Legislature(2013 - 2014)SENATE FINANCE 532
04/18/2014 01:30 PM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB278 | |
| HB385 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| = | HB 278 | ||
| + | HB 385 | TELECONFERENCED | |
| = | HB 160 | ||
| = | HB 140 | ||
| = | HB 306 | ||
| = | HB 287 | ||
| = | HJR 10 | ||
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
April 18, 2014
1:44 p.m.
1:44:41 PM
CALL TO ORDER
Co-Chair Meyer called the Senate Finance Committee meeting
to order at 1:44 p.m.
MEMBERS PRESENT
Senator Pete Kelly, Co-Chair
Senator Kevin Meyer, Co-Chair
Senator Anna Fairclough, Vice-Chair
Senator Click Bishop
Senator Mike Dunleavy
Senator Lyman Hoffman
Senator Donny Olson
MEMBERS ABSENT
None
ALSO PRESENT
Edra Morledge, Staff, Senator Kevin Meyer; Michael Hanley,
Commissioner, Department of Education and Early
Development; Diane Blumer, Commissioner, Department of
Labor and Workforce Development; Norm Wooten, Director,
School Improvement and Governmental Relations, Association
of Alaska School Boards (AASB); Dr. Robert Whicker,
Director, Consortium for Digital Learning, Association of
Alaska School Boards; Angela Rodell, Commissioner,
Department of Revenue; Kathy Wasserman, Executive Director,
Alaska Municipal League, Juneau; Senator Hollis French;
SUMMARY
HJR 10 CONST. AM: TRANSPORTATION FUND
HJR 10 was SCHEDULED but not HEARD.
CSHB 140(FIN)
REGULATIONS: NOTICE, REVIEW, COMMENT
CSHB 140(FIN) was SCHEDULED but not HEARD.
CSHB 160(FIN)
LICENSING OF ATHLETIC TRAINERS
CSHB 160(FIN) was SCHEDULED but not HEARD.
CSHB 278(FIN) am
EDUCATION
CSHB 278(FIN) am was HEARD and HELD in committee
for further consideration.
CSHB 287(RLS) am
OIL ROYALTIES; TAX CREDIT
CSHB 287(RLS) am was SCHEDULED but not HEARD.
HB 306 EVAL. INDIRECT EXPENDITURES; TAX CREDITS
HB 306 was SCHEDULED but not HEARD.
HB 385 PERS/TRS STATE CONTRIBUTIONS
HB 385 was HEARD and HELD in committee for
further consideration.
CS FOR HOUSE BILL NO. 278(FIN) am
"An Act increasing the base student allocation used in
the formula for state funding of public education;
relating to the exemption from jury service for
certain teachers; relating to the powers of the
Department of Education and Early Development;
relating to high school course credit earned through
assessment; relating to school performance reports;
relating to assessments; establishing a public school
and school district grading system; relating to
charter schools and student transportation; relating
to residential school applications; relating to tenure
of public school teachers; relating to 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
schools operated by a federal agency; relating to a
grant for school districts; relating to education tax
credits; establishing an optional municipal tax
exemption for privately owned real property rented or
leased for use as a charter school; requiring the
Department of Administration to provide a proposal for
a salary and benefits schedule for school districts;
making conforming amendments; and providing for an
effective date."
1:46:40 PM
Co-Chair Kelly MOVED to ADOPT the proposed committee
substitute for HB 278, Work Draft 28-GH2716\S (Mischel,
4/17/14) as a working document. There being NO OBJECTION,
it was so ordered.
1:47:28 PM
AT EASE
1:52:02 PM
RECONVENED
1:52:20 PM
Co-Chair Meyer noted that education was very important to
the committee and that several different Senate bills had
been rolled into the current committee substitute (CS);
some of the included bills were sponsored by Senator Olson,
Senator Dunleavy, and Senator Bishop. He recalled taking
public testimony during the formulation of the legislation
and offered that there were some things in CS that people
would like and perhaps other things that people would not
care for; however, he believed that the bill was a balanced
piece of legislation that everyone could support. He noted
that $100 million had been set aside for bottom line of
education in the bill, which included $100 million in
funding for the next 3 out years. He stated that the base
student allocation (BSA) was part of the formula for
education and that the CS included a study that would
examine how to better improve the education funding
formula. He reiterated that the committee had opted to keep
the funding outside of the formula in the new CS, but added
that $100 million in funding equated to around a $400 BSA
per student; however, some of that funding would be used
for other programs and the BSA would end up being closer to
$300.
