Legislature(2013 - 2014)CAPITOL 106
03/20/2013 08:00 AM House EDUCATION
| Audio | Topic |
|---|---|
| Start | |
| HB133 | |
| HB93 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 133 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 93 | TELECONFERENCED | |
| += | HB 151 | TELECONFERENCED | |
HB 133-SCHOOL CONST. GRANTS/SMALL MUNICIPALITIES
8:04:44 AM
CHAIR GATTIS announced that the first order of business would be
HOUSE BILL NO. 133, "An Act relating to grants for school
construction."
8:05:18 AM
TIM CLARK, Staff, Representative Bryce Edgmon, Alaska State
Legislature, presented a PowerPoint, titled "HB 133 School
Construction Grants/Small Municipalities." [Included in members'
packets] He read from slide 2: "HB 133 makes small municipal
school districts that meet certain criteria eligible for school
construction funding from the REAA fund. Five districts would
currently qualify. They are Saint Mary's, Tanana, Kake,
Klawock, and Hydaburg." He stated that the proposed bill
related to Willie and Sophie Kasayulie, et al., v. State of
Alaska, 3AN-97-3782 CI, (1999), which had identified inequitable
access to construction funding for rural schools. He explained:
Most municipal districts are able to bond for school
construction and subsequently access the state's debt
reimbursement program. However, Regional Education
Attendance Areas (REAAs) as well as some small rural
school districts lack taxable bases large enough to
make bonding for construction possible. Therefore,
REAAs and some small rural school districts can never
access the guaranteed state funding that exists in the
form of the bonding debt reimbursement program.
MR. CLARK read from slide 3, "The REAA Fund was established in
2010 to make a more reliable, consistent funding stream
available to REAAs, none of which can bond for school
construction," and he shared that they would not have access to
this guaranteed funding stream in the form of debt
reimbursement. He continued reading: "Some small municipal
school districts are effectively in the same circumstances as
REAAs." Moving on to slide 4, he stated that, "The Department
of Education and Early Development Capital Improvement Projects
School Construction Grant Fund List," which he declared would be
referred to as "The List," "plays a central role." Directing
attention to slide 5, "Paths to School Construction Funding in
the Capital Budget," he declared that these pathways were the
heart of the proposed bill and school construction funding. He
tracked the paths to receiving school construction funding in
the Capital Budget, and walked through the available means for
construction funding. He declared that bonding was available to
most municipal districts, as the State of Alaska subsequently
reimbursed 60 - 70 percent of that annual bond debt as
guaranteed by law. He described that the other path was through
the school construction grant list, which was open to REAAs,
small municipal school districts without bonding capability, and
those districts with bonding capability, if they so choose. He
explained that the Department of Education and Early Development
(EED) ranked all the projects on the grant list by priority, and
that the projects then awaited funding in that order of
priority. He explained that a non-REAA project was reliant on
legislative appropriation from the General Fund, with no
guarantee to any project on the list that funds would be made
available. He pointed out that an REAA project at the top of
the list would have access to designated funding in the REAA
fund by the legislature, with no other competition.
8:12:29 AM
REPRESENTATIVE P. WILSON asked how schools would qualify to be
placed on the list.
MR. CLARK replied that there was an EED application process for
assessment and addition to the list.
REPRESENTATIVE P. WILSON offered her belief that it was
necessary for an architect or engineer to review the project
prior to the EED.
MR. CLARK pointed out that school construction was not solely
defined as an entirely new structure, and could include
expansion of capacity.
8:13:59 AM
REPRESENTATIVE SADDLER directed attention to slide 5, and
clarified that the list for non-REAA projects was recreated
every year, so that there could always be higher priority issues
such that there are schools that edge out others.
MR. CLARK expressed his agreement, and explained that the set of
criteria by the department includes considerations for health
and safety issues, such that a natural disaster issue could
prioritize a project.
REPRESENTATIVE SADDLER pointed out that both ranking and a lack
of appropriation could mean that a project would never reach the
top of the list.
MR. CLARK agreed that was concern for any project on the Non-
REAA project list.
CHAIR GATTIS reminded the committee that the EED had a
representative available to answer any questions.
8:15:33 AM
REPRESENTATIVE LEDOUX, offering an example for a number of
families settling in a remote area where there was not a school,
although there were ten children, asked if a school would
automatically be built to accommodate them.
MR. CLARK offered his belief that the area would need to
incorporate in some form of municipality in order to receive the
funding.
8:17:05 AM
ELIZABETH SWEENEY NUDELMAN, Director, School Finance and
Facilities Section, Department of Education and Early
Development (EED), in response, said that the arrival of 10
students to a community would not automatically entitle a
school. She said that criteria for school construction would
need to be met, which included identification as an attendance
area, with an additional review for an area of less than 24
students.
