House Journal                      Page 0141
HB 85                                                                        
This bill represents the collective wisdom of the many Alaskans                
through Alaska 2000 to improve the way the state provides financial            
aid to school districts.  Given the amount of the state budget at stake        
in this important program, it is essential that the program be run             
efficiently and effectively to benefit all Alaskans, especially the            
children of Alaska.  I urge your early consideration of this important         
      Walter J. Hickel