Legislature(1995 - 1996)
04/12/1995 01:45 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 230 "An Act making appropriations to the Department of Education for support of kindergarten, primary, and secondary education and for community schools programs for fiscal year 1996 and fiscal year 1997; making appropriations from the constitutional budget reserve fund under art. IX, sec. 17(c), Constitution of the State of Alaska; and providing for an effective date." SHIRLEY HOLLOWAY, DR., COMMISSIONER, DEPARTMENT OF EDUCATION testified in support of full funding for education. She observed that the public has demanded better schools. She asked that dollar decisions consider the consequences to student learning. She stated that student learning will be adversely impacted by a funding level that does not include money for increased enrollment. She observed that students have special needs that require additional services. She maintained that ground will be lost if funding does not remain stable. She stressed that innovations and risks have been made to keep kids in school, do a better job at preparing students and raise standards. She discussed some innovations being made by teachers and parents. Commissioner Holloway noted that the State Board of Education is committed to reviewing the foundation formula in order to provide recommendations to the Legislature. Representative Martin noted the amount of overhead in education funding. He suggested that savings could be made if school districts were combined. Commissioner Holloway stated that the Board has started a dialogue in regards to combining school districts. LARRY WIGGET, ANCHORAGE SCHOOL DISTRICT testified via the teleconference network. He stated that the Anchorage School District opposes HB 230. He stressed that the District supports the $61.0 thousand dollar instructional unit level. He maintained that HB 230 would result in a loss to the Anchorage School District of $4.0 million dollars in FY 96 7 and $9.0 million dollars in FY 96-97. He observed that the Anchorage School District is the 80th largest school district in the United States and the largest in Alaska. He emphasized the need to pursue computer technology. He stated that Anchorage has the second lowest student cost in Alaska. Representative Grussendorf observed that Sitka has the lowest student cost in the state. In response to a question by Representative Brown, Mr. Wigget noted that student ratios would increase if HB 230 is enacted. He discussed ramifications of a $4.0 million dollar reduction to the Anchorage School District. KATHY HOYT, SOLDOTNA testified via the teleconference network. She spoke in opposition to HB 230. She compared the cost of supporting individuals in the criminal system to educating a high school student in Alaska. She noted that 89 percent of the nation's criminals are high school drop outs. The high school drop out rate in Alaska is 33 percent. It costs approximately $32.0 thousand dollars to incarcerate a prisoner annually. In Anchorage in 1991, it cost $4,050 thousand dollars to educate a high school student. She insinuated that it is cheaper and better to provide education than to pay for institutionalizing offenders. RICHARD SWARNER, EXECUTIVE DIRECTOR, BUSINESS MANAGEMENT, KENAI PENINSULA SCHOOL DISTRICT testified via the teleconference network. He testified in opposition to HB 230. He testified in support of the Governor's proposed $61.0 thousand dollar foundation formula instructional unit. He stressed that the foundation program needs to be reviewed. He observed that the Kenai School District is up against the local effort cap. He noted that assessed value in the Borough has dropped 5.87 percent. He noted that the cost per pupil over 10 years has only increased 1.44 percent. He noted that Kenai School District employee's salaries have not been raised in four years. He emphasized that 38 percent of their school district's budget comes from local contributions. DEBRA GARRISH, JUNEAU testified in opposition to HB 230. She expressed concern with the quality of state education. She observed that the student/teacher ratio is high, books are obsolete and that teachers have been laid off. She suggested that state school and income taxes be re- instituted. She maintained that HB 230 sacrifices the education and future of children in the state. JACK FARGNOLI, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF 8 THE GOVERNOR testified in support of the Governor's proposal for full funding. He stated that the Governor is concerned with the function of the bill and the funding source the bill uses. He observed that the two year forward funding mechanism would be disadvantageous in respect to the state's reserves. He maintained that the state's ability to respond to cash flow problems will be inhibited. He observed that if the second year's funding remains in the general fund it would not provide any of the constancy or predictability that true forward funding would provide. He stated that the Governor does not support forward funding. He stressed that the state is facing a $300 to $400 million dollar deficit in cash projections. He expressed concern that the work and purpose of the Long Range Fiscal Planning Commission not be truncated or prejudged. Mr. Fargnoli discussed the effect that the legislation would have on the Constitutional Budget Reserve Fund. He