Legislature(2013 - 2014)HOUSE FINANCE 519
04/22/2014 10:00 AM Senate CONFERENCE COMMITTEE ON HB278
| Audio | Topic |
|---|---|
| Start | |
| HB278 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| = | HB 278 |
HB 278-EDUCATION
10:30:30 AM
CHAIR HAWKER announced that the only order of business would be
HOUSE BILL NO. 278, "An Act increasing the base student
allocation used in the formula for state funding of public
education; repealing the secondary student competency
examination and related requirements; relating to high school
course credit earned through assessment; relating to a college
and career readiness assessment for secondary students; relating
to charter school application appeals and program budgets;
relating to residential school applications; increasing the
stipend for boarding school students; extending 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 education tax credits; making conforming amendments;
and providing for an effective date."
[Before the committee was CSHB 278(FIN)am and SCS CSHB
278(FIN)amS.]
10:33:40 AM
CHAIR HAWKER noted that the committee would be operating under
Uniform Rule 42, Conference and Free Conference Committees, (a)
and (b) suspended. Thus, the Uniform rules were waived and the
conference committee has been granted the powers of free
conference, which gives the conference committee the ability to
consider all issues that are germane to the titles of the bill
before the committee. He advised his intention to consider the
Senate version of HB 278, which was built on the House version.
He characterized these bills as creating "book ends" to the
dialogue. He indicated that disagreement in policy exists
between the two versions and the goal will be to bring the two
bills into accord for adoption as a final bill and brought back
to the respective bodies for mutual concurrence.
10:36:34 AM
CHAIR MEYER explained the leadership as it applies to the
committee. He pointed out that Representative Hawker will chair
the meeting since the bill originated as a House bill. He asked
staff to provide a section-by-section comparison between the
House and Senate versions of the bill.
10:39:33 AM
EDRA MORLEDGE, Staff, Senator Kevin Meyer, Alaska State
Legislature, directed attention to page 1 of the committee
handout labeled "HB 278 Comparison," with a footer dated
4/22/2014 9:58 AM.
MS. MORLEDGE referred to Section 1, relating to jury duty
postponement to a time not during the school year. Section 1
language for both bills is the same. The language in Senate
Section 2 was similar to the House version for secondary school
course credit through mastery not limited to core topics. The
Senate version would limit high school course credit through
mastery and includes core topics only, such as math, language
arts, science, social studies, and world languages.
10:40:44 AM
CHAIR HAWKER asked for a definition of "secondary" versus "high
school."
MS. MORLEDGE replied that "secondary school" is defined in
statute as seventh through twelfth grades and "high school" is
only ninth through twelfth grades.
10:41:03 AM
REPRESENTATIVE GATTIS reported that Section 1 of the House
version of HB 278 was based on all subjects being tested and
opined that the tests should not be limited to core areas.
CHAIR MEYER said the Senate based its decision more on cost
since funding is necessary to provide students an opportunity to
test out of classes although it could be expanded in the future
from core areas.
10:42:06 AM
MS. MORLEDGE directed attention to House Section 3 and Senate
Section 4 of HB 278. She explained that Senate Section 4
removes the reference to the High School Graduation Qualifying
Exam (HSGQE) [exit exam] and requires electronic reporting by
the department to the legislature and House Section 3 makes
technical cleanup to the language but does not repeal the HSGQE.
CHAIR HAWKER commented that the House passed separate
legislation [HB 220] to repeal the HSGQE but the Senate included
the HSGQE concept in HB 278.
10:43:20 AM
MS. MORLEDGE said that House Section 4 provides language that
the state may not cede any measure of autonomy or control over
education standards and assessments. The Senate version did not
have a similar section.
10:43:37 AM
MS. MORLEDGE directed attention to House and Senate language in
Section 5, noting the House version contains technical cleanup
language and requires reporting on military and associated data,
which is also included in the Senate version.
CHAIR HAWKER added that the Senate Section 5 also had conforming
language involving the exit examination [HSGQE] removal.
10:44:09 AM
MS. MORLEDGE noted [House version] Section 6 is technical
cleanup language and [House version] Section 7 substitutes the
term "language arts" for "reading and writing." This was
included in the Senate version, which also includes conforming
language for the HSGQE repeal.
10:44:36 AM
MS. MORLEDGE turned to Section 8 of the House version, which
replaces the "star" rating with an "A-F" grading system. The
Senate does not have a similar section.
The committee took a brief at-ease from 10:45 a.m. to 10:46 a.m.
10:46:21 AM
MS. MORLEDGE directed attention to page 2 of the section-by-
section comparison. She related that Senate Section 7 contains
three new provisions. First, it would include funding to bring
every school's Internet speed up to 10 megabits per second
(mbps); second, it would provide funding for personalized
learning opportunity grants; and third, it would provide funding
for innovative approaches to learning grants.
CHAIR MEYER commented that this language would allow schools to
expand their broadband service to at least 10 mbps, which is
very important in rural Alaska especially pertaining to the use
of digital learning. In addition, the personalized learning
opportunity grants and the innovative approaches to learning
grants were items that were brought to the Senate's attention by
the [Senate] Education [Standing] Committee and Senator
Dunleavy.
10:47:44 AM
SENATOR DUNLEAVY explained that the personalized learning grant
is the one-on-one concept that has been discussed in the past
two years with the Association of Alaska School Boards and the
Alaska Department of Education [and Early Development] (EED).
This would put "tablets" in the hands of students and teachers
to address the growing trend in education of working with online
vendors to integrate technology into the actual program instead
of as an add-on element. The Senate Education Standing
Committee developed these changes by proposing the technology
expansion and the innovative education grants. The program
would allow small start-up educational grants to plan approaches
that a district could endorse such as cyber schools. This is in
response to an issue that sometimes occurs when people seek
funding to implement ideas that are later discovered as not
being well thought out. Under the grant program, a "project of
promise" could be eventually brought to the legislature for
further appropriation. He envisioned that districts would float
concepts to the department, and if the department found the
concept had merit, a small planning grant would ensue and the
district would hire a contractor to fully flesh out the concept.
That fleshed-out concept would go back to the department for
approval, and, if approved, would be presented to the
legislature as a "project of promise" for funding. Ultimately,
this process could firm up projects to avoid funding concepts
without merit.
CHAIR HAWKER asked for further clarification on the fiscal notes
for these three components.
SENATOR DUNLEAVY answered that the one-on-one grant was funded
at $5 million and the innovative learning grant approach was
funded at $750,000 for this fiscal year. In further response,
he agreed the Internet services fiscal impact was $7.3 million.
10:51:05 AM
CHAIR MEYER interjected that he believed the learning grants
would start at $3-$5 million. In response to a question, he
clarified he was speaking about the one-on-one grants.
CHAIR MEYER related his understanding that the proposed
broadband Internet services would be eligible for four-to-one
matching funds from the federal government. In response to a
question, he reiterated his comment related to the broadband
Internet services.
10:51:42 AM
REPRESENTATIVE GATTIS offered support for technological
advances, which will change how Alaska does business in the next
50 years; however, challenges for providing these grants exist.
She offered her preference to consider all contractors, not just
the Association of Alaska School Boards, as possible vendors for
the grants.
10:52:36 AM
SENATOR HOFFMAN, regarding the Internet speed, reported that the
national standard calls for 100 megabits (mbps) by 2016 or 2017.
CHAIR HAWKER acknowledged that the national target is 100 mbps
rather than the 10 mbps that the Senate Section 7 proposes.
10:53:18 AM
MS. MORLEDGE directed attention to House Sections 9-10 and
Senate Sections 8-9 addressing charter school application and
appeal process. The House version doesn't have a similar
provision to Senate Section 10, which would repeal the High
School Graduation Qualifying Exam (HSGQE) [exit exam] for
charter school students.
CHAIR HAWKER pointed out the House accomplished the HSGQE
language change in a separate bill.
10:53:52 AM
MS. MORLEDGE turned to Section 11, which requires districts to
offer the right of first refusal to charter schools to lease
space, noting lease agreements shall be true to operational
costs. She said this language is the same in both versions of
HB 278.
MS. MORLEDGE directed attention to [House and Senate] Section
12. She explained that the Senate adopted the House language,
but also added language that would require funds generated by a
charter school student to include grants, appropriations,
federal impact aid, and local contributions.
CHAIR HAWKER remarked that the [Senate version] is a more
encompassing implementation of the same concept that was brought
forward in the House version of the bill.
10:54:36 AM
MS. MORLEDGE referred to Section 13, relating that language in
both [House and Senate] versions would provide a $500 one-time
per student grant for charter school start-up funds in the first
year.
MS. MORLEDGE directed attention to [House] Section 15 that
substitutes the term "language arts" for "reading, writing." In
addition, the language would prohibit the department from
spending money on "common core" standards implementation for K-
12.
10:55:19 AM
MS. MORLEDGE referred back to Senate Section 14, which includes
language related to a correspondence study program, individual
learning plans, and student allotments.
CHAIR HAWKER asked for further clarification on the student
allotment component.
CHAIR MEYER deferred to Senator Dunleavy.
SENATOR DUNLEAVY explained that [Section 14] pertains to
correspondence homeschool programs, which are public school
programs that have existed for approximately 15 years educating
thousands of students statewide. Some programs are district-
centered programs and others are statewide programs. The change
was originally proposed under SB 100. He detailed several
components. First, under the program, all correspondence
students must have an individual learning plan (ILP), although
one component that changes is the ILP is considered to be
functioning for those students who are proficient according to
statewide assessments. For students who are not proficient, the
teacher and parent would amend the ILP and dedicate resources to
ensure that the child becomes proficient.
SENATOR DUNLEAVY turned to the second component [of Senate
Section 14], noting that many homeschool correspondence program
students obtain an allotment to purchase materials to support
the ILP. In the past, that allotment would lapse at the end of
the fiscal year. One unintended consequence has been that
families rushed to spend the allotment to purchase materials for
the next year before funds lapsed. Under [Senate Section 14],
funding wouldn't lapse, but could accumulate for long-term
planning for students who remain in the program. This could
have the desired effect of keeping a family with the program,
but will also have the effect funds being spent more wisely and
judiciously instead of end-of-year spending. Third, the final
component will change the current foundation formula funding
factor for correspondence students from .80 to .90. In response
to Representative Kito III, he indicated that the allotment in
AS 14.03.320 is not an actual cash payment to the parent or
guardian but is held by the school.
10:59:58 AM
MS. MORLEDGE related that Section 14 of the House version and
Section 15 of the Senate version substitute the term "language
arts" for "reading, writing." House Section 15 would add
language prohibiting the EED from spending funds on "common
core" standards implementation for K-12. Senate Section 16
contained the cleanup language, but did not contain the "common
core" standards language, she said.
CHAIR HAWKER highlighted the committee will need to be briefed
by Commissioner Hanley today on the "common core" standards
issue and implementation language.
REPRESENTATIVE GATTIS explained that the House intent was that
Alaskans be in control of the curriculum being taught in the
state and that it would not be based on a national standard.
11:01:28 AM
MS. MORLEDGE directed attention to Senate Sections 17 and 18,
noting Section 17 is a technical change related to the exit exam
[HSGQE] and Section 18 defines the term "child with a
disability."
11:01:45 AM
MS. MORLEDGE referred to House Section 16, which requires the
State Board of Education and Early Development (BOE) to
recommend changes in how the state could expend education funds
more efficiently. The Senate removed that language, she said.
