Legislature(2017 - 2018)BUTROVICH 205

01/17/2018 08:00 AM EDUCATION

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Audio Topic
07:59:44 AM Start
08:00:34 AM SB131
08:51:16 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 131 EDUCATION FUNDING TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    SB 131-EDUCATION FUNDING                                                                                
                                                                                                                                
8:00:34 AM                                                                                                                    
CHAIR STEVENS announced the consideration of SB 131 and added                                                                   
that the bill avoids pink-slipping teachers. [SB 131, version                                                                   
30-LS1106\A, was before the committee.]                                                                                         
                                                                                                                                
8:01:10 AM                                                                                                                    
TIM   LAMKIN,  Staff,   Senator   Gary   Stevens,  Alaska   State                                                               
Legislature, presented SB 131 on behalf of the sponsor.                                                                         
                                                                                                                                
MR.  LAMKIN  said  this  bill  is about  early  funding  for  the                                                               
foundation  formula  as   detailed  in  AS  14.17.   One  of  the                                                               
challenges  faced by  many  districts is  that  they must  submit                                                               
their budgets to  their local municipalities by May 1.  It can be                                                               
problematic because many times the  state budget is not passed by                                                               
that time.  So, the purpose of  this bill is to  allow for better                                                               
budget planning. There may be  a question of whether that funding                                                               
is  enough  on  April  1,   but  probably  many  districts  would                                                               
appreciate knowing what  the amount is, whatever it  is, by April                                                               
1. At its core the bill is about the pink-slip issue.                                                                           
                                                                                                                                
8:02:24 AM                                                                                                                    
SENATOR BEGICH  asked if  a bill like  this been  proposed before                                                               
and what its progress was.                                                                                                      
                                                                                                                                
8:02:44 AM                                                                                                                    
MR. LAMKIN  said yes,  a similar bill  was introduced  by Senator                                                               
Stevens in 2003.  At that time, the biggest pushback  was that if                                                               
the  budget   process  went  further  into   the  calendar  year,                                                               
districts  would  have  more negotiating  power  to  secure  more                                                               
funds. That  was largely  contingent on the  fact that  the state                                                               
had a  healthy Constitutional Budget  Reserve (CBR) and  now that                                                               
the CBR is substantially diminished,  that argument may no longer                                                               
be as potent.                                                                                                                   
                                                                                                                                
CHAIR STEVENS added districts objected  in the past, because then                                                               
they thought  the longer they  waited, the more funds  they could                                                               
get. He  said he thought  that is not  the case presently  and he                                                               
wanted to hear about that from the districts.                                                                                   
                                                                                                                                
8:04:03 AM                                                                                                                    
HEIDI TESHNER,  Director, Administrative Services,  Department of                                                               
Education  and  Early   Development  (DEED),  answered  questions                                                               
related  to SB  131.  She said  DEED  supports districts  knowing                                                               
their foundation funding early so  that they can avoid delivering                                                               
unnecessary pink-slips and will know  that they have enough funds                                                               
to open at the start of the school year.                                                                                        
                                                                                                                                
8:04:46 AM                                                                                                                    
CHAIR STEVENS asked for the timeline for sending out pink-slips.                                                                
                                                                                                                                
8:04:55 AM                                                                                                                    
MS. TESHNER deferred  to Ms. Herman about the  timeline, but said                                                               
since  foundation funding  is a  $1.2-billion program,  districts                                                               
want to know what funds will be available to them.                                                                              
                                                                                                                                
8:05:36 AM                                                                                                                    
CHAIR  STEVENS asked  Ms. Herman  to explain  what happened  when                                                               
districts did not have a budget by a certain time.                                                                              
                                                                                                                                
8:06:00 AM                                                                                                                    
MARCY HERMAN,  Legislative Liaison,  Department of  Education and                                                               
Early Development  (DEED), answered questions related  to SB 131.                                                               
She said  previously, districts had  to notify teachers  in March                                                               
that they might lose their jobs  for the next school year. Two or                                                               
three sessions ago, the notification  deadline was changed to May                                                               
15. Since  the 90-day session  ends mid-April, a May  15 deadline                                                               
would  prevent unnecessary  layoff  notices.  However, since  the                                                               
legislature has  remained in session  more than 90 days  the past                                                               
few years, districts  have been in a tough  spot regarding layoff                                                               
notifications.                                                                                                                  
                                                                                                                                
