Legislature(2013 - 2014)CAPITOL 106

02/28/2014 08:00 AM EDUCATION


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08:06:07 AM Start
08:06:35 AM HB278
10:04:07 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 278 EDUCATION: FUNDING/TAX CREDITS/PROGRAMS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
         HB 278-EDUCATION: FUNDING/TAX CREDITS/PROGRAMS                                                                     
                                                                                                                                
8:06:35 AM                                                                                                                    
                                                                                                                                
CHAIR GATTIS announced  that the only order of  business would be                                                               
HOUSE  BILL  NO.  278,  "An   Act  increasing  the  base  student                                                               
allocation  used  in the  formula  for  state funding  of  public                                                               
education;   repealing    the   secondary    student   competency                                                               
examination  and related  requirements; relating  to high  school                                                               
course credit  earned through assessment;  relating to  a college                                                               
and career readiness assessment  for secondary students; relating                                                               
to  charter  school  application  appeals  and  program  budgets;                                                               
relating  to  residential  school  applications;  increasing  the                                                               
stipend  for  boarding  school students;  extending  unemployment                                                               
contributions for  the Alaska technical and  vocational education                                                               
program; relating  to earning high  school credit  for completion                                                               
of   vocational  education   courses   offered  by   institutions                                                               
receiving  technical and  vocational  education program  funding;                                                               
relating to education tax  credits; making conforming amendments;                                                               
and providing for an effective date."                                                                                           
                                                                                                                                
[Presentation    and   discussion    limited   to    the   school                                                               
transportation section of HB 278.]                                                                                              
                                                                                                                                
8:07:27 AM                                                                                                                    
                                                                                                                                
MIKE  HANLEY, Commissioner,  Department  of  Education and  Early                                                               
Development (EED),  said his presentation  is in response  to the                                                               
committee's    questions    about    the    appropriateness    of                                                               
transportation  being listed  as a  component of  [HB 278].   The                                                               
presentation  will  include  the history  of  the  transportation                                                               
component,   its   funding,   and  its   impact   on   districts.                                                               
Commissioner  Hanley  began  by  reading  the  current  statutory                                                               
language as follows:                                                                                                            
                                                                                                                                
     The budget for  charter schools shall not  be less than                                                                    
     the  amount generated  by the  students,  and that  the                                                                    
     amount generated  by students  enrolled in  the charter                                                                    
     school is  to be  determined in the  same manner  as it                                                                    
     would for students enrolled in other public schools.                                                                       
                                                                                                                                
COMMISSIONER HANLEY  explained that  the language of  the charter                                                               
school portion of  the bill is based on -  and is a clarification                                                               
of -  the aforementioned current language.   The idea of  the new                                                               
language  in the  bill  is  not to  add  new  components, but  to                                                               
recognize  and  clarify  the  amount   of  funding  generated  by                                                               
students, specifically transportation funding.   He stressed that                                                               
the language is addressing equity,  and issues of disparity, that                                                               
have been brought  to the attention of EED.   Commissioner Hanley                                                               
directed attention  to a document  found in the  committee packet                                                               
entitled, "Transportation  of Pupils,"  and dated  2/28/14, which                                                               
read:                                                                                                                           
                                                                                                                                
     Sec. AS 14.09.010. Transportation of students.                                                                             
                                                                                                                                
     (a)   A   school   district   that   provides   student                                                                    
     transportation  services  for   the  transportation  of                                                                    
     students  who   reside  a  distance   from  established                                                                    
     schools is  eligible to  receive funding  for operating                                                                    
     or subcontracting  the operation of  the transportation                                                                    
     system for students to and  from the schools within the                                                                    
     student's  transportation  service  area.   Subject  to                                                                    
     appropriation, the  amount of  funding provided  by the                                                                    
     state for  operating the student  transportation system                                                                    
     is the amount of a  school district's ADM, less the ADM                                                                    
     for the  district's correspondence programs  during the                                                                    
     current  fiscal year,  multiplied  by  the per  student                                                                    
     amount for the school district as follows:                                                                                 
                                                                                                                                
COMMISSIONER HANLEY  stated that  the transportation  program was                                                               
once a  reimbursable program; districts submitted  their costs to                                                               
EED and the department reviewed  and reimbursed the costs.  About                                                               
ten  years ago,  in  an attempt  to  encourage efficiencies,  EED                                                               
moved from a  reimbursable amount to a block  grant program based                                                               
on  the  average daily  membership  (ADM)  in  a district  and  a                                                               
formula  that  calculates  how  much a  district  receives.    He                                                               
referred  to a  second  document found  in  the committee  packet                                                               
entitled   "Pupil  Transportation   Program   -  Charter   School                                                               
PROJECTIONS,"  and dated  2/28/14.   This document  indicated the                                                               
projected  fiscal   year  2014   (FY  14)   ADM  and   per  child                                                               
transportation  costs  for  each   school  district  which,  when                                                               
multiplied,   determine    the   amount   of    each   district's                                                               
transportation grant.   Also, two separate  columns indicated the                                                               
additional  projections  for  the students  enrolled  in  charter                                                               
schools in eight districts.                                                                                                     
                                                                                                                                
8:11:45 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE P. WILSON asked for  the consequences to a charter                                                               
school whose ADM drops below 150 students.                                                                                      
                                                                                                                                
COMMISSIONER  HANLEY said  if a  charter school  falls below  150                                                               
students  it  is  in  hold-harmless  standing,  and  receives  95                                                               
percent of its funding for that year.                                                                                           
                                                                                                                                
REPRESENTATIVE P. WILSON pointed out  that the charter schools in                                                               
Juneau and Nome  are below 150 students.  She  asked whether that                                                               
meant less funding from the state every year.                                                                                   
                                                                                                                                
