Legislature(2013 - 2014)HOUSE FINANCE 519

04/01/2014 08:30 AM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 278 EDUCATION: FUNDING/TAX CREDITS/PROGRAMS TELECONFERENCED
Heard & Held
+= HB 21 FOUR-DAY SCHOOL WEEK TELECONFERENCED
Moved CSHB 21(FIN) Out of Committee
+= HB 127 OMBUDSMAN TELECONFERENCED
Moved CSHB 127(JUD) Out of Committee
                  HOUSE FINANCE COMMITTEE                                                                                       
                       April 1, 2014                                                                                            
                         8:38 a.m.                                                                                              
                                                                                                                                
                                                                                                                                
8:38:41 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stoltze called the House Finance Committee meeting                                                                     
to order at 8:38 a.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Alan Austerman, Co-Chair                                                                                         
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Mark Neuman, Vice-Chair                                                                                          
Representative Mia Costello                                                                                                     
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative David Guttenberg                                                                                                 
Representative Lindsey Holmes                                                                                                   
Representative Cathy Munoz                                                                                                      
Representative Steve Thompson                                                                                                   
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Daniel George, Staff, Representative Bill Stoltze; Andy                                                                         
Mills, Special Assistant to the Commissioner, Department of                                                                     
Administration.                                                                                                                 
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Linda Lord-Jenkins, State Ombudsman, Anchorage; Beth                                                                            
Leibowitz, Office of Ombudsman, Juneau.                                                                                         
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 21     FOUR-DAY SCHOOL WEEK                                                                                                  
                                                                                                                                
          CSHB 21(FIN) was REPORTED out of committee with                                                                       
          no recommendation and with one new zero fiscal                                                                        
          note from  the Department  of Education  and Early                                                                    
          Development and one new zero  fiscal note from the                                                                    
          Department of Administration.                                                                                         
                                                                                                                                
HB 127    OMBUDSMAN                                                                                                             
                                                                                                                                
          CSHB 127 (JUD) was  REPORTED out of committee with                                                                    
          a "do  pass" recommendation and with  two new zero                                                                    
          fiscal    notes    from    the    Department    of                                                                    
          Administration, one new zero  fiscal note from the                                                                    
          Legislature and one new zero  fiscal note from the                                                                    
          Department of Corrections.                                                                                            
                                                                                                                                
HB 278    EDUCATION: FUNDING/TAX CREDITS/PROGRAMS                                                                               
                                                                                                                                
          HB  278  was  HEARD  and  HELD  in  committee  for                                                                    
          further consideration.                                                                                                
                                                                                                                                
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."                                                                                      
                                                                                                                                
8:38:59 AM                                                                                                                    
                                                                                                                                
Vice-Chair Neuman MOVED to ADOPT the proposed committee                                                                         
substitute for HB 278, Work Draft 28-GH2716\G, (Mischel,                                                                        
3/31/14). Co-Chair Stoltze OBJECTED for discussion.                                                                             
                                                                                                                                
DANIEL   GEORGE,   STAFF,   REPRESENTATIVE   BILL   STOLTZE,                                                                    
discussed the work draft. He  stated that version G replaced                                                                    
version N. He  provided a sectional analysis.  He began with                                                                    
section  1  where  the governor's  language  was  reinstated                                                                    
related to an opportunity to  challenge for credit. He noted                                                                    
that sections 2, 3, and  4 reinserted provisions of existing                                                                    
statutes related  to the  high school  graduation qualifying                                                                    
exam.                                                                                                                           
                                                                                                                                
8:41:28 AM                                                                                                                    
                                                                                                                                
Mr. George  continued with section  5, page 5,  lines 29-30,                                                                    
which created  an opportunity for charter  school applicants                                                                    
to  further appeal  within 30  days  to the  state Board  of                                                                    
Education and  Early Development.  Section 5, page  6, lines                                                                    
6-8 related to  a situation where a local  school board that                                                                    
denied  an  application  for a  charter  school,  which  was                                                                    
subsequently  approved by  the state  board on  appeal could                                                                    
operate  the  charter school.  The  section  also removed  a                                                                    
former  subsection  stating  that   the  state  board  would                                                                    
operate  a charter  school  as  if the  state  board were  a                                                                    
school district.                                                                                                                
                                                                                                                                
Mr. George  continued with  section 6,  page 6;  lines 18-26                                                                    
were added regarding charter  school application appeals and                                                                    
timelines. He  moved to  section 7, page  7; lines  3-5 were                                                                    
amended  to clarify  that if  the  school district  required                                                                    
lease  payments  by  a charter  school  the  district  would                                                                    
negotiate a lease  agreement with the charter  school for an                                                                    
amount  that  did  not exceed  the  true  operational  costs                                                                    
calculated.                                                                                                                     
                                                                                                                                