8:07:02 AM                                                                                                                    
SENATOR COGHILL  said the governor  has a certain amount  of time                                                               
to amend  his budget,  so the budgeting  process can  extend into                                                               
March. This would  only give the legislature 15  days for debate.                                                               
He questioned whether  April 1 should be the date  because of the                                                               
compressed timeline.                                                                                                            
                                                                                                                                
8:08:01 AM                                                                                                                    
SENATOR  BEGICH asked  if DEED  would have  the capacity  to deal                                                               
with the potential 15-day timeline.                                                                                             
                                                                                                                                
8:08:40 AM                                                                                                                    
SENATOR COGHILL said  that is part of the equation,  but 60 other                                                               
people would have to be part of that equation.                                                                                  
                                                                                                                                
8:08:51 AM                                                                                                                    
CHAIR STEVENS said the date of  April 1 was a starting point that                                                               
could be changed.                                                                                                               
                                                                                                                                
SENATOR HUGHES joined via teleconference.                                                                                       
                                                                                                                                
8:09:22 AM                                                                                                                    
MS. TESHNER said  DEED does have the capacity to  do this because                                                               
the projections  come in early  November and DEED can  do reports                                                               
about projections for the following fiscal year.                                                                                
                                                                                                                                
8:09:48 AM                                                                                                                    
SENATOR GIESSEL said SB 131  deals with appropriations, but since                                                               
the bill was in the Education  Committee, she wanted to bring the                                                               
discussion back  to a more  foundational, basic level.  She asked                                                               
what is it  that the state is funding.  This summer, Commissioner                                                               
Michael  Johnson of  DEED put  together  the Education  Challenge                                                               
that created  numerous recommendations for transformation  of how                                                               
the  state educates  students. She  said the  bill is  about when                                                               
funding for  education is available,  but equally critical  is to                                                               
address what  the state is funding.  She would like to  hear from                                                               
the commissioner  about what  he has  gleaned from  the Education                                                               
Challenge  and how  he plans  to transform  the product  they are                                                               
asked to appropriate money for.                                                                                                 
                                                                                                                                
8:11:18 AM                                                                                                                    
CHAIR STEVENS said that was a good point.                                                                                       
                                                                                                                                
8:11:27 AM                                                                                                                    
MS. HERMAN  said she  formally requested that  a joint  House and                                                               
Senate Education Committee hearing be  held with the Alaska State                                                               
Board of  Education January 29  about how DEED is  moving forward                                                               
with the Alaska's Education Challenge.                                                                                          
                                                                                                                                
8:12:27 AM                                                                                                                    
CHAIR STEVENS  said he  has talked to  the House  Education Chair                                                               
about a joint hearing.                                                                                                          
                                                                                                                                
8:13:23 AM                                                                                                                    
NORM  WOOTEN, Executive  Director, Association  of Alaska  School                                                               
Boards (AASB), testified  in support of SB 131. He  said AASB has                                                               
several resolutions that support the  elements of SB 131. A major                                                               
concern of  many school districts  is the ability to  recruit and                                                               
retain  teachers  and  administrators. Because  districts  cannot                                                               
pass an  unbalanced budget, many  times they are forced  to issue                                                               
layoff notices.  He said this  makes it difficult to  recruit and                                                               
retain teachers and administrators.                                                                                             
                                                                                                                                