COMMISSIONER HANLEY clarified that  the students in those schools                                                               
generate less  funding from  the state for  their districts.   He                                                               
said he would provide further clarification.                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX  asked whether transportation to  school is                                                               
mandated by state statute.                                                                                                      
                                                                                                                                
COMMISSIONER HANLEY  advised transportation is included  in EED's                                                               
intent  and  responsibility  to  provide  an  education  for  all                                                               
students in  the state; although  he was unsure of  the directive                                                               
in statute,  it is  recognized by  state and  federal governments                                                               
that access  to education is  part of the requirement  to provide                                                               
education to all students.                                                                                                      
                                                                                                                                
8:15:04 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX asked  for the  distance from  school that                                                               
qualifies a student for transportation.                                                                                         
                                                                                                                                
COMMISSIONER  HANLEY noted  that the  districts decide  the exact                                                               
distance, and he read from the statute as follows:                                                                              
                                                                                                                                
     The  school  district provides  student  transportation                                                                    
     services for the transportation  of students who reside                                                                    
     a distance from established  schools. [Said student] is                                                                    
     eligible to receive funding.                                                                                               
                                                                                                                                
COMMISSIONER HANLEY  added that  there are other  factors besides                                                               
distance, such as a situation where  a student would have to walk                                                               
across a highway.                                                                                                               
                                                                                                                                
REPRESENTATIVE  SEATON  recalled  that  when  transportation  was                                                               
reimbursable, the  state only paid  for bus service  for students                                                               
who lived over one and one-half miles from school.                                                                              
                                                                                                                                
COMMISSIONER HANLEY  agreed there  were criteria  as to  what was                                                               
reimbursed such  as hazards and other  extenuating circumstances.                                                               
In further  response to Representative Seaton,  he confirmed that                                                               
there  are no  longer criteria  because the  [grant amounts]  for                                                               
districts are based on the  transportation contracts that were in                                                               
place at the time of the change from the reimbursable program.                                                                  
                                                                                                                                
REPRESENTATIVE SEATON  referred back to the  PROJECTIONS document                                                               
and  clarified   that  the  [estimated   grant  amount   for  the                                                               
transportation of  charter school  students] is reflected  in the                                                               
column  under  the  heading:    Charter  School  Projected  Pupil                                                               
Transportation Funding.   He  concluded that  the state  does not                                                               
pay  a certain  amount per  student across  the state;  the state                                                               
pays a per  student amount related to the  cost of transportation                                                               
that  was in  place in  2005.   For example,  the Alaska  Gateway                                                               
School District  is granted $2,195  per student, and  the Annette                                                               
Island  School District  is granted  $192 per  student. The  idea                                                               
that  each  student  generates  a  certain  amount  of  money  is                                                               
incorrect.                                                                                                                      
                                                                                                                                
COMMISSIONER  HANLEY   observed  that  the  grant   amounts  were                                                               
originally based on the routes  the districts ran, and the number                                                               
of students  served at that time.   Last year or  the year before                                                               
the legislature made adjustments to those costs.                                                                                
                                                                                                                                
8:19:38 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX speculated  about  the sense  of busing  a                                                               
student less than one mile.                                                                                                     
                                                                                                                                
COMMISSIONER  HANLEY reminded  the  committee  of EED's  previous                                                               
testimony   that   charter   school   students   are   generating                                                               
transportation funds for their district,  thus the district needs                                                               
to   negotiate  with   charter  schools   on  the   logistics  of                                                               
transportation for their students,  so that the district provides                                                               
that service  in the same  manner that  it is provided  for other                                                               
students in  the district.  On  the other hand, a  district could                                                               
direct transportation  funds directly  to the charter  school, to                                                               
be used for transportation only.   He stressed that the intent of                                                               
the bill is  to prevent a district  from retaining transportation                                                               
funds and  leaving the  charter school  "on [its]  own as  far as                                                               
transportation goes."   He  pointed out that  there are  only two                                                               
school  districts that  don't provide  transportation to  charter                                                               
schools.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  P. WILSON  reported  that  the Ketchikan  Gateway                                                               
Borough School District  has an agreement to  provide the charter                                                               
school transportation.                                                                                                          
                                                                                                                                
8:23:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX  noted that  the Anchorage  School District                                                               
(ASD)  works creatively  to provide  transportation for  homeless                                                               
students so  they can  stay at  the same  school no  matter where                                                               
they are.                                                                                                                       
                                                                                                                                
COMMISSIONER HANLEY said that is correct.                                                                                       
                                                                                                                                
REPRESENTATIVE  SEATON  cautioned  that  the  bill  may  increase                                                               
conflicts  between charter  schools  and school  districts.   For                                                               
example, a charter  school may require students  to provide their                                                               
own transportation, and by the  change in statute proposed by the                                                               
bill, still receive the transportation  funds allocated for their                                                               
students.    This  would  result  in a  negative  impact  to  the                                                               
district's  busing  system,   and  exacerbate  conflicts  between                                                               
charter schools and the school district.                                                                                        
                                                                                                                                
8:26:01 AM                                                                                                                    
                                                                                                                                
COMMISSIONER HANLEY pointed out that  if a charter school chooses                                                               
to receive  transportation funds,  those funds  must be  used for                                                               
transportation.  In  addition, he assured the  committee that the                                                               
state  will  not  interfere  in a  required  contract  between  a                                                               
charter  school  and  school district;  moreover,  transportation                                                               
needs to  be addressed at  the time of  the contract.   He opined                                                               
that transportation is  currently an issue of disparity  and is a                                                               
"built-in conflict" that the bill seeks to relieve.                                                                             
                                                                                                                                
REPRESENTATIVE  SEATON  questioned whether  transportation  funds                                                               
are audited in each school district  to ensure that the funds are                                                               
spent on transportation.                                                                                                        
                                                                                                                                