CHAIR HAWKER advised this is another item for Commissioner
Hanley to address since there are several opinions on this
matter.
11:02:47 AM
MS. MORLEDGE directed attention to page 4, of the section-by-
section comparison, to House Section 17 and Senate Section 19,
noting both versions retain the same language regarding pupil
transportation for charter schools. The Senate version also
inserted a new Section 20, related to debt reimbursement for
school construction and maintenance.
CHAIR HAWKER emphasized that the Senate Section 20 represents a
substantial change from current statute that is not in the House
version. He also would like Commissioner Hanley to address
this. He characterized this as being more of a Department of
Revenue (DOR) function, but he was certain the commissioner
could recommend the appropriate party to inform the committee.
11:03:35 AM
CHAIR MEYER indicated that from a financial standpoint, the
state can control its substantial bonding for many projects;
however, the state can't control costs when districts pass
school bonds, with the state having responsibility for 60
percent or 70 percent of the cost. He related his understanding
that the commissioner will discuss the 70/30 program, noting
that the state has more control over it than it does the 60/40
program. He identified this is an area that needs some
adjustment.
REPRESENTATIVE GATTIS agreed that this is an area of concern.
She suggested that the legislature might consider lowering the
bonding and removing some regulations to give school districts
the ability to make choices that work best for them. She said
she looks forward to the conversation.
11:05:01 AM
MS. MORLEDGE directed attention to House Section 18 and Senate
Section 21, which contain the same language and will allow
course credit by mastery for boarding school students. The next
section, House Section 19, and Senate Section 22 would allow an
annual open application period for residential schools.
11:05:24 AM
MS. MORLEDGE turned to Senate Sections 23-26, which were added
in the Senate version. Senate Section 23 would increase the
residential school stipend.
CHAIR HAWKER interjected that he believes that has a $2.25
million fiscal note.
CHAIR MEYER offered his belief that it was Senator [Coghill's]
bill and that Senator Hoffman was very familiar with residential
schools.
REPRESENTATIVE GATTIS related that she introduced a
corresponding bill, [HB 291] that is currently before the House
Finance [Standing] Committee.
11:06:12 AM
MS. MORLEDGE turned to Senate Section 24, which would increase
the required local contribution from a 2.65 mill to 2.8 mill
rate.
CHAIR HAWKER suggested that the committee will hear testimony to
provide background and the ramifications of this.
CHAIR MEYER acknowledged the importance of considering the
bigger issue between voluntary contributions that municipalities
make versus required contributions. Obviously when the mill
rate is adjusted it constitutes a required contribution. He
recalled that the mill rate was adjusted three years ago that
the contribution changed from a 2.9 mill rate to a 2.65 mill
rate, which meant the state had to take on a bigger burden of
the education funding. In fact, he recommended this change in
order to find a better balance between local and state required
contributions to education.
11:07:34 AM
MS. MORLEDGE directed attention to Senate Section 25, which is a
provision to allow municipalities to contribute up to 23 percent
of funds that are distributed to the school districts outside of
the basic need.
CHAIR HAWKER explained that funding added outside of the BSA
[base student allotment] contribution is treated as if it was
within the BSA for the purpose of calculating the maximum
voluntary local contributions.
MS. MORLEDGE related that Senate Section 26 raises the
correspondence study factor from 80 percent to 90 percent.
CHAIR HAWKER added that the fiscal note for the factor change is
approximately $6.1 million.
SENATOR DUNLEAVY said the idea was to increase it to incentivize
school districts to give serious thought to expanding their
homeschool correspondence programs. He characterized it as a
low-cost approach to expanding the "larger tent" of public
education to as many students as possible without having to
factor in building construction, transportation, lunch programs,
and other costs. The homeschool correspondence programs are
probably the fastest growing programs within public education.
11:09:22 AM
CHAIR MEYER asked when funding for homeschool or correspondence
school was last changed.
SENATOR DUNLEAVY offered his belief that this funding has been
in place for many years. He related his understanding the
percentage was a number that was chosen.
11:09:52 AM
MS. MORLEDGE continued on page 5 of the section-by-section
comparison of HB 278 to Senate Section 27, noting the House
version does not have a similar provision. She stated that this
language relates to the charter school size factor and lowers
the threshold of 120 students to 75 students to receive 100
percent of funding.
CHAIR HAWKER asked Commissioner Hanley to address and put on the
record what is at issue for both of these charter school
adjustments.
11:10:36 AM
MS. MORLEDGE referred to House Sections 20-22, which relate to
BSA increases. The Senate version does not contain any of these
provisions.
CHAIR HAWKER said this is the biggest sticking point between the
Senate and House approaches to HB 278. The House preferred to
include some element of funding within the BSA and the Senate
chose not to increase funding inside the BSA, yet still make
substantial commitments to education funding by increasing
funding outside the BSA for the next three years. He indicated
that the committee will be work to find a route forward as the
free conference committee proceeds.
11:11:31 AM
MS. MORLEDGE directed attention to House Sections 23-24, which
provide increases the time for teacher tenure to five years in
urban areas.
SENATOR HOFFMAN asked for a breakdown on the dollar amounts
within the BSA, outside the BSA, and other funding.
CHAIR HAWKER responded that the general formula used is that an
increase of $100 to the BSA equates to approximately a $25
million increase in the budget, therefore, a $25 million
increase outside the BSA would have the same effect as a $100
increase to the BSA. He said that a summary will be necessary
to highlight the overall financial impact. Again, this is the
greatest sticking point in the bill, he said.
11:13:11 AM
CHAIR MEYER said he believed that his staff, Suzanne Armstrong,
or David Teal, Legislative Fiscal Analyst, Legislative Finance
Division will be able to provide the comparison.
CHAIR HAWKER commented that the comparison would be available
for all of the components, recognizing that costs are associated
with many of the proposals before the free conference committee.
11:13:40 AM
MS. MORLEDGE directed attention again to House Sections 23 and
24, which increases the qualifying period for teacher tenure to
five years for urban school districts and three years for rural
school districts; however, this language is not contained in the
Senate version.
REPRESENTATIVE GATTIS pointed out that a tenure bill was passed
last year. She agreed it may be a sticking point.
11:14:48 AM
MS. MORLEDGE directed attention to Senate Section 28, which
increases the employee contribution to the unemployment
insurance fund from the current .15 percent to .16 percent for
the technical vocational education program. She related that
House Section 25 and Senate Section 29 included a sunset date of
2017. In addition, the Senate version corrected the names of
the recipient organizations and rolled the University of Alaska
Southeast into the university system as a whole and added
Ilisagvik College. The Senate version also reduced the
university system funding by five percent overall.
MS. MORLEDGE turned to House Section 26 [and Senate version 30],
which relates to the TVEP program survey and performance review.
11:15:56 AM
MS. MORLEDGE continued to page 6 of the section-by-section
comparison of HB 278. She directed attention to [House Sections
27 and 28 and Senate Sections 31 and 32], which relate to the
TVEP [Technical Vocational Education Program] and to [House
Sections 30-41 and Senate version 34-45] that relate to the
education tax credits. She explained that the Senate version
included all of the House language and added two recipients, the
Regional Training Center (RTC) and apprenticeship programs and
nonprofit agencies providing educational opportunities that
promote the legacy of public service.
11:16:45 AM
MS. MORLEDGE continued to page 7 of the section-by-section
comparison of HB 278. She turned to House Section 42 and Senate
Section 46, which is a technical cleanup and repeals BIA
language. House Section 43 and Senate Section 47 contain the
same language regarding charter schools, she said.
11:17:08 AM
MS. MORLEDGE directed attention to House Section 44, which
relates to the applicability of tenure [not included in the
Senate version]. House Sections 45-46 and Senate Sections 48-49
would provide transition language for charter school
applications and regulations.
11:17:38 AM
MS. MORLEDGE directed attention to House Section 47, which
requires the Department of Administration (DOA) to submit to the
legislature a salary and benefits proposal for school districts
statewide. Senate Section 55 would require the Legislature
Budget & Audit Committee (LB&A) to perform that study.
CHAIR HAWKER turned to the proposed studies with the distinction
being that the House approach has the DOA taking authority while
the Senate retains it within the legislative function and
authority [LB&A). He questioned whether the function should be
in terms of an administrative forum or a legislative forum since
the legislature retains the sole authority to appropriate.
REPRESENTATIVE GATTIS commented that the intent of the House was
to have a clear look at not only a study, but implementing
updated state salaries and benefits.
11:19:45 AM
CHAIR HAWKER asked for further clarification on the LB&A's
approach to the Senate version's study.
CHAIR MEYER deferred to Senator Fairclough, as Chair of the LB&A
committee; however, he added that the key critical point to the
Senate's approach to educational funding was to avoid putting
funds in a foundation formula, which the BSA is part of, when it
is known that the formula needs adjustments. Thus, the Senate
version places the funding outside of the foundation formula
until the [LB&A] study is completed. In addition, the Senate
version funds education at $100 million for each of three years
since it will take two to three years to complete and implement
the study.
CHAIR HAWKER related these comments segue into the next two or
three points.
11:20:52 AM
MS. MORLEDGE directed attention to House Section 48, which
includes a $30 million one-time grant to districts and although
the Senate version does not include a similar provision, it does
propose that $100 million be appropriated for each of the next
three years.
MS. MORLEDGE turned to Senate Sections 50-51, which propose to
study components of the foundation formula, including district
costs and school-size factors. Senate Section 52 relates to a
design and construction report by the EED and Section 53 would
create a middle school pilot program to expand the ANSEP [Alaska
Native Science and Engineering Program] and Science Technology
Engineering and Math [STEM] programs. Senate Section 55 relates
to the [HSGQE] exit exam. House Sections 49-53 and Senate
Sections 56-59 relate to the effective dates.
11:22:10 AM
CHAIR HAWKER said it is apparent that there are a number of
areas in which the House and Senate have taken the same
approach. One area, the elimination of the [HSGQE] exit exam,
has the same goal but used different approaches. The House
version has been largely incorporated into the Senate version of
HB 278, he said. He indicated that at this point the free
conference committee seeks to identify and build a foundation of
commonality, removing as many issues as possible where
fundamental agreement exists. He indicated a more vigorous
debate can occur for the remaining issues. He highlighted his
intention to work with Chair Meyer to identify areas of
consensus and develop a baseline free conference committee
substitute (FCCS for HB 278), which will be brought to the free
conference committee. Further, he hoped to bring testifiers to
before the committee to provide information on the more
contentious issues. The free conference committee will proceed
steadily toward this goal, he said.
11:25:38 AM
JULI LUCKY, Staff, Representative Mike Hawker, Alaska State
Legislature, noted that she has an e-mail notification list that
will be accessed to provide meeting information.
11:26:35 AM
REPRESENTATIVE KITO III asked for clarification regarding the
forthcoming fiscal summary and if it will cover all sections of
the bill with fiscal impact.
CHAIR HAWKER answered yes; that he hoped the fiscal summary
would be as comprehensive as possible.
CHAIR MEYER agreed the fiscal impacts will be covered.
11:28:00 AM
CHAIR HAWKER recessed the meeting to a call of the chair at
11:28 a.m.
2:22:23 PM
CHAIR HAWKER reconvened the meeting at 2:22 p.m.
Representatives Gattis, Kito III, and Hawker, and Senators
Dunleavy, Hoffman, and Meyer were present at the call to order.
Representatives Hughes and LeDoux and Senator Fairclough were
also in attendance.