8:16:23 AM                                                                                                                    
LISA SKILES PARADY, Ph.D., Executive  Director, Alaska Council of                                                               
School Administrators, testified in support  of SB 131. She noted                                                               
that SB  131 is concise but  will have a huge  positive impact on                                                               
school  districts. The  2018 joint  position statements  that she                                                               
presented  to the  committee represent  a  consensus from  Alaska                                                               
administrators.  The  first sentence  states  that  the State  of                                                               
Alaska  must provide  timely, reliable,  and predictable  revenue                                                               
for  funds.  The  timing is  particularly  important.  State  law                                                               
requires that tenured  teachers receive layoff notices  by May 15                                                               
and nontenured  by the  last day of  school. She  said recruiting                                                               
and  retaining qualified  educators  is a  bigger challenge  than                                                               
ever before  in the history of  Alaska, at a time  when the State                                                               
of  Alaska  is experiencing  incredibly  high  turnover rates  at                                                               
every level.  She said  if districts  cannot issue  contracts the                                                               
state's qualified  educators go elsewhere. Her  organization sees                                                               
the bill  as accomplishing two straightforward  tasks, separating                                                               
education to its  own appropriations bill and requiring  it to be                                                               
passed  by April  1. This  would address  the issue  of premature                                                               
pink-slips,  something districts  have experienced  for the  last                                                               
three years.                                                                                                                    
                                                                                                                                
8:19:36 AM                                                                                                                    
CHAIR STEVENS said he was president  of his local school board in                                                               
the 80s when  the budget was cut in half.  Many teachers who were                                                               
pink-slipped found  jobs in other  states. He  said pink-slipping                                                               
and then  hiring people  back doesn't retain  all the  people who                                                               
received pink-slips.                                                                                                            
                                                                                                                                
8:20:14 AM                                                                                                                    
SENATOR  GIESSEL asked  if other  states are  having difficulties                                                               
retaining teachers.                                                                                                             
                                                                                                                                
8:20:34 AM                                                                                                                    
DR. PARADY  said absolutely,  yes. There  is a  national educator                                                               
shortage   of   superintendents    and   principals,   but   most                                                               
prominently,  teachers, which  is very  hard for  Alaska, because                                                               
Alaska  historically recruits  from the  lower 48.  But educators                                                               
can get jobs almost anywhere in the lower 48 at this point.                                                                     
                                                                                                                                
8:21:01 AM                                                                                                                    
CHAIR STEVENS said in the 70s  and 80s people came because of the                                                               
wonderful  retirement system,  but  now it's  a portable  system.                                                               
People can take the money and leave the state readily.                                                                          
                                                                                                                                
8:21:21 AM                                                                                                                    
DR. PARADY  replied that Alaska  is less competitive than  it has                                                               
been historically and,  in addition, fewer people  are going into                                                               
education.                                                                                                                      
                                                                                                                                
8:21:41 AM                                                                                                                    
CHAIR STEVENS said  he would like to know whether  the quality of                                                               
hired  teachers  has  been  reduced,   whether  there  are  fewer                                                               
qualified  teachers,  and whether  the  state  should change  its                                                               
requirements.                                                                                                                   
                                                                                                                                
8:22:03 AM                                                                                                                    
SENATOR  BEGICH  asked  if  Dr.   Parady  had  analyzed  Alaska's                                                               
competitiveness with other states.                                                                                              
                                                                                                                                
8:22:24 AM                                                                                                                    
DR. PARADY said her organization  has been working with Northwest                                                               
Regional Educational  Laboratory (NWREL) to  do that. It  is also                                                               
working  with DEED  to get  more precise  numbers about  Alaska's                                                               
educator shortage. She  would like to present those  numbers in a                                                               
joint education session.                                                                                                        
                                                                                                                                
8:23:56 AM                                                                                                                    
CHAIR STEVENS responded that a joint session was a good idea.                                                                   
                                                                                                                                
8:24:11 AM                                                                                                                    
SENATOR GIESSEL said  that when she worked in  very rural Alaskan                                                               
schools,  she would  often encounter  very  young, new  teachers,                                                               
eager to  start the  school year,  and when she  came back  a few                                                               
months  later they  would be  gone.  "The cultural  shock was  so                                                               
much,  the environment,  just  the light  itself,  far above  the                                                               
Arctic Circle,  such a  factor," she  said. While  the retirement                                                               
system has changed, these elements  haven't changed. She asked if                                                               
the state  is attempting to  hire so many brand-new  teachers who                                                               
aren't  ready   to  be  out   on  their  own  in   a  challenging                                                               
environment.                                                                                                                    
                                                                                                                                