COMMISSIONER HANLEY said  no.  However, EED  believes that school                                                               
districts  and the  charter  schools will  discuss  how to  spend                                                               
transportation    funds   for    efficiency   and    to   provide                                                               
transportation services.                                                                                                        
                                                                                                                                
REPRESENTATIVE  LEDOUX  suggested a  simpler  means  would be  to                                                               
require  in  statute  that  all  school  districts  must  provide                                                               
transportation  to students  attending  neighborhood and  charter                                                               
schools.   She acknowledged  Anchorage may  have a  problem doing                                                               
so.                                                                                                                             
                                                                                                                                
COMMISSIONER HANLEY responded:                                                                                                  
                                                                                                                                
     We don't  want to step  in and  tell a district  how to                                                                    
     implement the  most efficient process, what  we want to                                                                    
     do is clarify  language that already says  'You need to                                                                    
     be  fair to  charters,  and don't  forget  you need  to                                                                    
     consider  the  pupil   transportation  funds  that  are                                                                    
     generated.'   Beyond that we  don't want to step  in on                                                                    
     how to  implement, we want  to say, 'Recognize  that in                                                                    
     the contract you have with your charters.'                                                                                 
                                                                                                                                
8:30:06 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KITO  III stated  that  some  districts, such  as                                                               
Juneau, have an easier time  identifying the allocable cost for a                                                               
charter  school,  but in  Anchorage  there  are multiple  charter                                                               
school  facilities  for  students  from all  over  the  district.                                                               
Parents of  students attending  Anchorage charter  schools cannot                                                               
determine   the  transportation   "share"   generated  by   their                                                               
child(ren), raising questions about equity.                                                                                     
                                                                                                                                
COMMISSIONER HANLEY agreed.                                                                                                     
                                                                                                                                
CHAIR GATTIS commented that some  school districts are very large                                                               
and solving transportation problems  requires a lot of discussion                                                               
between the districts and charter  schools.  However, without the                                                               
proposed bill, charter schools are  not allowed to participate in                                                               
the discussions.                                                                                                                
                                                                                                                                
REPRESENTATIVE P.  WILSON observed  some areas don't  have enough                                                               
students  to  warrant a  bus  and  alternatives  may need  to  be                                                               
considered, such as taxis or carpooling.                                                                                        
                                                                                                                                
REPRESENTATIVE  LEDOUX  opined  that the  directives  related  to                                                               
transportation  funding   in  the  bill  interfere   with  school                                                               
districts more than just a  requirement to provide transportation                                                               
to all  charter school students;  in fact, Anchorage is  the only                                                               
district  not  accepting  this   responsibility.    An  agreement                                                               
between ASD,  its charter schools,  and Anchorage  charter school                                                               
parents would supplant a change in funding.                                                                                     
                                                                                                                                
8:36:22 AM                                                                                                                    
                                                                                                                                
DEENA  PARAMO, Superintendent,  Matanuska-Susitna Borough  School                                                               
District (MSBSD), agreed with  Commissioner Hanley that providing                                                               
transportation  requires extensive  conversations between  school                                                               
district administrations and charter  school principals.  This is                                                               
not just  a charter school  issue in that districts  are provided                                                               
transportation   funds  for   students  attending   neighborhood,                                                               
charter, and  special mission schools,  such as  Chugach Optional                                                               
Elementary  School in  Anchorage.   At MSBSD,  the administration                                                               
quantified  the  amount  of transportation  funds  generated  and                                                               
queried  the   charter  schools  for  their   preferences.    For                                                               
instance, the location  of one charter school  determined that it                                                               
would  use its  funds  for full  transportation.   Other  charter                                                               
schools  use hubs  to collect  students from  outlying areas;  in                                                               
fact, one  route is  90 minutes  in duration.   Hubs are  used to                                                               
transport students  efficiently to  all of  the other  schools as                                                               
well.   Traditional  busing service  for neighborhood  schools is                                                               
provided,  although  high school  and  junior  high students  are                                                               
allowed  to  mix   in  order  to  offer   options,  choices,  and                                                               
efficiencies.                                                                                                                   
                                                                                                                                
8:39:43 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON posed a scenario  in which a charter school                                                               
is allocated its transportation  amount, but does not collaborate                                                               
with  the  school district  on  transportation.    It is  not  in                                                               
statute   that   transportation   funds    must   be   used   for                                                               
transportation, and  if the district  needs the money,  would the                                                               
district  justify retaining  the charter  school's transportation                                                               
funds.                                                                                                                          
                                                                                                                                
DR. PARAMO said school districts  have three funds:  operational,                                                               
transportation, and food-service.  If  there were excess money in                                                               
transportation, money  can be carried  over to the next  year and                                                               
used for transportation.  Further,  transportation funds from the                                                               
state  cannot be  used for  field  trips, but  only for  home-to-                                                               
school  transportation.    She  said she  could  have  a  reserve                                                               
transportation fund, but could not  transfer money to a different                                                               
fund.                                                                                                                           
                                                                                                                                
REPRESENTATIVE  SEATON recalled  that the  original structure  of                                                               
the law  was to allow  districts to identify efficiencies  and if                                                               
so, reserve funds.                                                                                                              
                                                                                                                                
REPRESENTATIVE LEDOUX  said she would  like to hear  from schools                                                               
in Anchorage.                                                                                                                   
                                                                                                                                
CHAIR GATTIS inquired  as to ways to  incentivize other districts                                                               
to work with charter schools on the transportation issue.                                                                       
                                                                                                                                
                                                                                                                                
DR. PARAMO was unsure, except to bring the problem to light.                                                                    
                                                                                                                                
8:44:35 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX stated  that  if the  law required  school                                                               
districts to  provide transportation to charter  school students,                                                               
and this  was not  done, the repercussions  from violating  a law                                                               
would provide charter schools "a place at the table."                                                                           
                                                                                                                                