2:22:36 PM
CHAIR HAWKER recapped the status, such that he and Chair Meyer
have identified areas of common ground and have requested a
draft free conference committee substitute (FCCS) for HB 278.
2:22:48 PM
CHAIR HAWKER reviewed the morning meeting and directed attention
to points requiring further information and clarification in
order to find accord. He referred to a spreadsheet prepared by
the Legislative Finance Division. In response to a question, he
clarified that the single document was before them [footer label
of "4-22-14 LFD Summary 278 Senate vs House (2)"]. This
document and other supporting documents are also found posted
online in BASIS [Bill Activity Status Inquiry System], he said.
2:25:58 PM
DAVID TEAL, Legislative Fiscal Analyst, Legislative Finance
Division, Alaska State Legislature, directed attention to the
committee packet handout and the document with a footer label of
"4-22-14 LFD Summary 278 Senate vs House (2)," noting this
document has been prepared for the division's use. The
division's role is not to determine the policy provisions but to
translate actions the legislature takes to fiscal impacts and be
certain the decided upon funding is included in the capital
budget or in a fiscal note, he said.
MR. TEAL noted that section numbers for the House version and
Senate version and associated costs are listed in the document.
He explained that as the free conference committee chooses
specific funding amounts these amounts will be added to the
columns; however, it's a little more complicated to put together
amendments to the capital budget. For example, the $100,000 on
the first line of the aforementioned document implies that $100
million is associated with FY 15, FY 16, and FY 17; however, the
actual funding mechanism in the Senate version would fund $300
million in FY 15, but distribute it in FYs 15-17. He explained
that it is one-time funding, but it will also give districts a
three-year certainty since districts don't have to request
additional funds from subsequent legislatures for FY 16 and FY
17.
CHAIR HAWKER added that aspect would be accommodated in the
fiscal note attached to the proposed HCCS.
MR. TEAL agreed; however, the way the Senate version was adopted
doesn't necessarily mean that the free conference committee will
decide to take the same route. He suggested that if the free
conference committee chose to increase the BSA rather than to
fund an increase outside the formula [BSA], it would represent a
different method. He acknowledged that it wouldn't be more
complicated, but it would mean funding the BSA for FY 15 if the
forward funding concept is included. For instance, House
Section 20 costs in FY 15 for BSA changes is $45 million, but in
FY 16, the BSA is scheduled to increase by another $50 million
pushing that total cost to $60 million. Forward funding would
include the $45 million plus the $60 million in FY 15. He
concluded that the division will simply need to know how much to
deposit into the education fund.
CHAIR HAWKER acknowledged that in terms of "book ends" the
funding is broken into two major categories, which are the
distribution according to the formula, and the breakdown between
the House version and the Senate version. He also noted the
House total of $859,000 and the Senate total of $18,351,000. He
identified the total unrestricted general funds of as
approximately $76.6 million and $24.9 [$124.9 million for FY
15], which provide the book ends to be worked within today. He
described the aforementioned document as a reference document.
2:31:11 PM
SENATOR HOFFMAN, concentrating on the BSA, stated that in FY 15
the House version funded $30 million outside the BSA [money
distributed in the same way as the formula and $45.8 million
inside the BSA; however, the line entitled "Approximate BSA
Equivalent (Dollars)" totals $75.8 million for the House version
and $106.6 million for the Senate version. In FY 16 the figures
drop to $60.1 million, but increase to $74.5 million in FY 17.
He stated that the total House funding for three years would be
approximately $210 million and for the Senate version would be
$310 million. He asked for further clarification whether that
was correct.
MR. TEAL, referring to the spreadsheet, responded that this
represents the difference between the one-time funding on the
first line, with the House version at $30 million outside the
BSA. This figure is removed in FY 16 and FY 17 since it is one-
time money; however this doesn't mean it will necessarily be
removed, but it won't be reflected in this spreadsheet since
unlike the Senate version of $300 million in forward funding,
the $30 million in the House version is truly one-time money.
He acknowledged it could be replaced next year but the committee
has no way of knowing for certain if that will occur.
CHAIR HAWKER pointed out that this leads to the crux of the
discord that has led to this conference committee, which is the
House's general desire to have a lesser degree of spending
recognizing the state's fiscal circumstances at this time than
the Senate was willing to bring forward. The purpose of a
conference committee is to reconcile these differences.
CHAIR HAWKER asked Commissioner Hanley, Department of Education
and Early Development (EED) to testify. He indicated the
committee would work from the HB 278 comparison used as a
section-by-section analysis of the bill [entitled HB 278
Comparison," with a footer dated 4/22/2014 9:58 AM]. He
anticipated that most of the dialogue will be on the Senate
version of the bill since the Senate added to the bill with a
few exceptions.
2:34:29 PM
CHAIR HAWKER directed attention to the first item of interest,
which is Senate Section 2. The House version related to
"secondary school" courses but did not limit testing out of
programs to core subjects. The Senate version allowed "high
school" course credit testing via mastery of core subjects. He
asked for the department's perspective.
MIKE HANLEY, Commissioner, Department of Education and Early
Development (EED), said both versions accomplish similar things.
Currently, districts are allowed to give students opportunities
to test out of courses; however, sometimes the opportunities are
available and some districts have not allowed testing out of
courses to occur. The governor's version [of HB 278] contained
a provision to limit testing-out assessments to core areas.
This is largely due to a sensitivity to school districts, since
districts would need to develop assessments for these subject
areas, and a recognition that some elective courses do not lend
themselves well to a summative assessment, such as drama and
debate. Thus, the bill would require districts to allow testing
out for core areas subjects, such as reading, writing or
language arts, math, social studies, science, and world
languages. Other courses were identified as optional, he said.
The [House Section 2] allows testing-out for all courses.
2:36:27 PM
REPRESENTATIVE GATTIS explained that the House Education
Standing Committee disagreed with the department on testing-out
of courses. The House determined that final exams exist for a
topic such as pottery, and the district must administer that
exam to students who believe they have mastered the course
topic. The House worked on the assumption that these tests
already exist. She asserted that numerous courses identify a
certain level of proficiency so testing-out should be allowed to
students who demonstrate that level of proficiency.
2:37:52 PM
REPRESENTATIVE KITO III pointed out another issue that was
raised related to students having the ability to test out of a
series of core courses. For example, students could test out of
Algebra I and enroll in Algebra II. One concern was that if the
high school had testing-out options for every core class,
students could effectively test out of high school and never
attend any classes.
CHAIR HAWKER reminded members the process will be to introduce
the subjects, lay the groundwork, but not debate the issues to a
conclusion at this point.
REPRESENTATIVE GATTIS, with respect to testing-out, preferred to
allow students who have mastered the course work test out and
move on with their education and not spend an additional year in
a classroom.
CHAIR MEYER added that the Senate's approach was to allow
students to test out of core topics. Later, districts could
expand into other topics since it might be burdensome to ask
districts to provide testing-out options for all courses at
once. He then asked which term the department favored, using
the term "high school" or "secondary school." He further asked
whether high school is defined as grades 9-12 and secondary is
defined as grades 7-12.
COMMISSIONER HANLEY responded that traditionally the department
uses the term "secondary school" but they are synonymous. After
verifying that a definition for the terms existed, he agreed
that secondary school begins in 7th grade. Thus, the department
would prefer the term "high school" since the department does
not allow any option to test-out of middle school courses. In
further response to a question, he agreed he would recommend the
Senate version that uses the term "high school."
2:40:46 PM
CHAIR HAWKER referred to House Section 4, relating to language
that the state may not cede any measure of autonomy or control
over education standards or assessments. He asked whether any
problems exist with this language.
COMMISSIONER HANLEY answered no. He said concern arose when the
state joined the Smarter Balanced Consortium in regards to
finding a new state assessment standard. Although the
perception was that the state had relinquished its authority and
someone else would control the state's standards, he assured the
committee that was never the case. This language [House Section
4] simply clarifies that the state should not give up autonomy
to someone outside the state. The department would agree with
that statement.
2:41:50 PM
REPRESENTATIVE GATTIS asked why the Senate removed the autonomy
language from its version.
COMMISSIONER HANLEY interjected that a conversation ensued for
the removal of the language since House Section 4 essentially
tells the department to "not do something which is not being
done." The Senate found it unnecessary to retain the autonomy
language; however, he said it is not harmful to include the
language.
CHAIR HAWKER commented that it seems like this is an area that
would not be an area of concern. He turned to Senate Section 7
and the three subsections on Internet funding, technical support
for the student one-on-one program, and funding for innovative
approaches to learning. He characterized this as a more
substantive area, with significant financial consequences. He
referred to these provisions as 7A, 7B and 7C. He asked for the
agency's perspective on 7A, the broadband Internet bandwidth.
COMMISSIONER HANLEY recognized that additional broadband can
only be a positive move, but the negative aspect is the fiscal
aspect. The goal is to have all schools attain a minimum of 10
megabits, which is a minimum floor. The department has no
concern with increasing the amount of Internet broadband to
schools statewide.
CHAIR HAWKER highlighted that the issue on the House version
would be that the fiscal impact was $7.3 million.
2:45:24 PM
CHAIR MEYER asked if the federal matching funds are $4 for every
$1 the state puts towards this.
LINDA THIBODEAU, Director, Office of the Director, Libraries,
Archives & Museums, answered that the e-rate is a discount
program, not necessarily providing matching funds. She said the
discount is based on the poverty level in any given school and
may range from 20-90 percent with an average in Alaska of 70
percent. She indicated that in off-the-road system areas the
average is 80 percent. For example, if $100 is spent, with a
poverty rate discount of 80 percent, the federal government
would provide $80 and the district would pay $20.
2:46:36 PM
CHAIR MEYER offered his belief that this would not only help the
schools but also helps the communities, villages, and region.
MS. THIBODEAU agreed that schools provide access to the public
in off hours and some public school libraries are also public
libraries.
CHAIR MEYER asked whether concern exists that additional costs
are involved for provider services.
MS. THIBODEAU answered that additional costs would be related to
first-time cost for the vendor to initially set up the equipment
and put in new routers, wiring, or switches; however, these
costs are also eligible for the discount. The Federal
Communications Commission (FCC) requires that e-rate discounts
be made each January and the cost is a very significant factor
in choosing which vendor is chosen for the school.
2:47:50 PM
CHAIR HAWKER asked what drives the $7.3 million fiscal note,
whether it is the cost the state would need to bear to bring all
the districts up to the 10 megabit level.
MS. THIBODEAU answered that the fiscal note amount represents
the cost for districts below 10 megabits per second. In
response to a question, she agreed the state would need to bear
that cost.
CHAIR HAWKER asked whether the state could access any matching
federal funds or additional federal grant funding.
MS. THIBODEAU answered no.
CHAIR HAWKER asked for further clarification on which districts
might be affected.
MS. THIBODEAU did not specifically recall individual districts;
however she noted that a spreadsheet has been distributed to
committee members.
2:49:23 PM
REPRESENTATIVE GATTIS referred to a survey on bandwidth. She
asked whether the state has identified any alternative if the
state cannot deliver this. She offered her belief that
technology will be the driver in educational delivery.
COMMISSIONER HANLEY explained that this proposal has been
generated by the legislature so he was unsure if an alternative
exists. He pointed out the vision and goal will be to increase
opportunities and equalize them statewide and this proposal has
the potential to accomplish this.
