Legislature(2015 - 2016)HOUSE FINANCE 519

03/17/2015 01:30 PM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 140 LEG. APPROVAL: AK RAILROAD REVENUE BONDS TELECONFERENCED
Heard & Held
+ HB 30 CONSTITUTIONAL HISTORY CURRICULUM TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                  HOUSE FINANCE COMMITTEE                                                                                       
                      March 17, 2015                                                                                            
                         1:32 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:32:33 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair  Thompson   called  the  House   Finance  Committee                                                                    
meeting to order at 1:32 p.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Mark Neuman, Co-Chair                                                                                            
Representative Steve Thompson, Co-Chair                                                                                         
Representative Dan Saddler, Vice-Chair                                                                                          
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative Lynn Gattis                                                                                                      
Representative Scott Kawasaki                                                                                                   
Representative Cathy Munoz                                                                                                      
Representative Lance Pruitt                                                                                                     
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative David Guttenberg                                                                                                 
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Jane   Pierson,  Chief   of   Staff,  Representative   Steve                                                                    
Thompson;  William G.  O'Leary,  President  and CEO,  Alaska                                                                    
Railroad  Corporation; Linda  Leary, Board  Chair, Board  of                                                                    
Directors, Alaska  Railroad Corporation;  Representative Wes                                                                    
Keller, Sponsor; Commissioner  Michael Hanley, Commissioner,                                                                    
Department of Education and Early Development;                                                                                  
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 30     CONSTITUTIONAL HISTORY CURRICULUM                                                                                     
                                                                                                                                
          HB 30 was HEARD and HELD in committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
HB 140    LEG. APPROVAL: AK RAILROAD REVENUE BONDS                                                                              
                                                                                                                                
          HB 140 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HOUSE BILL NO. 140                                                                                                            
                                                                                                                                
     "An Act authorizing the  Alaska Railroad Corporation to                                                                    
     issue  revenue  bonds  to   finance  a  positive  train                                                                    
     control   rail  transportation   safety  project   that                                                                    
     qualifies  for  federal  financial  participation;  and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
Co-Chair Thompson reviewed the meeting agenda and indicated                                                                     
he would not be moving either of the scheduled bills out of                                                                     
committee.                                                                                                                      
                                                                                                                                
1:33:51 PM                                                                                                                    
                                                                                                                                
JANE   PIERSON,  CHIEF   OF   STAFF,  REPRESENTATIVE   STEVE                                                                    
THOMPSON,  introduced  herself  and told  a  personal  story                                                                    
about  riding   on  the  Alaska  railroad   from  Seward  to                                                                    
Anchorage. She read the sponsor statement:                                                                                      
                                                                                                                                
     HB 140  will authorize the Alaska  Railroad Corporation                                                                    
     (ARRC) to issue  up to $37 million  in tax-exempt bonds                                                                    
     backed by Federal  Transit Administration (FTA) formula                                                                    
     funds received annually by ARRC.  Bond proceeds will be                                                                    
     used to finance Positive  Train Control (PTC): a safety                                                                    
     program mandated by the  federal government without any                                                                    
     correlating funding,  which is  estimated to  cost ARRC                                                                    
     approximately $158 million.                                                                                                
                                                                                                                                
     ARRC  proposes to  refinance  $66  million in  existing                                                                    
     bonds and extend  the repayment date in  order to issue                                                                    
     an additional $37  million in bonds to pay  for a major                                                                    
    portion of the remaining $55 million in PTC costs.                                                                          
                                                                                                                                
     Under   AS.42.40.285  ARRC   is  required   to  receive                                                                    
     legislative approval  to issue bonds. In  no event will                                                                    
     the general  credit of the  State of Alaska or  ARRC be                                                                    
     pledged for the repayment  of these bonds. AS.42.40.500                                                                    
     requires that  all liabilities  incurred by  ARRC shall                                                                    
     be satisfied  "exclusively" from the assets  or revenue                                                                    
     of ARRC and not the State.                                                                                                 
                                                                                                                                
     Debt payment for the bonds  will come from a portion of                                                                    
     Federal  Transit  Administration  (FTA)  formula  funds                                                                    
     which  are  statutorily  mandated by  Federal  law  and                                                                    
     received annually  by ARRC. Issuing debt  backed by FTA                                                                    
     formula funds is authorized  through FTA regulation and                                                                    
     has already been used by ARRC to issue bonds.                                                                              
                                                                                                                                
     PTC  is technology  designed to  stop or  slow a  train                                                                    
     before  human-error causes  an  accident  to occur.  In                                                                    
     2008, the federal Rail  Safety Improvement Act required                                                                    
     certain  railroads to  install a  fully functional  PTC                                                                    
     system by the  end of 2015; by virtue  of its passenger                                                                    
     service,  ARRC  is  subject   to  this  requirement.  A                                                                    
     failure to  implement PTC will  force ARRC  to severely                                                                    
     curtail  or  eliminate  passenger service  and/or  face                                                                    
     severe fines for non-compliance.                                                                                           
                                                                                                                                
     Estimates  for  this  large  research  and  development                                                                    
     project indicate  that it will cost  approximately $158                                                                    
     million  to implement.  Since 1997,  ARRC has  invested                                                                    
     $68.9  million to  develop a  PTC system.  In 2013  and                                                                    
     2014,  ARRC received  an additional  $19.1 million  and                                                                    
     $15 million  respectively from the  State of  Alaska to                                                                    
     continue  work  on  PTC.  Between  2016  and  2018,  an                                                                    
     additional  $55 million  will be  required for  ARRC to                                                                    
     complete  the development  and installation  of PTC  by                                                                    
     2018.  This figure  does not  include the  estimated $5                                                                    
     million  to  $7  million  per  year  of  operating  and                                                                    
     capital maintenance  costs related  to the  system that                                                                    
     ARRC will fund after PTC is installed.                                                                                     
                                                                                                                                
She added that the bond  issuance would leave the additional                                                                    
$18  million  to  complete  the   project  for  the  funding                                                                    
package. She  noted that if  ARRC did  not show that  it was                                                                    
making  a good-faith  effort to  implement PTC,  the Federal                                                                    
Railroad  Administration could  implement fines  up to  $100                                                                    
thousand  per day.  She concluded  her  introduction of  the                                                                    
bill and  mentioned that Bill O'Leary,  ARRC's President and                                                                    
Chief  Executive  Officer,  and Linda  Leary,  ARRC's  Board                                                                    
Chair  were in  the  audience available  for questions.  She                                                                    
also indicated Barbara Amy,  ARRC's Chief Financial Officer,                                                                    
was online and available for questions.                                                                                         
                                                                                                                                
1:38:37 PM                                                                                                                    
                                                                                                                                
Co-Chair   Thompson  relayed   that   Co-Chair  Neuman   and                                                                    
Representative Gattis  had joined  the meeting and  asked if                                                                    
any committee members had questions.                                                                                            
                                                                                                                                
Vice-Chair Saddler wondered  if anyone had any  ideas on how                                                                    
to increase revenue to pay  for the additional $5 million to                                                                    
$7 million per  year for the operational expense  of the PTC                                                                    
system.                                                                                                                         
                                                                                                                                
WILLIAM  G.  O'LEARY,  PRESIDENT AND  CEO,  ALASKA  RAILROAD                                                                    
CORPORATION,  responded that  the $5  million to  $7 million                                                                    
would  be the  ongoing  costs to  maintain  the system  once                                                                    
installed.  He anticipated  taking  the maintenance  funding                                                                    
from  the  railroad's  operating and  capital  budgets.  The                                                                    
railroad had been in a series  of flux with the drops in key                                                                    
revenue streams  including federal  monies. He  thought that                                                                    
funding would be a challenge starting in 2019.                                                                                  
                                                                                                                                
Co-Chair  Thompson asked  about how  much gross  revenue the                                                                    
state received from passenger service.                                                                                          
                                                                                                                                
Mr.  O'Leary estimated  that the  annual  gross revenue  for                                                                    
passenger services  was between $26 million  to $27 million.                                                                    
He reported  that passenger activity  had grown  over recent                                                                    
years.                                                                                                                          
                                                                                                                                