8:42:42 AM                                                                                                                    
                                                                                                                                
Mr. George  discussed section 8,  page 7, where  lines 12-14                                                                    
were  added  to specify  that  a  local school  board  shall                                                                    
provide   a  charter   school   with   a  report   itemizing                                                                    
administrate  costs  retained  by the  local  school  board.                                                                    
Section 11, page 8, line 23  through page 9, line 7 inserted                                                                    
a new duty for the  Board of Education and Early Development                                                                    
to report to the  legislature recommendations for changes in                                                                    
the method  of education  spending by  the state  and school                                                                    
districts  that resulted  in  improved  efficiencies and  in                                                                    
administration of  public education  in the state.  He noted                                                                    
the removal of three sections:  a section relating to school                                                                    
bond reimbursement  program, a section relating  to boarding                                                                    
school  stipends and  a section  relating to  student counts                                                                    
for charter schools.                                                                                                            
                                                                                                                                
Co-Chair  Stoltze  added  "it  keeps  them  in  without  the                                                                    
increase."                                                                                                                      
                                                                                                                                
Mr.  George  continued with  section  15;  lines 21-27  were                                                                    
added   relating   to   the  public   education   fund   and                                                                    
appropriations for the Teachers  Retirement System (TRS). He                                                                    
continued with  section 16,  page 11,  line 28  through page                                                                    
14,  line 3,  which  was inserted  and  related to  unfunded                                                                    
liability and  the teachers  retirement cost  adjustment. He                                                                    
noted  page 14,  line 1  included a  change in  the required                                                                    
local  contribution  from 45  percent  to  40 percent  of  a                                                                    
district's  basic  need.  Section  17, page  14,  line  4-19                                                                    
amended the school size table  for purposes of calculating a                                                                    
schools Average  Daily Membership  (ADM) to  determine state                                                                    
aide.                                                                                                                           
                                                                                                                                
Mr. George  continued with  sections 18, 19  and 20  on page                                                                    
14; lines 20-28  were amended to reflect an  increase in the                                                                    
Base Student  Allocation (BSA) by  $100 in addition  to that                                                                    
of the governor's  plan in the first year.  Section 21, page                                                                    
14, line 29  through page 15, line 15  was inserted relating                                                                    
to  state  aid  to  school  districts  and  withholding  for                                                                    
purpose of deposit into the  teachers retirement trust fund.                                                                    
Sections 22, 23  and 24 on page 15, line  13 though page 16,                                                                    
line 16  were inserted  relating to altering  teacher tenure                                                                    
from 3  years to  5 years and  subjecting tenure  to review,                                                                    
and regarding loss of tenure rights.                                                                                            
                                                                                                                                
8:45:51 AM                                                                                                                    
                                                                                                                                
Mr. George continued with sections 25,  26 and 27 on page 16                                                                    
line  17  through  page  17; line  19,  which  was  inserted                                                                    
relating  to  pension  benefits  and  employer  contribution                                                                    
rates,  transmitting   funds  for   deposit  in   a  teacher                                                                    
retirement  trust fund  and  additional state  contributions                                                                    
and  the teacher's  pension reserve  fund. Section  28, page                                                                    
17, lines-22  and 27 and page  18 were amended to  reflect a                                                                    
three-year   reauthorization   of   the   Alaska   Technical                                                                    
Vocational   Education  Program   (TVEP)  program   and  the                                                                    
allocations  of TVEP  funding present  in existing  statute.                                                                    
Section 30  was removed  from the bill  including subsection                                                                    
(h)  relating  to  a  20  percent  withholding  penalty  for                                                                    
failure to comply with new TVEP requirements.                                                                                   
                                                                                                                                
Mr.  George continued  with  section 32;  the  option for  a                                                                    
municipality to  adopt by ordinance  a partial or  whole tax                                                                    
exemption  for all  or  a portion  of  privately owned  real                                                                    
property, rented or  leased for use as a  charter school was                                                                    
added.   Sections   33,   34  and   35   relating   to   the                                                                    
establishment, trusteeship  and management of  the teachers'                                                                    
pension  reserve   fund  and  the   duties  of   the  Alaska                                                                    
Retirement Management  Board were  inserted. He  stated that                                                                    
sections 36 through  46 related to the  income tax education                                                                    
credit,   mining   business  education   credit,   fisheries                                                                    
business  education credit  and  fisheries resource  landing                                                                    
tax education  credit. Three  changes were  made to  the tax                                                                    
credits, two of which were  permanent and one of which would                                                                    
sunset in 2021 along with other tax credits.                                                                                    
                                                                                                                                