REPRESENTATIVE  SEATON  returned  attention  to  the  PROJECTIONS                                                               
document and noted that some  school districts have huge expenses                                                               
per  student for  transportation.   He cautioned  that putting  a                                                               
requirement for charter school  student transportation in statute                                                               
should be carefully considered.                                                                                                 
                                                                                                                                
REPRESENTATIVE P.  WILSON said the  current language in  the bill                                                               
is appropriate because it promotes collaboration and equity.                                                                    
                                                                                                                                
COMMISSIONER HANLEY  clarified an earlier response  as to whether                                                               
the  law requires  that  a  district or  the  state must  provide                                                               
transportation.      He   read  from   the   document   entitled,                                                               
Transportation of Pupils [text found  above] and pointed out that                                                               
the  statute does  not direct  that all  school districts  "shall                                                               
provide."    However,  if  an  Alaska  school  district  suddenly                                                               
refused  to provide  transportation,  legal  issues would  arise.                                                               
Commissioner Hanley  restated that the  intent of the bill  is to                                                               
treat charter schools like traditional  public schools, and solve                                                               
problems at the "ground level."                                                                                                 
                                                                                                                                
8:51:10 AM                                                                                                                    
                                                                                                                                
CHAIR GATTIS  turned attention to  the transportation  portion of                                                               
the bill related  to changes in busing contracts.   She asked for                                                               
an   explanation    of   the   circumstances    surrounding   the                                                               
transportation of students who attend  Monroe Catholic, a private                                                               
religious school in Fairbanks.                                                                                                  
                                                                                                                                
COMMISSIONER  HANLEY directed  attention  to  AS 14.09.020  which                                                               
read in part:                                                                                                                   
                                                                                                                                
       AS   14.09.020.   Transportation   for   nonpublic                                                                       
          school students                                                                                                       
                                                                                                                                
     In those places in the  state where the department or a                                                                    
     school  district provides  transportation for  children                                                                    
     attending  public schools,  the  department also  shall                                                                    
     provide transportation for  children who, in compliance                                                                    
     with  the  provision  of  AS  14.30,  attend  nonpublic                                                                    
     schools that are administered  in compliance with state                                                                    
     law  where   the  children,  in  order   to  reach  the                                                                    
     nonpublic  schools,  must travel  distances  comparable                                                                    
     to,  and over  routes the  same as,  the distances  and                                                                    
     routes  over   which  the  children   attending  public                                                                    
     schools are transported. ...                                                                                               
                                                                                                                                
COMMISSIONER  HANLEY  advised that  this  statute  allows EED  to                                                               
provide  transportation to  nonpublic  school students  following                                                               
the same bus route as the public school students.                                                                               
                                                                                                                                
REPRESENTATIVE  LEDOUX  asked  whether   a  court  case,  perhaps                                                               
related  to the  provisions  of the  Blaine  Amendment, has  ever                                                               
ensued from this provision.                                                                                                     
                                                                                                                                
[Note:   Alaska's  "Blaine  Amendment" language  is  part of  the                                                               
Alaska  State Constitution  Article 7,  Paragraph 1  which reads:                                                               
"The legislature  shall by general  law establish and  maintain a                                                               
system of public  schools open to all children of  the State, and                                                               
may provide  for other public educational  institutions.  Schools                                                               
and  institutions so  established  shall be  free from  sectarian                                                               
control.   No  money  shall be  paid from  public  funds for  the                                                               
direct  benefit of  any religious  or  other private  educational                                                               
institution."]                                                                                                                  
                                                                                                                                
COMMISSIONER   HANLEY  expressed   his  understanding   that  the                                                               
language of the  Blaine Amendment speaks to  benefiting a private                                                               
or  religious entity,  and the  historical interpretation  of the                                                               
statute is  that transportation  benefits a child,  and is  not a                                                               
direct benefit to the private or religious school.                                                                              
                                                                                                                                
CHAIR GATTIS opined  the focus of HB  278 is on what  is best for                                                               
kids.                                                                                                                           
                                                                                                                                
8:55:55 AM                                                                                                                    
                                                                                                                                
DAVE  JONES, Assistant  Superintendent,  Kenai Peninsula  Borough                                                               
School  District  (KPBSD), informed  the  committee  that in  his                                                               
district  charter school  students  are transported  in a  manner                                                               
similar to,  and under the  same regulations as,  the traditional                                                               
school students.   Currently there are four  charter schools, and                                                               
three utilize the school district  transportation service.  Prior                                                               
to 2005, KPBSD was reimbursed  for transportation costs by route,                                                               
thus a route could be added  with approval from EED.  He recalled                                                               
that one state  regulation was that the district did  not have to                                                               
transport students  living less than  one and one-half  mile from                                                               
school, unless  warranted by  a hazardous  condition.   Mr. Jones                                                               
explained that when  the reimbursable program changed  to a block                                                               
grant program,  the per student  funding allowance came  from the                                                               
calculation  of the  cost of  the bus  routes a  district had  in                                                               
2005, divided by the number  of students; therefore the allowance                                                               
that  has  been  carried  forward  was  based  on  the  framework                                                               
existing in 2005.                                                                                                               
                                                                                                                                
REPRESENTATIVE LEDOUX  surmised that  a school district  that had                                                               
been conscious  of its transportation  costs was  penalized under                                                               
this system.                                                                                                                    
                                                                                                                                
MR. JONES  said that  was possible;  however, the  state required                                                               
that routes were proven necessary by the number of children.                                                                    
                                                                                                                                
9:01:07 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  P. WILSON  recalled  some  frugal districts  were                                                               
frustrated with the change to the block grant.                                                                                  
                                                                                                                                
REPRESENTATIVE  SEATON reflected  on the  effect of  the proposed                                                               
change on school districts.   For example, if the statute directs                                                               
that   charter  school   funding   includes  the   transportation                                                               
allowance, and  one charter school does  not need transportation,                                                               
but still  collects the transportation amount,  that amount would                                                               
be subtracted from the [funds  supporting the] existing routes in                                                               
the district.  He asked  how the district's transportation system                                                               
would be affected.                                                                                                              
                                                                                                                                
