Legislature(1995 - 1996)
05/02/1995 02:04 PM HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE May 2, 1995 2:04 p.m. MEMBERS PRESENT Representative Cynthia Toohey, Co-Chair Representative Con Bunde, Co-Chair Representative Al Vezey Representative Gary Davis Representative Norman Rokeberg Representative Caren Robinson Representative Tom Brice MEMBERS ABSENT All members present COMMITTEE CALENDAR CSSB 123(FIN): "An Act relating to student loan programs and fees for review of postsecondary education institutions; relating to a postsecondary student exchange program administered by the Western Interstate Commission on Higher Education; and providing for an effective date." PASSED OUT OF COMMITTEE HB 205: "An Act relating to a claim based on criminal street gang activity; relating to offenses related to criminal street gang activities; relating to the crime of recruitment for, sentencing for, and forfeiture of property relating to criminal street gang activities; restricting criminal street gang offenders from obtaining a permit to carry a concealed handgun; amending Alaska Rule of Civil Procedure 82; and providing for an effective date." PASSED OUT OF COMMITTEE HB 281: "An Act ratifying an agreement between the Alaska Housing Finance Corporation and the commissioner of revenue and making certain pledges to obligees of the corporation regarding that agreement; relating to the authorization for and the issuance of bonds by the Alaska Housing Finance Corporation to pay for the costs of repair and rehabilitation of student housing facilities of the University of Alaska; and providing for an effective date." PASSED OUT OF COMMITTEE HB 282: "An Act relating to the authorization for and the issuance of revenue bonds by the University of Alaska to pay for the costs of repair and rehabilitation of buildings and other structures, excluding student housing and dormitories, of the University of Alaska; expanding the uses of the Alaska debt retirement fund to allow financing of the repair and rehabilitation of University of Alaska facilities; and providing for an effective date." PASSED OUT OF COMMITTEE CSSB 88(FIN): "An Act establishing a pilot program for charter schools; and providing for an effective date." PASSED OUT OF COMMITTEE * HB 119: "An Act exempting schools from certain fees charged by the Department of Environmental Conservation; and providing for an effective date." HEARD AND HELD SB 58 am: "An Act restricting the use of the title `industrial hygienist' and related titles and initials." PASSED OUT OF COMMITTEE CONFIRMATION HEARINGS: Board of Nursing Belle Cunningham Kathleen Kloster Joe Senungetuk (* First public hearing) WITNESS REGISTER DR. JOE L. McCORMICK, Executive Director Postsecondary Education Commission Department of Education 3030 Vintage Boulevard Juneau, AK 99801-7109 Telephone: (907) 465-6740 POSITION STATEMENT: Testified in support of SB 123. MARGOT KNUTH, Assistant Attorney General Criminal Division Department of Law Court Building, Room 717 Juneau, AK 99801 Telephone: (907) 465-3428 POSITION STATEMENT:Testified in support of HB 205. DAN FAUSKE, Chief Executive Officer Alaska Housing Finance Corporation P.O. Box 101020 Anchorage, AK 99510-1020 Telephone: (907) 561-1900 POSITION STATEMENT: Testified in support of HB 281. WENDY REDMAN, Vice President Statewide University System University of Alaska P.O. Box 155000 Fairbanks, AK 99775 Telephone: (907) 474-7311 POSITION STATEMENT: Testified in support of HB 282. SENATOR BERT SHARP Alaska State Legislature Room 514, State Capitol Juneau, AK 99801 Telephone: (907) 