8:48:19 AM                                                                                                                    
                                                                                                                                
Mr. George  pointed out  that section 48;  page 33,  line 25                                                                    
relating  to  transfer or  absorption  of  a federal  agency                                                                    
school and  teachers was repealed.  Section 50  was removed;                                                                    
it  included transition  language related  to the  appeal of                                                                    
the  high school  graduation qualifying  exam. Applicability                                                                    
language related  to teacher  tenure provisions  in sections                                                                    
22-24 was added. Section 51  addressed the effective date of                                                                    
transition language  related to charter  school applications                                                                    
filed  with the  local  school board;  it  was amended  from                                                                    
September  to   July  1,  2014.  Section   53  directed  the                                                                    
Department of  Administration to present to  the legislature                                                                    
a  written  proposal  to implement  a  salary  and  benefits                                                                    
schedule  for  school  districts.  Sections  54  through  59                                                                    
reflected the  effective dates of various  provisions of the                                                                    
act; notably the effective date  of the act was changed from                                                                    
September to July 1, 2014.                                                                                                      
                                                                                                                                
8:49:53 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stoltze WITHDREW  his  OBJECTION.  There being  NO                                                                    
OBJECTION,  it was  so ordered.  Version G  was ADOPTED.  He                                                                    
stated his intent  for invited testimony related  to some of                                                                    
the  legislation's key  provisions.  He  invited a  vigorous                                                                    
amendment process.                                                                                                              
                                                                                                                                
Representative  Munoz  asked  if  the  administration  would                                                                    
testify about the retirement portion of the CS.                                                                                 
                                                                                                                                
Co-Chair Stoltze replied in the affirmative.                                                                                    
                                                                                                                                
Representative  Munoz requested  invited testimony  from the                                                                    
university.                                                                                                                     
                                                                                                                                
8:51:22 AM                                                                                                                    
                                                                                                                                
Representative Gara asked if he could pose technical                                                                            
questions related to the bill's provisions.                                                                                     
                                                                                                                                
Co-Chair Stoltze denied Representative Gara's request.                                                                          
                                                                                                                                
8:51:47 AM                                                                                                                    
                                                                                                                                
Vice-Chair Neuman requested a written list of the changes                                                                       
made in the CS.                                                                                                                 
                                                                                                                                
Co-Chair Stoltze agreed.                                                                                                        
                                                                                                                                
8:52:07 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
8:52:18 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Stoltze noted the deadline for amendments of 5:00                                                                      
pm.                                                                                                                             
                                                                                                                                
8:53:00 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:14:07 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 127                                                                                                            
                                                                                                                                
     "An Act  clarifying that the Alaska  Bar Association is                                                                    
     an  agency  for  purposes   of  investigations  by  the                                                                    
     ombudsman;  relating to  compensation of  the ombudsman                                                                    
     and  to  employment of  staff  by  the ombudsman  under                                                                    
     personal  service  contracts;  providing  that  certain                                                                    
     records of communications between  the ombudsman and an                                                                    
     agency are  not public records; relating  to disclosure                                                                    
     by  an  agency  to   the  ombudsman  of  communications                                                                    
     subject  to attorney-client  and attorney  work-product                                                                    
     privileges; relating to informal  and formal reports of                                                                    
     opinions and  recommendations issued by  the ombudsman;                                                                    
     relating  to  the privilege  of  the  ombudsman not  to                                                                    
     testify  and  creating  a  privilege  under  which  the                                                                    
     ombudsman   is  not   required   to  disclose   certain                                                                    
     documents;  relating to  procedures for  procurement by                                                                    
     the ombudsman;  relating to the definition  of 'agency'                                                                    
     for  purposes  of  the   Ombudsman  Act  and  providing                                                                    
     jurisdiction  of the  ombudsman over  persons providing                                                                    
     certain  services   to  the  state  by   contract;  and                                                                    
     amending Rules 501 and 503, Alaska Rules of Evidence."                                                                     
                                                                                                                                
9:14:15 AM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze noted his  successful effort in determining                                                                    
a lack  of objection to  the legislation from the  Office of                                                                    
Victims' Rights.                                                                                                                
                                                                                                                                
Co-Chair Austerman  informed the  committee that  the bill's                                                                    
sponsor  was  the  House  Rules  Committee  by  request.  He                                                                    
wondered who requested the legislation.                                                                                         
                                                                                                                                
Co-Chair Stoltze  replied that  the Office of  the Ombudsman                                                                    
requested the bill.                                                                                                             
                                                                                                                                
9:15:16 AM                                                                                                                    
                                                                                                                                
Representative  Costello  discussed  the  bill's  four  zero                                                                    
fiscal notes.                                                                                                                   
                                                                                                                                
Co-Chair  Stoltze  stated that  the  agency  existed in  the                                                                    
legislature's budget.                                                                                                           
                                                                                                                                
Vice-Chair Neuman  asked about  page 2, lines  9 and  10. He                                                                    
discussed  the  confidential  negotiations with  the  Alaska                                                                    
Gasline  Development Corporation  (AGDC).  He  asked if  the                                                                    
ombudsman's office  would have access to  the state agency's                                                                    
records of the confidential hearings.                                                                                           
                                                                                                                                