MR.  JONES responded  that in  his district  if a  charter school                                                               
decided  to   take  the   transportation  allotment   instead  of                                                               
transportation  services, "it  would  be hard  for  [them] to  do                                                               
that."   He explained that  the current  bus contract is  paid by                                                               
$9.65 that  KPBSD receives per  student.  The district  would not                                                               
be  able to  cut routes  to compensate  for the  loss of  the per                                                               
student allowance  of $9.65, because the  charter school students                                                               
are  incorporated  in  the existing  route  structure,  thus  the                                                               
district would be short the amount paid to the charter school.                                                                  
                                                                                                                                
REPRESENTATIVE  SEATON surmised  a charter  school could  decline                                                               
transportation  services, but  use  its transportation  allotment                                                               
for  field trips.    He  asked whether  the  potential losses  of                                                               
transportation funding  could cause the  denial of a  new charter                                                               
school application.                                                                                                             
                                                                                                                                
9:04:55 AM                                                                                                                    
                                                                                                                                
MR.  JONES  clarified  that  an   existing  charter  school  that                                                               
withdraws  from transportation  services would  cause a  deficit;                                                               
however, a  new charter  school would be  invited to  utilize the                                                               
transportation system - as long as  it met safety standards - and                                                               
the students would be incorporated in the existing routes.                                                                      
                                                                                                                                
CHAIR  GATTIS asked  why  one  charter school  in  KPBSD did  not                                                               
choose to use transportation services.                                                                                          
                                                                                                                                
MR.  JONES relayed  his understanding  that the  charter school's                                                               
academic policy committee (APC) made the decision.                                                                              
                                                                                                                                
COMMISSIONER  HANLEY advised  that some  schools in  Anchorage do                                                               
not  need  transportation services  and  some  do; moreover,  the                                                               
school  district would  not require  a  charter, or  neighborhood                                                               
public  school, to  use a  bus  that was  not needed.   Thus  the                                                               
debate is  not about money, it  is about "in the  same manner" in                                                               
providing  transportation based  on the  amount generated  by all                                                               
students.   "In the same manner  is the idea of  equity" he said.                                                               
He continued:                                                                                                                   
                                                                                                                                
     If I offer  transportation, and we work  out a contract                                                                    
     for  transportation, and  we get  what  you need,  that                                                                    
     might mean  one bus, and  it might mean no  buses, then                                                                    
     we've worked  that out. ...  If there was money  on the                                                                    
     table  only for  charters, but  not for  a school  that                                                                    
     didn't need  a bus,  now we  have disparity  again, now                                                                    
     we've   gone  backwards   again,  now   we're  treating                                                                    
     charters  like super-schools,  now  they get  something                                                                    
     that nobody else gets.   That's not what this is about.                                                                    
     [The bill] is  designed and it's written  to bring them                                                                    
     up to the level of the other schools.                                                                                      
                                                                                                                                
9:09:05 AM                                                                                                                    
                                                                                                                                
CHAIR GATTIS  asked if  a charter  school has  any leverage  in a                                                               
situation where the charter school  wants transportation, but the                                                               
school district is unwilling.                                                                                                   
                                                                                                                                
COMMISSIONER HANLEY  further explained  that if a  charter school                                                               
requests transportation,  the district has an  obligation to look                                                               
at  the  transportation funds  generated  by  the charter  school                                                               
students, work  out a solution,  and provide  the transportation.                                                               
The  funds  generated by  the  charter  school students  are  its                                                               
leverage.  In  further response to Chair Gattis, he  said the law                                                               
already requires  parity for charter  schools; the  proposed bill                                                               
provides further clarification and  removes the general provision                                                               
that is "open to interpretation."                                                                                               
                                                                                                                                
9:11:07 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  directed attention  to [section 9]  of the                                                               
bill which read:                                                                                                                
                                                                                                                                
     * Sec. 9. AS 14.03.260(a) is amended to read:                                                                            
                                                                                                                                
          (a)  A   local  school  board  shall   provide  an                                                                    
     approved charter school with  an annual program budget.                                                                    
     The budget shall be not  less than the amount generated                                                                    
     by  the students  enrolled in  the charter  school less                                                                    
     administrative  costs  retained  by  the  local  school                                                                    
     district,  determined  by  applying the  indirect  cost                                                                    
     rate approved by the Department  of Education and Early                                                                    
     Development.   The   "amount  generated   by   students                                                                    
     enrolled in the charter school"  is to be determined in                                                                    
     the same manner  as it would be for  a student enrolled                                                                    
     in another  public school in  that school  district and                                                                  
     includes  funds generated  by  special  needs under  AS                                                                
     14.17.420(a)(1),   secondary   school  vocational   and                                                                
     technical  instruction  under AS  14.17.420(a)(3),  and                                                                  
     pupil  transportation  under  AS  14.09.010.  A  school                                                                
     district shall direct state aid  under AS 14.11 for the                                                                
     construction or  major maintenance of a  charter school                                                                  
     facility  to  the  charter school  that  generated  the                                                                
     state  aid, subject  to the  same terms  and conditions                                                                
     that   apply  to   state  aid   under   AS  14.11   for                                                                  
     construction or major maintenance  of a school facility                                                                
     that is not a charter school.                                                                                            
                                                                                                                                
REPRESENTATIVE  SEATON  said  the  question  is  not  about  "the                                                               
conversation,  it's about  the words  on the  paper" and  he read                                                               
from section 9 as follows:                                                                                                      
                                                                                                                                
     The budget shall not be  less than the amount generated                                                                    
     by the students enrolled in the charter school ...                                                                         
                                                                                                                                