Co-Chair Kelly thought that the money was distributed
through the formula, but that it was allocated through the
adjusted average daily membership (AADM) instead of the
BSA. He concluded that the funding was distributed through
the formula but that it did not raise the BSA.
Co-Chair Meyer stated that Co-Chair Kelly was correct.
1:56:28 PM
EDRA MORLEDGE, STAFF, SENATOR KEVIN MEYER, presented a
sectional analysis of the CS (copy on file) and spoke to
the changes from the House version of the bill. She related
that the first change in the new CS was in Section 2 on
page 2, beginning on line 23. In the first change, the
course credit earned through mastery of course content had
been reinserted in this section; this included a student
being able to challenge out of one of the core courses and
allowed one of the courses to simultaneously qualify for
the Alaska Performance Scholarship (APS). She expounded
that the core courses in question were mathematics,
language arts, science, social studies, and world
languages.
Ms. Morledge continued to speak to the sectional analysis
and related that the second change to the bill occurred on
Section 3 on page 3, beginning on line 6. The change was
related to college and career reediness assessments and
allowed a student to choose between taking the SAT, ACT, or
Work Keys within 2 years of their graduation. She addressed
the CS's third change from the House version; it was also
on page 3, beginning on line 19 and it effectively removed
the requirement for students to take the high school
graduation qualifying exam (HSGQE). She stated that the
next change was on Section 7 on page 6, beginning on line
15 and was funding for internet services. She noted that
the funding for internet services was one of the pieces of
other Senate legislation that had been rolled into the
bill.
Ms. Morledge continued to address a sectional analysis of
the bill and related that the next change was in Section 7
on page 6, beginning on line 29. The change was the
personalized learning opportunity grant program and would
be administered through the Association of Alaska School
Boards; the program would provide technological equipotent
and well as technical support and training for students in
the use of an electronic device. The second change was on
Section 12 on page 11, beginning on line 6; language had
been inserted to ensure that the 4 percent administrative
fee cap that may be charged by districts to charter schools
would not include costs related to rent utilities and
maintenance. Also included in Section 12 was language that
began on line 14 which ensured that funds that were
generated by charter school student were distributed to the
charter schools for the student that generated the funds.
Ms. Morledge continued to present a sectional analysis of
the bill and stated that there were changes in Section 14
on page 12, beginning on line 9 to correspondence study
programs and individual learning plans; this section
provided requirements for districts to provide individual
learning plans for students enrolled in a correspondence
program. She added that Section 14 on page 13, beginning on
line 2 had been changed to allow the Department of
Education and Early Development (DEED) or a school district
to provide an annual allotment to a parent or guardian of a
student enrolled in a correspondence program to cover
instructional expenses. She stated that the next change
could be found in Section 20 on page 21, beginning on line
18 and explained that it pertained the debt reimbursement
program; the 70/30 debt reimbursement program that the
state was currently using was being changed to 60/40. She
added that the second program that the state was currently
reimbursing at 60 percent had been changed to reimburse at
40 percent.
2:01:59 PM
Ms. Morledge continued to speak to a sectional analysis of
the bill and related that the next change occurred on
Section 23 on page 24; the residential school stipends had
been increased. She related that the next change was in
Section 24 and that language had been added so that
municipalities could voluntarily contribute up to 23
percent of the total state aid, including basic need. She
stated that in Section 25 on line 27 state funding for
correspondence study had increased from 80 percent of the
average daily membership (ADM) to 90 percent. She pointed
to Section 26 on the top of page 25 and related that the
charter school size factor threshold had been reduced from
150 students to 75 for full funding for each student within
the first 3 years of the their operation. She discussed an
additional change in Section 29 on page 26, on line 12 and
stated that the contribution for the Technical Vocational
Education Program (TVEP) had been raised from 15 percent to
16 percent. She stated that the current version of the bill
kept the House version sunset date of 2017 for TVEP;
additionally, the allocations had been changed, Ilisagvik
College had been added to the program, and there were some
name corrections.