Co-Chair Stoltze replied that he did not know the answer.                                                                       
                                                                                                                                
Representative  Thompson echoed  the concerns  of Vice-Chair                                                                    
Neuman.  He  wondered  if the  agency's  authority  was  too                                                                    
broad.                                                                                                                          
                                                                                                                                
Co-Chair Stoltze  stated that he  would hold the  bill until                                                                    
the concerns of the members could be alleviated.                                                                                
                                                                                                                                
[Note: Further discussion  and action on CSHB  127 (JUD) can                                                                    
be found later in this meeting.]                                                                                                
                                                                                                                                
HOUSE BILL NO. 21                                                                                                             
                                                                                                                                
     "An Act relating to the length of a school week; and                                                                       
     providing for an effective date."                                                                                          
                                                                                                                                
9:19:18 AM                                                                                                                    
                                                                                                                                
ANDY   MILLS,  SPECIAL   ASSISTANT   TO  THE   COMMISSIONER,                                                                    
DEPARTMENT  OF ADMINISTRATION,  expressed  his apology  that                                                                    
the fiscal note  was not addressed in  the committee's prior                                                                    
hearing of HB 21.                                                                                                               
                                                                                                                                
Co-Chair  Stoltze  asked  for  further  explanation  of  the                                                                    
fiscal note.                                                                                                                    
                                                                                                                                
Mr. Mills discussed  the new fiscal note  from Department of                                                                    
Administration,  Centralized   Administrative  Services.  He                                                                    
noted  changes  in  the prior  year's  CS  necessitating  an                                                                    
additional  table.  The  change required  reprogramming  and                                                                    
other changes  at the Division  of Retirement  and Benefits.                                                                    
He discussed the  cost estimates listed in  the fiscal note.                                                                    
The reprogramming  was related to communication  between the                                                                    
division  and the  federal government.  He  stated that  the                                                                    
Central Retirement System (CRS)  was the system that allowed                                                                    
for  tracking   of  the  retiree  data   for  the  division.                                                                    
Calculation  systems,   found  on  the   division's  website                                                                    
provided  self-assessment tools  that  allowed employees  to                                                                    
track  their retirement.  Statements were  delivered to  the                                                                    
members and  brochures were sent  to notify  employees about                                                                    
the change to the system.                                                                                                       
                                                                                                                                
9:22:31 AM                                                                                                                    
                                                                                                                                
Vice-Chair Neuman wondered about  the fiscal note's proposed                                                                    
$100 thousand dollar expense. He  stated that the Department                                                                    
of  Administration received  approximately  $100 million  in                                                                    
capital  budget   items  related  to   Integrated  Resources                                                                    
Information Services  (IRIS) upgrades. He asked  whether the                                                                    
changes  needed  for  the legislation  could  be  made  with                                                                    
already existing resources.                                                                                                     
                                                                                                                                
9:23:27 AM                                                                                                                    
                                                                                                                                
Representative Costello asked about  the state's approach to                                                                    
programmers. She  expressed confusion regarding  the payment                                                                    
of computer programmers already employed by the department.                                                                     
                                                                                                                                
Mr. Mills replied that certain  programmers would absorb the                                                                    
changes proposed  in the fiscal  note. The numbers  were for                                                                    
outside  contracted  costs.  He  stated  that  an  alternate                                                                    
schedule might seem  simple, but the brochures  were a fixed                                                                    
cost.                                                                                                                           
                                                                                                                                
9:25:37 AM                                                                                                                    
                                                                                                                                
Representative  Costello  discussed   her  experience  as  a                                                                    
teacher  for  Service  High School.  She  wondered  how  the                                                                    
employee  hours could  be translated  into  portions of  the                                                                    
year  as  outlined   in  the  bill.  She   wondered  if  the                                                                    
department  could apply  retirement benefits  for a  teacher                                                                    
contracted for one-half of the year.                                                                                            
                                                                                                                                
Mr. Mills  replied that  the schedule  proposed in  the bill                                                                    
was an alternate schedule. He  noted that utilization of the                                                                    
uncodified  code  would  have spawned  multiple  alternative                                                                    
calendars.   He  suggested   that  further   information  be                                                                    
provided by the division.                                                                                                       
                                                                                                                                
Representative  Costello  asked  if  the  state  moved  from                                                                    
hiring  full-time  to  contractual  programmers,  would  the                                                                    
charge to  the state change.  She wondered why  the practice                                                                    
of contractual programmers was not utilized.                                                                                    
                                                                                                                                
9:28:45 AM                                                                                                                    
                                                                                                                                
Co-Chair  Austerman commented  that  the  state reduced  the                                                                    
number of  days for a retiree  from 172 to 150.  He asked if                                                                    
the change  increased the retirement  cost to the  state. He                                                                    
asked about the  changes needed in the  retirement system as                                                                    
a result of the legislation.                                                                                                    
                                                                                                                                