REPRESENTATIVE SEATON  said this  language means that  the budget                                                               
to  the   charter  school  -   in  a  manner  different   than  a                                                               
neighborhood school  that does not  need transportation  and that                                                               
does not  get transportation funds  - by statute says  the budget                                                               
includes the money generated per pupil.                                                                                         
                                                                                                                                
COMMISSIONER HANLEY said that it is  clarified on line 7 that the                                                               
money is to be in the same manner.                                                                                              
                                                                                                                                
REPRESENTATIVE SEATON read line 7 in part as follows:                                                                           
                                                                                                                                
        The amount generated by students enrolled in the                                                                        
     charter school is to be determined in the same manner                                                                      
     as it would be ....                                                                                                        
                                                                                                                                
REPRESENTATIVE  SEATON stated  current statute  directs that  the                                                               
money has to go into the  charter school budget, and the proposed                                                               
bill adds in the transportation portion  as well.  He pointed out                                                               
that  could happen  by any  means, such  as a  contract with  the                                                               
school  district, or  to parents  providing  transportation.   He                                                               
requested  an  opinion from  Legislative  Legal  Services on  the                                                               
meaning of the language.                                                                                                        
                                                                                                                                
9:13:36 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX agreed that  the testimony and the language                                                               
of  the bill  conflict regarding  whether a  charter school  that                                                               
does  not  need   transportation  still  receives  transportation                                                               
money.                                                                                                                          
                                                                                                                                
COMMISSIONER HANLEY  restated his interpretation and  agreed that                                                               
a legal opinion is warranted.                                                                                                   
                                                                                                                                
CHAIR GATTIS said an opinion will be requested.                                                                                 
                                                                                                                                
REPRESENTATIVE  KITO III  asked if  the funds  for transportation                                                               
are  administered separately  from  the  base student  allocation                                                               
(BSA).                                                                                                                          
                                                                                                                                
COMMISSIONER HANLEY said yes.                                                                                                   
                                                                                                                                
REPRESENTATIVE  KITO  III  surmised   that  BSA  funds  would  be                                                               
administered, in  a manner similar, and  the transportation funds                                                               
would be administered,  in a manner similar, but not  as one fund                                                               
for a single budget.                                                                                                            
                                                                                                                                
COMMISSIONER  HANLEY   said  for  accounting  purposes   that  is                                                               
correct.  He added that both  funds are generated by ADM, but are                                                               
separate accounts.                                                                                                              
                                                                                                                                
REPRESENTATIVE   SEATON  stated   that   MSBSD  understood   that                                                               
transportation funds could not be  used for other purposes, which                                                               
differs  from his  understanding.   He asked  whether the  monies                                                               
generated  are   based  on   the  cost   of  a   district's  past                                                               
transportation  system,  and is  it  still  the  case that  if  a                                                               
district  can  save  money,  the  funds can  be  used  for  other                                                               
purposes.                                                                                                                       
                                                                                                                                
COMMISSIONER  HANLEY   deferred  to   EED,  School   Finance  and                                                               
Facilities Section.                                                                                                             
                                                                                                                                
REPRESENTATIVE SEATON  questioned the relevant state  law, rather                                                               
than common practice.                                                                                                           
                                                                                                                                
9:18:19 AM                                                                                                                    
                                                                                                                                
LUKE  FULP, Assistant  Superintendent of  Business &  Operations,                                                               
MSBSD, informed the committee that  the pupil transportation fund                                                               
is discretionary.  At MSBSD,  after the change [in transportation                                                               
funding] from the reimbursement  basis, the fund was administered                                                               
much  like  a  special  revenue  grant.    Currently,  the  funds                                                               
received  from the  state  potentially could  be  used for  other                                                               
purposes.   He acknowledged that  a transfer back to  the general                                                               
fund may be  allowable by state statute, but that  is not done by                                                               
MSBSD; in  fact, the  situation is  that this  is a  deficit fund                                                               
subsidized with instructional dollars.                                                                                          
                                                                                                                                
REPRESENTATIVE SEATON  restated his  point that a  charter school                                                               
is  not  under   an  obligation  to  only  spend   its  funds  on                                                               
transportation, or account for them separately.                                                                                 
                                                                                                                                
9:21:08 AM                                                                                                                    
                                                                                                                                
KIKI  ABRAHAMSON,  Principal,  Fireweed  Academy,  expressed  her                                                               
belief   that  the   most  cost   effective   method  to   handle                                                               
transportation  monies  is to  direct  the  funds to  the  school                                                               
district.  As a small  charter school, Fireweed Academy could not                                                               
afford   to   provide   transportation  using   its   per   pupil                                                               
transportation allocation.  The  school district can contract for                                                               
transportation service  more efficiently  on a higher  economy of                                                               
scale.   She assured the  committee Fireweed Academy has  a great                                                               
transportation  system   and  its  students,   including  out-of-                                                               
attendance boundary students,  are treated in the  same manner as                                                               
at other schools.                                                                                                               
                                                                                                                                
9:22:58 AM                                                                                                                    
                                                                                                                                
JOEY  ESKI, Chair,  Academic Policy  Committee, Aquarian  Charter                                                               
School,  said regarding  transportation, Aquarian  Charter School                                                               
is viewed as inaccessible  to economically disadvantaged children                                                               
because  their parents  are unable  to provide  transportation to                                                               
the school, therefore, the school  is asking for support from the                                                               
school district  to provide transportation to  students who would                                                               
benefit from attending.   She opined that the  charter schools in                                                               
Anchorage  do not  seek  transportation funds,  but  do seek  the                                                               
ability to negotiate  with the district on  the transportation of                                                               
students.  In  response to Chair Gattis, she said  her school and                                                               
ASD  first  discussed transportation  issues  two  weeks ago,  an                                                               
event coinciding  with the release  of the  proposed legislation.                                                               
Ms. Eski stated  that ASD's transportation budget has  an over $1                                                               
million  deficit  and is  supplemented  with  general funds;  ASD                                                               
offered  to share  transportation services  with charter  schools                                                               
provided more funds were available from  the state.  If this were                                                               
the  case,  ASD  proposed  that   the  charter  schools  purchase                                                               
transportation   services   from    the   district   with   their                                                               
transportation allocations.     Ms. Eski said  charter schools in                                                               
Anchorage seek  fairness and the  ability to open their  doors to                                                               
more students who cannot attend due to a lack of transportation.                                                                
                                                                                                                                