Ms. Morledge stated that the next 2 changes were to
Sections 35 through 46 to the education tax credits. She
related that the only 2 changes to the education tax
credits sections were that non-profit regional training
centers and apprentice programs, as well as non-profit
organizations that provided education opportunities
promoting the legacy of public service contributions had
been added. She stated that the next change was Sections 52
and 53 beginning on page 41, line 25; a school district
cost factor study and a school size factor study had been
added. She stated that the next change was in Section 54
and explained that beginning on line 13, a school design
and construction report had been added. She related that
another change to the current version of the bill was in
Section 56 and explained that the pilot project to expand
middle school science, technology, engineering, and
mathematics education had been added. She stated that on
the last page of the bill there had been a provision added
that allowed students to receive a retroactive issuance of
their high school diploma if they had previously been
required to take the HSGQE.
Co-Chair Meyer stated that the bill was a piece of omnibus
legislation that touched on a lot of different areas. He
thought that the legislation would provide more choices for
the parents, as well as more resources for teachers and
students; the legislation incentivized the districts to
operate differently and also incentivized the successful
model of residential boarding schools. He noted that the
legislation also made the process of opening up a charter
easier and noted the lowered threshold requirements of 75
from 150 students. He discussed the $500 one-time stipend
that went with each student who attended a charter school.
He pointed out that Senator Dunleavy could speak to the
success and popularity of the correspondence schools and
offered that the legislation was attempting to target the
classroom. He stated that the Alaska Native Science and
Engineering Program (ANSEP) had also been expanded in the
bill to encompass middle schools.
2:08:38 PM
MICHAEL HANLEY, COMMISSIONER, DEPARTMENT OF EDUCATION AND
EARLY DEVELOPMENT, stated that he the appreciated the work
of the Senate on the bill and recalled that the governor
had previously stated the need for changes in education in
order to improve outcomes, remove barriers, and increase
opportunity for students. He remembers that the governor
also recognized additional funding was needed for Alaska's
school districts. He thought that the Senate had taken the
governor's initial ideas and had built them into a more
comprehensive bill that would have positive impacts on
Alaska's children.
Co-Chair Meyer inquired if there was anything in particular
within the bill that would be difficult to implement.
Commissioner Hanley responded that anytime there was
change, it was difficult to implement; however, he did not
see any particular challenges regarding implementation for
the department. He related that a lot had change in Alaska
over the last several years regarding raising standards and
teacher evaluations. He thought that the legislation
represented positive opportunity without a lot of mandated
or unfunded responsibilities for districts. He thought
there would need to be some small changes to the current
system and some new responsibilities, but that they were
worth it. He thought that repealing the high school exit
exam was significant and would provide several extra days
of learning time for the state's students. He opined that
the removal of some of the barriers was a positive thing.
He concluded that he did not see anything in the bill that
seemed to cause red flags for him or the school districts.
Vice-Chair Fairclough requested an explanation of the
changes in the bill that related to the debt reimbursement
program and if there would be transitional opportunities
for those who might already be in the queue. Commissioner
Hanley replied that he had not seen the language regarding
the transitional aspect of the bill, but that his
understanding was that the debt had already been acquired
and bonds that had already gone out were under the current
system; bonds going forward after the bill passed would be
under this new system. He anticipated that after the bill
passed, the state's responsibility for the ongoing debts
would become less and that there would be some rethinking
regarding putting forward projects that would cost local
municipalities a little more money; additionally, there
might be some more review into projects regarding what went
into them, which might lead to more frugal designs.
2:13:18 PM
Vice-Chair Fairclough directed the committee's attention to
Sections 17 and 18 on page 21 of the bill and related that
she wanted to be sure that municipalities that had gone out
to bond had transitional ability. She wanted language in
the CS or an amendment that recognized that there were
people who may qualify for debt reimbursement even if they
had not submitted the issue to voters and whether
reimbursement under the old plan was desired. Her
understanding was that if the department had already
qualified a school district for a project, it would qualify
under the old reimbursement plan instead of the new one;
she requested an explanation of whether the bill stated
that or not. Commissioner Hanley believed that lines 7 and
8 spoke to the issue and pointed out that those lines
discussed other indebtedness that was authorized by the
qualified voters of the municipality on or after October
2006, but before June 30, 2014. He expounded that prior to
a project coming to the state for reimbursement, it would
need to authorized by qualified voters prior to June 30,
2014; he thought that this addressed Vice-Chair
Fairclough's question.
Vice-Chair Fairclough noted that it addressed her question
and the needs of Anchorage because its bonds were held in
April; however, she was unsure if the legislation
anticipated others who had already qualified and expected
to take a particular project before the voters. She
wondered if people who had already qualified for a project
would be entitled to the reduced rate.