Vice-Chair Saddler asked Mr. O'Leary  if the cost of the PTC                                                                    
was paid  for through passenger fees.  Mr. O'Leary responded                                                                    
in the negative.  He signified that ARRC  would be exploring                                                                    
different revenue  options. He opined that  the railroad was                                                                    
operating  in a  competitive market  place and  raising fees                                                                    
could  lead to  more competition.  He assured  the committee                                                                    
that ARRC would be reevaluating its entire fee structure.                                                                       
                                                                                                                                
1:41:44 PM                                                                                                                    
                                                                                                                                
Representative  Gara  commented  that  over  the  years  the                                                                    
railroad had not made a  consistent net revenue. He wondered                                                                    
about the railroad's net revenue  in real estate operations,                                                                    
for  example,  over the  previous  five  years. Mr.  O'Leary                                                                    
responded that the  revenue bonds would not be  a credit for                                                                    
ARRC. He  continued that the only  supporting revenue stream                                                                    
for the  bonds would  be the Federal  Transit Administration                                                                    
(FTA) formula  monies, federal monies the  railroad received                                                                    
annually. He relayed  that over the previous  ten years ARRC                                                                    
had received between $29 million  to $36 million per year in                                                                    
FTA  funds. The  funds came  as  a result  of ARRC  offering                                                                    
year-round  scheduled  passenger  service.  The  corporation                                                                    
itself had a  net income of $11 million to  $14 million over                                                                    
the previous five years.                                                                                                        
                                                                                                                                
Representative   Gara  asked   if  Mr.   O'Leary  had   full                                                                    
confidence  that the  railroad would  be able  to repay  the                                                                    
revenue bonds.                                                                                                                  
                                                                                                                                
Mr. O'Leary responded that since  the credit of the railroad                                                                    
would not  be supporting  the bonds,  the only  revenue that                                                                    
would  be applied  were FTA  monies. He  furthered that  FTA                                                                    
funds were  up for  reauthorization in  congress as  part of                                                                    
the  national transportation  reauthorization. He  explained                                                                    
that  the funding  that ARRC  received was  part of  formula                                                                    
monies that  supported many other passenger  train lines all                                                                    
over the country.  He expressed his confidence  in the funds                                                                    
continuing  into the  future. Otherwise,  he surmised  there                                                                    
would be too great an impact on the populous of the states.                                                                     
                                                                                                                                
Representative Gara commented that  the bill seemed fine. He                                                                    
expressed concern that  the railroad would come  back to the                                                                    
state for  funds to  pay for  the bonds  in the  future. For                                                                    
example, if ARRC  received $30 million in  federal funds but                                                                    
began to  lose more  than that as  a railroad  operation, he                                                                    
wondered  if ARRC  would come  to the  state for  additional                                                                    
funds. He wanted  to know whether Mr.  O'Leary was confident                                                                    
that ARRC  had enough  internal revenue  to avoid  coming to                                                                    
the state for help with the bond repayment.                                                                                     
                                                                                                                                
Mr.  O'Leary responded,  "Yes." He  explained that  the bond                                                                    
indenture  was  written such  that  the  bond holders'  debt                                                                    
service payments were made before  the federal revenue could                                                                    
be used for any other purpose.                                                                                                  
                                                                                                                                
Representative  Gara suggested  that  ARRC  had been  making                                                                    
approximately $11 million to $14  million in net revenue. He                                                                    
wondered if it included the  $29 million to $36 million from                                                                    
the  federal government.  Otherwise,  he  surmised ARRC  was                                                                    
losing money.                                                                                                                   
                                                                                                                                
Mr.  O'Leary  responded  positively  that  the  net  revenue                                                                    
included the  federal funds. However,  the monies  that came                                                                    
in did  not flow into  net income.  The funds were  used for                                                                    
capital  activities. He  continued that  the FTA  funds were                                                                    
used   for  debt   service  first   and  then   for  capital                                                                    
activities.                                                                                                                     
                                                                                                                                
1:46:17 PM                                                                                                                    
                                                                                                                                
Representative  Gara wanted  to confirm  that ARRC  would be                                                                    
revenue positive even without FTA  funding. He asked that if                                                                    
ARRC was  using the FTA  money for capital expenses  and the                                                                    
funds  were now  pledged to  pay for  the revenue  bond, was                                                                    
there any foreseeable circumstance  in which ARRC would have                                                                    
to come  to the state  for additional money. He  wondered if                                                                    
ARRC would always have a positive net revenue.                                                                                  
                                                                                                                                
Mr.  O'Leary  stated  that  in   his  view  there  would  be                                                                    
sufficient revenue and that ARRC  would not be coming to the                                                                    
state for any kind of operating subsidy.                                                                                        
                                                                                                                                
Representative Wilson  asked about funding for  the previous                                                                    
two years.                                                                                                                      
                                                                                                                                
Mr. O'Leary  responded that in  the past two years  ARRC had                                                                    
received  state  general  fund   (GF)  monies  totaling  $34                                                                    
million.  Prior  to  that, since  1997,  AARC  used  federal                                                                    
monies including  ear marks and  formula funds,  and revenue                                                                    
generated from internal railroad operations.                                                                                    
                                                                                                                                
Representative Wilson asked  why ARRC was not  asking for GF                                                                    
monies.                                                                                                                         
                                                                                                                                
Mr. O'Leary  replied that  ARRC started  out looking  for GF                                                                    
monies,  but was  quickly disabused  of  the notion.  Alaska                                                                    
Railroad  Corporation (ARRC)  was challenged  by members  of                                                                    
the  [Finance] committee  to think  creatively about  how to                                                                    
move the project forward without $55 million in GF funding.                                                                     
                                                                                                                                
Representative Wilson thanked Mr. O'Leary for his efforts.                                                                      
                                                                                                                                
Vice-Chair Saddler asked if other  states had used their FTA                                                                    
revenue  stream to  pay  for PTC.  He  wondered if  Alaska's                                                                    
approach had been used previously.                                                                                              
                                                                                                                                
Mr. O'Leary  confirmed that  the approach  had been  used in                                                                    
other states. He  furthered that ARRC had  used the approach                                                                    
in 2006 when the railroad issued its first bonds.                                                                               
                                                                                                                                
Vice-Chair Saddler asked how it  had worked for the state in                                                                    
the past and for other railroads.                                                                                               
                                                                                                                                
Mr. O'Leary  believed that it  had worked well for  ARRC and                                                                    
for other  railroads to leverage  FTA funds. The  funds were                                                                    
consistent, coming  from FTA,  and provided  the opportunity                                                                    
to  finish projects  that would  have  otherwise taken  much                                                                    
longer to complete.                                                                                                             
                                                                                                                                
Vice-Chair Saddler  asked about the federal  funding stream.                                                                    
He wondered if it stemmed from  a freight surcharge or if it                                                                    
was a full faith in  credit with the federal government. Mr.                                                                    
O'Leary relayed that  the monies came from  the mass transit                                                                    
account in the highway trust fund.                                                                                              
                                                                                                                                
Vice-Chair  Saddler asked  how  the highway  trust fund  was                                                                    
fueled. Mr.  O'Leary responded that  the fund  was augmented                                                                    
by a federal gas tax.                                                                                                           
                                                                                                                                
Representative   Kawasaki   suggested   that   in   previous                                                                    
committee  meetings with  Department  of Transportation  and                                                                    
Public Facilities  it was reported that  the federal highway                                                                    
trust  fund was  shrinking. He  wondered how  ARRC would  be                                                                    
affected.                                                                                                                       
                                                                                                                                
Mr. O'Leary  indicated that  there was  risk in  the federal                                                                    
reauthorization concerning how the  highway trust fund would                                                                    
be  funded  and  at  what   levels.  However,  congress  was                                                                    
investigating different  approaches alternate to a  flat gas                                                                    
tax. He  noted the possibility of  a mileage-based approach.                                                                    
Alaska Railroad  Corporation believed the outflows  from the                                                                    
federal government would continue in a similar form.                                                                            
                                                                                                                                
Co-Chair Thompson signified that  his understanding was that                                                                    
the  bond holders  were aware  of  the risk  of FTA  dollars                                                                    
going away.                                                                                                                     
                                                                                                                                