REPRESENTATIVE  P.  WILSON  asked  whether ASD  buses  that  have                                                               
routes to serve charter schools are currently available.                                                                        
                                                                                                                                
MS. ESKI  declined to  respond as to  the availability  of buses.                                                               
She recalled  that when per  student allocations  were determined                                                               
in 2005,  Anchorage was not  providing transportation  to charter                                                               
schools thus it  probably does not have sufficient  funding to do                                                               
so now.  Furthermore, ASD  does not provide transportation to its                                                               
alternative and  optional schools  either, except for  the Highly                                                               
Gifted Program  at Rogers Park  Elementary, which may  mean other                                                               
public  schools may  need to  be served  also.   She acknowledged                                                               
that busing presents a major dilemma for ASD.                                                                                   
                                                                                                                                
9:28:25 AM                                                                                                                    
                                                                                                                                
CHAIR  GATTIS asked  whether ASD  provides transportation  to any                                                               
charter school.                                                                                                                 
                                                                                                                                
MS. ESKI said no.                                                                                                               
                                                                                                                                
[Although not formally stated, public  testimony was opened on HB
278.]                                                                                                                           
                                                                                                                                
9:30:26 AM                                                                                                                    
                                                                                                                                
BRENDON  GERDTS, Student,  ASD; Representative,  Students With  A                                                               
Voice,  informed the  committee his  organization seeks  to raise                                                               
awareness   about  the   educational  needs   in  Anchorage   and                                                               
throughout  Alaska.   As  an  aside,  he  recalled that  when  he                                                               
attended  Rogers  Park  Elementary  School the  bus  carried  six                                                               
students, which was not efficient;  however, busing was necessary                                                               
so that the program could benefit students throughout the city.                                                                 
                                                                                                                                
CHAIR GATTIS  asked if  Mr. Gerdts  could offer  any alternatives                                                               
for a more efficient busing system.                                                                                             
                                                                                                                                
MR. GERDTS said  he was unsure.  The geography  of Anchorage does                                                               
not  lend itself  to efficiently  transporting  students who  are                                                               
interested  in a  program across  the city.   He  suggested using                                                               
smaller buses  on an expanded route  would be one option  to save                                                               
money.   Turning to  HB 278, he  said raising the  BSA by  $86 is                                                               
inadequate to  restore past  losses or  to prevent  the impending                                                               
loss  of  200 positions  in  Anchorage.    Mr. Gerdts  noted  the                                                               
previous  loss  of  school  counselors  has  hurt  the  emotional                                                               
stability  of  the  student  body,  particularly  for  elementary                                                               
children of military families; in  fact, any loss of school staff                                                               
is  damaging.     In  response   to  Chair  Gattis,   Mr.  Gerdts                                                               
recommended an  increase to the  BSA of  $400, inflation-proofed,                                                               
which  would restore  the educational  programs supported  by his                                                               
organization.                                                                                                                   
                                                                                                                                
9:36:20 AM                                                                                                                    
                                                                                                                                
GRETCHEN  STODDARD,  Member,  Goldenview  Middle  School  Parent-                                                               
Teacher-Student  Association (PTSA),  informed the  committee her                                                               
son is a student at Goldenview  Middle School and she is speaking                                                               
with the support of the Goldenview  PTSA.  She said her son rides                                                               
the school  bus, which  is usually  not full,  but it  often runs                                                               
late because the bus route  covers Goldenview, South High School,                                                               
and Rabbit Creek Elementary.   Inclement weather often causes the                                                               
bus to run late.  Ms.  Stoddard stated her support for busing for                                                               
all students  if the resources are  available; however, Anchorage                                                               
is a  massive school district  that serves all of  Anchorage with                                                               
one level property  tax base.  Ms. Stoddard  restated her support                                                               
for transporting students to the  school of their choice if money                                                               
is available.                                                                                                                   
                                                                                                                                
REPRESENTATIVE   LEDOUX   understood   that   transportation   is                                                               
difficult   for  ASD;   however,   if  the   district  has   made                                                               
accommodations to bus students from  all over Anchorage to Rogers                                                               
Park Elementary  School for an  optional program,  she questioned                                                               
how ASD could not provide  transportation for other optional, but                                                               
important, programs.                                                                                                            
                                                                                                                                
MS. STODDARD  cautioned that [school issues]  are pitting parents                                                               
against each  other.  She  opined there are not  enough resources                                                               
to give  everyone a  choice and  provide transportation,  but the                                                               
state has  sufficient resources  to provide  "one good  option to                                                               
children,  but we  don't  have  the resources  to  give full  bus                                                               
service to everything [that] every parent would want.                                                                           
                                                                                                                                
REPRESENTATIVE KITO  III asked if  a weather delay results  in an                                                               
overcrowded bus.                                                                                                                
                                                                                                                                
MS. STODDARD  said there is  always room on  the bus, but  by the                                                               
third route, the bus often runs late.                                                                                           
                                                                                                                                