465-3004 POSITION STATEMENT: Provided sponsor statement for SB 88. CHRISTINE CASLER HC31 Box 5248A Wasilla, AK 99654 Telephone: (907) 376-3739 POSITION STATEMENT: Testified in support of SB 88. KATHY FUNT P.O. Box 4 Gustavus, AK Telephone: (907) 697-2458 POSITION STATEMENT: Testified in support of SB 88. ANNIE MACKOVJAK P.O. Box 63 Gustavus, AK 99826 Telephone: (907) 697-2246 POSITION STATEMENT: Testified in support of SB 88. LYNN JENSEN P.O. Box 87 Gustavus, AK Telephone: (907) 697-2259 POSITION STATEMENT: Testified in support of SB 88. DAVID CORNBERG, Independent Education Consultant P.O. Box 82631 Fairbanks, AK 99708 Telephone: (907) 479-4514 POSITION STATEMENT: Testified in support of SB 88. CATHERINE PORTLOCK 10501 Loudermilk Anchorage, AK 99516 Telephone: (907) 346-2534 POSITION STATEMENT: Testified in support of SB 88. CARL ROSE, Executive Director Association of Alaska School Boards 316 W. 11th Street Juneau, AK 99801 Telephone: (907) 586-1083 POSITION STATEMENT:Testified in support of SB 88. LINDA SHARP 2060 Esquire Anchorage, AK 99517 Telephone: (907) 278-6951 POSITION STATEMENT: Testified in support of SB 88. SHEILA PETERSON, Special Assistant to Commissioner Halloway Department of Education 801 W. 10th Avenue, Suite 200 Juneau, AK 99801 Telephone: (907) 465-4156 POSITION STATEMENT: Testified in support by SB 88. ROBERT GOTTSTIEN, Member State Board of Education 630 W. 4th Avenue, #300 Anchorage, AK 99501 Telephone: (907) 257-5601 POSITION STATEMENT: Testified in support of SB 88. MARILYN WILSON, Legislative Assistant to Senator Bert Sharp's Alaska State Legislature Room 514, State Capitol Juneau, AK 99801 Telephone: (907) 465-3004 POSITION STATEMENT: Testified in support of SB 88. REPRESENTATIVE GENE KUBINA Alaska State Legislature Room 406, State Capitol Juneau, AK 99801 Telephone: (907) 465-4859 POSITION STATEMENT: Provided sponsor statement for HB 119. KIT BALLANTINE, Acting Director Division of Environmental Health Department of Environmental Conservation 410 Willoughby Avenue, Room 105 Juneau, AK 99801 Telephone: (907) 465-5280 POSITION STATEMENT: Testified on HB 119. AARON TRIPPLER, Director of Government Affairs American Industrial Hygienist Association 2700 Prosperity Avenue, Suite 250 Fairfax, VA 22031 Telephone: (703) 849-8888 POSITION STATEMENT: Testified in support of SB 58. PENNY GOODSTIEN, Representative Anchorage Branch/Midnight Sun Section American Industrial Hygienist Association 9500 Buddy Lerner Anchorage, AK 99561 Telephone: (907) 346-1083 POSITION STATEMENT: Testified in support of SB 58. JANET OGAN, Legislative Secretary to Senator Loren Leman Alaska State Legislature Room 113, State Capitol Juneau, AK 99801 Telephone: (907) 465-2095 POSITION STATEMENT: Provided sponsor statement for SB 58. JEFF CARPENTER, Member Midnight Sun Section American Industrial Hygienist Association 9121 King David Drive Anchorage, AK 99507 Telephone: (907) 344-8516 POSITION STATEMENT: Testified in support of SB 58. PREVIOUS ACTION BILL: SB 123 SHORT TITLE: POSTSECONDARY EDUCATION PROGRAMS SPONSOR(S): HEALTH, EDUCATION & SOCIAL SERVICES JRN-DATE JRN-PG ACTION 03/10/95 578 (S) READ THE FIRST TIME - REFERRAL(S) 03/10/95 578 (S) HES, FIN 03/20/95 (S) HES AT 09:00 AM BUTROVICH ROOM 205 03/20/95 (S) MINUTE(HES) 03/21/95 721 (S) HES RPT CS 3DP 2NR SAME TITLE 03/21/95 721 (S) ZERO FISCAL NOTES (DOE-2) 04/19/95 (S) FIN AT 09:00 AM SENATE FINANCE 532 04/26/95 1249 (S) FIN RPT CS 4DP 2NR NEW TITLE 04/26/95 1249 (S) PREVIOUS ZERO FNS (DOE-2) 04/27/95 (S) RLS AT 01:00 PM FAHRENKAMP ROOM 203 04/28/95 1310 (S) RULES TO CALENDAR 