Mr. O'Leary responded affirmatively.  He reported that there                                                                    
were very  explicit disclosures on all  of the bond-offering                                                                    
documents that showed  there was no pledge of  full faith in                                                                    
credit  of the  state,  nor  of ARRC,  but  rather the  only                                                                    
security  for the  bonds  was the  formula  money that  ARRC                                                                    
received from FTA.                                                                                                              
                                                                                                                                
1:51:00 PM                                                                                                                    
                                                                                                                                
Co-Chair Thompson asked if the  timing was critical for ARRC                                                                    
to secure the bonds in the current year.                                                                                        
                                                                                                                                
Mr.  O'Leary   responded  that  the  timing   was  extremely                                                                    
critical. The  railroad was  not quite  living hand-to-mouth                                                                    
on the  project but explained  that ARRC would need  to have                                                                    
an infusion of cash by June 2015 or July 2015.                                                                                  
                                                                                                                                
Vice-Chair   Saddler   wonder   about  the   interest   rate                                                                    
associated  with the  bonds. Mr.  O'Leary reported  that the                                                                    
modeling ARRC was  doing with a financial  advisor was based                                                                    
on an interest rate below 2.5 percent.                                                                                          
                                                                                                                                
Co-Chair Thompson commented that if  the state waited a year                                                                    
the interest rate  could jump to 5 percent or  7 percent. He                                                                    
added that an interest rate of 2.5 percent was a good rate.                                                                     
                                                                                                                                
Vice-Chair Saddler  asked about what would  happened if ARRC                                                                    
did  not  receive  authority from  the  legislature  in  the                                                                    
current year.                                                                                                                   
                                                                                                                                
Mr.  O'Leary  stated  that ARRC  would  have  a  significant                                                                    
problem. He elaborated  that the railroad would  not be able                                                                    
to  enter into  any  further contracts  or spend  additional                                                                    
funds  which  would  result  in  the  project  coming  to  a                                                                    
complete  halt. Alaska  Railroad  Corporation  would not  be                                                                    
acting in  good faith  in the eyes  of the  Federal Railroad                                                                    
Administration, the railroad  regulator. The consequences of                                                                    
not implementing  PTC within  the designated  timeline could                                                                    
lead to fines of up to  $100 thousand per day and eventually                                                                    
the inability  to provide passenger  service. He  noted that                                                                    
not  only would  ARRC lose  $26  million to  $27 million  in                                                                    
gross revenues  for passenger service, ARRC  would no longer                                                                    
be eligible  to receive FTA  funding. There would be  a very                                                                    
different model  for ARRC going  forward. He referred  to it                                                                    
as a, "death spiral."                                                                                                           
                                                                                                                                
Vice-Chair Saddler followed up by  asking if it was possible                                                                    
that  the   Federal  Railroad  Administration   would  issue                                                                    
waivers for the PTC requirement.                                                                                                
                                                                                                                                
Mr. O'Leary  responded in the  negative. He relayed  that he                                                                    
had recently been in Washington  D.C. the prior week to meet                                                                    
with  Alaska's  congressional  delegation and  with  federal                                                                    
regulators. He  cited that the  consistent message  from all                                                                    
parties was  that there was  no way for  ARRC to get  out of                                                                    
meeting the PTC requirement.                                                                                                    
                                                                                                                                
HB  140  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
Co-Chair  Thompson  relayed  a   personal  story  about  Mr.                                                                    
O'Leary's mom.                                                                                                                  
                                                                                                                                
Representative  Gara interjected  that  he  knew that  Linda                                                                    
Leary was a good fisherman.                                                                                                     
                                                                                                                                
LINDA  LEARY,  BOARD  CHAIR,   BOARD  OF  DIRECTORS,  ALASKA                                                                    
RAILROAD CORPORATION,  thanked the committee for  hearing HB                                                                    
140 and admitted to loving to fish.                                                                                             
                                                                                                                                
Co-Chair  Thompson   acknowledged  Sharon  Kelly   from  the                                                                    
Speaker's  office  and  wished  her  a  happy  birthday.  He                                                                    
followed by bringing up the next agenda item, HB 30.                                                                            
                                                                                                                                
1:56:12 PM                                                                                                                    
                                                                                                                                
HOUSE BILL NO. 30                                                                                                             
                                                                                                                                
     "An  Act  requiring  school districts  to  develop  and                                                                    
     require   completion   of   a   history   of   American                                                                    
     constitutionalism  curriculum  segment;  and  providing                                                                    
     for an effective date."                                                                                                    
                                                                                                                                
REPRESENTATIVE WES  KELLER, SPONSOR,  began by  reading from                                                                    
the sponsor statement:                                                                                                          
                                                                                                                                
     CS  for  House  Bill   30  will  require  the  Alaska's                                                                    
     Department   of  Education   and/or  organized   school                                                                    
     districts  to  implement   curriculum  segments  within                                                                    
     civic  or  history courses  centering  on  15 years  of                                                                    
     American  History  critical  to  the  creation  of  our                                                                    
     country. The program will  concentrate on the documents                                                                    
     that so  many people have  lived and died for  over the                                                                    
     past 239 years. Included in  the course work will be an                                                                    
     understanding  of  the   Declaration  of  Independence,                                                                    
     first state  constitutions, Articles  of Confederation,                                                                    
     and the U.S. Constitution.                                                                                                 
                                                                                                                                
Representative     Keller     proposed     that     American                                                                    
constitutionalism  was   a  beacon.  He  read   from  HB  30                                                                    
beginning on page 1, line 14:                                                                                                   
                                                                                                                                
     (2)   American    constitutionalism   represents   this                                                                    
     country's greatest  gift to human freedom;  its ideals,                                                                    
     ideas,  and  institutions   have  influenced  different                                                                    
     people in different lands at different times.                                                                              
                                                                                                                                
Representative Kelly suggested that  it was best illustrated                                                                    
with a story. He relayed  that approximately 90 to 100 years                                                                    
after  the  constitution  was passed  the  French  had  warm                                                                    
feelings towards  America. He opined that  America would not                                                                    
be a nation without the  French having helped with money and                                                                    
troops.  He continued  to explain  that the  French American                                                                    
founders  were dead  after  90 years  and  most likely  only                                                                    
their grandchildren were alive. He  relayed that at the time                                                                    
France  was under  the  monarchy of  Napoleon  III, who  was                                                                    
known to be oppressive. The French  came up with the idea of                                                                    
building  Americans a  statue,  the Statue  of Liberty.  The                                                                    
official title  of the Statue  of Liberty was,  "The Liberty                                                                    
and Lighting of  the World." Some of  the influential people                                                                    
in France wanted to install a  marker to remind them of what                                                                    
was  happening in  the world.  He conveyed  that the  French                                                                    
were  impressed  with  what   Americans  took  for  granted;                                                                    
inalienable rights  of human beings  such as  life, liberty,                                                                    
and  the pursuit  of happiness.  The Statue  of Liberty  was                                                                    
given to the  U.S. by the French as a  reminder to the world                                                                    
about  American  freedoms. He  remarked  that  there was  an                                                                    
impressive amount  of symbolism in the  statue including the                                                                    
torch and  the crown on  the woman's head with  seven points                                                                    
representing  the seven  continents and  the seven  seas. He                                                                    
reiterated that the  statue was a beacon to  mankind of what                                                                    
had  been enshrined  in  the great  country  of America.  He                                                                    
pointed  out the  tablet tucked  under the  woman's arm  and                                                                    
explained that  it was a  symbol of  the rule of  law rather                                                                    
than of  a monarch. He  reiterated that Americans  took some                                                                    
things for granted. There were  broken chains at the feet of                                                                    
the Statue  of Liberty representing the  consequences of the                                                                    
values of  the U.S.  Constitution resulting  in enslavement.                                                                    
He provided another interesting fact  that July 4, 1776, the                                                                    
date of the  Declaration of Independence, was  listed on the                                                                    
tablet.  He  stressed  the  document's  profoundness  as  it                                                                    
related to America's constitutionalism.                                                                                         
                                                                                                                                