Co-Chair Meyer welcomed Senator Hollis French who was
present in committee. He stated that the current version
was the Senate Finance Committee's first CS and that there
would be changes to the bill. He requested members to
provide desired changes to his office by 6 p.m.
Senator Bishop discussed duel credits and articulation
agreements regarding TVEP. He requested an affirmation that
Commissioner Hanley would work with the commissioner of the
Department of Labor and Workforce Development, the
president of the University of Alaska, and the districts on
duel credits with TVEP recipients in order to all allow
more Alaskan students to enter into the university at their
freshmen or sophomore year. Commissioner Hanley replied
that the duel credits were critical and that DEED was
training Alaskan students for Alaskan jobs, many of which
were directly tied to these types of trainings.
2:17:15 PM
Senator Dunleavy wanted it on the record that his office
and the office of Commissioner Hanley had worked together
on a section of the bill that was referred to as the home
school correspondence section. He thought that language had
been developed by the two offices in the section that would
work for kids, parents, teachers, and school districts in
the state. Commissioner Hanley surmised that Senator
Dunleavy was referencing the language on Section 14 on page
12 of the bill, which dealt with correspondence study
programs and individual learning plans. He noted that the
first part of the language on page 12 solidified current
regulatory language into statute. He explained that some of
the language was not new, but it built on other ideas such
as student allotments being allowed to roll over. He
confirmed that he had his office had conversations that
were focused on money being spent for educational purposes
in a relatively flexible manner. He added that he and
Senator Dunleavy did agree on the current language in the
section being referenced.
Vice-Chair Fairclough recalled discussions the previous
summer in the Senate Finance Subcommittee regarding
repealing the HSGQE. She noted that the bill was
reinserting the SATs, the ACTs, and other placements. She
wondered if there had been considerations regarding setting
a testing level so that the state could measure outcomes
for students. She inquired if there was a level on the
tests that would be similar to what students qualified for
the in the APS that could be used as a measurement tool for
how Alaskan students were achieving. Commissioner Hanley
replied that the department had not looked at bringing a
separate cut score on to the assessments. He noted that the
department was moving from high stakes exam to an
informative tool that was intended to inform students,
parents, counselors, and high schools of a student's
readiness for college. He stated that there were other
tools in place already to measure a student's proficiencies
regarding standards; the department also had the cut scores
for different levels of the APS.
Vice-Chair Fairclough noted that she had not yet read
through the entirety of the new CS and inquired how tenure
was addressed. Co-Chair Meyer replied that the tenure was
not changed from the House version of the bill.
Commissioner Hanley addressed the fiscal notes attached to
the bill and spoke to a 4 page spread sheet that showed the
fiscal impacts of each section (copy on file). He discussed
Section 3 of the bill which dealt with the ACT and SAT
tests and pointed out that the fiscal note attached to the
Section was for $525,000. He noted the removal of the HSGQE
in Section 4 created a decrement of $2.7 million. He
discussed Section 7 and stated that the funding for
internet services had been slightly changed from Senator
Olson's bill; it no longer added 10 percent, but got all
the schools up to 10 megabits. He stated that DEED's latest
analysis of the internet services had the cost at $7.3
million. He discussed the 1:1 Digital Learning Initiative
and stated that the fiscal note for that was currently
indeterminate. He added that the department did not
currently have the ability to determine the exact costs of
the 1 to 1 initiative.
2:23:45 PM
Co-Chair Meyer requested an explanation of the 1:1 Digital
Learning Initiative. Senator Dunleavy explained that it was
a program that would get Ipads and electronic devices in
the hands of teachers and students in order focus on an
approach to education that encompassed modern technology,
as well as modern and online course work. He thought that
estimates of the costs for the program ranged from $3
million to $5 million.
Co-Chair Meyer noted that the costs for the 1:1 Digital
Learning Initiative were still unknown, but that it was
expected to be between $3 million to $5 million.
Commissioner Hanley pointed out that there were models of
IPads out there, but that there were other vendors that
were interested in the initiative. He added that it would
not involve strictly apple products. Senator Dunleavy
clarified that he used the brand name IPad sometimes in
referenced to all kinds of electronic tablets.
Co-Chair Meyer observed that the committee was not
promoting one company over another.
Commissioner Hanley continued to address the spread sheet
and noted that there was an item in the budget for $750,000
for the innovative approach to learning grants.