REPRESENTATIVE GATTIS said some districts have inadequate
bandwidth and may struggle. She asked for ways these districts
can be helped to creatively provide adequate Internet bandwidth.
2:51:15 PM
CHAIR HAWKER turned to Senate Section 7B, to the $3 million
funding for technical support and training for students, known
as the one-to-one initiative.
COMMISSIONER HANLEY answered that this initiative is similar to
one introduced last year by Senator Dunleavy to increase
opportunities for students. He explained that the goal is to
change the way teaching occurs and technical devices are a tool.
CHAIR HAWKER remarked this will be a policy call by the
committee based on the legislature's willingness to fund $3
million.
COMMISSIONER HANLEY answered yes. He remarked that he did not
see a downside to adding technology into schools in the 21st
century; however, there is a cost associated with it. In
further response to a question, he agreed the one-on-one
initiative appears to have a fiscal impact of $3 million per
year.
2:52:30 PM
SENATOR DUNLEAVY highlighted one advantage will be that students
would no longer be saddled and weighed down by backpacks. As
districts move into this technology, all textbooks will be
downloaded onto tablets and all information and communication
will be accomplished using these devices. In fact, this
technology will revolutionize Alaskan classrooms and research
will be done by students accessing the Internet via their
tablets, he said.
CHAIR HAWKER referred to the $3 million fiscal note and asked
what that would cover, for example, whether it would begin in
kindergarten or in the 11th grade and how widely the program
would extend to across the state.
SENATOR DUNLEAVY answered that the Alaska Association of School
Boards could provide detail, but he envisioned that districts
would be ready and willing to make the transition. He suggested
that the districts that were interested would have ideas about
the grade level appropriate for implementation.
2:54:57 PM
REPRESENTATIVE KITO III said this funding proposal did not arise
on the House side. He asked for further clarification of what
happens if course materials are on tablets and a student drops
or otherwise damages the tablet and all the course work is lost.
In addition, although significant information may be available
on their tablets, students might not be able to take notes and
utilize the information in the same way as they can using paper
tablets. He further inquired as to whether there is a good way
to include written communication on tablets since writing is
part of the course work.
REPRESENTATIVE GATTIS asked about the procurement process in
terms of the one-to-one program, noting that the state
procurement process can be used rather than using the Alaska
Association of School Boards (AASB) as the default provider. In
other words, an open competitive bidding process should be used
if a substantial number of tablets will be purchased.
2:57:17 PM
CHAIR HAWKER directed attention to Senate Section 7C to the
funding for encouraging innovative approaches to learning with a
fiscal note of $750,000 for each of the next three years.
COMMISSIONER HANLEY explained that sometimes districts need an
opportunity to "get the ball rolling" and the implementation
strategy for these grants is that they would be operated through
the department, which fits within its mission to provide funding
to districts with innovative ideas to improve education. The
department would report on funding expenditures and grant
outcomes, but he was unsure if the department would speak to the
legislature on individual school district ideas. Still, it
doesn't mean the implementation strategies will be lost since
the department would report, which will allow for legislative
response.
CHAIR HAWKER asked how the department would allocate funds to
assure some degree of fairness and parity between districts
throughout the state.
COMMISSIONER HANLEY answered that the statute offers broad
language and it would be necessary to stipulate parameters to
address this issue. He acknowledged the importance to assure
integrity in the process. He anticipated that grants ranging
from $50 to $150 thousand would be issued, but the details have
not yet been fleshed out.
3:00:00 PM
CHAIR HAWKER directed attention to Senate Section 14 to the
correspondence study programs. He characterized this as being
one of the more controversial provisions. This relates to
individual learning programs (ILPs) and the ability to rollover
the student allotment or stipend for program materials.
COMMISSIONER HANLEY answered that the ILP language is not new
but puts regulatory language into statute. He said the
department has not weighed in on the ability to rollover the
funds; however he also understood the "use it or lose it"
spending philosophy that might ensue, rather than identifying
needs and spending funds on them. Certainly one pro would be to
avoid parents having a quick rush to spend money since funds
will otherwise expire.
CHAIR HAWKER asked whether it would be beneficial to ILP
students to allow rollover funding.
COMMISSIONER HANLEY answered yes. The stipends are typically
determined by school districts and are not excessive. He
pointed out these decisions are already made by the districts
and unexpended funds will revert back to the districts.
CHAIR HAWKER commented that the fiscal note is indeterminate
since the department doesn't know.
COMMISSIONER HANLEY answered that the note is zero because the
correspondence students would still be funded at .80 with this
funding mechanism.
CHAIR HAWKER asked whether there has been testimony from the
local school districts to indicate any support or opposition.
SENATOR DUNLEAVY offered his belief that the Matanuska-Susitna
Borough School District is in favor of this. He also believed
that the Galena City School District IDEA program is in favor of
it. He did not believe extensive comment has been received but
certain areas have demonstrated support, he said.
COMMISSIONER HANLEY said he hasn't received any public comment,
but he did not think having this flexibility would pose a
problem for correspondence programs.
3:03:43 PM
REPRESENTATIVE KITO III wondered if there is any benefit in
attaching a cap on the rollover amount. He expressed concern
that a buildup could result over time if a student is in the
program for 12 years.
SENATOR DUNLEAVY responded that it would be difficult for that
to occur since the ILP requires the purchase of equipment and
material for course work. He offered his belief that the
process is established. In addition, once the child exits the
program, any residual allotment will be returned to the
district. He did not foresee this happening.
CHAIR HAWKER was reassured knowing the funds would revert to the
districts.
3:05:09 PM
CHAIR HAWKER referred to Senate Section 16, noting the House
proposes to prohibit funds being spent on the implementation of
"common core" standards implementation for K-12. He was unsure
if this reaffirms current practice or if it would constrain the
department's ability to operate and develop the state's
curriculum.
COMMISSIONER HANLEY related that the "common core" standards
were developed as a national movement. Alaska chose to
reference some of those materials but developed its own
standards. Thus, the department never adopted the "common core"
standards. He suggested that this language is being proposed to
insure that the state won't do so. One thing he noted is that
sponsor of the component was clear that the intent is not to
inhibit the adoption of the state standards. Prior to the state
adopting the higher-level standards, some districts had taken
the initiative to adopt the "common core" standards. He pointed
out that the expectations from students is similar in the new
state standards and the "common core" standards at graduation.
Thus, it doesn't create issues for the department, especially
given that the state trains specifically to the Alaska standards
and much of the verbiage and standards are the same. For
example, Anchorage adopted the "common core" standards just
prior to the state moving forward with adopting its standards.
He hoped the intent is not to withdraw support from any
districts that have moved ahead of the department.
CHAIR HAWKER remarked that the commissioner has referenced that
this is a "don't do what you're not doing measure."
REPRESENTATIVE GATTIS reported that the [House Education
Standing Committee] worked with the administration on several
areas. She referred to Section 4 of the bill, which read:
AS 14.03.083 is amended by adding a new subsection to
read:
(d) The department and the state Board of Education
and Early Development may not enter into or renew a
contract or agreement, or participate, with any
organization, entity, group, or consortium after the
effective date of this section that requires the state
to cede any measure of autonomy or control over
education standards and assessments, including the
determination of passing scores.
CHAIR HAWKER asked whether that was previous [language].
REPRESENTATIVE GATTIS agreed. She emphasized that the goal is
to not adopt a national standard, to use state standards and
tests for the state to be in control of education in Alaska.
She agreed that the language does what the state is already
doing.
COMMISSIONER HANLEY appreciated the work that was done since the
language was previously a little broad. He reiterated that the
current language is not an issue.
CHAIR MEYER indicated that as the commissioner states this is
something already being done so the Senate did not view the
language as necessary and didn't include this language.
3:12:16 PM
CHAIR HAWKER directed attention to House Section 16, noting the
Senate version did not include this provision, which will add a
requirement that the state Board of Education recommend changes
to promote efficiency in the administration of public education.
REPRESENTATIVE GATTIS said the intent is to identify and promote
efficiency in the administration of public education.
COMMISSIONER HANLEY answered that this provision was part of the
House CS for HB 278. Certainly, the state Board of Education
(BOE) does not shy away from making recommendations or offering
support. He voiced concern over the language as written in that
it requires the BOE to make recommendations as to the method of
education spending by state and school districts that results in
efficiencies. In reviewing the BOE's duties, which are in
statute, this language seems to fall outside its duties and
purview. He related that BOE members are policy oriented and
are not experts in methods of education spending at school
district levels or making recommendations to the legislature on
education spending. He referred to some of the duties and
policies, for example, that the BOE shall adopt statewide goals
on regulations regarding application and award of grants. The
current legislative report requires the BOE to provide a summary
of resolves and rationales in support of policy decisions,
program or curriculum changes made, and additional information
relevant to the efforts to improve education. It seems to be a
stretch to ask the state BOE about methods of educational
spending, since it seems to be outside of the BOE's duties and
expertise.
CHAIR HAWKER remarked that the legislature retains the authority
to appropriate, which is solely the legislature's
responsibility. He suggested that the commissioner has given
the legislature a good grounding.
REPRESENTATIVE GATTIS remarked this language came about in the
latter hours and didn't get a lot of discussion. She said this
language does not represent a sticking point.
CHAIR HAWKER thanked Representative Gattis, remarking he was
beginning to see a way forward through this process.
3:16:19 PM
CHAIR HAWKER referred to Senate Section 20 to the changes to the
debt reimbursement program percentages. He acknowledged that
this is a serious component of HB 278 and is one of the
contentious points between the House and the Senate versions of
the bill.
CHAIR MEYER offered several reasons Section 20 needs to be
considered. If the state isn't fortunate enough to increase oil
production and doesn't build a gas pipeline or control expenses,
the state will have used up all of its savings in ten years.
The legislature doesn't have much control over the 60/40 debt
bond reimbursement program, yet the state must pay 60 percent of
bond debt reimbursement. Thus, the Senate's approach was not to
incentivize the 60/40 bond debt reimbursement program by
flipping it to a 40/60 ratio. The 70/30 program has been a
little more successful because the commissioner has a little
more control over how that money is spent; however, when a local
school district passes bonds, the state is liable for 70 percent
of the bonds and local community is responsible for 30 percent.
He deferred to the commissioner; however, he noted this program
is heavily used and it costs the state significant money.
CHAIR HAWKER explained that the 70/30 program was initially
established as a balanced program that involved both the school
debt and school grant programs. He asked about the historical
outlook and noted that the legislature may consider suspending
the program for several years.
COMMISSIONER HANLEY responded that the 70/30 has several
parameters in order for a school to qualify, which includes a
square footage ratio to students, and a demonstrated need for
the program. This program has provided a powerful way for the
schools to maintain their facilities and build facilities when
needed. The 60/40 program does not have those parameters so it
allows school districts to work outside those square footage
parameters. They also don't have to demonstrate need; however,
he cautioned that these bonds are not frivolous, but are used to
maintain school facilities. He suggested it might make sense to
protect the integrity of the 70/30 program more so than the
60/40 program.
CHAIR HAWKER asked for a foundational view of the history of the
debt program.
3:22:33 PM
ELIZABETH SWEENEY NUDELMAN, Director, School Finance and
Facilities Section, Department of Education and Early
Development (EED), highlighted the grant program and the debt
program. The grant programs use a competitive process, noting
that projects are ranked by the department, and the legislature
funds the projects in rank order. One list covers major
maintenance and another construction. The lists overlap, but
the grant list allows all districts to participate and the debt
program is limited to municipalities with bonding abilities.