Representative Keller informed the  committee that HB 30 was                                                                    
an  unfunded  mandate.  In  his estimation  it  was  a  soft                                                                    
mandate because high stakes were not involved.                                                                                  
                                                                                                                                
2:02:25 PM                                                                                                                    
                                                                                                                                
Representative  Keller read  from a  letter of  support from                                                                    
the Mat-Su School District to the committee:                                                                                    
                                                                                                                                
     The Mat-Su Borough School District  would like to offer                                                                    
     support for  HB 30,  Constitutional History.  It embeds                                                                    
     the teaching  of the Constitution  and the  teaching of                                                                    
     the  original documents  that  helped  our country  and                                                                    
     governing  system in  our  required  civics course.  We                                                                    
     concur with the importance of this.                                                                                        
                                                                                                                                
Representative  Keller  reported  that the  school  district                                                                    
also spoke  against a mandated  test which he  confirmed was                                                                    
not  part  of  the  curriculum  requirement  in  HB  30.  He                                                                    
continued to explain  that the bill was  an unfunded mandate                                                                    
and  suggested  that  many  school  districts  were  already                                                                    
teaching the  curriculum. He voiced that  all schools should                                                                    
be  teaching American  constitutionalism, as  the curriculum                                                                    
covered  fundamental issues  to  the U.S.  He was  concerned                                                                    
with   people   forgetting   the   country's   history.   He                                                                    
communicated that when  he reread the history  of the Statue                                                                    
of Liberty  he realized how  much he had taken  for granted.                                                                    
He appreciated  the reinforcement  that came  from reviewing                                                                    
the history. He indicated he  was open to questions from the                                                                    
committee.                                                                                                                      
                                                                                                                                
Co-Chair  Thompson   read  from   page  19  of   the  Alaska                                                                    
Standards:  Content  and  Performance Standards  for  Alaska                                                                    
Students:                                                                                                                       
                                                                                                                                
     A student who meets the content standard should:                                                                           
                                                                                                                                
     1) understand  the ideals of  this nation  as expressed                                                                    
     in the  Declaration of Independence, the  United States                                                                    
     Constitution, and the Bill of Rights;                                                                                      
                                                                                                                                
     2) recognize  American heritage and  culture, including                                                                    
     the  republican form  of  government, capitalism,  free                                                                    
     enterprise  system,  patriotism, strong  family  units,                                                                    
     and freedom of religion;                                                                                                   
                                                                                                                                
     3)   understand   the   United   States   Constitution,                                                                    
     including   separation   of  powers,   the   executive,                                                                    
     legislative,  and  judicial   branches  of  government,                                                                    
     majority rule, and minority rights;                                                                                        
                                                                                                                                
     4)  know how  power  is shared  in  the United  States'                                                                    
     constitutional  government at  the federal,  state, and                                                                    
     local levels;                                                                                                              
                                                                                                                                
     5)  understand the  importance  of individuals,  public                                                                    
     opinion,  media, political  parties, associations,  and                                                                    
     groups in forming and carrying out public policy;                                                                          
                                                                                                                                
     6)  recognize  the  significance of  diversity  in  the                                                                    
     American political system;                                                                                                 
                                                                                                                                
     7) distinguish between constitution-based ideals and                                                                       
    the reality of American political and social life;                                                                          
                                                                                                                                
     8) understand the place of law in the American                                                                             
     political system; and                                                                                                      
                                                                                                                                
     9) recognize the role of dissent in the American                                                                           
     political system.                                                                                                          
                                                                                                                                
Co-Chair   Thompson  asked   if   the   bill  was   creating                                                                    
duplication   or  adding   to  the   list  of   the  already                                                                    
established standards.                                                                                                          
                                                                                                                                
Representative  Keller responded  that from  his perspective                                                                    
he wanted an additional  history requirement. He crafted the                                                                    
bill such  that the curriculum  was a segment that  could be                                                                    
inserted where  appropriate such as  in a civics  course. He                                                                    
claimed  that   his  legislation   added  emphasis   to  the                                                                    
established standards.  He was unclear about  the details of                                                                    
how well the standards were fulfilled.                                                                                          
                                                                                                                                
Co-Chair Thompson asked Commissioner  Hanley if the bill was                                                                    
duplicative and whether schools  were abiding by the current                                                                    
Alaska Content Standards.                                                                                                       
                                                                                                                                
2:06:25 PM                                                                                                                    
                                                                                                                                
COMMISSIONER  MICHAEL  HANLEY, COMMISSIONER,  DEPARTMENT  OF                                                                    
EDUCATION   AND  EARLY   DEVELOPMENT,  confirmed   that  the                                                                    
standards  in  Representative  Keller's  bill  were  in  the                                                                    
Alaska  Content  Standards.  He   commented  that  the  bill                                                                    
clarified a  couple of components  that were implied  in the                                                                    
standards but were pointedly emphasized in HB 30.                                                                               
                                                                                                                                
Co-Chair  Thompson asked  Commissioner  Hanley  if the  bill                                                                    
would result  in additional monies  and costs to  the school                                                                    
districts.                                                                                                                      
                                                                                                                                
Commissioner   Hanley  pointed   out   that   there  was   a                                                                    
responsibility to  the state's school districts  in that the                                                                    
chief  administrator of  each school  would have  to develop                                                                    
and submit  a syllabus to  the governing body.  He explained                                                                    
that it was not a  separate course, but a curriculum segment                                                                    
that would be  incorporated into a course.  He believed that                                                                    
many  of  the school  districts  were  already teaching  the                                                                    
segment  content in  their current  curriculum. However,  he                                                                    
claimed there would be some  schools that would need to make                                                                    
some additions and changes.                                                                                                     
                                                                                                                                
Vice-Chair Saddler  asked if the commissioner  felt that the                                                                    
Alaska Content Standards already covered the content.                                                                           
                                                                                                                                
Commissioner   Hanley   indicated   that  there   could   be                                                                    
duplicity.   However,  he   noted   that  the   foundational                                                                    
documents   specified  in   the  bill   were  not   directly                                                                    
represented in  the Alaska Content Standards.  House Bill 30                                                                    
would bring greater focus on particular components.                                                                             
                                                                                                                                
Vice-Chair  Saddler  asked  if   the  commissioner  saw  the                                                                    
requirements of  the bill as  teaching the  U.S Constitution                                                                    
or constitutionalism.                                                                                                           
                                                                                                                                
Commissioner  Hanley  wondered  if  Vice-Chair  Saddler  was                                                                    
asking for his interpretation of the sponsor's bill.                                                                            
                                                                                                                                
Vice-Chair Saddler responded affirmatively.                                                                                     
                                                                                                                                
Representative Keller  explained that  the reason  "ism" was                                                                    
included  in  the  bill  was   because  his  intent  was  to                                                                    
incorporate the values around the  U.S. Constitution. He was                                                                    
concerned with including  the values that were  in the minds                                                                    
and  hearts  of  the  American  founders.  He  claimed  that                                                                    
looking at  the values was  important and distinctive  to HB                                                                    
30.                                                                                                                             
                                                                                                                                
Representative  Keller wanted  to make  a clarification.  He                                                                    
relayed  that  he  had  said   previously  that  his  school                                                                    
district supported  the bill  based on  a letter  of support                                                                    
from   Mr.   Gene   Stone,   Assistant   Superintendent   of                                                                    
Instruction   for  the   Matanuska-Susitna  Borough   School                                                                    
District. However,  Mr. Stone  was not  necessarily speaking                                                                    
on behalf  of the school  district. He wanted to  stress the                                                                    
point of correction.                                                                                                            
                                                                                                                                
Representative   Gara  informed   the  committee   that  the                                                                    
Matanuska-Susitna Borough School  District and the Anchorage                                                                    
School District  taught U.S. History  and included  the U.S.                                                                    
Constitution,  the Bill  of Rights,  and the  Declaration of                                                                    
Independence  as  part  of the  course  curriculum.  He  was                                                                    
unable  to find  any  district  in the  state  that did  not                                                                    
include these  items. He asked  Commissioner Hanley  if knew                                                                    
of any district that did not include them.                                                                                      
                                                                                                                                
