Legislature(2021 - 2022)ADAMS 519
04/14/2021 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Presentation: Tribal American Rescue Plan Act Funding | |
| HB169 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 169 | TELECONFERENCED | |
| += | HB 69 | TELECONFERENCED | |
| += | HB 71 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED | ||
HOUSE BILL NO. 169
"An Act making appropriations for public education and
transportation of students; and providing for an
effective date."
3:05:53 PM
Co-Chair Foster listed individuals available online.
REPRESENTATIVE DAN ORTIZ, SPONSOR, introduced the
legislation with a prepared statement:
I appreciate the opportunity for the chance to present
House Bill 169, which is an appropriation bill for the
education formula and pupil transportation for fiscal
year 2022. House Bill 169 is a separate appropriation
bill from the regular operating budget in order to
pass funding for education earlier in the session and
prevent school districts from issuing mandatory
teacher layoff notices.
Each year, school districts rely heavily on an
appropriation from the state to fund education,
although we, the legislature, sometimes do not pass
the operating budget until late May or June. School
districts must complete their budgets much earlier,
usually in March. Districts are often forced to draft
multiple budgets and anticipate low amounts.
In the face of uncertainty, school districts will
sometimes issue pink slips to tenured teachers by May
15th and to non-tenured teachers by the last day of
the school year because they did not know what the
legislature was going to do specifically in
relationship to funding for education; therefore,
without knowing, by contracts, stipulations, and
things like that, they sometimes are forced to hand
out pink slips because they were left without the
information they needed. Therefore, there was an
opportunity cost with that. Education and students'
success is a high priority for the state.
Keeping educators in the classrooms is one of the most
effective ways to address that priority. House Bill
169 reflects the legislature's commitment to
education, the school districts, and teachers.
Vice-Chair Ortiz further explained the bill was an attempt
by the legislature to give early notice to districts as to
where things would stand for them in relationship to
funding. The goal was to hopefully avoid districts having
to issue pink slips. He explained there was an opportunity
cost with issuing pink slips because teachers sometimes
decided to leave a community and take a job elsewhere. He
highlighted the difficulty retaining teachers in Alaska. He
hoped the problem could be avoided by working together to
pass an early funding bill. He was available for questions.
Co-Chair Foster did not see the necessity of reviewing the
sectional analysis. He pointed out that the legislature had
provided early funding for education several years back. He
explained early funding was different than forward funding.
He elaborated that early funding meant paying the current
year as the legislature normally would in the operating
budget, but rather than putting it in the operating budget,
it was included in a separate bill to provide funding
sooner. He elaborated that with the anticipated ARPA
funding, the operating budget timeline had slowed down. He
detailed that if the budget was not completed until after
May 15, it was a problem for school districts. He argued
that while May 15 was the deadline, some school districts
had multiple schools that were asked internally to provide
a list of potential pink slips by May 1. He highlighted
that if the legislature did not issue a budget by May 10 or
so, it would put some school districts in a bind. He
pointed out that HB 169 was a basic bill that followed the
formula. He clarified the bill did not contain any
additional items such as projected ARPA funds or one-time
increments.
3:10:49 PM
Representative Josephson asked what average daily
membership (ADM) would be applied to the calculation.
Vice-Chair Ortiz answered that the ADM had been impacted in
the current year by COVID. He had heard requests to use the
FY 19 ADM numbers rather than the most recent October
numbers. He did not know whether the legislature had the
leeway to make the adjustment in the bill. He relayed he
had submitted the question to the department.
LACEY SANDERS, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT
OF EDUCATION AND EARLY DEVELOPMENT, OFFICE OF MANAGEMENT
AND BUDGET, OFFICE OF THE GOVERNOR (via teleconference),
answered that there were no changes made by the current
version of the bill and the Department of Education and
Early Development (DEED) would utilize the existing statute
to provide payments to school districts. Currently the
projection in the bill was based on the ADM provided by the
school districts in September 2020; however, there would be
a new student count with preliminary numbers after October
2021. She detailed that a reconciliation would be provided
by the department and finalized numbers would be available
in March of 2022. She explained the March 2022 number would
be paid to school districts.
3:13:02 PM
Representative Josephson provided a scenario where student
populations beginning in mid-August looked more like a
typical year as opposed to the current school year. He
asked if the appropriation would look more like the
2019/2020 school year under the scenario.
Ms. Sanders answered in the affirmative. She detailed
districts would be paid based on the school count period in
the fall [of 2021].
Representative Rasmussen asked if it was possible to look
at language for funding the following year as well in the
same piece of legislation to bring some certainty to
districts. She reasoned if the funding was within the same
two-year cycle, the legislature would not be binding a
future legislature to an appropriation. She believed it was
important for the legislature do everything it could to not
put teachers and schools in the position of receiving pink
slips, especially during a time with many financial
stresses on families.