Although municipalities can bond, not all municipalities have
the financial backing to do so. Another overlap between the
debt and grant programs is the participating share based on
qualifying square footage and major maintenance projects on the
debt program is 30 percent, with the state paying 70 percent.
The participating share in the grant program is based on the
assessed value per [Average Daily Membership] ADM. The Regional
Education Attendance Areas (REAAs) are set at two percent and
each district in the grant program has a participating share
that ranges from 5 percent to 35 percent. For example,
Anchorage has a 30 percent participating share in the grant
program which equals the 30 percent in the debt program.
CHAIR HAWKER suggested there is a carefully constructed inter-
relationship between these programs.
3:25:06 PM
REPRESENTATIVE KITO III noted that the change in the debt
program decreases the major split from 70/30 to 60/40 with the
districts receiving 60 percent, but having an ability to go to
the grant list and only pay the 30 percent participating share.
Thus the pressure would be transferred from the debt program to
the grant program. He identified this as the "balancing act."
For example, if the participating share was changed in
conjunction with the debt reimbursement rate, municipalities
would still be using the debt program as opposed to being
incentivized to apply for the grant program. Again, this
represents the balancing of the two programs. Therefore, if the
legislature decreases the debt reimbursement rate on the debt
program there is a strong possibility that municipalities that
can obtain a 30 percent participating share will use the grant
program, then try to get on the grant list since there is a
financial incentive for them to do so.
CHAIR MEYER asked for further clarification on participation in
the grant program [those on the list] since it seems like the
incentive for municipalities is to try for the 70/30 or 60/40
programs rather than to wait for a grant.
COMMISSIONER HANLEY agreed that the list is extensive.
MS. NUDELMAN estimated perhaps 150 projects have currently been
evaluated and are awaiting funding, but it doesn't address all
the projects awaiting major maintenance grants. Districts are
limited to the number of requests they can make so they tend to
work on their highest priorities, understanding project funding
is limited. Thus, many more projects are waiting to get on the
list.
REPRESENTATIVE KITO III commented that it may be a good idea to
suspend new construction; however, the concern he has is related
to the major maintenance list or the debt program that supports
major maintenance. He offered his belief that suspending the
program will delay routine facility maintenance and could
decrease the sustainability of those buildings.
CHAIR HAWKER acknowledged that suspending the 60/40 program
would put more pressure on the grant and maintenance list.
REPRESENTATIVE KITO III agreed.
3:28:29 PM
CHAIR MEYER asked for further clarification on whether major
maintenance approved by the department is eligible for the 70/30
program or if it would fall under the 60/40 program.
MS. NUDELMAN answered that currently major maintenance is
eligible for the 70/30 program, and items such as roof and
boiler repairs fall under the 70/30 debt program.
3:29:19 PM
REPRESENTATIVE GATTIS said is important to keep buildings
maintained and suggested retaining the maintenance aspect.
SENATOR HOFFMAN commented that the problem with major
maintenance is that although the list continues to grow the
state has not been funding anything on the list.
3:30:36 PM
CHAIR HAWKER directed attention to Senate Section 23, related to
the residential school stipend with a $2.25 million fiscal note,
which is not in the House version.
COMMISSIONER HANLEY explained that the state has several
residential schools, which are funded just like any other
schools through the BSA and the [foundation] formula; however,
these schools also receive a stipend for a residential
component.
CHAIR HAWKER asked whether the residential school stipend is
funded through the BSA or the foundation formula.
COMMISSIONER HANLEY answered that it is funded through the
foundation formula.
CHAIR HAWKER clarified that the foundation funding is
substantially more than just the BSA.
COMMISSIONER HANLEY explained that residential schools receive a
boarding stipend to help cover the cost of housing, feeding, and
monitoring students for 24 hours per day. Last year, a proposal
was before the legislature to increase that funding to reflect
actual costs. The legislature increased the funding for
residential components, but did not fully fund it. He said the
$2.2 million will raise the stipend to approach actual costs to
house students, noting the rate for the most expensive district
for a residential student's room and board is at $59 per day and
the lowest is at $40 per day.
CHAIR HAWKER asked whether the $2.25 million will bring the
funding level up to last year's recommendation that was
partially funded.
COMMISSIONER HANLEY answered yes. In response to a question he
said it does not exceed the department's request but reflects
the exact request by Senator Coghill and Representative Gattis.
3:33:26 PM
CHAIR HAWKER turned to Senate Section 24, which will increase
the required local contribution from a 2.65 mill rate to a 2.8
mill tax levy. He asked Commissioner Hanley to provide
background information. He referred to a handout in members'
packets entitled "Department of Education & Early Development,
Prepared 4/19/2014, FN: Increase to required Mill rate 2.65 to
2.8." He stated that this chart identifies the cost per school
district.
COMMISSIONER HANLEY answered that the mill rate averaged 2.9
mills prior to a change that occurred two years ago. At a
certain point new properties came in with a mill rate of 2.0 so
districts fell between 2.0 and 4.0 depending on how quickly they
were growing, the value of property, and the property tax rate.
Thus, on average the mill rate was about 2.9. Two years ago the
legislature chose to take on more of the share. The basic need
is determined by local and state contribution, he said.
CHAIR HAWKER interjected that this change was adopted under
Senate Bill 182 under actions taken by the House Finance
Standing Committee on 4/14/2012.
COMMISSIONER HANLEY explained that the mill rate represents the
local contribution of the basic need for schools and school
districts. In April 2012, the legislature chose to establish
the mill rate at 2.65 for all districts. This means funding for
the basic need was shifted to the state, requiring the state to
pick up an additional $20 million from local municipalities.
This proposal would shift it back to about $11.9 million.
CHAIR HAWKER remarked that the 2012 bill was a gratuitous
transfer of school funding responsibility from the local school
districts to the state at $20 million. This provision would put
the responsibility of approximately $12 million back on local
school districts and reduce the state's cost of funding basic
education. He characterized it as a basic cost-shifting with a
net benefit to the state. He directed attention to Mr. Teal's
aforementioned spreadsheet to a footnote [Senate Section 24
proposes increasing Required Local Effort (RLE) from 2.65
[mills] to 2.8 [mills]]. This provision would increase RLE by
approximately $12 million and reduce state funding by the same
amount, he said.
COMMISSIONER HANLEY agreed that it is a cost-shift; however, it
will not change the amount of the overall funding to school
districts.
3:38:29 PM
CHAIR MEYER said he has asked his staff to provide comparisons
using different mill rates, such as 2.7, 2.75, or 2.9 since the
Senate felt this proposed number was part way between the 2.65
and the average rate in 2012. He recalled at the time the
legislature changed the rationale for funding, the vote was
close, and some uncertainty existed among the members about the
overall effect of the change. Now that the Senate has had more
time to consider this matter, he considered that perhaps the
state may have taken on more of the burden than it should have.
It now appears that communities should carry more of a burden.
Certainly, it's up to communities to decide whether they want to
voluntarily provide more funding in the BSA process; however,
municipalities should contribute more to education so the burden
is not on the state, he said.
CHAIR HAWKER referred to a summary sheet being distributed to
members [entitled, Department of Education & Early Development,
Prepared 4/11/2014, Request Local Effort adjustment], which
shows a spectrum of rates. In response to a question, he agreed
the mill rate was set at 4.0 for many years.
CHAIR HAWKER further clarified that the average for the older
property mill rate was set at 4.0 and newer property was set at
2.0, and that the average mill rate was 2.9.
COMMISSIONER HANLEY agreed. He related his understanding that
the number was chosen from the municipality with the lowest
effective mill rate, which was the MSB's rate at the time
although he admitted he did not participate in the discussion.
CHAIR HAWKER restated that the average mill rate was 2.9.
3:41:58 PM
REPRESENTATIVE KITO III noted that the overall effect of
increasing the mill rate will be an increase on local property
taxes since it will place more of a burden on local government.
CHAIR MEYER pointed out that municipalities have a choice
whether to increase property taxes or sales tax in areas with an
established sales tax.
REPRESENTATIVE GATTIS explained that the Matanuska-Susitna
Borough (MSB) doesn't have a sales tax so it would result in a
property tax increase.
CHAIR HAWKER identified Section 24 as one of the items of
contention between the House and the Senate versions of the
bill.
CHAIR HAWKER related that Senate Section 25 allows for voluntary
local contributions and the House does not find this to be a
problem.
3:44:10 PM
CHAIR HAWKER directed attention to Senate Section 26, which will
raise the correspondence study factor from 80 percent to 90
percent of the BSA with a $6.1 million increment.
COMMISSIONER HANLEY stated that the department is neutral on
this issue. The $6.1 million in funding would go to districts
for their correspondence programs.
3:45:17 PM
SENATOR DUNLEAVY observed that a theme runs through the bill to
incentivize lower cost approaches to education. The
correspondence homeschool concept in several districts
represents a means to educate kids at a much lower rate than in
the classroom. The state developed a system in the past 50
years that provides schools in every community, with classrooms
of approximately 25 students. The fiscal situation doesn't look
as promising and as the state faces fiscal uncertainty the
question arises as to how to pivot the system to reduce costs
yet maintain a quality education for kids.
SENATOR DUNLEAVY related a scenario to illustrate how the
legislature impacts local districts either by creating
incentives or else by penalizing districts via legislation.
Senate Section 26 was developed to incentivize low-cost
approaches. What complicates this process is that
correspondence students have not been viewed as public school
students even though they are part of the public school system.
In some districts hybrid programs exist and some homeschool
students take some courses at the brick and mortar schools. He
characterized this approach as providing more flexibility for
the districts, especially those with a diverse population, and
to offer a different approach to engage more families. Many
homeschool students have statistically remained outside of the
system. This proposal attempts to incorporate a lower-cost
program and incentivize it to see how districts and schools
respond. He viewed Senate Section 26 as a means to reduce
costs.
3:48:48 PM
REPRESENTATIVE KITO III said it is important to not over
incentivize programs that may take emphasis away from the state
providing education for students in neighborhood schools.
SENATOR DUNLEAVY said the district receives funding and
determines the distribution so it should help the neighborhood
schools.
CHAIR MEYER asked when this issue was last raised.
COMMISSIONER HANLEY reported that the [foundation formula
funding factor for correspondence students] was initially set at
.80 when the program was switched from the statewide Alyeska
correspondence program in the early 2000s. In response to a
question, he agreed that .80 was the initial number chosen in
2000.
SENATOR DUNLEAVY asked for further clarification that
[foundation formula funding factor for correspondence students]
was never funded at 1.0 but has always been set at .80.
COMMISSIONER HANLEY explained that it was funded differently
when the state operated a statewide correspondence program, but
the funding factor shifted to .80 when correspondence programs
[were offered by districts.]
CHAIR HAWKER asked for clarification when that change occurred.
COMMISSIONER HANLEY was unsure of the exact date, but believed
it was in the early 2000s.
3:50:22 PM
CHAIR HAWKER turned to Senate Section 27, which was originally
in the governor's bill. This language would allow a charter
school with at least 75 students to obtain additional funding
for the first three years. Currently, charter schools obtain a
supplement for the first year only. This proposal would change
the formula by removing language limiting the adjusted student
count for a charter school to 95 percent of the student rate for
a school that has 150 or more students.
3:51:19 PM
REPRESENTATIVE GATTIS clarified that the governor's proposal was
accepted in the House Education Standing Committee, but was
deleted in House Finance Standing Committee, probably due to the
cost.