Representative  Keller  conveyed  that he  did  not  believe                                                                    
there  was enough  understanding  of  the historical  issues                                                                    
brought forth  in his  bill. He admitted  that his  view was                                                                    
subjective  based on  his children's  educational experience                                                                    
and his own.                                                                                                                    
                                                                                                                                
2:11:39 PM                                                                                                                    
                                                                                                                                
Representative   Gara  reiterated   that  Alaska's   Content                                                                    
Standards  already   required  the  teaching  of   the  U.S.                                                                    
Constitution, the Declaration of  Independence, and the Bill                                                                    
of  Rights. Commissioner  Hanley  had  commented that  there                                                                    
were different foundational documents  specified in the bill                                                                    
on page  2, paragraph 4  [line 5-10].  He wanted to  know if                                                                    
Commissioner  Hanley was  referring to  the first  15 years-                                                                    
worth of documents.                                                                                                             
                                                                                                                                
Mr. Hanley responded affirmatively.                                                                                             
                                                                                                                                
Representative  Gara expressed  some concern.  Currently the                                                                    
state was required  to teach the full  U.S Constitution, the                                                                    
Bill  of Rights,  and the  Declaration  of Independence.  He                                                                    
cited that  paragraph 4 on  page 2 talked about  the special                                                                    
importance of the  first 15 years of  documents. Events such                                                                    
as a woman's right to vote,  the right to vote regardless of                                                                    
race, the  abolishment of slavery,  and the adoption  of the                                                                    
equal protection clause all occurred  following the first 15                                                                    
years  of  U.S. history.  He  expressed  concerned with  the                                                                    
latter   items   were   of  less   importance.   He   wanted                                                                    
clarification  about the  emphasis in  HB 30  placed on  the                                                                    
foundational documents  versus the  emphasis in  the current                                                                    
standards.                                                                                                                      
                                                                                                                                
Representative Keller  responded that, in his  view, many of                                                                    
the things  that have gone  right in the U.S.  including the                                                                    
ending of slavery,  the increase of women's  rights, and the                                                                    
increase in human rights were  products of the "ism" portion                                                                    
enshrined within  the first 15-year period  of U.S. history.                                                                    
He believed  the history that Representative  Gara mentioned                                                                    
was in large  part based on the values evident  in the early                                                                    
documents. He added  that the list of the  documents was not                                                                    
exclusive. He suggested that the  bill emphasized the values                                                                    
of the time period which  made America great. He opined that                                                                    
the documents  were instrumental  in changing  and enhancing                                                                    
human rights. He suggested that  a student who was trying to                                                                    
determine whether something was  a violation of human rights                                                                    
would  be at  an  advantage knowing  the  basis of  American                                                                    
values and their origins.                                                                                                       
                                                                                                                                
Representative  Gara   commented  that  the  parts   of  the                                                                    
constitution that  came after the  first 15  years including                                                                    
the abolishment  of slavery,  a woman's  right to  vote, and                                                                    
the right for all races  to vote, were equally important. He                                                                    
wondered  if  they  would  continue  to  be  taught  in  the                                                                    
classroom.  He asked  Commissioner Mr.  Hanley how  the bill                                                                    
was  different  from  the current  mandated  curriculum.  He                                                                    
wanted  clarification  about   the  difference  Commissioner                                                                    
Hanley had referred to earlier in the meeting.                                                                                  
                                                                                                                                
Representative  Keller clarified  that  the bill  in no  way                                                                    
restricted the  history curriculum.  He stressed that  HB 30                                                                    
was an emphasis bill on American constitutionalism.                                                                             
                                                                                                                                
Representative  Gara wondered  how  the  bill was  different                                                                    
from   the   requirements   outlined  in   the   established                                                                    
standards.                                                                                                                      
                                                                                                                                
Mr. Hanley  stated that  the bill  was duplicative  for some                                                                    
school districts.  He relayed that some  districts that were                                                                    
not   specifically   addressing   documents  such   as   the                                                                    
Federalist  Papers might  have to  make some  adjustments to                                                                    
their curriculum with the passing of HB 30.                                                                                     
                                                                                                                                
2:16:52 PM                                                                                                                    
                                                                                                                                
Representative Kawasaki  asked if  there were  any districts                                                                    
not teaching  the curriculum. He  mentioned that  he learned                                                                    
how  a bill  became  a law  in the  second  grade through  a                                                                    
School House Rock video.                                                                                                        
                                                                                                                                
Mr.  Hanley relayed  that he  was  not aware  of any  school                                                                    
districts that  were not  already teaching  Alaska's content                                                                    
standards.                                                                                                                      
                                                                                                                                
Representative Kawasaki  referred to  Section 2 of  the bill                                                                    
which  required   secondary  schools  to  teach   a  defined                                                                    
curriculum. He then made reference  to Section 3b which said                                                                    
that a district could not issue  a diploma to a student that                                                                    
did  not successfully  complete  the course.  He provided  a                                                                    
hypothetical  scenario  in  which  a  student  falls  asleep                                                                    
during   a  government   class.  He   wondered  under   such                                                                    
circumstances  if  the  student  would  remain  eligible  to                                                                    
receive a diploma.                                                                                                              
                                                                                                                                
Representative   Keller  responded   in  the   negative.  He                                                                    
suggested  that  the  bill  required  the  administrator  of                                                                    
schools  to provide  the course  description in  a syllabus.                                                                    
The idea was to ensure  that the student knew the curriculum                                                                    
through testing. He returned to  the question about the bill                                                                    
being duplicitous.  He pointed out that  the state standards                                                                    
were not  state law. He  wanted to place higher  emphasis on                                                                    
the curriculum  even if  the bill was  crafted to  match the                                                                    
Alaska State  Standards verbatim.  He wanted  the curriculum                                                                    
placed in statute.                                                                                                              
                                                                                                                                
Representative Kawasaki  asked if  there were  any statutory                                                                    
requirements dictating students to  take a certain number of                                                                    
math or English classes.                                                                                                        
                                                                                                                                
Mr.  Hanley highlighted  Alaska Studies  as the  only course                                                                    
requirement defined by either law or regulation.                                                                                
                                                                                                                                
Representative Kawasaki wondered if  the rest of the courses                                                                    
were part of Alaska's regulations.                                                                                              
                                                                                                                                
Mr. Hanley  responded that the  Alaska State  Standards were                                                                    
adopted by reference into regulation.                                                                                           
                                                                                                                                
Representative  Kawasaki asked  the bill  sponsor about  the                                                                    
first  couple of  legislative findings  and the  use of  the                                                                    
word values.  He asked if  Representative Keller  thought it                                                                    
was the responsibility of state schools to teach values.                                                                        
                                                                                                                                
Representative Keller responded  affirmatively in regards to                                                                    
constitutionalism values. He suggested  that the values were                                                                    
the  foundation of  the  United States,  the  basis for  the                                                                    
country's liberty, and  the reason for so  many people going                                                                    
to  war to  defend  the  country. He  pointed  out that  the                                                                    
values he  was referring to  were not ones he  was defining,                                                                    
but  were  ones  captured  in the  word  "ism"  specifically                                                                    
related to  the early  state constitutions,  the Declaration                                                                    
of   Independence,  the   Articles  of   Confederation,  the                                                                    
declaration articles,  and the  Bill of Rights.  He believed                                                                    
the  state  was in  danger  of  taking the  information  for                                                                    
granted.                                                                                                                        
                                                                                                                                
2:21:22 PM                                                                                                                    
                                                                                                                                
Co-Chair Thompson mentioned that  there was a question about                                                                    
whether there were  any school districts that  did not teach                                                                    
the U.S Constitution. He read  from a letter from the Alaska                                                                    
Municipal League (AML):                                                                                                         
                                                                                                                                
     While  the concept  of teaching  our  young people  the                                                                    
     basics of  our U.S.  Constitution is a  laudatory goal,                                                                    
     it seems  that this  is not  the time  to put  one more                                                                    
     unfunded  mandate in  front of  all of  Alaska's school                                                                    
     districts. On  introduction of the bill,  you mentioned                                                                    
     that  most  schools  are already  doing  this,  so  you                                                                    
     visualize  very little  cost involved.  While Anchorage                                                                    
     may be  doing this,  I am fairly  certain that  this is                                                                    
     not  necessarily  being   done  in  Craig,  Dillingham,                                                                    
     Galena,  Hoonah, Hydaburg,  Kake,  King Cove,  Klawock,                                                                    
     Pelican, Saint Mary's, Seldovia,  and Tanana (all First                                                                    
     Class   cities  responsible   for   their  own   school                                                                    
     district).                                                                                                                 
                                                                                                                                
