Legislature(1995 - 1996)

04/12/1995 01:45 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  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                 
                                                                               
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  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                 
                                                                               
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  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                 
                                                                               
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  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                 
                                                                               
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  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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