4/28/95 04/28/95 1314 (S) READ THE SECOND TIME 04/28/95 1315 (S) FIN CS ADOPTED UNAN CONSENT 04/28/95 1315 (S) ADVANCED TO THIRD READING UNAN CONSENT 04/28/95 1315 (S) READ THE THIRD TIME CSSB 123(FIN) 04/28/95 1315 (S) PASSED Y19 N- E1 04/28/95 1315 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 04/28/95 1323 (S) TRANSMITTED TO (H) 04/29/95 1659 (H) READ THE FIRST TIME - REFERRAL(S) 04/29/95 1659 (H) HEALTH, EDUCATION AND SOCIAL SERVICES 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 BILL: HB 205 SHORT TITLE: STREET GANG ACTIVITY SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR JRN-DATE JRN-PG ACTION 02/27/95 497 (H) READ THE FIRST TIME - REFERRAL(S) 02/27/95 497 (H) HES, STATE AFFAIRS, JUDICIARY 02/27/95 497 (H) 7 ZERO FNS (2-ADM, 3-DHSS, CORR, LAW) 02/27/95 497 (H) ZERO FISCAL NOTES (DPS) 02/27/95 498 (H) GOVERNOR'S TRANSMITTAL LETTER 04/25/95 (H) HES AT 02:00 PM CAPITOL 106 04/27/95 (H) HES AT 02:00 PM CAPITOL 106 04/27/95 (H) MINUTE(HES) 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 BILL: HB 281 SHORT TITLE: AHFC TRANSFERS TO GENERAL FUND; BONDS SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR JRN-DATE JRN-PG ACTION 03/24/95 901 (H) READ THE FIRST TIME - REFERRAL(S) 03/24/95 901 (H) HES, FINANCE 03/24/95 901 (H) FISCAL NOTE (REV) 03/24/95 901 (H) 2 ZERO FISCAL NOTES (REV, UA) 03/24/95 901 (H) GOVERNOR'S TRANSMITTAL LETTER 04/27/95 (H) HES AT 02:00 PM CAPITOL 106 04/27/95 (H) MINUTE(HES) 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 BILL: HB 282 SHORT TITLE: FINANCING REPAIR/REHAB OF U AK BLDGS SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR JRN-DATE JRN-PG ACTION 03/24/95 904 (H) READ THE FIRST TIME - REFERRAL(S) 03/24/95 904 (H) HES, FIN 03/24/95 904 (H) 4 ZERO FNS (2-ADM, REV, UA) 03/24/95 904 (H) GOVERNOR'S TRANSMITTAL LETTER 04/27/95 (H) HES AT 02:00 PM CAPITOL 106 04/27/95 (H) MINUTE(HES) 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 BILL: SB 88 SHORT TITLE: PILOT PROGRAM FOR CHARTER SCHOOLS SPONSOR(S): SENATOR(S) SHARP, Frank, Miller, Taylor, Rieger, Green, Halford JRN-DATE JRN-PG ACTION 02/15/95 288 (S) READ THE FIRST TIME - REFERRAL(S) 02/15/95 289 (S) HES, FIN 02/21/95 356 (S) COSPONSOR(S): RIEGER 02/22/95 (S) HES AT 09:00 AM BUTROVICH ROOM 205 02/22/95 (S) MINUTE(HES) 03/01/95 (S) HES AT 09:00 AM BUTROVICH ROOM 205 03/01/95 (S) MINUTE(HES) 03/08/95 543 (S) COSPONSOR(S): GREEN 03/01/95 (S) MINUTE(HES) 03/08/95 (S) HES AT 09:00 AM BUTROVICH ROOM 205 03/08/95 (S) MINUTE(HES) 03/09/95 556 (S) HES RPT CS 2DP 3NR SAME TITLE 03/09/95 556 (S) FN (DOE) 03/27/95 (S) FIN AT 09:00 AM SENATE FINANCE 532 03/30/95 840 (S) FIN RPT CS 5DP 2NR SAME TITLE 03/30/95 840 (S) PREVIOUS FN (DOE) 03/30/95 (S) MINUTE(FIN) 04/10/95 979 (S) RULES TO CALENDAR 4/11/95 04/11/95 979 (S) RETURN TO RLS COMMITTEE 04/11/95 (S) RLS AT 12:00 PM FAHRENKAMP ROOM 203 04/11/95 (S) MINUTE(RLS) 04/12/95 997 (S) RULES RPT 3CAL 2 OTHER 4/12/95 04/12/95 999 (S) READ THE SECOND TIME 04/12/95 999 (S) FIN CS ADOPTED UNAN CONSENT 04/12/95 999 (S) COSPONSOR(S): HALFORD 04/12/95 999 (S) ADVANCED TO THIRD READING UNAN CONSENT 04/12/95 999 (S) READ THE THIRD TIME CSSB 88(FIN) 04/12/95 1000 (S) PASSED Y12 N8 04/12/95 1000 (S) EFFECTIVE DATE PASSED Y15 N5 04/12/95 1000 (S) DUNCAN NOTICE OF RECONSIDERATION 04/13/95 1036 (S) RECON TAKEN UP - IN THIRD READING 04/13/95 1036 (S) PASSED ON RECONSIDERATION Y12 N6 E1 A1 04/13/95 1037 (S) EFFECTIVE DATE PASSED Y16 N2 E1 A1 04/13/95 1037 (S) TRANSMITTED TO (H) 04/18/95 1340 (H) READ THE FIRST TIME - REFERRAL(S) 04/18/95 1340 (H) HES, FINANCE 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 