Ms. Sanders responded that the bill provided funding for FY
22 and did not address FY 23. She believed it was what Co-
Chair Foster had spoken to earlier when he had explained
the bill did not forward fund education.
Co-Chair Foster added that the bill did not forward fund,
but it could. He stated the other part of the equation was
whether the legislature wanted to do so. He relayed the
committee could add the provision with an amendment.
3:15:47 PM
Representative LeBon supported the legislation. He stated
that he almost wished the legislature had passed the bill a
bit earlier. He recalled his time on the Fairbanks School
Board and reported that the school board had been deep into
its budget process one to two months back. He highlighted
that it still did not hurt that the legislature was giving
districts some heads up that it was willing to fund to the
formula. He stated that the bill would help regardless.
Vice-Chair Ortiz referenced an earlier question by
Representative Josephson. He asked if it would be legal to
use the ADM count from FY 19 with the understanding that
those numbers may more accurately reflect the student count
in October of 2021.
Ms. Sanders answered that using a different student count
period would require a statutory change. She noted that the
bill reflected the projections currently. She clarified
that the actual payment made by DEED to school districts
would be paid based on actuals in FY 22.
Representative Thompson noted that the bill looked at
projections for the current budget using 2020 counts from
the past fall. He believed funding would be short if the
student count in the fall increased to the 2019 level, but
the budget used the 2020 count. He asked if it would mean a
supplemental budget item.
Co-Chair Foster answered that it was possible to do a
supplemental. He remarked that the question had been asked
to Legislative Legal Services or another entity. He
explained that if the 2019 student count were used, each
school would get a disproportionate amount. He referenced a
recent year when the legislature had allocated a one-time
increment of $35 million. He noted it had been necessary to
get around the disparity test. He asked if the one-time
increment had been allocated based on the ADM.
3:20:07 PM
Ms. Sanders clarified that the estimates provided in the
bill were projections by the school districts on what they
think the next school year would look like. She elucidated
that the projections were not based on the districts'
decreased populations during the pandemic. She explained
the language in the bill provided the appropriation at the
amount necessary to fund, which provided DEED the ability
to pay school districts based on the actual student count
period and did not require DEED to come back for a
supplemental. The department reported back on the changes
between the initial projection and the actual amount
required. She reiterated it did not require DEED to come
back for a supplemental. She agreed that the $35 million
had been an appropriation outside the foundation formula,
which was allocated based on the adjusted ADM. She
confirmed that changes to the formula required working with
federal partners to avoid failing the disparity test, which
would cost the state more money.
Co-Chair Foster thought there would be a $26 million dip in
the funding for education because students had gone to
correspondence and fewer students had been in schools. He
asked how to ensure schools did not see a reduction. He
highlighted that eventually students would be back in brick
and mortar schools.
Ms. Sanders replied that school districts would be paid
based on their actual student count. In the current year,
districts may see a dent based on the decline in actual
student enrollment. She clarified that the fund
appropriated in HB 169 would be based on the next [school]
year. She explained that school districts may have
considered students returning from correspondence programs
as schools were reopening in the next fiscal year and
projections would not reflect the dip that occurred in the
current year.
3:23:28 PM
Representative Edgmon spoke to projections versus actual
student counts. He stated that in the fall of 2020, many
schools had kids being instructed by remote learning or not
in school. He stated his understanding that schools were
projecting "x" number of students in the fall in order to
meet the funding that would come into play in March of
2022. He asked if projections could be used to suffice for
the student count.
Ms. Sanders replied in the affirmative. She elaborated that
statutory guidance directed school districts to provide
projections in the fall in order for DEED to have a budget
to present to the legislature. She confirmed that districts
provided projections.
Representative Edgmon used the Bristol Bay Borough in his
district as an example. He remarked that most of the kids
were at home. He considered a scenario where the district
projected 300 students for the fall of 2020. In terms of
the legislation, he asked if the projections would suffice
as opposed to counting the actual students.
Ms. Sanders responded that DEED used projections when it
developed the future year budget. She clarified that when
DEED reimbursed districts during the year, it used
districts' first nine months based on the FY 21 count and
trued up in the final three months. She explained that
projections were used for purposes of budgeting and when
the actual student count occurred in October, the
department used the actual counts.
Representative Edgmon surmised the legislature could
appropriate $1.1 billion in HB 169, but in the end, what
actually went to school districts could be smaller because
of the actual numbers in the true up.
Ms. Sanders answered that the funding could be less or more
depending on student counts.
Co-Chair Foster referenced $26 million the legislature had
heard schools would be shorted. He asked if the $26 million
would be applied to the FY 21 budget with the "estimated to
be" language. Alternatively, he asked if it was the
projection for the FY 22 budget that schools would be short
by $26 million.
3:27:11 PM
Ms. Sanders stated her understanding that in FY 21 there
was an increase over the projection in the prior budget.
She would follow up with an answer in writing.