COMMISSIONER HANLEY related that the fiscal impact would be
$483,000.
CHAIR HAWKER pointed out it is listed on Mr. Teal's chart as
formula changes for charter school size factor at $483,900.
3:51:48 PM
SENATOR DUNLEAVY offered his belief this is an attempt by the
Senate to reach out to a diverse group of Alaskans who want to
be engaged in public education. Although charter schools are
public schools they have struggled to gain a foothold. Senate
Section 27 recognizes that charter schools provide a valuable
approach to education to engage more students each year and this
helps them obtain adequate funding.
3:52:36 PM
CHAIR HAWKER, referring to House Sections 20-22, stated he would
set aside the BSA issues for now. He directed attention to
House Sections 23 and 24, which he characterized as a policy
call on teacher tenure.
REPRESENTATIVE GATTIS suggested that some teacher tenure studies
exist and it might be possible to look at teacher tenure.
3:53:40 PM
The committee took a brief at-ease from 3:53 p.m. to 3:56 p.m.
3:56:26 PM
CHAIR MEYER stated that although teacher tenure is not included
in the Senate version of the bill, teacher tenure is of interest
to the Senate.
3:57:44 PM
CHAIR HAWKER directed attention to House Section 47 and Senate
Section 55, to the two salary and benefits studies proposed.
The House study would be due on January 1, 2016, but the
Senate's took the approach of using an LB&A study with a report
due January 1, 2016.
COMMISSIONER HANLEY deferred to Senator Fairclough.
3:58:42 PM
SENATOR ANNA FAIRCLOUGH, Alaska State Legislature, as Chair of
the Legislative Budget & Audit Committee, stated that the Senate
Finance Committee considered previous LB&A studies that were
underway to review health care benefits statewide. A Senate
Finance subcommittee held over the past interim evaluated the
largest cost drivers for all school districts statewide and
identified health care costs as the largest driver. The LB&A
Committee has gathered considerable information about individual
benefits in each school district. The question was whether to
build on the current information or ask the administration to
restart the process. She deferred to the committee with respect
to the approach to take. As Chair of the Legislative Budget &
Audit Committee, stated that the LB&A study on health benefits
could be built on as a cost savings opportunity. She noted that
the House will chair the LB&A committee next legislature.
CHAIR HAWKER related his understanding that it would be a pretty
substantial cost savings issue.
SENATOR FAIRCLOUGH answered that the proposed overall cost
savings were estimated at $45 million, but as the committee dug
deeper it was the Senate Finance subcommittee's position to
honor collective bargaining. The contractors had used a
combined approach. The committee broke the costs into
individual years.
CHAIR HAWKER interjected that he was actually interested in
further clarification on the cost of performing the studies. He
recalled that if the DOA performed the studies it could cost
$600,000, but if the LB&A committee continued the costs may be
closer to $100,000.
SENATOR FAIRCLOUGH advised that the money has been invested and
LB&A estimated it could complete the initial survey for
$150,000.
CHAIR HAWKER asked whether the LB&A's work had been done under
the Chair's signature authority.
SENATOR FAIRCLOUGH related that the Senate Finance Standing
Committee has been housing the contract itself, with Suzanne
Armstrong as the project coordinator, but LB&A has been
coordinating it.
4:01:40 PM
SENATOR DUNLEAVY explained that the work was the result of SB
90, which passed the legislature in 2013, but the study needed
more time more time to flesh out the information.
REPRESENTATIVE GATTIS reported that the House doesn't consider
this to be a sticking point. She stated that this language was
put in as a recommendation by the Sustainable Education Task
Force during the House Finance committee meetings; however, the
House doesn't have any preference for which agency performs the
studies.
REPRESENTATIVE KITO III asked for further clarification on the
advertising process and how the contracts are solicited.
SENATOR FAIRCLOUGH explained that a legislative team consisting
of three to five members will identify the criteria and work
with the procurement officer in the Legislative Affairs Agency
on a request for proposal (RFP) which would be public noticed
and distributed.
4:04:00 PM
CHAIR HAWKER remarked that he appreciated the clarity and can
see a route forward. He skipped past Sections 50 and 51 which
are studies proposed for the foundation formula, including the
district cost factor and the school size factor, noting this has
been quite contentious in HB 278. He suggested substantial
interest exists within the legislature to conduct a
comprehensive review of the foundation formula and not limit it
to just a few variables.
4:05:18 PM
REPRESENTATIVE GATTIS asked for further clarification on the
January 31, 2017 reporting date and whether it should be January
31, 2016.
CHAIR HAWKER referred to Senate Section 52, which directs EED to
do a study on developing energy and engineering efficiency
statewide for school design and construction with a fiscal
impact of $620,000.
COMMISSIONER HANLEY answered that this will require EED to
consider prototypical designs with the idea of enhancing energy
efficiency in the state, potentially with models that can be
expanded. He characterized this study as being similar to the
LB&A studies in that the EED would likely contract this out.
CHAIR HAWKER characterized Senate Section 52 as a funding policy
call.
4:07:13 PM
CHAIR HAWKER directed attention to Senate Section 53, which is
an expansion of the ANSEP's [Alaska Native Science and
Engineering Program's] STEM program into the middle schools with
a termination date of June 30, 2017, which essentially creates a
pilot program, noting the ANSEP program has been a very
successful model.
COMMISSIONER HANLEY concurred that the STEM program has been a
very successful model. Although ANSEP is not listed in the
bill, it is a model that fits the STEM [Science Technology
Engineering and Math] program very well; however, it does not
preclude another program from being considered.
4:08:48 PM
SENATOR DUNLEAVY related that the emphasis in middle school
would be to come out of middle school with Algebra I concepts.
COMMISSIONER HANLEY answered that is correct. In response to a
question, he acknowledged that it has encouraged raising the
bar.
CHAIR HAWKER pointed out that the STEM program has a $3 million
fiscal impact and is on Mr. Teal's spreadsheet for
consideration. This concludes the inventory of the policies and
points that require additional conversation, he said.
4:10:10 PM
CHAIR MEYER turned to Senate Section 54. He related that the
governor previously recommended removing the High School
Graduation Qualifying Exam (HSGQE) exam, but the Senate took it
further and allowed students to get their diploma if they
initially failed the exit exam.
COMMISSIONER HANLEY agreed that the goal is to remove the HSGQE.
The language also mirrors the language that was in a House bill.
The governor had initially planned to phase out the HSGQE over
three years and this language just is another way to achieve the
same result. In doing so, it would allow students who have met
all other criteria and received their certificate of achievement
to receive a diploma.
CHAIR HAWKER related his understanding that if this language was
retained and the diploma was issued retroactively that the
requirements would still need to be completed for graduation.
COMMISSIONER HANLEY agreed that these students would need to
have met all other graduations requirements, but are students
who simply did not pass a portion of the exit exam.
4:12:44 PM
CHAIR HAWKER returned to the core school funding approach to
identify the differences that exist between the legislative
bodies. He asked Mr. Teal to explain the different between the
House and Senate versions of HB 278. He stated that the House
version used a multiple-year approach on a BSA increase with a
smaller amount funded outside the BSA [formula] in year one.
The Senate's approach was to provide three years of committed
funding outside the [BSA] formula.
MR. TEAL agreed with the summary. He said people could argue
whether one approach is better than the other; however, the
primary difference is that the BSA is typically considered to be
a permanent increase. Technically, it is not a permanent
increase since the BSA can always be changed downward. The same
would be true for a one-time increase. He did not recall a one-
time increase that has ever been removed and typically the
increase has been rolled into the BSA; however, he reminded
members that one legislature can't bind any future legislatures.
CHAIR HAWKER said that the Senate's approach is easy to
understand since it is to fund $100 million each year outside of
the BSA. Since the approximate conversion rate is that every
$25 million increase outside the BSA equates to a $100 increase
in the BSA, this essentially means that $100 million in each of
those three years roughly equates to a $400 [dollar] increase
[to the BSA] for each of the next three years. The House
version was not quite as generous, he said. He asked for
further clarification on how the House BSA increase works since
it may be a little confusing.
MR. TEAL referred to his spreadsheet to the House FY 15 column
with a line item of $30 million [$30,000.0], whereas the House
column contains $30 million outside the BSA and $45 million
[$45,832.2] as a BSA increase, or a $185 increase to the BSA,
bringing the total BSA to $5,865. However, converting the $30
million to a BSA equivalent means that the $76 million total
distributed according to the formula converts to a $303 increase
in the BSA [listed as the Approximate BSA Equivalent (Dollars)
on the spreadsheet.]
CHAIR HAWKER, referring to the spreadsheet, asked for further
clarification that the [BSA increase] of $185 includes rolling
past one-time funding of $25 million.
MR. TEAL answered that is correct. The governor's proposal to
include $25 million was deleted from the operating budget;
however, it was replaced in the House version of HB 278 with $30
million outside the BSA. The Senate language increase of $100
million outside the BSA plus changes in the formula to
correspondence and charter schools brings the Senate's total to
$106 million, which equates to a $427 increase to the BSA.
4:18:12 PM
CHAIR HAWKER asked for further clarification on the growth
factor inside the BSA funding.
MR. TEAL reported that the House version [inside the] BSA
funding increases by another $58 in FY 16, bringing it to
$5,923, but the cost drops in the total distributed amount
according to the formula because of the reduction to the $30
million outside the BSA. He suggested thinking of it as going
from $45 million inside the BSA to $60 million in FY 16 and
bringing that up to $75 million in FY 17.
CHAIR HAWKER related his understanding that the current House
version does not make a commitment for any outside the BSA
amount.
MR. TEAL answered that is the reason there is a reduction from
$75 million to $60 million. The net is $75 million minus $30
million, which drops to $45 million, but raising the BSA by $58
adds in the additional $14 million. The House has more movement
but it is understandable if one thinks of it simply as
increasing the BSA by $185, then another $58 increase, and
another $58 increase, whereas the Senate increment is constant
for three years.
CHAIR HAWKER highlighted the House Finance Standing Committee
took a very measured approach to conserve as much money as
possible while providing adequate investment in the BSA,
although he acknowledged it doesn't make as much of an
investment as the Senate does. The House version wanted to
split some of it between "inside and outside" the BSA, he said.
4:20:44 PM
CHAIR MEYER commented that the public requested stability and
this gives schools $427 in increased funding that can be counted
on for the next three years. Although the Senate's funding
level is higher than the House, the House could still add
additional funding outside of the formula funding in FY 16 and
FY 17 to increase their education funding. The Senate does not
intend to further fund the formula, but will study the
foundation formula over the next three years and try to fix it.
Since the process is significant, it will take several years to
accomplish. In addition, the Senate's goal is to hold the
districts harmless for the next three years while the foundation
formula is studied and avoid an annual battle. This represents
the Senate's attempt to adequately fund education for the next
three years.
4:22:12 PM
CHAIR HAWKER emphasized the House's approach was to commit to an
increase to the BSA for the next three years, but the Senate's
approach makes a committed and forward funded approach using an
outside the BSA [formula] mechanism to fund education.
4:22:32 PM
SENATOR DUNLEAVY explained the underlying philosophy in the
Senate's approach has been to support the neighborhood schools
while exploring other approaches such as residential,
correspondence, charter schools, and home study programs. The
Senate's approach would provide three years of sustained funding
at a level to meet the needs of the mainstay schools and
districts while at the same time exploring other approaches and
opportunities. At the same time the studies will provide
information and an understanding for future decisions.