Representative Wilson  stated that the bill  would not allow                                                                    
for an  employee's premature retirement. The  shorter school                                                                    
weeks would equal a full year of school.                                                                                        
                                                                                                                                
Co-Chair  Austerman noted  that  the days  allowing for  one                                                                    
year's worth of retirement had changed.                                                                                         
                                                                                                                                
Representative Wilson explained that  fewer days were needed                                                                    
because the days were longer.                                                                                                   
                                                                                                                                
Co-Chair Austerman did not understand the concept.                                                                              
                                                                                                                                
Co-Chair   Stoltze  understood   that   the  teachers   were                                                                    
currently  eligible for  retirement and  the changes  in the                                                                    
bill allowed that continuity of  accrual despite the shorter                                                                    
work/school weeks.                                                                                                              
                                                                                                                                
Co-Chair  Austerman requested  further understanding  of the                                                                    
cumulative effect of the legislation.                                                                                           
                                                                                                                                
Co-Chair Stoltze  asked Mr.  Mills if  he could  envision an                                                                    
addition of a new employee under the proposed calculation.                                                                      
                                                                                                                                
Mr.  Mills  assumed  that  a  full year  would  lead  to  an                                                                    
insignificant difference in time accrual.                                                                                       
                                                                                                                                
9:31:55 AM                                                                                                                    
                                                                                                                                
Representative  Thompson  stated  dissatisfaction  with  the                                                                    
fiscal  note.  He  understood that  the  part-time  teachers                                                                    
worked a certain  amount of days. He did  not understand why                                                                    
new statements would  be required. He assumed  that the cost                                                                    
of the statements was built into the division's budget.                                                                         
                                                                                                                                
Mr.  Mills replied  that the  fiscal note  included a  large                                                                    
number of  contractor costs. He  noted that the  fiscal note                                                                    
would increase in its request  if the entire change required                                                                    
contractual programmers.                                                                                                        
                                                                                                                                
9:34:08 AM                                                                                                                    
                                                                                                                                
Vice-Chair  Neuman OFFERED  a conceptual  AMENDMENT to  zero                                                                    
out fiscal  note one from the  Department of Administration,                                                                    
Office of  Management and Budget  (OMB) number 64.  He MOVED                                                                    
that  the Department  of Administration  absorb the  cost of                                                                    
the changes proposed in the legislation.                                                                                        
                                                                                                                                
Co-Chair  Stoltze  supported  the  change.  There  being  NO                                                                    
OBJECTION,  it  was  so  ordered. Fiscal  note  1  from  the                                                                    
Department of  Administration, OMB  component number  64 was                                                                    
changed to reflect ZERO fiscal impact.                                                                                          
                                                                                                                                
Co-Chair  Stoltze RESCINDED  the prior  action made  to move                                                                    
the bill out of committee.  There being NO OBJECTION, it was                                                                    
so ordered. CSHB 21 (FIN) was back before the committee.                                                                        
                                                                                                                                
9:36:17 AM                                                                                                                    
                                                                                                                                
Representative  Gara  OFFERED  a  conceptual  AMENDMENT.  He                                                                    
pointed  to  page  2,  line 18,  section  C  addressing  the                                                                    
reduction  of school  days and  the provision  of retirement                                                                    
benefits. He stated that some  school districts would reduce                                                                    
school   hours  by   20  percent.   He  noted   the  minimum                                                                    
instruction hours mandated by  the legislation was 740 hours                                                                    
for lower  and 900  hours for higher  grades. He  noted that                                                                    
many schools had greater than 1000 instructional hours.                                                                         
                                                                                                                                
Representative  Gara  discussed  page  2,  line  3  and  the                                                                    
commissioner's  ability  to  reduce instructional  days,  as                                                                    
long as  instructional hours remained comparable.  He stated                                                                    
that  the commissioner  had reduced  school  days below  180                                                                    
days in one community  recently. The legislation reduced the                                                                    
number of hours further.  He expressed concern about cutting                                                                    
the number of school hours.                                                                                                     
                                                                                                                                
Representative  Gara  MOVED   the  conceptual  amendment  to                                                                    
retain page 2, line 18 through page 3, line 9.                                                                                  
                                                                                                                                
Co-Chair Stoltze stated that the  committee would not accept                                                                    
such  a   conceptual  amendment.  He  requested   a  written                                                                    
amendment.                                                                                                                      
                                                                                                                                