Representative LeBon stated there was a lot unknown out
there. He shared that his own district in Fairbanks was
doing everything it could identify returning students
because many students sought other options as much of the
in-person instruction had paused. He recalled having
meetings in June and July during his time on the school
board to adjust budget amounts because of new information.
He explained that in Fairbanks, funding had come from
federal sources because of the schools on Fort Wainwright
and Eielson Air Force Base. Additionally, there was the
state funding formula, a borough component, and
miscellaneous grants. He highlighted that budget actions
were not limited to one time per year.
Co-Chair Foster pointed out that although May 15th may be a
deadline for tenured teachers, there was a deadline on the
last day of school for non-tenured teachers, which was
April 30 in one of the schools in his district. He stressed
that the issue impacted schools.
Representative Wool stated that the student count was down
in Fairbanks by 2,000 from the previous year. He added that
statewide the count was down 2,000. He noted that kids
doing remote learning during in-person school closures did
not change the student count. He remarked that
correspondence learning was within the public school system
depending on the program. He pointed out that although
projected numbers were down from 2019, some school
districts were up. He cited Galena as an example and
explained that correspondence schools had a surge in
enrolment. He referenced many calls to legislators
requesting the use of 2019 numbers [in the education
budget]. He reasoned that if the budget used 2019 numbers,
the schools with robust correspondence programs (e.g., the
Galena or Yukon-Kuskokwim School districts) would take a
hit. He did not know what the correspondence schools'
projected numbers were, but he speculated they would likely
see decreases in student numbers. He reasoned that while it
sounded simple, it may not be advisable to use 2019 student
count numbers in the budget. He considered that statewide,
the student count was only down by 2,000 and attributed the
decrease partially to people leaving the state and private
schools absorbing some of the students. He believed that
remote schooling would not be offered in Fairbanks in the
coming school year. He thought students would have the
choice of doing correspondence or going to school in
person. He speculated that school numbers would bounce
back. He reported that his kids, who were attending school
in person, had told him more students were returning to the
classroom each week. He asked where student counts were
currently in comparison to 2019 numbers.
3:32:35 PM
Ms. Sanders replied that she did not have the district
allocation on hand. She shared that the DEED website had a
report showing projections provided by school districts.
She would include the information in her response to the
committee.
Vice-Chair Ortiz asked if Ms. Sanders had the HB 169
sectional analysis on hand.
Ms. Sanders replied that she would pull it up online.
Vice-Chair Ortiz referenced language in the sectional
analysis specifying the bill would appropriate the amount
necessary, estimated to be $1.193 billion. He asked if the
number reflected the savings or lessened funding that would
go towards the Base Student Allocation (BSA) based on
declined student enrollment due to COVID.
Ms. Sanders answered that the number reflected the student
count projected by school districts during the next school
year. She relayed that school districts may have included
some reduction based on projected declines, whether from
COVID or students leaving the state. She could not speak to
each school districts' basis for determining their
projections.
Vice-Chair Ortiz asked if it was no longer the position of
the administration that approximately $30 million would be
saved in the FY 22 budget based on declining enrollment.
Ms. Sanders answered that she was not aware of the
statement being made. She was not aware of the $30 million
in savings due to [enrollment] decline. She reported that
the actual cost of education had increased over the
projection from the previous year. She elaborated that the
number had increased by $26 million from the previous
session. She wondered if Vice-Chair Ortiz was possibly
comparing FY 20 to FY 22.
Vice-Chair Ortiz answered that he was referring to a number
referenced by Co-Chair Foster. He explained that the
governor's initial budget reflected a decrease in BSA
funding based on declining enrollment in FY 21. He did not
recall the precise number referenced by Co-Chair Foster
earlier in the meeting.
Co-Chair Foster recalled the figure as $26 million.
Co-Chair Foster asked Ms. Sanders to include the
information in the written response to the committee.
3:36:46 PM
Representative Carpenter asked for clarification on the
projections and student counts. He referenced earlier
discussion about September 2020 and October 2021 student
counts for the ADM. He asked for verification that both
were physical counts. He surmised the October 2021 count
was not a projection. He thought the budget process used
what he characterized as a third count reflecting
projections created currently during the budget process. He
asked for verification that the projected count resulted in
the $1.2 billion appropriation.
Ms. Sanders answered that there was one physical count
period that occurred in October 2020, which determined what
would actually be paid during the current year. The
projection provided by the school district was at the same
time for the following year; however, in October 2021,
there would be another physical student count period that
would apply to the next year's payment.
HB 169 was HEARD and HELD in committee for further
consideration.
Co-Chair Foster reviewed the schedule for the following
day.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 169 Sectional Analysis.pdf |
HFIN 4/14/2021 1:30:00 PM |
HB 169 |
| HB 169 Sponsor Statement.pdf |
HFIN 4/14/2021 1:30:00 PM |
HB 169 |
| AFN - HFIN, re - ARPA (14APR21).pdf |
HFIN 4/14/2021 1:30:00 PM |