Legislature(1993 - 1994)

1993-01-22 Senate Journal

Full Journal pdf

1993-01-22                     Senate Journal                      Page 0133
SB 62                                                                        
SENATE BILL NO. 62 by the Senate 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 Community and Regional             
Affairs Committee, the Health, Education and Social Services                   
Committee and the Finance Committee.                                           
Fiscal note published today from Department of Education.                      
Governor's transmittal letter dated January 22:                                
Dear Mr. President:                                                            
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                     Senate Journal                      Page 0134
SB 62                                                                        
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        

1993-01-22                     Senate Journal                      Page 0135
SB 62                                                                        
program.  See sec. 5 of the bill.                                              
The bill also makes adjustments to the foundation program for                  
calculation of financial support to a district for its gifted and talented     
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          

1993-01-22                     Senate Journal                      Page 0136
SB 62                                                                        
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              
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