9:39:33 AM                                                                                                                    
                                                                                                                                
Representative  Costello  appreciated Representative  Gara's                                                                    
point. She  stated that the  statute dictated  minimum hours                                                                    
constituting  a day.  School  districts  often exceeded  the                                                                    
requirements. She  stated that  the opportunity  for shorter                                                                    
days  existed, yet  districts chose  not to  take advantage.                                                                    
She   stated  that   the   proposed  legislation   addressed                                                                    
alternative  schedules  versus  shorter teaching  time.  She                                                                    
mentioned  the  concept  of  year-round  school  as  another                                                                    
option for  an alternative  schedule. She mentioned  a study                                                                    
in  the  committee  members'  packets  related  to  improved                                                                    
results in math and  reading with alternative schedules. She                                                                    
believed that  the concept of  minimum school hours  per day                                                                    
was already in  statute and did not belong in  the bill. She                                                                    
stated  that the  policy  call was  unique  and demanded  an                                                                    
opinion from the House Education  Committee. She spoke about                                                                    
the school  board and public's involvement  in all decisions                                                                    
related  to school  week changes.  The proposed  legislation                                                                    
was  tied  to  the  wishes  of  the  parents  and  education                                                                    
community. She  opposed the conceptual amendment  offered by                                                                    
Representative Gara.                                                                                                            
                                                                                                                                
Representative Wilson  stated that  a school  district could                                                                    
choose  a   four-day  school   week  without   the  proposed                                                                    
legislation. She noted that the  issue of teacher retirement                                                                    
was  the reason  for the  proposed legislation.  Because the                                                                    
teachers were working  more days and hours  in one district,                                                                    
the  full-years' worth  of  retirement  was not  accessible.                                                                    
Upon the bill's inception,  she asked the commissioner about                                                                    
the constitution  of a  full work day.  She opined  that the                                                                    
bill had flexibility without the amendment.                                                                                     
                                                                                                                                
Co-Chair  Stoltze stated  that an  amendment was  not before                                                                    
the committee.                                                                                                                  
                                                                                                                                
Representative  Munoz  discussed  Representative  Costello's                                                                    
reference  to the  report.  She noted  that  in the  report,                                                                    
Montana shifted  to a four-day  week, but retained  the 1000                                                                    
hour  requirement. She  wondered  why the  bill shifted  the                                                                    
requirement in Alaska.                                                                                                          
                                                                                                                                
Representative  Wilson replied  that  the  hours in  statute                                                                    
were used to determine the  bill's proposal. She stated that                                                                    
each district  used a different  number of total  hours. She                                                                    
suggested that  instituting one number for  the entire state                                                                    
might negatively  impact some  districts. She  discussed the                                                                    
issue with  the commissioner  and proposed that  the problem                                                                    
be addressed in  a separate bill with a  study about whether                                                                    
an increase  in hours would  provide a better  education for                                                                    
Alaska's students.                                                                                                              
                                                                                                                                
Vice-Chair Neuman asked  about page 2, lines  3-6 related to                                                                    
the commissioner's  approval of  plans. He wondered  why the                                                                    
section was changed. He understood  the local control issue,                                                                    
but   he  opined   that  an   alternative   view  from   the                                                                    
commissioner would prove advantageous.                                                                                          
                                                                                                                                
9:46:57 AM                                                                                                                    
                                                                                                                                
Representative  Wilson stated  that  the commissioner  would                                                                    
review  the plan  with a  checklist. The  mechanism mandated                                                                    
community meetings. She believed  that the communities would                                                                    
make the  best judgments  for their  unique area  needs. The                                                                    
commissioner  would   approve  the   plans,  based   on  the                                                                    
checklist.                                                                                                                      
                                                                                                                                
Vice-Chair Neuman asked for details about the checklist.                                                                        
                                                                                                                                
Representative  Wilson  stated  that the  community  meeting                                                                    
must  address  a  plan  for  days/hours  needed  during  the                                                                    
shortened school  week. The plan  was then submitted  to the                                                                    
commissioner who  reviewed it for necessary  components. She                                                                    
stated that  outcomes were reviewed using  standardized test                                                                    
scores.                                                                                                                         
                                                                                                                                
9:49:03 AM                                                                                                                    
                                                                                                                                
Representative Gara opined that  a problem arose in removing                                                                    
the commissioner's  discretion. He  pointed to page  2, line                                                                    
11, "if  the school district  shows that they  are providing                                                                    
the minimum  of instruction"  he stated that  upon community                                                                    
approval, the  decision would  be made.  He stated  that the                                                                    
commissioner could  allow for an alternative  schedule under                                                                    
current  law.  The  commissioner   was  not  amenable  to  a                                                                    
reduction to  700 instructional hours. Current  law retained                                                                    
the   districts   with   greater  than   statutory   minimum                                                                    
instructional  hours. The  bill mandated  the commissioner's                                                                    
approval  of  the   statutory  minimum  following  community                                                                    
members' decision.                                                                                                              
                                                                                                                                
9:51:52 AM                                                                                                                    
                                                                                                                                
Vice-Chair  Neuman MOVED  to  REPORT CSHB  21  (FIN) out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying  revised  fiscal  notes.  Representative  Munoz                                                                    
OBJECTED. She  wished to see  the amended fiscal  note prior                                                                    
to reporting out the bill.                                                                                                      
                                                                                                                                