BILL: HB 119 SHORT TITLE: EXEMPT SCHOOLS FROM CERTAIN DEC FEES SPONSOR(S): REPRESENTATIVE(S) KUBINA, Davies, Ivan JRN-DATE JRN-PG ACTION 01/25/95 131 (H) READ THE FIRST TIME - REFERRAL(S) 01/25/95 132 (H) HES, FIN 03/29/95 987 (H) COSPONSOR(S): IVAN 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 BILL: SB 58 SHORT TITLE: USE OF TITLE "INDUSTRIAL HYGIENIST" SPONSOR(S): SENATOR(S) LEMAN JRN-DATE JRN-PG ACTION 02/01/95 129 (S) READ THE FIRST TIME - REFERRAL(S) 02/01/95 129 (S) HES, L&C 02/15/95 286 (S) HES RPT 2DP 2NR 02/15/95 286 (S) ZERO FISCAL NOTE (LABOR #1) 02/15/95 (S) HES AT 09:00 AM BUTROVICH ROOM 205 02/15/95 (S) MINUTE(HES) 03/07/95 (S) L&C AT 01:30 PM FAHRENKAMP RM 203 03/07/95 (S) MINUTE(L&C) 03/21/95 (S) L&C AT 01:30 PM FAHRENKAMP RM 203 03/21/95 (S) MINUTE(L&C) 03/22/95 744 (S) L&C RPT 1DP 4NR 03/22/95 744 (S) PREVIOUS ZERO FN (LABOR) 03/27/95 (S) RLS AT 11:35 AM FAHRENKAMP ROOM 203 03/27/95 (S) MINUTE(RLS) 04/05/95 872 (S) RULES TO CALENDAR 4/5 04/05/95 873 (S) READ THE SECOND TIME 04/05/95 874 (S) ADVANCED TO THIRD READING UNAN CONSENT 04/05/95 874 (S) READ THE THIRD TIME SB 58 04/05/95 874 (S) PASSED Y16 N2 E2 04/05/95 874 (S) RIEGER NOTICE OF RECONSIDERATION 04/06/95 898 (S) RECON TAKEN UP - IN THIRD READING 04/06/95 898 (S) RETURN TO SECOND FOR AM 1 UNAN CONSENT 04/06/95 898 (S) AM NO 1 ADOPTED UNAN CONSENT 04/06/95 899 (S) AUTOMATICALLY IN THIRD READING SB 58 AM 04/06/95 899 (S) PASSED ON RECONSIDERATION Y16 N3 E1 04/06/95 900 (S) TRANSMITTED TO (H) 04/07/95 1170 (H) READ THE FIRST TIME - REFERRAL(S) 04/07/95 1170 (H) HES, LABOR AND COMMERCE 05/02/95 (H) HES AT 02:00 PM CAPITOL 106 ACTION NARRATIVE TAPE 95-46, SIDE A Number 000 CO-CHAIR CON BUNDE called the meeting of the House Health, Education and Social Services Standing Committee to order at 2:04 p.m. Present at the call to order were Representatives Bunde, Toohey, Brice, and Davis. A quorum was present to conduct business. Co-Chair Bunde read the calendar and announced the order of the bills. SB 123 - POSTSECONDARY EDUCATION PROGRAMS Number 129 DR. JOE McCORMICK, Executive Director, Postsecondary Education Commission, Department of Education (DOE), said SB 123 is basically the same as HB 257 which was passed by the House HESS Committee. However, there are two notable exceptions. The loan limits, as they apply to career school programs, were modified to allow for a $6,500 annual maximum for programs that are 30 or more weeks in length. That is the standard definition of a year in length. A $4,500 maximum was established for programs that were less than 30 but more than 20 weeks in length; and a $3,000 maximum was allowed for programs of less than 20 weeks in length but at least 10 weeks. DR. McCORMICK continued that HB 257 had a total maximum loan eligibility of $79,000. The Senate modified that to $60,000. As a point of reference, the $60,000 does represent about a 26 percent increase over the current maximums allowed for under current law. In addition, SB 123 denies loans to individuals who are incarcerated full-time. HB 257 provided loans for incarcerated individuals who were scheduled for release within two months. DR. McCORMICK recommended that the HESS Committee embrace the Senate bill, and pass it. Number 268 CO-CHAIR BUNDE announced for the record that Representative Vezey joined the meeting at 2:08 p.m. CO-CHAIR CYNTHIA TOOHEY said her office received two communications from people who feared they would not be able to get loans for trade schools because those schools were less than six months in duration. She asked how