He conveyed  that AML expressed  concern and  disfavor about                                                                    
instituting an  unfunded mandate for new  curriculum for the                                                                    
above listed schools.                                                                                                           
                                                                                                                                
Representative  Wilson asked  Commissioner  Hanley if  there                                                                    
would  be a  problem incorporating  the proposed  curriculum                                                                    
into the Alaska Content Standards.                                                                                              
                                                                                                                                
Mr. Hanley  offered that  he could take  the request  to the                                                                    
state board for consideration.  He outlined the process; the                                                                    
board reviewed  the current  state standards,  evaluated how                                                                    
the  additional   curriculum  would   be  folded   into  the                                                                    
standards,  allowed  for a  period  of  public comment,  and                                                                    
submitted a  proposal for adoption.  He mentioned  the value                                                                    
of having changes placed into statute as well.                                                                                  
                                                                                                                                
Representative  Wilson was  concerned that  some schools  in                                                                    
Alaska were  not teaching the Alaska  Content standards. She                                                                    
relayed  that  she had  spoken  previously  to some  of  the                                                                    
schools in her  district and did not find any  that were not                                                                    
teaching  the  curriculum.  She   asked  the  bill  sponsor,                                                                    
referring to  page 2, about the  language used, specifically                                                                    
the word  ensure. She wondered  how a school would  ensure a                                                                    
student's understanding  of American  constitutionalism. She                                                                    
provided  a personal  illustration;  she  explained that  in                                                                    
eighth grade a  student had to know elements  of the state's                                                                    
history.  A student  had to  be able  to identify  the state                                                                    
comptroller  and  the governor.  She  relayed  that in  high                                                                    
school  she had  to know  similar information  proven in  an                                                                    
exam.  She  wanted  to  know  how  to  measure  a  student's                                                                    
knowledge.   She  also   pressed  for   the  definition   of                                                                    
"successful" in terms of a grade.                                                                                               
                                                                                                                                
Representative  Keller  explained   that  the  reference  to                                                                    
ensuring  a student's  knowledge was  meant to  describe the                                                                    
syllabus. He furthered that a  syllabus was a description of                                                                    
a  course  that  defined  content,   hours,  and  perhaps  a                                                                    
classroom  discussion  to  measure  success  rather  than  a                                                                    
grade.  He referred  to page  2, line  26 that  provided the                                                                    
standard;  successfully  completing  the course.  He  stated                                                                    
that  it was  conceivable  that the  syllabus  might not  be                                                                    
based  on  testing  but  rather   on  attendance  and  class                                                                    
participation.  He  trusted  the  teachers  to  ensure  that                                                                    
students learned the curriculum.  He believed that there was                                                                    
a  sincere effort  by the  teachers  and the  administrators                                                                    
within Alaska  to provide students with  the information. He                                                                    
added  that  there  was  no   standard  test  to  measure  a                                                                    
student's knowledge  of the  curriculum. He  elaborated that                                                                    
the syllabus  defined what  information the  teachers needed                                                                    
to present  to students. He  added that  it was part  of the                                                                    
job of a teacher.                                                                                                               
                                                                                                                                
2:26:36 PM                                                                                                                    
                                                                                                                                
Representative  Wilson asked  who determined  the completion                                                                    
of a course.  She asked if there would be  an indicator on a                                                                    
transcript. She also wondered how  and where a teacher would                                                                    
report that a student completed a course.                                                                                       
                                                                                                                                
Representative Keller  replied that  the intent of  the bill                                                                    
was  not  to  micromanage.   He  furthered  that  successful                                                                    
completion would be when a  child successfully completed the                                                                    
course  in which  the curriculum  segment  was embedded.  He                                                                    
remarked that it  was a simple mandate  instructing a school                                                                    
district to get the job done.                                                                                                   
                                                                                                                                
Representative Wilson  suggested that her point  was that if                                                                    
a child  were to  change districts,  one school  board might                                                                    
have  a different  interpretation than  another. She  opined                                                                    
that the  curriculum was  not clearly  defined. She  did not                                                                    
want a student to have to retake a segment.                                                                                     
                                                                                                                                
Representative Gattis  thanked the sponsor for  bringing the                                                                    
bill forward and instigating the  conversation. She asked if                                                                    
there were  any changes  from the old  and new  standards in                                                                    
regards to the bill.                                                                                                            
                                                                                                                                
Mr.  Hanley  responded  that the  social  studies  standards                                                                    
remained unchanged.  He reported that the  English, Language                                                                    
Arts,  and math  standards  had been  altered. He  mentioned                                                                    
that  in   Alaska's  English  and  Language   Arts  section,                                                                    
previously  referred to  as  reading  and writing,  specific                                                                    
documents  were  identified  such  as the  preamble  to  the                                                                    
Declaration   of   Independence   and   other   foundational                                                                    
documents.                                                                                                                      
                                                                                                                                
Representative Gattis  asked about  how to determine  if the                                                                    
standards were currently being  taught statewide. She stated                                                                    
that a  bill could be  crafted to ensure that  the standards                                                                    
were  being   taught.  She  noted  that   the  bill  sponsor                                                                    
mentioned  trusting  the  teachers  to  do  their  job.  She                                                                    
wondered  how the  Commissioner knew  whether teachers  were                                                                    
teaching the state's standards.                                                                                                 
                                                                                                                                
Mr. Hanley  commented that the  Department of  Education and                                                                    
Early Development  (DEED) did  not micromanage  teachers. He                                                                    
was disappointed  and concerned  to hear that  districts had                                                                    
voluntarily said that they were  not teaching Alaska Content                                                                    
Standards.  He relayed  that the  department did  not review                                                                    
each district's curriculum  to see if they  were teaching to                                                                    
the  standards. Instead,  reading,  writing,  and math  were                                                                    
assessed. The state  did not have a  separate assessment for                                                                    
social   studies,   nor   was    he   promoting   one.   The                                                                    
responsibility belonged to local school districts.                                                                              
                                                                                                                                
Representative  Gattis  commented,  "There lies  the  bigger                                                                    
problem." She better understood  the bill sponsor's concern.                                                                    
She relayed  that she  had been on  the Mat-Su  school board                                                                    
and  had  experience in  dealing  with  civics classes.  She                                                                    
noted that  districts were able  to choose what part  of the                                                                    
standards to  focus on.  She opined that  the state  was not                                                                    
doing what it  had done 30 to 40 years  prior. She wanted to                                                                    
know who was responsible for  ensuring that the schools were                                                                    
teaching  what  the state  paid  in  significant funding  to                                                                    
teach in Alaska's schools.                                                                                                      
                                                                                                                                
Mr.  Hanley answered  that the  responsibility  laid in  the                                                                    
hands  of  the local  school  boards.  He communicated  that                                                                    
school boards adopted their  district's school curriculum to                                                                    
be aligned with  the state's standards. He  shared that when                                                                    
the department  found that districts were  not in compliance                                                                    
or  not following  through with  their responsibilities  the                                                                    
department  then   followed  through.  He  added   that  the                                                                    
department did not have the  staff to review each district's                                                                    
curriculum to ensure alignment.                                                                                                 
                                                                                                                                
Representative Gattis thanked Commissioner Hanley.                                                                              
                                                                                                                                
2:32:33 PM                                                                                                                    
                                                                                                                                
Vice-Chair Saddler commented that he  did not see any intent                                                                    
in  the language  of the  bill  or in  the sponsor's  words,                                                                    
referring to page  2, lines 5 through 10,  that slighted the                                                                    
changes made over time to  the U.S. Constitution. Nor did he                                                                    
note  any  desire  to  limit the  scope  of  the  curriculum                                                                    
segment   to  just   the  first   15  years   of  the   U.S.                                                                    
Constitution. He relayed  that it simply said  that the U.S.                                                                    
Constitution  was  one  of  several  foundational  documents                                                                    
written  over  15  years  that  should  be  the  subject  of                                                                    
consideration.  He asked  if the  bill required  each school                                                                    
district to  develop its  own curriculum  segment, or  if it                                                                    
was  possible for  school districts  that currently  offered                                                                    
appropriate segments to share  them with other districts for                                                                    
adoption.                                                                                                                       
                                                                                                                                