Representative  Gara  apologized  that  he did  not  have  a                                                                    
written amendment.                                                                                                              
                                                                                                                                
9:53:07 AM                                                                                                                    
                                                                                                                                
Representative  Costello  shared   that  her  office  worked                                                                    
tirelessly reviewing  hours of school days.  She stated that                                                                    
a school  currently following  state law  would pay  a large                                                                    
organizational  price for  the proposed  mandate. She  urged                                                                    
the   legislature   to   revisit  the   issue   of   minimum                                                                    
instructional hours.  She cautioned the committee  to review                                                                    
all pertinent information before  proposing a minimum number                                                                    
of instructional hours to all Alaskan schools.                                                                                  
                                                                                                                                
9:54:23 AM                                                                                                                    
                                                                                                                                
Representative Gara apologized for  not having his amendment                                                                    
available   in  writing.   He  agreed   with  Representative                                                                    
Costello and did not recommend  that the committee mandate a                                                                    
minimum  number of  instructional hours.  He noted  that the                                                                    
commissioner  currently   decided  the  minimum   number  of                                                                    
instructional  hours  based  on   his  determination  of  an                                                                    
adequate  number   of  school  hours  to   protect  academic                                                                    
achievement.  He pointed  to page  2,  lines 3-6  indicating                                                                    
that the commissioner  could approve the number  of days and                                                                    
the  number of  instructional  hours. The  bill required  an                                                                    
acceptance  of the  school district's  decision to  instruct                                                                    
for  the minimum  number of  allowable  hours. He  disagreed                                                                    
with the bill for that one  reason. He wished to continue to                                                                    
allow the  commissioner to make  the decision  regarding the                                                                    
minimum number  of instructional  hours for  each individual                                                                    
proposal.                                                                                                                       
                                                                                                                                
9:56:12 AM                                                                                                                    
                                                                                                                                
Representative  Wilson stated  that  the commissioner  would                                                                    
not allow  a four-day  school week without  the legislation.                                                                    
She  stated that  the commissioner  had denied  all requests                                                                    
for a four-day school week.                                                                                                     
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Holmes,   Neuman,   Thompson,  Wilson,   Costello,                                                                    
Edgmon, Stoltze, Austerman                                                                                                      
OPPOSED: Guttenberg, Munoz, Gara                                                                                                
                                                                                                                                
The MOTION PASSED (8/3).                                                                                                        
                                                                                                                                
CSHB  21  (FIN)  was  REPORTED  out  of  committee  with  no                                                                    
recommendation and  with one new  zero fiscal note  from the                                                                    
Department of  Education and Early  Development and  one new                                                                    
zero fiscal note from the Department of Administration.                                                                         
                                                                                                                                
9:58:54 AM                                                                                                                    
                                                                                                                                
HOUSE BILL NO. 127                                                                                                            
                                                                                                                                
     "An Act  clarifying that the Alaska  Bar Association is                                                                    
     an  agency  for  purposes   of  investigations  by  the                                                                    
     ombudsman;  relating to  compensation of  the ombudsman                                                                    
     and  to  employment of  staff  by  the ombudsman  under                                                                    
     personal  service  contracts;  providing  that  certain                                                                    
     records of communications between  the ombudsman and an                                                                    
     agency are  not public records; relating  to disclosure                                                                    
     by  an  agency  to   the  ombudsman  of  communications                                                                    
     subject  to attorney-client  and attorney  work-product                                                                    
     privileges; relating to informal  and formal reports of                                                                    
     opinions and  recommendations issued by  the ombudsman;                                                                    
     relating  to  the privilege  of  the  ombudsman not  to                                                                    
     testify  and  creating  a  privilege  under  which  the                                                                    
     ombudsman   is  not   required   to  disclose   certain                                                                    
     documents;  relating to  procedures for  procurement by                                                                    
     the ombudsman;  relating to the definition  of 'agency'                                                                    
     for  purposes  of  the   Ombudsman  Act  and  providing                                                                    
     jurisdiction  of the  ombudsman over  persons providing                                                                    
     certain  services   to  the  state  by   contract;  and                                                                    
     amending Rules 501 and 503, Alaska Rules of Evidence."                                                                     
                                                                                                                                
10:00:56 AM                                                                                                                   
                                                                                                                                
Co-Chair Stoltze discussed HB  127. He acknowledged that the                                                                    
testifiers were online to speak about the bill.                                                                                 
                                                                                                                                
LINDA   LORD-JENKINS,   STATE  OMBUDSMAN,   ANCHORAGE   (via                                                                    
teleconference), stated that she was available.                                                                                 
                                                                                                                                
Vice-Chair Neuman  asked about page 2,  paragraph 4, section                                                                    
3 related to records for every state agency.                                                                                    
                                                                                                                                