those schools were addressed. DR. McCORMICK said the original house version, HB 257, proposed that those programs that were one year in length remain at $5,500, and those programs that were less than nine months in length were dropped to $4,000. The Senate version came up with a compromise that actually improves the situation regarding trade schools. Those programs that are a year in length are allowed $6,500. That is $1,000 more than they now receive. Those programs that are 20 to 30 weeks in length are allowed $3,500, which is $500 more than allowed by the House version. DR. McCORMICK continued that those programs that are less than 20 weeks but are at least 10 weeks in length are allowed $3,000 a year. Number 362 REPRESENTATIVE AL VEZEY asked Dr. McCormick to comment on how many trade school or vocational programs are less than six months in length. DR. McCORMICK responded that approximately 70 to 80 percent of those programs are of that duration. They usually run about six months to a year. REPRESENTATIVE VEZEY asked how many are less than six months in duration. DR. McCORMICK answered no more than 30 percent, perhaps only 10 to 15 percent. REPRESENTATIVE VEZEY said that is in terms of programs. If it is broken down into student classroom or learning hours, what are the numbers? DR. McCORMICK said it does not break down into very many students. Typically, a small school like that does not enroll more than 10 to 20 students per term. Those schools are usually very small operations. Number 431 REPRESENTATIVE CAREN ROBINSON joined the meeting at 2:10 p.m. REPRESENTATIVE TOM BRICE said in other words, something like a beauty school would no longer be eligible. DR. McCORMICK indicated that was not correct. Under SB 123 everyone who is currently eligible will still be eligible. The change occurs in the amounts allowed. Currently, all program lengths are eligible for the same amounts, regardless of the length of the program. SB 123 simply takes into account the length of the program. CO-CHAIR BUNDE closed public testimony and asked for the wish of the committee. REPRESENTATIVE BRICE moved CSSB 123(FIN) from the HESS Committee with individual recommendations and accompanying zero fiscal note. There were no objections, and the bill passed. HB 205 - STREET GANG ACTIVITY Number 515 MARGOT KNUTH, Assistant Attorney General, Criminal Division, Department of Law, recalled at the last hearing on HB 205 the issue had come up about whether or not a provision could be included for those juveniles who have run away from home. In such a case, their parents would not be liable for acts committed by that child as part of a street gang. MS. KNUTH had prepared an amendment which added a paragraph on page 2, line 1 of the bill. This paragraph appears in at least one, and perhaps two other bills that have gone through this session. CO-CHAIR TOOHEY moved Amendment 1. CO-CHAIR BUNDE asked for further discussion of the amendment. He also called for objections. Number 602 REPRESENTATIVE VEZEY felt the amendment only addresses a small part of what is a flaw in Section 1 of the bill. There are many other aspects of the bill that the HESS Committee members have not talked about. A lot of the concerns are simple, such as what happens to children who are under joint custody agreements, or children who are visiting non-custodial parents. There may be simple cases of people who don't have control over their kids. REPRESENTATIVE VEZEY again expressed concern over suing someone who is indigent--there is no point to that. He felt Section 1 still leaves a lot to