stated that the Governor prefers that education is funded through the general fund as all other items. (Tape Change, HFC 95-84, Side 1) In response to a question by Representative Martin, Mr. Fargnoli agreed that the state's cash flow problem would be diminished by funding education from the Constitutional Budget Reserve Fund. He stated that there is no consensus in regards to leveling expenditures or altering revenue in- flows. STEVE MCPHETRES, EXECUTIVE DIRECTOR, ALASKA COUNCIL OF SCHOOL ADMINISTRATORS testified in opposition of HB 230. He spoke in support of the $61.0 thousand dollar instructional unit. He observed that parents are concerned about education. He stressed that the state is not broke. He referred to the Alaska Permanent Fund Dividend Program. Representative Therriault suggested that rural Alaskan's will support the re-institution of an income tax over the use of their permanent fund dividends. He observed that a 15 percent state income tax would only cover half of the state's deficit. He emphasized that a combination of taxes and spending cuts are needed to balance the budget. Mr. McPhetres stated that school administrators would welcome dialogue in regards to raising revenues. He emphasized that "all the cards have got to be placed on the table." WILLIE ANDERSON, NEA-ALASKA testified in opposition to HB 230. He observed that if the instructional unit had kept pace with increases in the cost of living the instructional 9 unit would now be $81,318 thousand dollars. He urged the Committee to "do the right thing by our kids." He maintained that we must educate our children and look to the future. He suggested that revenues could be raised through taxes or capping permanent fund dividends. He stressed the need for quality education. Representative Kelly questioned if NEA-Alaska would accept downward negotiations in teacher's pay. Mr. Anderson pointed out that increases were not taken in 1986 - 1987. He stressed that teachers or public schools employees should not carry the whole burden. Representative Parnell stressed that education funding will increase by $200 million dollars over the next five years at the current rate. He emphasized that we need to reinvent how we provide government and education. He urged NEA- Alaska to join in rethinking the delivery of education services. He stressed that he has a deep concern about the children of Alaska. Mr. Anderson agreed that education delivery must be rethought, but emphasized that it cannot be transformed overnight. He observed that technology can assist in education delivery. Representative Parnell emphasized the need to start working towards doing something now. ROBERT GOTTSTEIN, ALASKA STATE SCHOOL BOARD spoke in support of full funding for education. He acknowledged the need to do more with less. He stressed that solutions must be found. He noted that there are 54 school districts in Alaska. He suggested that the number of school districts is not cost effective. He observed that the correspondence school program costs about $1.5 hundred dollars. It costs about $7.5 hundred dollars to teach a student in the Anchorage School District. He maintained that the level of parent involvement makes the difference. He stressed that principles and teachers cannot replace parents. He observed the value of quality parents and emphasized the need to provide opportunities to improve parenting skills. He acknowledged the need for change. He asserted that success will be greater if funding is protected than if it is cut. He stated that the state of Alaska must invest in our children, their parents and in creating an economic opportunity for everyone in the state. He stressed that if the state does more for children the public will do more for the state. He maintained that revenue will not be raised by making the state less worthy. He stated that there is no area in state government more worthy than education. He expounded that the way out of this dilemma is to make sure that everyone has a value received from the state. He maintained that there is no better opportunity than to 10 provide a value education. Representative Grussendorf noted the need to maximize the revenue that is due the state of Alaska. Mr. Gottstein stated that an Anchorage survey showed that if the public was guaranteed educational opportunities for everyone in their family, including postsecondary education, then 85 percent would be willing to give up their dividend and begin to pay taxes. DALE STALEY, PRESIDENT, JUNEAU SCHOOL BOARD testified in support of full funding for education. He noted that nurses, counseling services, janitorial services and teachers have been reduced in the Juneau School District. He observed that the District will not be able to lay teachers off in the coming year since most are tenured. There are only 8 non-tenured staff and 3 non-tenured administrators. He observed that the District's teaching staff is experienced and well educated. He observed that if the state reduces funding to the Juneau School District, the local contribution must also be reduced. He noted that Juneau's local contribution has been at its cap for several years. He acknowledged the need to do more with less, but asserted that it cannot be accomplished in the next three or four months. HB 230 was HELD in Committee for further discussion.
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