Co-Chair  Stoltze  clarified  that the  bill  stated  "every                                                                    
agency" as opposed to "every state agency."                                                                                     
                                                                                                                                
Ms. Lord-Jenkins deferred the question to Ms. Leibowitz.                                                                        
                                                                                                                                
Co-Chair  Stoltze requested  an opinion  about the  policy's                                                                    
intent from Ms. Lord-Jenkins.                                                                                                   
                                                                                                                                
Ms. Lord-Jenkins  replied that  the policy intended  to have                                                                    
the statute  conform to other provisions  allowing access to                                                                    
information from  investigated agencies. She noted  that the                                                                    
"state agency proviso" would limit  the reach. She mentioned                                                                    
other limited records that were not accessible.                                                                                 
                                                                                                                                
10:03:53 AM                                                                                                                   
                                                                                                                                
Vice-Chair  Neuman asked  which agencies  were reviewed.  He                                                                    
wondered  the scope  of the  ombudsman's abilities  during a                                                                    
complaint.  He   mentioned  that  some   municipalities  had                                                                    
considered  property  taxes  related  to the  gas  line.  He                                                                    
wondered if a complaint from  a municipality would yield the                                                                    
ability for  the ombudsman to  review confidential  gas line                                                                    
materials.                                                                                                                      
                                                                                                                                
Ms. Lord-Jenkins  replied that  the ombudsman  had statutory                                                                    
authority  to review  each agency  of  the state  government                                                                    
regarding  the  gas  line issues  and  individual  community                                                                    
concerns. She admitted that her  office was more apt to view                                                                    
citizen complaints.  She stated that  individual communities                                                                    
would be better  rectified in a court of  law. The ombudsman                                                                    
could not force  an agency to pay a fine  or compensation to                                                                    
an aggrieved party.                                                                                                             
                                                                                                                                
10:06:31 AM                                                                                                                   
                                                                                                                                
Vice-Chair  Neuman asked  about the  ombudsman's ability  to                                                                    
review terms  by the Legislative Budget  and Audit division.                                                                    
He  wondered  if  a complaint  related  to  the  appropriate                                                                    
nature  of  building  contracts could  be  reviewed  by  the                                                                    
ombudsman.                                                                                                                      
                                                                                                                                
Ms.  Lord-Jenkins  interpreted  the  statute  to  allow  the                                                                    
investigation of legislative agencies  with the exemption of                                                                    
the  Office of  Victims'  Rights.  She mentioned  occasional                                                                    
complaints related  to legislative  agencies and  aides. She                                                                    
interpreted  that the  ombudsman  would have  access to  the                                                                    
mentioned contracts as would the Legislative Council.                                                                           
                                                                                                                                
Vice-Chair Neuman  referred to  section 6,  page 3  and "the                                                                    
procedure   shall   be  followed   by   the   office  in   a                                                                    
professional."  He  asked if  the  section  referred to  all                                                                    
state agencies.                                                                                                                 
                                                                                                                                
BETH   LEIBOWITZ,   OFFICE   OF   OMBUDSMAN,   JUNEAU   (via                                                                    
teleconference)   requested   question  clarification.   She                                                                    
stated  that   section  6  addressed  procurement   for  the                                                                    
ombudsman office.                                                                                                               
                                                                                                                                
Vice-Chair Neuman  understood. He asked about  the authority                                                                    
related to the terms "otherwise erroneous."                                                                                     
                                                                                                                                
10:10:22 AM                                                                                                                   
                                                                                                                                
Ms.  Leibowitz  replied  that "otherwise  erroneous"  was  a                                                                    
catch-all category  that was rarely used.  She mentioned the                                                                    
other  appropriate  terms  related  to  complaints  such  as                                                                    
"arbitrary, oppressive, unfair, and contrary to law."                                                                           
                                                                                                                                
Co-Chair Stoltze did  not disagree with the  bill. He opined                                                                    
that  the legislation  included good  policy provisions.  He                                                                    
noted that  the fiscal notes  were discussed earlier  in the                                                                    
meeting.                                                                                                                        
                                                                                                                                
10:11:36 AM                                                                                                                   
                                                                                                                                
Vice-Chair  Neuman MOVED  to REPORT  CSHB 127  (JUD) out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSHB  127 (JUD)  was REPORTED  out of  committee with  a "do                                                                    
pass"  recommendation and  with  two new  zero fiscal  notes                                                                    
from the  Department of Administration, one  new zero fiscal                                                                    
note from the Legislature and  one new zero fiscal note from                                                                    
the Department of Corrections.                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 10:12 a.m.                                                                                         

Document Name Date/Time Subjects
HB 278 CS WORKDRAFT FIN 28-GH2716-G.pdf HFIN 4/1/2014 8:30:00 AM
HB 278
HB 278 Summary of Changes HB 278 - CS(FIN).pdf HFIN 4/1/2014 8:30:00 AM
HB 278