SEANTOR DUNLEAVY said the House and Senate's [Standing]
Education Committees have looked at funding and sustainability.
Mr. Teal has identified that by 2024 three items may consume the
state's entire budget. He recalled a prior funding shortfall in
the 1980s and subsequently funding began to fall apart. The
state could currently be hemmed in by price and declining
production that could result in an unsustainable level of
funding. Instead of waiting for an exhaustion of funding
reserves, he suggested the legislature could make determinations
and see what can be accomplished to lower educational costs by
examining different approaches while still trying to maintain
the quality of education.
CHAIR HAWKER remarked that that was a well-stated explanation.
4:25:13 PM
SENATOR HOFFMAN also reminded the committee the last time the
state had an extended BSA increment was when the legislature
implemented recommendations by an education task force, chaired
by Representative Hawker. At the time the general consensus by
the education community was that they were satisfied.
SENATOR HOFFMAN expressed concern that the House's current
approach doesn't increase the BSA to the amounts the education
community would like, which is a $400 increment this year, and
an additional $125 increment each of the next two years for a
total BSA of $650. In fact, the House falls well short of that
funding. He doubted the education community could support the
House's approach to only add $185 to the BSA, with a $58
increment in the next two fiscal years. He anticipated the
response will be that that level of funding is woefully
inadequate to meet the educational needs of Alaska's students.
At a time when the legislature is addressing education, it is
unsatisfactory to endorse such low increments to the BSA. He
wondered whether the BSA will be addressed again in two years or
if the $30 million in funding means that education needs will
continue to be funded outside the [foundation] formula each
year. He did not agree with the House's perspective on
education funding for the next three years.
CHAIR HAWKER responded that he cannot speak for the House;
however he offered his belief that the House has taken an
approach of "living within our means." He suggested that it's
easy to raise [the BSA funding], but nearly impossible to take
something away. The general sentiment of the legislature and
the public is that value is not being realized from the schools
and student performance. Thus, instead of rewarding the status
quo by "writing a check" the state needs to be shown [student]
performance improvements. "This is the balance that we're in
this committee to discuss," he said.
4:29:19 PM
REPRESENTATIVE KITO III commented that Mr. Teal has indicated
the level of funding inside the BSA and outside the BSA. He
asked whether it would satisfy Alaskans that the state is
committed [to education] if the funding over the next three
years was all within the BSA, while at the same time the studies
are completed and the formulas are readjusted. He asked for
further clarification on the Senate FY 15, FY 16, and FY 17
figures for the BSA increment of $427; however, he questioned
whether this includes $6 million for correspondence schools and
the $400,000 for the charter school size factor. Still, all
districts don't have correspondence programs and charter schools
are only in a handful of school districts. He asked whether
this represents an average for school districts since the other
amounts only apply to some districts.
MR. TEAL concurred that the funding is not distributed equally
to all districts, but it is allocated on the basis of the
[foundation] formula. The aforementioned spreadsheet indicates
that it's a formula distribution like the fiscal note section,
which has the same issue, which is the grants to districts since
the state doesn't know how they will be allocated; however, the
state does know how correspondence and charter school monies
will be allocated. Those funds are placed into the public
education fund and are distributed without appropriation
according to the formula.
REPRESENTATIVE KITO III expressed concern that the $427 BSA
equivalent is actually not going to be the same for every
district. He asked for further clarification that this figure
will be the amount for school districts that receive
correspondence and charter school funds, but it will be lower
for those schools without correspondence or charter schools.
MR. TEAL answered that is correct. He characterized it as a
formula distribution.
CHAIR HAWKER related his understanding that [funding for those
schools] will not be appreciably lower.
MR. TEAL agreed that is correct. He clarified that the $6
million in funding is out of a $1.2 billion program so the
"needle" won't be moved very far.
4:32:03 PM
REPRESENTATIVE GATTIS advised members that the House Education
[Standing Committee] did not review the BSA or financial
portions, but deferred the financial aspects to the House
Finance [Standing Committee] to review. Certainly, members have
an obligation to make decisions to live within the state's
means. Granted, it would be much easier for the legislature to
simply fund education by "writing the check." However, she
viewed the House's approach as establishing long-term education
funding through the BSA. The public and some members have
expressed an interest in having the total education funding
within the BSA and not outside the BSA. She questioned whether
the state has the ability to continue to fund at these levels
and whether the studies will examine that issue.
SENATOR DUNLEAVY explained that the projections indicate that
the state is not living within it means and this will continue
unless something changes. He said the Senate model recognizes
this and attempts to pivot and consider other approaches to well
educate Alaska's children. Continuing to fund neighborhood
schools at the exclusion of other innovative educational
approaches will hasten that day. In fact, the educational
system that has evolved over 50 years in Alaska simply needs
more money every year. The legislature and administration must
decide if it will fall off the cliff in 2024 or if it can
institute innovative approaches using technology, the Internet,
and low-cost models to change the course and level-off funding
costs.
4:35:54 PM
MR. TEAL commented one thing that the committee may wish to
consider as it deliberates whether to fund inside versus outside
the BSA is that funding outside the BSA does not allow local
contributions to increase. Putting money inside the BSA means
that local contributions can go up by 23 percent of that amount.
He referred to page 4, to Senate Section 25, which would allow
funding distributed outside the BSA to be used to determine
voluntary local contributions. This would allow local
contributions to increase. That funding would include the
entire $100 million, or some other amount, noting the House has
funding outside the BSA as well. Those funds would increase
voluntary local effort as does quality schools, which is a $16
per ADM grant distributed according to the formula. He recalled
earlier comments that raising the mill rate will increase
property taxes; however, that will not necessarily raise taxes.
He related a scenario to illustrate that as the mill rate goes
up, the local contribution will be more, but the municipalities
can choose not to increase the voluntary effort by that amount.
CHAIR HAWKER interjected that, for example, the community could
pay for it out of existing revenues.
MR. TEAL agreed; however, he said there isn't any linkage
between raising the mill rate and increasing taxpayer burden
since a district can contribute more because the sum of required
and voluntary contributions will be higher, and they could
choose to contribute the same amount, or they could choose to
contribute less. He acknowledged some exceptions, such as
Tanana, Nenana, and other districts that have very low local
effort so an increase could affect them. He said that most
districts contribute a significant amount of money voluntarily.
He offered to provide a spreadsheet for the next meeting that
show which school districts might be affected.
CHAIR HAWKER confirmed that the committee would like to have
that additional information.
4:39:21 PM
CHAIR HAWKER suggested the free conference committee on HB 278
has challenging deliberations ahead. He counseled members to
focus on possible outcomes and not perfect outcomes and to also
seek common ground to build on to reach resolution. He assured
members that neither body will dictate final provisions in the
bill. He highlighted that the common objective is to achieve
what is possible today to improve schools and commit to long-
term and sustainable funding increases. He acknowledged Senator
Hoffman related the legislature previously took a collaborative
approach. He also anticipated the free conference committee
process will take some time. He announced that the proposed
"consent" free conference committee substitute for HB 278 is now
available for distribution, which he hoped the committee will
adopt as a working document.
4:43:19 PM
CHAIR MEYER emphasized that the Senate would like to continue
deliberations and asked whether the committee could identify
outstanding issues other than the funding issues.
CHAIR HAWKER related his understanding that the outstanding
issues are the ones just discussed with the commissioner. He
asked to have staff review the issues for members.
4:44:42 PM
MS. LUCKY clarified that she just received the proposed free
conference "consent" committee substitute [FCCS for HB 278] and
hopes to post it to the Bill Action Status Inquiry System
(BASIS) soon.
MS. LUCKY reviewed the preliminary actions the committee has
taken. She indicated the House and Senate reached consensus on
Section 1. Many of the sections on page 1 [of the HB 278
Comparison section-by-section] relate to the HSGQE or exit exam.
The proposed [FCCS for HB 278] would repeal the exit exam but
does not propose an alternative assessment vehicle, address
retroactive diplomas, or include a period to retest since those
items may require additional discussion.
MS. LUCKY advised that the House version included statements on
ceding control and "common core" standards, which are not in the
proposed [FCCS for HB 278] however, amendments are being
drafted. She related the new statutory references in AS
14.03.126, AS 14.03.127, and AS 14.03.128 in Senate Section 7,
include funding for Internet services, personalized learning
opportunities grant programs, and innovative approach to
learning grants, but are not in the proposed consent [FCCS for
HB 278], but will be considered as amendments.
CHAIR HAWKER stated that the proposed consent [FCCS for HB 278]
was a collaborative process.
4:46:45 PM
MS. LUCKY indicated that Senate Sections 8, 9, and 11 were the
same; however, since the [HSGQE] exit exam was repealed, these
sections were written a little differently since the assessments
or diploma options are not yet resolved. In addition,
outstanding issues include the fiscal issues, including debt
reimbursement, the residential school stipend, the mill tax
levy, correspondence study factor increase, and funding for
charter schools. She turned to House Section 15 and Senate
Section 16, noting language related to the "common core"
standards will be removed and will become an amendment.
REPRESENTATIVE KITO III asked whether it would be easier to
identify the sections that are not resolved and are open rather
than try to figure out agreed upon language that is in the
proposed FCCS for HB 278.
CHAIR HAWKER agreed and offered to summarize the open sections
that relate to issues that are still unresolved: House Section
2, related to "secondary" school courses through mastery, not
limited to core topics; House Section 4, related to the state
not ceding any measure of autonomy or control over education
standards and assessments. The general sense has been that not
ceding autonomy is unanimously agreed to as a non-issue. Still
unresolved is Senate Section 7, which includes funding for
Internet, technical equipment support and training, and
innovative approach to learning grants; Senate Section 14
related to correspondence study programs and student allotment
rollovers; and Senate Section 16, which is related to the
semantic change to "language arts" for "reading, writing."
Although the "common core" standards implementation language was
not included, he reiterated that there appears to be agreement
on this.
CHAIR HAWKER turned to House Section 16, which would direct the
state Board of Education (BOE) to make recommendations promoting
efficiency. Although he cannot speak for the House, he
suggested this is an area that will be held tightly to since a
misunderstanding on the role of the BOE has been identified.
Still unresolved is Senate Section 20, related to debt
reimbursement, noting that some compromise direction has been
identified. Senate Section 23 would increase the recommended
school stipend, which will simply be a funding decision; Senate
Sections 24 and 25, related to the required local contribution
mill tax levy and voluntary local contribution are unresolved.
Senate Section 26 would increase the state funding
correspondence study from 80 to 90 percent of the BSA; Senate
Section 27 includes the governor's proposed language for
increased funding of approximately $483,000 for charter schools,
which is not included in the House version. He remarked that
seemed like a good investment to him.
CHAIR HAWKER directed attention to House Sections 20, 21, and
22, as being the "elephant in the room," relating to the "inside
the BSA" and "outside the BSA" level of funding. House Sections
23 and 24, relating to teacher tenure still need to be sorted
out.
4:52:21 PM
CHAIR HAWKER said a series of reports and how they will be
structured represent the linchpin, including identifying aspects
to be included and how to reevaluate and re-engineer education
in Alaska. These studies include the proposed Department of
Education's (EED) study on efficient school design and
construction, which seems to make a lot of sense. In addition,
Senate Section 54 relates to the EED issuing a diploma to those
students who failed the exit exam, which he personally thought
was a non-issue. This fits into the larger discussion, which is
whether to require other benchmarking or attainment standards
instead of the exit exam.