Co-Chair Meyer requested an explanation of the innovative
approach to learning grants. Senator Dunleavy explained
that it was a granting opportunity for school districts,
especially for some of the smaller one to bring a concept
to DEED for application for a planning grant. He related
that the grant would allow districts that had a worthy
concept to contract research to more fully explore the
idea; then it could be submitted to DEED for scoring and
examination. If the idea had merit at this point, it would
be brought back before the legislature. He related that
this concept was opposed to the current method of the
districts coming to the state on an individual basis and
potentially asking for a multi-million dollar appropriation
for a program that might not work.
Commissioner Hanley spoke to page 2 of the spread sheet and
referenced Section 13 of the bill, which addressed the
Charter School Grant Program; the fiscal note for this was
for $168,000 and was for charter schools that began after
the bill was passed. He pointed to Section 23 and the
residential stipends and related that $2.2 million was what
DEED believed was close to the actual costs.
2:28:04 PM
Commissioner Hanley spoke to page 3 of the spread sheet and
section 25; the section moved the correspondence school
students from a .8 to a .9 and had a fiscal impact of $12.3
million. He noted that the annual cost of the change from
.8 to .9 was about $6.15 million but that there was an
obligation to have forward funding.
Co-Chair Meyer inquired if the funding was for $12.3
million for 2 years. Commissioner Hanley replied in the
affirmative and stated that it included the current year
and 1 additional year of forward funding.
Commissioner Hanley stated that Section 26 was the charter
school size factor and that it allowed charter schools that
fell below 150 students to continue to receive full
funding; it changed the minimum number to 75 students. He
added that the change would currently only impact several
schools and that it would have a cost of $483,000; DEED
believed that this would help charter schools that were
starting up and would enable people to start a smaller
school with full funding without having to reach 150
students. He directed the committee's attention to page 4
of the spreadsheet and Sections 52 and 53; these sections
dealt with the studies for school district cost factor and
the school size factor. He stated that the 2 studies were
both Legislative Budget and Audit components and that he
had not seen a fiscal note for those. He guessed that the
study costs from Sections 52 and 53 would be comparable to
the school design and construction report in Section 54,
which had a cost of $620,000.
Commissioner Hanley continued to address the spread sheet
and stated that Section 55 was the Department of
Administration's (DOA) salary and benefits proposal; the
cost for this was $610,000. He stated that the ANSEP middle
school pilot program had a cost of $3 million and that it
would engage 8th graders with a vision into high school and
beyond.
Co-Chair Meyer noted that the commissioner had discussed
ANSEP and inquired if it was limited to science and
engineering. Commissioner Hanley replied that the primary
focus of ANSEP was science and engineering.
2:32:04 PM
Co-Chair Meyer inquired if math was a focus of ANSEP.
Commissioner Hanley replied that math was incorporated
throughout the program and added that students in it were
engaged in high-level calculus, trigonometry, and other
math courses.
Senator Bishop observed that ANSEP was another example of
where the state would want to focus on duel credits.
Commissioner Hanley responded in the affirmative and added
that it was where the conversation had been originally
brought to light.
Senator Dunleavy noted that the duel credits involved the
high school component of ANSEP, but added that the pilot
program in reference reached into middle school. He stated
that the goal for the pilot program was to get middle
school students an Algebra 1 background before entering
high school.
Commissioner Hanley related that there was a small
component being added on Section 5 on the 1st page of the
spreadsheet. He explained that the change added a component
to data for students who had parents that were in the
active military and that it had a cost of about $80,000 in
the current year; beyond the current year, the fiscal note
had a cost of $10,000. He stated that the TVEP portion was
switching from 1.5 percent to 1.6 percent represented a
$926,000 fiscal note; that change could be found in Section
29.
Co-Chair Meyer noted that the funding for the TVEP increase
would come from a trust and thought that there would be no
additional cost to the workers. Commissioner Hanley
deferred the question to Commissioner Blumer and stated
that it was a labor component.
Commissioner Hanley recalled Co-Chair Meyer's comments that
the bill had set aside $100 million for education and noted
that if you pulled the spreadsheet's components, the bill
would be in the $65 million to $70 million range. He added
that the spreadsheet contained somewhere in the ballpark of
$30 million to $35 million in components, but that the
range could be solidified shortly.