REPRESENTATIVE LEDOUX reflected on an earlier visit to a logging
camp where a school had existed in a trailer which did not
appear to be an EED approved building. She reported that the
logging camp had more students than many villages, and she asked
why this community had not been entitled to a school.
MS. NUDELMAN explained that modular units were provided to some
areas, but that any community requesting a school would need to
process an application for funding and construction through EED.
8:20:13 AM
REPRESENTATIVE DRUMMOND noted that a logging camp was, by
definition, a temporary location. She pointed out that the
Anchorage School District had supplied as many as 150 portable
classrooms. Referring to the statement on slide 5, "60-70
percent of annual bond debt, guaranteed by law," she stated that
the Anchorage School District never took that for granted, even
though millions of dollars were passed in bond issues. She
stated that there was always a final decision for funding by the
State Legislature.
MR. CLARK suggested that it would be better to state that the
reimbursement program was in law.
8:21:25 AM
REPRESENTATIVE SEATON, referring to the aforementioned "The
List," offered his belief that school districts were not able to
receive assessment grants from [Department of Commerce,
Community & Economic Development] to develop the criteria for
consideration by Department of Education and Early Development
(EED) to be placed on "The List." He asked if this information
was correct.
MR. CLARK deferred.
MS. NUDELMAN explained that she was not familiar with a grant
program for application development, but that school districts
had the opportunity to apply to EED for phased funding, which
included design funding for project development. She reported
that some of the applications were developed in-house at the
school districts, and that the application process was very
clear. She stressed that there were several avenues for the
school districts in preparation of the applications.
REPRESENTATIVE SEATON referred to non-REAA projects, and pointed
to a large re-build project in the Anchorage School District,
which the Alaska State Legislature had approved and funded.
8:24:53 AM
MR. CLARK, directing attention to slide 5, emphasized the
contrast in the funding avenues for projects that were eligible
for the REAA fund versus those that were non-REAA eligible. He
declared that an REAA project had a greater likelihood for
funding due to the availability of the fund.
REPRESENTATIVE SEATON asked to clarify that the fund had been
created as a result of Willie and Sophie Kasayulie, et al., v.
State of Alaska, 3AN-97-3782 CI, (1999), which had determined
that rural school districts did not have the same opportunity
for construction as the municipal school districts.
MR. CLARK expressed his agreement that this provided a more
reliable funding stream.
8:26:25 AM
MR. CLARK read slide 6 which summarized the PowerPoint
presentation:
HB 133 makes small municipal school districts that
meet certain criteria eligible for the REAA fund.
Five districts would currently qualify. They are
Saint Mary's, Tanana, Kake, Klawock, and Hydaburg.
Like REAAs, these districts are not capable of bonding
and need access to the more consistent, reliable
funding source the REAA Fund creates. Making them
REAA Fund-eligible will further rectify the inequities
in rural school construction funding identified in
Kasayulie v. Alaska.
8:27:18 AM
REPRESENTATIVE P. WILSON asked who could apply to the REAA fund.
MR. CLARK replied that every REAA in the state was eligible, and
that proposed HB 133 would add eligibility for these five small
municipal school districts which were currently in a different
category.
REPRESENTATIVE P. WILSON asked to clarify that the limited fund
was being opened to more qualified school districts.
MR. CLARK explained that the practical effect on the fund was
small, as the fund was annually capitalized according to a
formula.
8:29:29 AM
TOM BEGICH, Policy Director, Citizens for the Educational
Advancement of Alaska's Children (CEAAC), explained that CEAAC
represented 21 of the 53 school districts in Alaska, and that
REAAs were the choice for highest priority of funding. He
declared that the members of CEAAC were in support of proposed
HB 133. He pointed out that the aforementioned five small
school districts had all been original members of the Kasayulie
lawsuit, but had not been included in the settlement language
for the REAA fund. He declared that proposed HB 133 would
correct this inequity.
REPRESENTATIVE P. WILSON asked how many schools were included in
REAAs.
MR. BEGICH replied that he did not have the exact number.
8:31:30 AM
REPRESENTATIVE SADDLER asked if there was any prospect for
future expansion.
MR. BEGICH replied that CEAAC did not intend to ask for
expansion, as the formula for REAA funding was very equitable,
and only allowed for school districts without the ability to
bond.
REPRESENTATIVE SADDLER asked if proposed HB 133 would dilute the
availability of funds to the REAAs.
MR. BEGICH replied that there would be minimal dilution of
funding to the REAAs in the next five to eight years,
specifically as there were not a lot of projects currently on
the list.
8:34:11 AM
REPRESENTATIVE SADDLER referred to the fourth paragraph of the
Sectional Summary [Included in members' packets} and read: "The
change provides that the percentage of municipal school
districts that are eligible for the REAA Fund will not be
included in the percentage of municipal school districts by
which the annual debt service is divided in the formula." He
asked for further clarification of the section.