4:54:15 PM
CHAIR MEYER asked for further clarification on the House's
position on the [HSGQE] exit exam.
REPRESENTATIVE GATTIS explained that the public and the
department did not find the HSGQE to be as rigorous as it should
be and did not adequately measure what high school graduates
should know. The committee held discussions on how to address
students who passed their final exams, but did not receive a
high school diploma [because they failed the exit exam]. She
did not think issuing a retroactive diploma was an issue.
CHAIR MEYER related his understanding that the Senate agreed
with the governor's version of HB 278 that there should be an
SAT, ACT, or WorkKeys assessment as an alternate assessment.
4:55:43 PM
The committee took an at-ease from 4:55 p.m. to 5:22 p.m.
5:22:05 PM
CHAIR HAWKER suggested that several additional items could also
be "taken off the table," since agreement exists. He directed
attention to House Section 2, related to testing-out of courses
limited to core topics. He asked whether Senator Meyer had a
strong position on the language in Senate Section 2.
CHAIR MEYER answered no; the Senate does not.
CHAIR HAWKER indicated that several House members felt strongly
about this so this would be an item that would go to the House
caucus with the recommendation to keep the House Section 2
language.
CHAIR MEYER offered his belief that would be fine with the
Senate.
CHAIR HAWKER directed attention again to House Section 4, which
states that the state may not cede any measure of autonomy or
control over education standards and assessments. He recalled
Commissioner Hanley saying it really is "not doing what we're
already not doing." In response to a question, he agreed the
House version would be included in the proposed "consent"
version [FCCS for HB 278].
CHAIR MEYER said the Senate believed the language in House
Section 4 was not necessary, but it seems important to some of
the House members so it will be included in the proposed
committee substitute [FCCS for HB 278].
CHAIR HAWKER agreed. In terms of the [HSGQE] exit exam, he
asked whether some form of attainment testing should be offered
or if exit exams will simply be removed and the matter will be
addressed in a separate bill next legislative session, if so
desired.
CHAIR MEYER, relating his desire to show good faith effort,
agreed that the Senate will go with the House language to repeal
the [HSGQE] exit exam.
5:25:48 PM
MS. LUCKY explained that the House version of HB 278 did not
repeal the [HSGQE] exit exam; however, the House did pass a
separate bill, [HB 220], to repeal the exit exam. She clarified
that the House's position was to have a clean repeal of the exit
exam.
CHAIR HAWKER clarified that the proposed FCCS HB 278 will
include the Senate Section 3 language to repeal the exit exam,
but will not add the Senate's language to require other
attainment testing, [such as the ACT, SAT or WorkKeys].
CHAIR MEYER concurred.
5:26:21 PM
SENATOR DUNLEAVY asked for further clarification on the action.
MS. LUCKY pointed out that the conference committee would adopt
partial Senate Section 3 language to repeal the exit exam but
not require the SAT, ACT, or WorkKeys be taken.
SENATOR DUNLEAVY related that the governor's bill required the
SAT, ACT, or WorkKeys be taken, although no cut score would be
used but an assessment would be taken. Senate Section 3
eliminated the current HSGQE. He asked for further
clarification that the free conference committee will not
require any assessment and that the high school diploma would be
conferred at the local level.
MS. LUCKY agreed the exit exam would be repealed and there would
not be any other requirements put into place.
SENATOR DUNLEAVY commented said this language is different from
either the House or Senate version.
5:28:09 PM
REPRESENTATIVE GATTIS reiterated that the exit exam is repealed
in [HB 220] and emphasized that it should be repealed.
SENATOR DUNLEAVY agreed, but was unsure that the Senate language
dismissed all exams on exit.
REPRESENTATIVE GATTIS explained that the House Education
[Standing] Committee considered whether another exam will be
required. However, after examining the costs of administering
an exam, such as ACT or SAT or WorkKeys, the WorkKeys was left
as an optional exam that will be given during the student's
junior year, but will not be required in order for the student
to receive a diploma.
SENATOR DUNLEAVY offered his belief that the Senate accepted the
governor's language in the bill so the Senate may not concur
with this change.
5:30:57 PM
CHAIR MEYER suggested that some type of measurement is
necessary, but it can be accomplished through regulation. This
would allow the department to decide if it is best accomplished
by administering the ACT, the SAT, or WorkKeys, or ACCUPLACER.
SENATOR DUNLEAVY asked whether intent language should be
proposed authorizing the department to develop regulation to
satisfy this requirement.
CHAIR HAWKER clarified the free conference committee's process,
such that each body has a caucus it represents and the process
will be to solicit support and concurrence from the respective
caucuses. He asked whether intent language could address some
type of optional attainment testing. He asked whether an
uncodified law of intent allows the department to promulgate a
regulation to allow students to take one of the exams.
COMMISSIONER HANLEY explained that currently the WorkKeys is in
regulation and is required to be taken in the 11th grade. This
will not be affected by the proposed adoption of a [modified
Senate Section 3]. He indicated that the governor's intent was
to allow students a choice by adding the SAT or ACT instead of
the WorkKeys. If the SAT/ACT is not added in the bill, students
will continue to take the WorkKeys.
CHAIR HAWKER suggested using the governor's language as a
recommendation for optional testing [by adding in the SAT/ACT as
optional exams students can take instead of WorkKeys]. He
further suggested that the Senate Section 3 be provisionally
adopted.
COMMISSIONER HANLEY said the governor would support that.
5:33:55 PM
REPRESENTATIVE GATTIS asked whether the ACCUPLACER assessment
will be included.
COMMISSIONER HANLEY answered no; that SAT/ACT as well as the
WorkKeys are all avenues as qualifiers for the Alaska
Performance Scholarship. Currently, students who want to take
the SAT/ACT must pay for it. The administration's position was
that it would save $2.7 million by removing the HSGQE so the
department could institute an alternate option and pay for the
SAT/ACT exams. Currently, the ACCUPLACER is not one of the
tools and was not added to the governor's language in HB 278.
REPRESENTATIVE GATTIS agreed that WorkKeys and SAT/ACT are
alternate exam choices, but questioned not including the
ACCUPLACER exam as a choice.
COMMISSIONER HANLEY explained that the department will work with
local districts to offer the optional WorkKeys that aim for
students seeking careers, or the SAT/ACT for students who aim
for a college score. He was unsure how the ACCUPLACER exam
would fit within these options.
REPRESENTATIVE GATTIS acknowledged that the ACCUPLACER exam was
never discussed in the House Education [Standing] Committee.
CHAIR HAWKER concluded that the Senate approach [in Senate
Section 3] will be taken with respect to the [HSGQE] exit exam,
noting this item will come before the respective caucuses for
further discussion.
5:36:42 PM
CHAIR HAWKER referred to Senate Sections 7A, 7B, and 7C, which
relate to the Internet, technical equipment and training, and
innovative learning grant approaches to education.
CHAIR MEYER welcomed Senator Dunleavy's participation in the
House caucus to impart his expertise. He has spent his whole
life in education, serving as a teacher, superintendent,
principal, and on the school board. He described him as
knowledgeable about education, employing an innovative and
progressive approach to create change in the field of education.
However, at the end of the day it will relate to level of
spending and where it will be spent, he said.
5:38:12 PM
CHAIR HAWKER referred to Senate Section 14, and asked Senator
Dunleavy to also address the caucus on this language related to
a correspondence study program, individual learning plans, and
student allotments. He directed attention to Senate Section 16,
to the "common core" standards language, which the
administration is somewhat ambivalent about, although it is
important to some members.
CHAIR MEYER related the Senate [was neutral] on Section 16.
SENATOR DUNLEAVY clarified that the Senate didn't disagree with
the House.
CHAIR MEYER remarked that he did not believe it is the BOE's
role to discuss spending.
CHAIR HAWKER offered to recommend Senate Section 16 with respect
to removal of the "common core" standards language.
5:39:42 PM
CHAIR HAWKER referred to Senate Section 20, which relates to
debt reimbursement, which is an area that will require further
discussion.
CHAIR HAWKER directed attention to Senate Section 23, to
increases for residential school stipends, which is a spending
issue. He asked Senator Dunleavy to address the caucus on this
issue.
5:40:06 PM
CHAIR HAWKER identified [Senate Section 24] related to the mill
levy will also be a House caucus conversation.
CHAIR MEYER acknowledged that the Senate education funding is
more than the House level; however, the Senate is offering a
means to gain a credit. He offered his belief that the
education funding should be shared with municipalities. The
proposal is not necessarily a tax increase since municipalities
can elect not to do the voluntary portion. He acknowledged it
was a potential savings to the state.
CHAIR HAWKER acknowledged it would be a cost-shifting measure
from the state to the municipalities.
5:41:08 PM
CHAIR HAWKER referred to Senate Section 26, related to the
correspondence study, and asked Senator Dunleavy to address the
House caucus. He directed attention to Senate Section 27,
related to the charter school start-up funding, removed in the
House Finance [Standing] Committee. He acknowledged that there
has been substantial support for charter schools.
REPRESENTATIVE GATTIS highlighted offered her belief that one of
the things the governor's bill did was address the need for
parity between the neighborhood schools and the charter schools.
However, to do so will require substantial funding. The House
Finance Committee struggled with the level of spending for
charter schools and removed the additional funding; however, she
acknowledged the significant parental support for charter
schools.
CHAIR HAWKER indicated that Senate Section 27 will be brought to
the House caucus with the recommendation to adopt the Senate
language.
5:43:09 PM
SENATOR DUNLEAVY remarked that the charter and correspondence
families don't necessarily have an organized constituency group
or lobbying group to approach the legislature as a whole.
However, the voice of this group should be heard and can only be
heard through the respective House and Senate members who
represent them.
REPRESENTATIVE HAWKER pointed out many sections have
commonality. He directed attention to Senate Sections 50-53,
related to studies and reporting, which will require further
discussion; however, he said he sees a way forward.
5:45:18 PM
CHAIR HAWKER directed attention to Senate Section 54, which
relates to retroactive high school diplomas. If the free
conference committee adopts the Senate's language on testing it
will automatically mean accepting the Senate version of Section
54.
MS. LUCKY pointed out Senate Section 53 is not actually a study
but is for a middle school pilot program. She related her
understanding that it is still an outstanding issue.
CHAIR HAWKER acknowledged it was still outstanding.
5:45:58 PM
CHAIR MEYER asked for further clarification on teacher tenure.
CHAIR HAWKER said the House is divided on this issue.
REPRESENTATIVE GATTIS stated that teacher tenure passed the
House. She said the vote is an indicator the House wants this
issue to be brought forward.
CHAIR MEYER remarked some Senate members felt very strongly
about teacher tenure. He offered to bring it to the Senate
caucus as well and hoped this is something that could be agreed
upon.
| Document Name | Date/Time | Subjects |
|---|---|---|
| CCS HB 278 Work Draft X.pdf |
JHB278 4/22/2014 10:00:00 AM |
HB 278 |
| HB 278 CC Comparison 4-22.pdf |
JHB278 4/22/2014 10:00:00 AM |
HB 278 |
| Mill Rate Comparison.pdf |
JHB278 4/22/2014 10:00:00 AM |
HB 278 |
| 4-22-14 LFD Summary HB 278 Senate vs House.pdf |
JHB278 4/22/2014 10:00:00 AM |
HB 278 |