8:25:21 AM                                                                                                                    
DR.  PARADY  said  to  be  quite  candid,  school  districts  are                                                               
struggling to  hire, period.  The majority  have gone  the entire                                                               
year without being  fully staffed. In many cases  they are trying                                                               
to  balance  paraeducators  and  substitutes  to  cover  courses.                                                               
Recently, working  with DEED and  the University of  Alaska (UA),                                                               
they looked  at school district vacancies  for special education.                                                               
Before  Christmas, Alaska  lacked  almost  100 special  education                                                               
teachers across the state.                                                                                                      
                                                                                                                                
8:26:54 AM                                                                                                                    
CHAIR STEVENS  said the bill is  just the tip of  the iceberg and                                                               
exposes enormous problems across the state in education K-12.                                                                   
                                                                                                                                
8:27:40 AM                                                                                                                    
SENATOR BEGICH said that teacher  retention grants that were part                                                               
of the Moore [vs. State  of Alaska] lawsuit were being evaluated.                                                               
He wondered if  DEED could present whether there  was an increase                                                               
in teacher retention because of those efforts.                                                                                  
                                                                                                                                
8:28:28 AM                                                                                                                    
CHAIR STEVENS asked that DEED plan to present on that issue.                                                                    
                                                                                                                                
8:28:54 AM                                                                                                                    
DAVE  JONES, Assistant  Superintendent,  Kenai Peninsula  Borough                                                               
School  District,  testified  in  support  of  SB  131.  He  said                                                               
districts need  funding certainty  to move forward  with staffing                                                               
decisions and  contract commitments.  He said  he didn't  see any                                                               
consequence in  the bill for  missing the deadline.  He suggested                                                               
that perhaps it  should be flat funding, so  districts could make                                                               
staffing decisions.                                                                                                             
                                                                                                                                
CHAIR STEVENS asked  Mr. Jones to describe his  experience at job                                                               
fairs and the impact that pink-slipping may have on his hires.                                                                  
                                                                                                                                
8:31:17 AM                                                                                                                    
MR. JONES  said many teachers  that his district wants  to retain                                                               
have young  children and they cannot  feed a family on  a promise                                                               
that they  probably will get  a contract after receiving  a pink-                                                               
slip.  By the  time his  district can  issue contracts  they have                                                               
moved on to  another district or state. He also  said the quality                                                               
of the  candidate pool is  so much higher  in April than  July or                                                               
August.                                                                                                                         
                                                                                                                                
8:33:29 AM                                                                                                                    
SENATOR HUGHES  said this has been  an issue for many  years. She                                                               
wondered what  reception SB 131  would receive in  Senate Finance                                                               
because education funding  is a huge part of  the overall budget.                                                               
She  asked what  if  districts always  worked  with the  previous                                                               
year's funding, so their budget  deadlines had nothing to do with                                                               
the current budget being debated by the legislature.                                                                            
                                                                                                                                
8:36:00 AM                                                                                                                    
CHAIR STEVENS said  SB 131 was one solution out  of many for this                                                               
issue.                                                                                                                          
                                                                                                                                
8:36:21 AM                                                                                                                    
MR.  JONES  said  there  are  many  alternatives  to  solve  this                                                               
problem. The  fiscal year starts  in July  and ends in  June, but                                                               
the revenue  source is not  solidified until the 20-day  count in                                                               
October ends.  If funding  were based  on the  student enrollment                                                               
the previous  year, the  district would know  its budget  for the                                                               
next school year in March or  April. He said this is what Wyoming                                                               
does. Wyoming does not penalize  for decreases in enrollment, but                                                               
districts  can get  more  money  for increases  of  more than  10                                                               
percent.                                                                                                                        
                                                                                                                                
8:38:23 AM                                                                                                                    
CHAIR  STEVENS said  the foundation  formula  included more  than                                                               
teachers. It  included transportation,  for example. He  asked if                                                               
the  foundation formula  could  be  divided up  so  at least  the                                                               
teacher element could be known.                                                                                                 
                                                                                                                                
8:38:57 AM                                                                                                                    
MR. JONES said that would be difficult.                                                                                         
                                                                                                                                