2:35:59 PM
Co-Chair Meyer thought that the bill was closer to $75
million without the components, but noted that there was a
lot of variance in the estimates. He stated that the
estimate for computers was $3 million to $5 million and
that the correspondence represented 2 years of funding. He
inquired if the bill represented a $300 BSA if the
spreadsheet's components were removed. Commissioner Hanley
replied that legislation seemed to be in the ballpark of a
$300 BSA.
DIANE BLUMER, COMMISSIONER, DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT, stated that there was a small
increase to the TVEP component and related that the funding
came out UI Trust Fund. She related that over the past
several years, the amount coming out had .15 percent, but
that it was being increased to .16 percent; however, there
was a slight cost to employers, which was about $2.40 per
year, per employee. She related that the effect on
employers represented the best estimate by the Research and
Analysis Division and that it limited the impact of adding
another regional training to the funding source.
Co-Chair Meyer inquired if the Commissioner Blumer
supported the change to the TVEP component. Commissioner
Blumer replied that she had spoken with Senator Bishop on
the issue and that the administration would prefer to move
forward with the governor's proposed language; however, the
administration understood that adding Ilisagvik College
would impact other recipients and it agreed with the
change.
2:39:57 PM
Vice-Chair Fairclough thought that if the committee was
going to conduct a salary and benefit proposal with DOA, it
should examine what the Legislative Budget and Audit
Committee had already paid for in the form of a benefit
analysis. She wanted to be sure that the dollars would be
used wisely. She wondered whether DOA was the right place
to conduct the survey or if it should be through
legislative budget and audit. She noted that legislative
budget and audit typically partnered with the National
Conference of State Legislatures, which had conducted like
surveys many times in the past. She was unsure if $610,000
was the best available price for the survey.
Co-Chair Meyer liked the 1:1 Digital Learning Initiative,
as well as the focus on science and math. He thought that
the bill represented a good package.
Senator Dunleavy requested that the Association of Alaska
School Boards (AASB) briefly comment on the bill.
2:42:12 PM
Senator Bishop requested Commissioner Hanley and
Commissioner Blumer to take a look at the ANSEP middle
school pilot program to see if it could be incorporated
with the Career and Technical Education Program.
Senator Dunleavy requested a walkthrough of the procurement
procedures of the l:1 Digital Learning Initiative because
it would involve a number of school districts, companies,
and platforms. He noted that there might concerns on the
part of school districts, particularly with a district that
may not be part of the AASB.
NORM WOOTEN, DIRECTOR, SCHOOL IMPROVEMENT AND GOVERNMENTAL
RELATIONS, ASSOCIATION OF ALASKA SCHOOL BOARDS (AASB),
explained that purpose of the 1:1 Digital Learning
Initiative was to increase student achievement and that the
association was not dedicated to a particular vendor. He
noted that student achievement would remain AASB's focus at
all times and that it would ensure the competitive
processes were followed by requiring local districts to
comply with board policies for procurement.
DR. ROBERT WHICKER, DIRECTOR, CONSORTIUM FOR DIGITAL
LEARNING, ASSOCIATION OF ALASKA SCHOOL BOARDS, added that
AASB represented 49 of the 53 school districts and that the
3 others out of the remaining 4 used policies from the
association's manual. He stated that the Aleutian Region
was the only school district that was not part of AASB, but
that the Consortium for Digital Learning worked with any
school district and school, including charter schools and
home school support programs. He stated that when the
consortium conducted a project, it made sure that districts
were aware of multiple vendors. He reported that in 2008,
the consortium ran a similar project to the 1:1 initiative
and that multiple vendors had been used in that project. He
stated that honoring local choice would be paramount and
that the consortium would be working with vendors to
identify what fits; it would be working with districts to
enable them to know what is available. He stated that the
consortium would be holding webinars with multiple vendors
and that there were probably 4 vendors in the state that
could be participating in the program. He stated that the
consortium had been conducting aggregate orders with the
smaller school districts and had been working with Apple
and Dell on those orders. He added that the consortium also
made sure through the application process that the school
districts had considered the multiple vendors.