MR. BEGICH explained that the five schools were being moved
"from one end of a divisor and putting them in the other end of
the divisor." He pointed out that the divisor was determined by
the total amount of bonding in any given year. He reported that
the current fund was a bit more than $35 million but could not
exceed $70 million. He said that this would add an additional
$600,000 to the fund.
8:35:51 AM
MS. NUDELMAN, referring to an earlier question, said that there
were 451 schools in the state, and that 136 schools were in
REAA's, while the remaining 315 schools were in the city and
borough school districts.
8:36:53 AM
REPRESENTATIVE REINBOLD asked how many of the REAA's had a tax
base which could contribute locally to the schools.
8:37:07 AM
MS. NUDELMAN replied that as the REAA's are in unorganized areas
of the state they were not organized to assess taxes similar to
city and boroughs. She noted that these REAAs did occasionally
receive impact aid.
8:38:00 AM
MS. NUDELMAN, in response to Representative P. Wilson, confirmed
that 136 schools were eligible for the construction project list
and access to the REAA fund, and that proposed HB 133 would add
5 more schools.
8:38:42 AM
REPRESENTATIVE SADDLER offered his belief that the unorganized
boroughs would eventually become organized boroughs, and asked
if the REAAs would eventually become school districts.
MS. NUDELMAN replied that this was a state policy question and
she would not speculate on it.
REPRESENTATIVE SADDLER asked if any REAAs had become school
districts.
8:39:49 AM
MR. BEGICH, noting that the history of the state was consistent,
explained that when a borough was formed the REAA became,
instead, a functioning school district with a tax base. He
pointed out that this decision was quite complex and was made in
conjunction with the Local Boundary Commission, although it was
based on the ability to have a sustainable tax base.
8:40:40 AM
REPRESENTATIVE P. WILSON, directing attention to the military
base in the area between Fairbanks and Tok, asked if there was a
tax base even though it was not a borough.
MR. BEGICH replied that many entities went through a long
process for determination of borough formation, and that there
was an initiative being considered in that area.
8:41:46 AM
REPRESENTATIVE SEATON asked if the tax from oil and gas
production located in an REAA was paid to the State of Alaska.
MR. BEGICH replied that this was correct.
8:42:38 AM
DAVID HERBERT, Superintendent, Saint Mary's City School
District, provided historical background to explain that the
district had been excluded during the final settlement
negotiations of Kasayulie as it was not an REAA school district,
but a first class city school district. He explained that a
first class city school district required an annual local
contribution from the city to the school district to offset the
costs of its operation, whereas an REAA did not have this
mandatory local contribution. He pointed out that Saint Mary's
City School District was surrounded by REAA districts, all of
which benefitted from the aforementioned settlement for school
construction funds. He explained that the school district had
taken the necessary steps to improve its position on the school
construction list by writing a quality application, academically
outperforming the surrounding schools, and showing a frugal
fiscal responsibility. He said that it was the only small
municipal school district on the school construction list to
which the proposed bill would apply; therefore, the impact of
the proposed bill was minimal to the state but very important to
the school district.
8:45:31 AM
MR. HERBERT explained that municipalities which had bonding
capacity were eligible for reimbursement up to 70 percent of
construction expenses. He pointed out that the group of REAA
school districts now had access to funds for school construction
due to Kasayulie, with an equitable formula of funding with the
municipalities. He opined that, as Saint Mary's City School
District was surrounded by REAAs, it made sense for it to be
included in the funding mechanism. He declared that the St.
Mary's City School District had demonstrated its ability to
provide quality education in Rural Alaska, and ensured that its
students would become productive, contributing citizens. He
urged the passage of proposed HB 133.
8:47:41 AM
REPRESENTATIVE REINBOLD commented that Anchorage had an excess
of elementary school space due to the 70 percent reimbursement
for school funding, and that property taxes were "taxed to the
max." She asked if the current mandatory contribution would no
longer be required if the proposed bill passed. She said that
she was "a huge believer that the community needs to have skin
in the game. They need to help develop the resources and jobs
around them." She asked for a statement of support from the
community that it would work with the Legislature to sustain the
schools.
MR. HERBERT replied that proposed HB 133 had no impact on the
required mandatory annual local contribution, which was
currently about $35,000 in Saint Mary's.
REPRESENTATIVE REINBOLD asked if this contribution was for one
school and how much was the school budget.
MR. HERBERT replied that that there was only one school and its
budget was about $3 million.
REPRESENTATIVE REINBOLD mused that this mandatory contribution
was about 10 percent.
MR. HERBERT explained that the mandatory local contribution rate
was determined by the state.
8:49:59 AM
REPRESENTATIVE LEDOUX asked why Saint Mary's City School
District had initially been a part of the lawsuit, but was then
not included in the settlement.