8:39:41 AM                                                                                                                    
SENATOR HUGHES asked if districts could change the fiscal year.                                                                 
                                                                                                                                
8:40:50 AM                                                                                                                    
MR. JONES said the legislature would  have to change that. He was                                                               
not sure if  changing the fiscal year would solve  the problem if                                                               
it started before the legislature passed a budget.                                                                              
                                                                                                                                
8:41:21 AM                                                                                                                    
SENATOR  HUGHES clarified  that  she meant  that districts  would                                                               
already  have  their  appropriations. She  wondered  about  other                                                               
options if Finance  members thought it might be  too difficult to                                                               
address  education  funding separately  from  the  rest of  state                                                               
budget.                                                                                                                         
                                                                                                                                
8:42:40 AM                                                                                                                    
CHAIR  STEVENS  said all  those  issues  would be  discussed  and                                                               
everything was  on the table. He  noted that education is  a very                                                               
important discussion and not easy to solve.                                                                                     
                                                                                                                                
8:43:37 AM                                                                                                                    
MARK  MILLER,  Ph.D.,  Superintendent,  Juneau  School  District,                                                               
testified  in support  of SB  131. He  said SB  131 is  needed to                                                               
prevent unnecessary layoff notices  and maintain consistent staff                                                               
to address the points in  the Alaska Education Challenge. Because                                                               
tenured  teachers cannot  be  laid off  without  a three  percent                                                               
reduction  in  the  budget,  he  had to  make  one  of  the  most                                                               
difficult choices  of his  career last  May when  the legislature                                                               
was  discussing a  five  percent reduction  to  the Base  Student                                                               
Allocation. He had to decide  whether to pink-slip all nontenured                                                               
teachers  before  the  end  of school.  He  didn't  issue  layoff                                                               
notices  to any  teacher, but  it  was risky.  He estimated  that                                                               
Juneau's end  fund balance  this year  would be  around $400,000,                                                               
what it cost to  run the district for one day.  He said, "We have                                                               
one school  day worth of  money between  us being solvent  and us                                                               
not being able to write checks to cover our debts."                                                                             
                                                                                                                                
8:48:14 AM                                                                                                                    
CHAIR STEVENS asked Dr. Miller  whether he had any reflections on                                                               
the right date.                                                                                                                 
                                                                                                                                
8:48:31 AM                                                                                                                    
DR. MILLER said  the earlier the better, but by  the first of May                                                               
at  the  latest because  of  the  rules  for laying  off  tenured                                                               
teachers.                                                                                                                       
                                                                                                                                
8:49:09 AM                                                                                                                    
SENATOR  GIESSEL  asked  for  an update  on  the  situation  with                                                               
Juneau's second high school regarding  low enrollment numbers and                                                               
the possibility of consolidation.                                                                                               
                                                                                                                                
8:49:31 AM                                                                                                                    
DR. MILLER  said a consultant  just concluded  that consolidating                                                               
both schools did  not make sense. The brand new  high school does                                                               
not have  the capacity to hold  all students and putting  all the                                                               
students in an old building, away  from where 70% of the students                                                               
live,  does not  save  money. Trying  to  restructure the  entire                                                               
district to  close one old  building does not save  money because                                                               
transportation costs  go up.  Trying to  solve one  problem often                                                               
creates another.                                                                                                                
                                                                                                                                
CHAIR STEVENS held the bill in committee.                                                                                       
                                                                                                                                

Document Name Date/Time Subjects
SB131_EarlyEdFunding_BillText_VersionA.PDF SEDC 1/17/2018 8:00:00 AM
SB 131
SB131_EarlyEdFunding_SponsorStatement_VersionA.pdf SEDC 1/17/2018 8:00:00 AM
SB 131
SB131_EarlyEdFunding_Sectional_VersionA.pdf SEDC 1/17/2018 8:00:00 AM
SB 131
SB131_EarlyEdFunding_FN1_Foundation.pdf SEDC 1/17/2018 8:00:00 AM
SB 131
SB131_EarlyEdFunding_FN2_PEF.pdf SEDC 1/17/2018 8:00:00 AM
SB 131