2:47:21 PM
Vice-Chair Fairclough noted that the Legislative Budget and
Audit Committee worked with procurement a little bit. She
was not sure that the plan that was just outlined provided
the best benefit for Alaska's students, while it might lead
to the most local choice. She had something a bit different
in mind and wondered why the state could not approach each
1 of the 4 vendors to get the lowest-cost bid for a unit as
a group. She offered that with 100,000 students, the state
would not purchase all of the products at once; however, it
seemed that negotiating each district individually would
not secure the best cost for the state. She had been
supportive of the money to be moved into AASB for
distribution because she thought that the buying power of
the state would be used in the negotiations. She thought
that a survey of districts should first be conducted to
determine what the software capacity was and that the AASB
would negotiate with all 4 contractors; at this point the
school districts could buy through AASB versus having 54
procurement processes. She offered that maybe the best
price possible was already achieved and requested an
explanation. Dr. Whicker replied that the Consortium for
Digital Learning had been conducting aggregate orders for
small school districts for several years and that vendors
recognized the consortium as the central agency; the
consortium negotiated the price with the vendors and had
sometimes been able to secure ultra-competitive prices
because of that. He related that the current method
streamlined purchases and had enabled getting more devices
into school; furthermore, the consortium had been tracking
the type of discounts that it had been getting in aggregate
orders and it had determined that it was as good as anyone
else had been able to achieve.
Vice-Chair Fairclough related a hypothetical example that
the state was quoted $500 for one unit and $495 per unit if
1,000 units were purchased. She inquired if every school
would receive the discount whether it purchased one unit or
500. Dr. Whicker replied in the affirmative, but added that
the $495 would be different and that it depended on the
type of equipment. He stated that if a small southeast
school district and Fairbanks were put into an aggregate
order, all of them would be lumped together and the small
district would receive the same price as the large one.
Vice-Chair Fairclough thought it seemed like a discount
would be achieved if a contract was set up for a certain
number, but was purchased in an incremental fashion. She
expounded that she thought there would be a price savings
between 1, 10, 100, 1000, and 10,000 units. She wondered if
the consortium had considered consulting the school
districts to find out the platforms and services that they
might want instead of having 54 different platforms; she
wondered if it should be standardized.
Vice-Chair Fairclough stated that her office had worked
Senator Dunleavy and his staff on the procurement issue
because of a concern for making sure that there was a
fairness aspect to competing. She appreciated the effort to
formulate language that provided the private sector an
opportunity to compete; she thought that this was being
achieved, but was unsure if the state would be getting the
highest value per unit with the current approach.
2:53:30 PM
Co-Chair Meyer understood that Vice-Chair Fairclough or
Senator Dunleavy had an amendment to offer that addressed
the cost per unit issue. Vice-Chair Fairclough replied that
the amendment was being worked on currently.
Senator Dunleavy understood that the 54 school districts
would be grouped per platform and product in bulk and that
the costs would be driven down as a result. He thought the
state's dollar would be maximized by grouping the
districts' orders together and that the cost per unit would
go down as a result. He stated that there was language that
would be offered in the amendment process that would
clarify the issue further.
Senator Olson inquired if the state's procurement code was
being handled. Dr. Whicker replied that the consortium was
looking at a competitive bidding process that was
reasonable and fair for the multiple vendors. He concluded
that local districts had different codes that they followed
and that the consortium would be working with those
districts to ensure that things were fair.
Senator Olson noted that on Section 56 on page 42 of the
bill, the middle school pilot project was discussed. He
recalled that the project was identified in the
presentation as being part of ANSEP, but stated that he did
not see ANSEP named in the referenced section. He inquired
if he was missing something in the legislation or if he had
misunderstood something. Ms. Morledge replied that 2
amendments had been received on the section and that the
pilot project was geared towards getting students into
ANSEP; it was intended as a pre-ANSEP program that would
move students towards ANSEP in middle schools.
Senator Olson inquired if the pilot project was open to all
students or just Alaskan Native students. Ms. Morledge
replied that it would be open to all students.
2:57:29 PM
Senator Hoffman referenced page 42 of the bill and the
salaries and benefit proposal. He expressed concerns that
the different salary structures and incentives for hiring
teachers could not be put into boxes and be compared
between schools districts because each district had a
different method of trying to hire the best teachers. He
also expressed concerns of higher costs in rural areas of
the state. He inquired how the study would be beneficial to
the State of Alaska and be fair to all districts of the
state. Commissioner Hanley responded that the answer
depended in the vision and will of the committee and the
legislature and that the implementation of the study was a
function of DOA; he added that it fell outside of the
purview of DEED.
Commissioner Hanley queried if Senator Hoffman was
inquiring what he personally thought of how the study would
be beneficial and fair to all of the school districts.