Representative Keller  reassured the  committee that  it was                                                                    
not his intent for every  school district to design a unique                                                                    
curriculum segment. He suggested  that one of the advantages                                                                    
of  the bill  was that  the smaller  districts could  borrow                                                                    
curriculum from other districts.  He highlighted that in his                                                                    
district a class called in  with enthusiasm regarding HB 30.                                                                    
The teacher of the class  had already developed a curriculum                                                                    
segment. He knew the teacher  personally and was certain the                                                                    
curriculum  could be  made available  to  any district  upon                                                                    
request. He  shared that  he had  written curriculum  in the                                                                    
past and  that it  was a significant  job. He  surmised that                                                                    
with knowledge of the subject it  might take a teacher a day                                                                    
or two  to design  the specific curriculum  segment required                                                                    
in the bill.                                                                                                                    
                                                                                                                                
Vice-Chair Saddler suggested that  while the bill created an                                                                    
unfunded mandate  it would not  necessarily be  an expensive                                                                    
mandate for  many of the  school districts in  Alaska. There                                                                    
were districts that already had  such curriculum segments in                                                                    
place.  He  thought  it  would  be  cost-effective  for  all                                                                    
districts in  Alaska to adopt  a curriculum  currently being                                                                    
taught.                                                                                                                         
                                                                                                                                
Representative  Kawasaki asked  if the  sponsor's definition                                                                    
of  the word  constitutionalism was  the meaning  written by                                                                    
David Fellman.                                                                                                                  
                                                                                                                                
Representative Keller  replied that the content  of the bill                                                                    
was the  closest to the definition  of constitutionalism. He                                                                    
referred   to  page   2,  line   20   which  read   American                                                                    
Constitutionalism  "as portrayed"  in the  documents listed.                                                                    
He explained the  reason he used the term was  because of an                                                                    
inspirational      text      book     titled,      "American                                                                    
Constitutionalism:  A  Shot  Heard Around  the  World."  The                                                                    
author called  attention to nations around  the Atlantic rim                                                                    
being  impacted  by  observing  what  happened  in  America,                                                                    
trying   to  duplicate   it  in   their  own   country,  and                                                                    
experiencing varying  levels of  success. The  author traced                                                                    
America's  history.  The  sponsor   confirmed  that  he  was                                                                    
intrigued  with the  book  and  felt the  term  was easy  to                                                                    
understand.                                                                                                                     
                                                                                                                                
2:36:42 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki   did  not  feel  that   the  term,                                                                    
constitutionalism,  was  easy  for  him  to  understand.  He                                                                    
suggested that Representative Keller  had just used the word                                                                    
itself to  define constitutionalism.  He speculated  that if                                                                    
the sponsor  was using  the definition  by David  Fellmen it                                                                    
would be easier to understand.                                                                                                  
                                                                                                                                
Representative    Keller    asked   about    the    document                                                                    
Representative Kawasaki referenced.                                                                                             
                                                                                                                                
Representative  Kawasaki responded  that it  was a  document                                                                    
that was  submitted by the  bill sponsor. He  indicated that                                                                    
the   document  titled   "Constitutionalism"  quoted   David                                                                    
Fellman, a constitutional scholar.  The document was part of                                                                    
the bill packet.                                                                                                                
                                                                                                                                
Representative Keller  stated that it was  included in order                                                                    
to provide context and an additional reference.                                                                                 
                                                                                                                                
Representative   Kawasaki   read    from   David   Fellman's                                                                    
definition of constitutionalism:                                                                                                
                                                                                                                                
     "Whatever particular form  of government a constitution                                                                    
     delineates, however,  it serves as the  keystone of the                                                                    
     arch  of constitutionalism,  except in  those countries                                                                    
     whose written constitutions are mere sham."                                                                                
                                                                                                                                
Representative Kawasaki continued reading:                                                                                      
                                                                                                                                
     "This is by no means a modern idea, for the concept of                                                                     
     a higher law which spells out the basic norms of a                                                                         
     political society is as old as Western civilization."                                                                      
                                                                                                                                
Representative  Kawasaki  wondered  if the  state  was  only                                                                    
teaching constitutionalism under Western civilization.                                                                          
                                                                                                                                
Representative  Keller  responded  affirmatively.  He  added                                                                    
that  the point  was that  American constitutionalism  had a                                                                    
huge impact on  the world. He emphasized  that children went                                                                    
to war  to defend  the U.S.  Constitution. He  observed that                                                                    
there was nothing  in the bill that said the  teacher or the                                                                    
school  district should  brainwash their  children to  think                                                                    
just like  Western America. He  believed that a  student had                                                                    
the right  to have a  better understanding of  the country's                                                                    
history and the principles that  were in place when the U.S.                                                                    
Constitution  was  written.  He  felt that  it  was  a  weak                                                                    
argument  to  suggest  that  kids   should  not  know  their                                                                    
history. He  relayed that it  was Western in the  sense that                                                                    
America was Western.                                                                                                            
                                                                                                                                
Representative Kawasaki  elaborated that the author  went on                                                                    
to say that  it was the concept of a  limited government. He                                                                    
proposed  that the  line  of thinking  was  the opposite  of                                                                    
current  thought. He  highlighted the  irony of  hearing and                                                                    
almost passing  a bill on  the previous day that  he thought                                                                    
was entirely unconstitutional.                                                                                                  
                                                                                                                                
2:39:36 PM                                                                                                                    
                                                                                                                                
Co-Chair Neuman asked Mr. Hanley  if DEED would have to hire                                                                    
additional positions  to enforce the curriculum.  Mr. Hanley                                                                    
clarified the  difference between standards  and curriculum.                                                                    
He voiced  that standards  were simply expectations  such as                                                                    
reading,  writing, math,  and content  standards for  social                                                                    
studies  that had  not been  updated  recently. He  believed                                                                    
that  the  requirement fit  well  into  the state's  current                                                                    
content  standards which  did not  need updating.  Districts                                                                    
would  continue to  be responsible  for  determining how  to                                                                    
meet the standards with their own curriculum choices.                                                                           
                                                                                                                                
Co-Chair Neuman  referred to page  2, Section 3b,  lines 25-                                                                    
27. He read the portion of the bill:                                                                                            
                                                                                                                                
     A district may not issue  a secondary school diploma to                                                                    
     a  student  who  does  not  successfully  complete  the                                                                    
     course  in which  the curriculum  segment described  in                                                                    
     (a) of this section is contained.                                                                                          
                                                                                                                                
He  spoke  about legislation  from  the  previous year  that                                                                    
allowed  DEED to  retroactively issue  diplomas to  students                                                                    
that had  not passed  the high school  graduation qualifying                                                                    
exam  (HSQED). He  asked how  students  would receive  their                                                                    
diploma. He was unclear.                                                                                                        
                                                                                                                                
Mr. Hanley  explained that in the  previous year legislation                                                                    
removed the  HSQED, a barrier  assessment. He noted  that if                                                                    
students  had   met  all  other  criteria   including  their                                                                    
curricular  course requirements  to graduate  and the  HSQED                                                                    
was  the only  thing  stopping them  they  could request  to                                                                    
receive their diploma. They were  required to meet all other                                                                    
course requirements.  It did not  allow school  districts to                                                                    
remove courses, it  only allowed them to  use the assessment                                                                    
as the barrier  to a student's diploma.  He anticipated that                                                                    
if the  bill passed  it would be  a required  social studies                                                                    
course for graduation. Regulations  would likely be added to                                                                    
clarify that the components proposed  in the bill would need                                                                    
to be  included into another social  studies course required                                                                    
for graduation.                                                                                                                 
                                                                                                                                
