Legislature(2003 - 2004)
04/29/2003 01:46 PM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CS FOR SENATE BILL NO. 25(FIN)
"An Act relating to the acquisition of teachers'
housing by regional educational attendance areas and to
teachers' housing loan programs in the Alaska Housing
Finance Corporation; and providing for an effective
date."
SENATOR GARY WILKEN, SPONSOR provided information about the
bill. He explained that the bill allow teachers to take out
zero down payment loans under the Alaska Housing Finance
(AFHC). He noted that this was in conjunction with programs
such as the first time homebuyer program, with a similar
interest rate through AHFC. He noted that a Senate bill
passed, which allows REAA [Rural Educational Attendance
Areas] school districts to construct, own and manage rental
housing for teachers. He stated that public elementary or
secondary school teachers would be eligible, including
therapists, nurses and school librarians, who must possess a
certificate from the Department of Education. Restrictions
include using the program only once, and that the home must
be owner occupied and be a single-family home, and agree
with all AHFC credit criteria. The sponsor added a five-
year sunset in order to evaluate the program's success.
Senator Wilkins stated that the bill is about recruitment
and retention, a tool to attract qualified teachers to the
state. He pointed out that the Alaska Association of School
Boards had written in support of the bill. He noted that
Representative Bunde had written an editorial piece in
October asking for relief for Alaska teachers' housing. The
Anchorage school district requested legislation to provide
housing relief, as well as The Alaska Statewide Educators'
Supply and Demand Report highlighted the need for teacher
housing. On a national basis, the "no dream denied"
publication speaks of how districts across the nation are
attracting good teachers by providing affordable housing.
In regard to other state programs, Senator Wilkins
highlighted these examples: Oregon is offering signing
bonuses to retain teachers; California is offering large
bonuses for advanced teachers; New Mexico is offering a
signing bonus. He explained that the bill allows a teacher
to come to Alaska and buy into the "American dream" of
owning a home. He pointed out that registered nurses were
added in the House and that he supports that amendment.
Representative Hawker expressed his support for the bill.
He asked why administrators were included in the bill.
Senator Wilken speculated that school districts might need
to hire administrators from other states and that this would
be a way to attract quality administrators.
Representative Hawker commented that administrators seemed
to be plentiful. Senator Wilken noted that they had a
difficult time looking for a Commissioner for the Department
of Education and Early Development.
Co-Chair Harris observed that the legislation was intended
to make a home available to teachers with no down payment.
He asked what happened if they ceased to teach, whether they
kept the home. Senator Wilken speculated that they would
keep their mortgage. Co-Chair Harris asked if the homes
would be owned by an REAA. Senator Wilken referred to a
previous bill that gave government entities and
municipalities a way to build multi-family housing in rural
Alaska. He explained that the current bill carried this to
the REAA's as long as no state foundation monies are used
and teachers qualify for an Alaska Housing Finance
Corporation loan.
BRYAN BUTCHER, LEGISLATIVE LIAISON, ALASKA HOUSING FINANCE
CORPORATION confirmed that the main advantage to the initial
purchase was the absence of a down payment. He explained
that should the house be resold, it would then become a
regular mortgage. In response to a question by Co-Chair
Harris, Mr. Butcher confirmed that the mortgage would
function as a regular loan through AHFC.
Representative Croft asked how the fiscal note could be zero
if there was a no down payment loan and potential defaults
might then represent a cost to the State. Mr. Butcher
conceded that there would be a minimal increased risk
associated with no down payment. He also pointed out that
the stability of teachers and mortgage insurance would
mitigate the risk. In response to a question by
Representative Croft, Mr. Butcher noted that if there were
an unforeseen problem the program would be re-examined in
five years at its sunset.
MARY FRANCIS, EXECUTIVE DIRECTOR, ALASKA COUNCIL OF SCHOOL
ADMINISTRATORS testified in support of the bill. She
explained that the Council represents all school
administrators in the state. She pointed out that Alaska
was facing a shortage in school administrators, in addition
to teachers. She stated that the Council viewed the bill as
a positive step toward providing incentives for professional
educators to live and work in Alaska. She noted that other
states had also provided benefits to attract educators,
including exemption from state income taxes and singing
bonuses. She maintained that Alaska must compete with these
incentives at a time when fewer people were choosing the
teaching profession.
Representative Stoltze asked what the average salary of
school superintendents was in Alaska. Ms. Francis responded
that the administrators make more than $50 thousand per
year, and offered to provide more specific information in
the future. She indicated that it was difficult to hire
school principles in the state.
REPRESENTATIVE PEGGY WILSON spoke to the provision for
nurses. She indicated that the nursing profession currently
had an 11.5 percent vacancy rate. She stated that the
health care industry was one of the state's fastest growing
industries, projecting a need for 4,100 nurses in the next
seven years. She stated that the bill would give nurses
another incentive to move to Alaska, and thereby prevent a
potential health care crisis in the state. She expressed
her support of the bill.
Representative Stoltze asked for a definition of nurses. He
asked if home care providers would be eligible for this
benefit. Representative Wilson explained that to qualify a
nurse must be registered. In response to a question by
Representative Stoltze, Representative Wilson speculated
that the type of nurse or their job did not affect whether
they qualified for the benefit. The state needs nurses of
all types.
Representative Foster MOVED to report HCS CSSB 25 (HES) out
of Committee with the accompanying fiscal note. There being
NO OBJECTION it was so ordered.
HCS CSSB 25 (HES) was REPORTED out of Committee with a "do
pass" recommendation and one zero fiscal note from the
Department of Revenue.
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