MR. BEGICH explained that the REAA Fund was created by the
Alaska State Legislature prior to settlement of the Kasayulie
lawsuit, which had allowed for settlement by a consent decree
that both parties would abide by this mechanism. He opined that
all of the schools at the time should have been included,
however the court had only named the top seven schools that were
listed in the suit.
MR. HERBERT added that these five school districts were in a
unique situation which needed to be addressed by the legislature
in order to create funding equality.
8:53:45 AM
REPRESENTATIVE LEDOUX questioned the process of the five school
districts' inclusion in the lawsuit and then removal from the
settlement. She said "that just doesn't make any sense to me."
8:54:07 AM
REPRESENTATIVE P. WILSON stated that she was "a real stickler
for fairness," and she declared her support for the proposed
bill.
8:55:18 AM
BRUCE JOHNSON, Executive Director, Alaska Council of School
Administrators (ACSA), said that David Herbert also served as
the president of ACSA, and he expressed his agreement with the
testimony regarding the need for a solution to this difficult
situation for the five school districts.
8:56:04 AM
CHAIR GATTIS closed public testimony.
8:56:13 AM
REPRESENTATIVE SEATON said that the proposed bill would provide
the opportunity for other major maintenance projects to be
prioritized.
8:57:17 AM
REPRESENTATIVE DRUMMOND stated her support for adding the small
school districts; however, she expressed concern for the
continued funding given the projected revenues. She questioned
whether the reimbursement was, indeed, "guaranteed by law."
8:58:01 AM
REPRESENTATIVE REINBOLD corrected her earlier observation,
noting that Saint Mary's contributed one percent to the school
budget. She emphasized that local communities needed to
contribute more than this amount, and needed to create jobs and
develop resources in the community.
8:58:48 AM
REPRESENTATIVE P. WILSON moved to report HB 133, labeled 28-
LS0509\A, out of committee with individual recommendations and
the accompanying fiscal notes. There being no objection, HB 133
was moved from the House Education Standing Committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 01 HB 133 Bill Text.pdf |
HEDC 3/11/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 02 HB 133 Sponsor Statement.pdf |
HEDC 3/11/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 03 HB 133 Sectional Summary.pdf |
HEDC 3/11/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 04 HB 133 ADMs and Full Values.pdf |
HEDC 3/11/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 05 HB 133 Kasayulie v. Alaska Consent Decree and Settlement Agreement.pdf |
HEDC 3/11/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 06 HB 133 DEED FY14 School Construction Grant Fund List.pdf |
HEDC 3/11/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 07 HB 133 PowerPoint.pdf |
HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 08 HB 133 Fiscal Note - EED-FundTransfer-3-13-13.pdf |
HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 133 |
| 00 CSHB 93 v. P.PDF |
HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 01 HB 93 Sponsor Statement.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 02 HB 93 v. A - Bill Text.PDF |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 03 CSHB 93 v. O.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 04 HB93 Changes from HB93 to CSHB93 v. O.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 05 HB 93 FAQ.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 06 HB 93 Fiscal Note - EED-TLS-3-6-13.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 07 HB 93 Sectional Summary v. A.PDF |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 08 HB 93 Backup Charter Schools Basic Information EED.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 09 HB 93 Research CERP Primer Multiple Authorizers 12-11.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 10 HB 93 Research ECS - What Policymakers Need to Know about Charter Schools.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 11 HB 93 Research Legislative Research Services.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 12 HB 93 Research Material - AYP Data for Charter Schools.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 13 HB 93 Letter Support NAPCS 3-13-13.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 14 HB 93 Letter Oppose NEA.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 15 HB 93 Letter Oppose Eagleton.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 16 HB 93 Letter Oppose ESSA.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 17 HB 93 Letter Oppose NAACP.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 18 HB 93 Letters Oppose.PDF |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 19 HB93 Letter Support - Covey.PDF |
HEDC 3/15/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM |
HB 93 |
| 01 HB 151 Sponsor Statement v. A.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |
| 02 HB 151 v. A Bill Text.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |
| 03 HB 151 Sectional v. A.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |
| 04 HB 151 Fiscal Note v. A - EED-TLS-3-8-13.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |
| 05 CS HB 151 ver. O.PDF |
HEDC 3/15/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |
| 06 HB 151 Information Packet.pdf |
HEDC 3/15/2013 8:00:00 AM HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |
| 07 CSHB 151 Fiscal Note - EED-TLS-3-14-13.pdf |
HEDC 3/18/2013 8:00:00 AM HEDC 3/20/2013 8:00:00 AM HEDC 3/22/2013 8:00:00 AM HEDC 3/25/2013 8:00:00 AM HEDC 4/3/2013 8:00:00 AM |
HB 151 |