2:43:15 PM                                                                                                                    
                                                                                                                                
Co-Chair  Neuman  discussed  being  a home  school  dad.  He                                                                    
reported being  a part  of the  Galena Home  School Program,                                                                    
the  largest school  in the  state with  over 3800  students                                                                    
enrolled. He added  that he thought there were  more than 10                                                                    
thousand home  school kids  in the  state. He  described his                                                                    
feeling standing next to the  Lincoln Memorial in Washington                                                                    
D.C.  as  energizing.  He  was   able  to  choose  the  best                                                                    
curriculum for  his children  as a  home school  parent. The                                                                    
Ideal program required  parents to make a  selection. He was                                                                    
not sure  he could have  taught his children  the curriculum                                                                    
that was required  in the bill. He asked how  a parent would                                                                    
be expected to handle a similar situation.                                                                                      
                                                                                                                                
Mr.  Hanley replied  that  the  responsibility would  likely                                                                    
fall  on  the  commissioner.  It would  become  one  of  the                                                                    
required  curriculum   segments  listed  in  the   bill.  He                                                                    
furthered that no  matter what curriculum a  parent chose as                                                                    
a parent.  Upon the passage  of the bill  certain components                                                                    
would be required  as part of a course. A  parent would have                                                                    
to confirm the completion of  the segment in order for their                                                                    
children to receive their diplomas.                                                                                             
                                                                                                                                
2:47:21 PM                                                                                                                    
                                                                                                                                
Co-Chair  Neuman  asked if  there  were  any other  required                                                                    
curriculums in math, English, reading  and writing that were                                                                    
required for homeschool parents.                                                                                                
                                                                                                                                
Mr.  Hanley  responded that  the  only  course that  he  had                                                                    
referenced earlier  was the Alaska Studies  Course which was                                                                    
required as one of the social studies credits.                                                                                  
                                                                                                                                
Co-Chair   Neuman  asked   if   there   were  any   required                                                                    
curriculums  for   math  or  English.   Commissioner  Hanley                                                                    
responded in the negative.                                                                                                      
                                                                                                                                
Co-Chair Neuman  conveyed that  he had  fought hard  to make                                                                    
sure  that  there were  home  school  opportunities. He  was                                                                    
aware  that  the sponsor  of  the  bill supported  the  home                                                                    
school model.  He wondered how  the requirement  outlined in                                                                    
the  bill would  affect home  school programs.  He expressed                                                                    
his  concern  in  mandating  parents   to  teach  a  certain                                                                    
curriculum. He  relayed his own  experience in which  he was                                                                    
able to choose his own curriculum for his children.                                                                             
                                                                                                                                
Representative  Keller responded  that  the  mandate of  the                                                                    
bill would apply to the  home school student receiving state                                                                    
funds. He  opined that it  was a soft mandate  that deserved                                                                    
to be placed at a  significant level of importance, at least                                                                    
in   regards   to   Alaskan    history.   He   was   certain                                                                    
Representative  Neuman had  taught his  children the  values                                                                    
that would be included in  the proposed mandate. If a parent                                                                    
refused to teach the proposed  curriculum while taking state                                                                    
funds, certain  repercussions would  have to  be determined.                                                                    
He  relayed that  his grandchildren  participated in  a home                                                                    
school program  and confirmed  that there  were requirements                                                                    
that were  imposed when taking  state funds. The  mandate of                                                                    
the bill would be one of the requirements.                                                                                      
                                                                                                                                
Vice-Chair Saddler read  the definition of constitutionalism                                                                    
from   Webster's  New   World  Dictionary,   Second  College                                                                    
Edition:                                                                                                                        
                                                                                                                                
     Constitutionalism is government according to a                                                                             
     constitution or adherence to constitutional principles                                                                     
     or government.                                                                                                             
                                                                                                                                
Vice-Chair Saddler asked Representative  Keller if he agreed                                                                    
that it was a fair definition of constitutionalism.                                                                             
                                                                                                                                
Representative  Keller  responded,  "Far   be  it  from  me,                                                                    
Representative  Saddler, through  the chair,  to argue  with                                                                    
Webster."                                                                                                                       
                                                                                                                                
2:50:26 PM                                                                                                                    
                                                                                                                                
Representative Gara  wondered about the meaning  of the term                                                                    
constitutionalism.  He  agreed with  Representative  Saddler                                                                    
that a definition  referenced in the bill  would be helpful.                                                                    
He suggested  that in looking  at the literature  there were                                                                    
radically  left-wing  versions   and  profoundly  right-wing                                                                    
versions of the meaning  of constitutionalism. He referenced                                                                    
a law review article from  the University of Louisville that                                                                    
presented  a   very  narrow  version   of  the   meaning  of                                                                    
constitutionalism  and cited  the case,  Brown vs.  Board of                                                                    
Education. The  case had to  do with whether there  could be                                                                    
white-only  schools. He  wanted to  make sure  that children                                                                    
would  have  the right  to  have  a  free debate  about  the                                                                    
meaning of  the terms of  the constitution. In  other words,                                                                    
he  did  not  want  any  particular  philosophy  imposed  on                                                                    
children when interpreting the word constitutionalism.                                                                          
                                                                                                                                
Representative Keller  referred to HB  30, page 2,  line 20.                                                                    
He pointed  to the words  "as portrayed." He  suggested that                                                                    
it  would  be  unlikely   to  misinterpret  the  meaning  of                                                                    
constitutionalism in  studying the  documents listed  in the                                                                    
bill. He  added that indisputable  values would be  found in                                                                    
studying things  like inalienable  rights or the  balance of                                                                    
powers necessary  to make  a republic  work. He  argued that                                                                    
the  curriculum  was  not  exclusive  and  felt  that  every                                                                    
student should know  it. He elaborated that he  felt that as                                                                    
long as  constitutionalism was portrayed  in the  same light                                                                    
as the  documents in  the legislation it  was fair  game for                                                                    
the requirements of the bill.                                                                                                   
                                                                                                                                
Representative Gara asked if  Representative Keller was okay                                                                    
with including a definition  of constitutionalism similar to                                                                    
that found in Webster's Dictionary.                                                                                             
                                                                                                                                
Representative  Keller   was  amenable.  He   indicated  the                                                                    
definition  found  in  Webster's Dictionary  was  consistent                                                                    
with his intent in the bill  and thought it was good to have                                                                    
on record.                                                                                                                      
                                                                                                                                
2:53:59 PM                                                                                                                    
                                                                                                                                
Co-Chair Thompson thanked the testifiers for their time.                                                                        
                                                                                                                                
Representative Keller  thanked the  committee and  urged the                                                                    
passing  of  HB 30.  He  thought  that  the bill  imposed  a                                                                    
worthwhile  mandate.  He  voiced  that the  issue  was  very                                                                    
important  and  was the  reason  he  brought it  before  the                                                                    
committee in the form of legislation.                                                                                           
                                                                                                                                
Co-Chair  Thompson   relayed  that   there  had   been  many                                                                    
questions about the bill and that  he would hold the bill in                                                                    
committee for additional hearings.                                                                                              
                                                                                                                                
HB  30  was   HEARD  and  HELD  in   committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
He discussed the following day's agenda.                                                                                        
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
2:55:18 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 2:55 p.m.                                                                                          
                                                                                                                                

Document Name Date/Time Subjects
HB 30 AK Ed Stand History.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 AK Ed Standards (no print).pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 AML ltr.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 Civics Board Timeline.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 Civic's Dunces.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 Constitutionalism.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 H Fin hear request.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 Keefer eltr.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 Thompson comments.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 US Senate S 504 summary and co spons.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 140 - Sponsor Statement.pdf HFIN 3/17/2015 1:30:00 PM
STRA 4/7/2015 1:00:00 PM
HB 140
HB 140 FN - AK Railroad.pdf HFIN 3/17/2015 1:30:00 PM
HB 140
HB 140 Supporting Document - 2015 PTC Two Pager.pdf HFIN 3/17/2015 1:30:00 PM
STRA 4/7/2015 1:00:00 PM
HB 140
CSHB 30 Sponsor.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
CSHB 30 Sectional.pdf HFIN 3/17/2015 1:30:00 PM
HB 30
HB 30 Support.pdf HFIN 3/17/2015 1:30:00 PM
HB 30