Senator Hoffman responded that it may fall outside of the
purview of DEED and be part of DOA's study; however, the
varied salary structures that the school districts had to
retain competent teachers had direct implications to the
quality of education for all of students throughout the
State of Alaska. He thought that Commissioner Hanley should
be involved in the study and that it should not be left to
DOA because of the implications of what the salary and
benefits proposal would recommend. Commissioner Hanley
state "wholeheartedly" that if the state took on the task
of choosing to set and implement state-wide salaries, it
would have huge implications. He anticipated that if the
state did set statewide salaries, it would be done
similarly to the geographic cost factor and that there
would be a district as a base; different regions would have
different levels.
Senator Hoffman stated that another factor with setting
salaries could involve a school district that already had a
hard time filling vacancies with the current flexibility to
increase its salary structure. He related another example
that a school district may want higher achievement levels
and would want more competitive salaries in order to hire
more competent teachers; he thought that this would be hard
to accomplish when salaries and benefits were structured.
He thought that it seemed as though a statewide benefit and
salary structure would tie school districts' hands by
removing a major avenue for teacher retention. Commissioner
Hanley understood and agreed. He added that anytime the
state made a decision for all of the districts from Juneau,
it needed to do so very cautiously. He observed that the
risk was that the state would not adequately recognize the
challenges of particular regions, communities, and schools
that had the ability to set salary schedules.
Senator Hoffman stated that from his viewpoint, giving
local control and flexibility to these regions,
communities, and schools was one of the primary reasons
that Alaska had switched from a state-operated system to
the current system.
3:03:19 PM
Senator Olson inquired how opposed Commissioner Hanley
would be to removing Section 55 of the bill. Commissioner
Hanley replied that he was not married to that particular
component.
Co-Chair Meyer thought that the component in question had
been added in the House and had not come from the governor.
Commissioner Haley responded that it was not in the
governor's version of the bill. Co-Chair Meyer assumed that
Commissioner Hanley was not too attached to that particular
component. Commissioner Hanley replied that he was not.
3:04:03 PM
AT EASE
3:32:58 PM
RECONVENED
Co-Chair Meyer handed the gavel over to Co-Chair Kelly.
HOUSE BILL NO. 385
"An Act relating to additional state contributions to
the teachers' defined benefit retirement plan and the
public employees' defined benefit retirement plan; and
providing for an effective date."
Co-Chair Kelly requested an explanation of changes of the
differences between SB 220 and HB 385.
3:33:44 PM
ANGELA RODELL, COMMISSIONER, DEPARTMENT OF REVENUE, spoke
to the changes between the 2 bills. She related that there
were no changes made between the house companion bill and
SB 220. She stated that the legislation provided for a
fixed amount of $343 million to be deposited into the
Teachers Retirement System (TRS) on an annual basis through
FY 36; it also would appropriate $157 million to the Public
Employee Retirement System (PERS) on an annual basis
through FY 36. She related that the bill also provided for
$1.1 billion to be deposited in a lump sum to TRS and $1.8
billion into PERS. She added that the bill was unchanged
from what had been presented to the committee on February
20th.
KATHY WASSERMAN, EXECUTIVE DIRECTOR, ALASKA MUNICIPAL
LEAGUE, JUNEAU, related that Alaska Municipal League (AML)
supported the bill and that it had been its priority for
several years. She stated that AML had been supportive of
the governor's proposal since it had been introduced. She
thanked the committee for its work on the issue and for
helping maintained the 22 percent salary base into the PERS
system. She stated that AML liked the bill because it was
predictable, allowed for budgeting, and it was affordable.
She related that even though the municipalities would pay
more at the end as the amortization schedule extended, AML
was willing to do that in order to keep it affordable for
the municipalities.
Co-Chair Kelly CLOSED public testimony.
3:37:11 PM
AT EASE
3:37:49 PM
RECONVENED
Co-Chair Kelly discussed the upcoming conference committee.
3:38:25 PM
RECESSED
HJR 10 was SCHEDULED but not HEARD.
CSHB 140(FIN) was SCHEDULED but not HEARD.
CSHB 160(FIN) was SCHEDULED but not HEARD.
CSHB 287(RLS) am was SCHEDULED but not HEARD.
HB 306 was SCHEDULED but not HEARD.
ADJOURNMENT
5:14:58 PM
The meeting was adjourned at 5:14 p.m.