9:45:35 AM                                                                                                                    
                                                                                                                                
BOB  GRIFFIN, Member,  Academic  Policy  Committee, Rilke  Schule                                                               
German School of  Arts & Sciences, stated he was  speaking on his                                                               
own behalf.   He encouraged  the committee to think  "outside the                                                               
box" about charter school funding  and transportation issues.  He                                                               
agreed that  the funds are  discretionary, and should  be applied                                                               
in a way to allow better  access to charter schools by low income                                                               
students through alternative transportation  methods.  As opposed                                                               
to charter  schools in the  Lower 48, Alaska charter  schools are                                                               
not  geared   to  benefitting  low  income   students,  with  the                                                               
exception  of  the  Alaska  Native  Cultural  Charter  School  in                                                               
Anchorage.  Mr. Griffin urged committee  members to find a way to                                                               
provide transportation funding and  equal support so that charter                                                               
schools have  transportation and  encourage attendance by  a more                                                               
diverse student population.                                                                                                     
                                                                                                                                
9:49:37 AM                                                                                                                    
                                                                                                                                
MIKE ABBOTT,  Chief Operating Officer,  ASD, stated that  ASD has                                                               
not taken  a position on  the portion  of [HB 278]  that requires                                                               
transportation funding to be allocated  on a per student basis to                                                               
charter  school  entities.    He   informed  the  committee  that                                                               
currently ASD retains the entire  per student allocation from the                                                               
state, multiplied by  the student population, and  parses out the                                                               
funds  to  certain  services provided  districtwide.    The  last                                                               
estimate  indicated  that  about  one-half  of  the  students  in                                                               
Anchorage are  eligible for transportation funding;  in fact, the                                                               
district's policy has not changed  from before the time the state                                                               
reimbursed districts for actual transportation costs.                                                                           
                                                                                                                                
REPRESENTATIVE  LEDOUX   observed  that  ASD  does   not  provide                                                               
transportation  for charter  school students,  and asked  for the                                                               
basis  of  that  decision.     Furthermore,  she  asked  for  the                                                               
practical  ramifications of  legislation which  may mandate  that                                                               
ASD provide transportation.                                                                                                     
                                                                                                                                
MR. ABBOTT said he could not  speak to the causal factors leading                                                               
to the manner  in which ASD addressed charter  school funding ten                                                               
or fifteen  years ago.   However, regarding the  potential impact                                                               
of the previously described legislation,  he said approximately 5                                                               
percent of  the student population  attends one of  eight charter                                                               
schools.   If the  legislation diverts 5  percent of  the student                                                               
transportation  revenue stream  away  from  the current  district                                                               
program,  ASD  would either  have  to  reduce the  service  level                                                               
provided  for   the  overall   student  population,   or  further                                                               
subsidize  the student  transportation program  from its  general                                                               
fund.  He  noted that at this time, the  transportation system is                                                               
subsidized with about $1 million, which  is equal to 5 percent of                                                               
the  total transportation  costs.   Mr. Abbott  acknowledged that                                                               
subsidizing a transportation system with  general funds is not an                                                               
unusual situation for schools.                                                                                                  
                                                                                                                                
9:55:47 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX  asked about  the distance a  student lives                                                               
from school to be eligible for bus transportation.                                                                              
                                                                                                                                
MR. ABBOTT  responded that  if a  non-hazardous walking  route is                                                               
less than one  and one-half miles, a student is  not eligible for                                                               
transportation.   If the route  is longer or deemed  hazardous, a                                                               
student is eligible, but only  to their neighborhood school.  The                                                               
primary  exceptions   are  Rogers   Park  Elementary,   Child  in                                                               
Transition,  special   education,  and   No  Child   Left  Behind                                                               
programs.                                                                                                                       
                                                                                                                                
9:57:22 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX inquired  as to  how much  money would  be                                                               
saved if the boundary limit was changed to two miles.                                                                           
                                                                                                                                
MR.   ABBOTT  said   he  was   unsure  exactly,   but  it   would                                                               
significantly  reduce elementary  school busing.   Most  of ASD's                                                               
elementary school  children live less  than two miles  from their                                                               
school; in  fact, over  10 percent of  the elementary  schools do                                                               
not have  transportation provided,  except for  special education                                                               
or other  programs.   An expansion  of the  walking limit  to two                                                               
miles  would put  many  more elementary  schools  in the  walking                                                               
category,  and reduce  bus service  at others.   Mr.  Abbott said                                                               
that  sort of  service-level change  would be  considered if  the                                                               
district were faced with a reduction in transportation funding.                                                                 
                                                                                                                                
                                                                                                                                
REPRESENTATIVE LEDOUX asked whether it  would it be practical and                                                               
cost-effective to  bus kindergarten through third  grade students                                                               
for one distance,  and fourth through sixth grade  students for a                                                               
longer distance.                                                                                                                
                                                                                                                                
MR. ABBOTT said  it could; however, generally  ASD's challenge to                                                               
provide transportation  is not  the number  of students,  but the                                                               
distance of the  route.  For example, elementary  bus routes have                                                               
many  stops, and  there may  not  be significant  savings from  a                                                               
lower or higher density [of riders].                                                                                            
                                                                                                                                
10:01:13 AM                                                                                                                   
                                                                                                                                
CASSIDY WYLDE,  Student Representative, Fireweed  Academy Charter                                                               
School, said she was speaking  for nine Fireweed Academy students                                                               
who average  16 miles one  way of travel  to school each  day, in                                                               
three  different  directions.    Therefore,  the  bus  funds  per                                                               
student would  not be sufficient  to pay  the cost of  their bus.                                                               
Although the proposed  increase in the BSA is  appreciated, it is                                                               
not enough, and she urged the  legislature to increase the BSA by                                                               
$100 per student, each year, for the next three years.                                                                          
                                                                                                                                
REPRESENTATIVE SEATON  submitted a  question for  the committee's                                                               
future consideration.  He referred to  section 9 of the bill, and                                                               
asked  school districts  to report  to the  committee on  whether                                                               
special education  dollars should  be proportional to  the number                                                               
of  special education  students  in  a charter  school,  or be  a                                                               
"flat" allocation as is proposed in HB 278.                                                                                     

Document Name Date/Time Subjects