be desired. CO-CHAIR BUNDE called for a roll call vote on the amendment. Voting "yes" on Amendment 1 was Representative Davis, Representative Brice, Representative Robinson, Co-Chair Toohey, Co- Chair Bunde, and Representative Vezey. There were no "no" votes. Amendment 1 was adopted, and HB 205 as amended was before the HESS Committee. Co-Chair Bunde asked for further discussion or the will of the committee. Number 711 REPRESENTATIVE BRICE moved HB 205 as amended with individual recommendations and accompanying fiscal notes. There was an objection, and a vote was taken. Voting "yes" on the passage of the bill were Co-Chair Toohey, Co-Chair Bunde, Representative Robinson, Representative Brice and Representative Davis. Voting "no" was Representative Vezey. The CSHB 205(HES) was passed out of the House HESS Committee. HB 281 - AHFC TRANSFERS TO GENERAL FUND; BONDS Number 830 CO-CHAIR BUNDE announced this bill had been heard previously, and he had proposed an amendment. The bill had been held so everyone would have a chance to look at the amendment. Number 847 DAN FAUSKE, Chief Executive Officer, Alaska Housing Finance Corporation (AHFC), understands the amendment proposed by Co-Chair Bunde would in essence eradicate Section 3, under ratification. The problem Mr. Fauske had with that is that in negotiations with the rating agencies in an attempt to get AHFC off credit watch, the agencies stated they wanted to see that some form of agreed upon legislation was in existence. With this legislation, the agencies could see what the transfers out of the corporation would be on a regular basis over a period of time. This was so the agencies could protect their bond holders. MR. FAUSKE said without that kind of language, the AHFC runs the risk that the credit agencies will not honor the agreement as it was seen, as far as transferring money out of the corporation. The AHFC will probably be placed back on credit watch with all the negative implications and, subsequent to that, any future bond sales. Probably, future bond ratings will most likely go down depending on how much money was taken from the corporation. Number 928 MR. FAUSKE stressed that his concern is not so much a case of being told what to do by people on the East Coast. The point is to look ahead in time after the bonds are already sold. The bonds are sold and the rating has been maintained based on the financial stability and strength of the corporation. If that is weakened, the rating agencies have a fiduciary responsibility to notify their bond holders of a potential problem. Therefore, the strength of the transfer bill was based on the fact that there would be some agreement between the legislature, the administration and the corporation. CO-CHAIR BUNDE understood. His reason for offering the amendment was not antagonistic in respect to someone from "back East" trying to tell Alaska what to do. Surely the ratings agencies are aware that this is a very hollow assurance. The next legislative session could repeal the entire bill or that section of the bill if the legislature chose to do so. CO-CHAIR BUNDE said if the rating agencies are not aware, they should be aware that HB 281 provides a very hollow assurance. Co- Chair Bunde does not feel that taking Section 3 out automatically indicates that Co-Chair Bunde wants to continue to drain capital reserves from the AHFC. To Co-Chair Bunde, Section 3 is a meaningless part of the bill. Number 1030 REPRESENTATIVE VEZEY pointed out the legislature cannot change the law without the Governor's signature or a veto override. Therefore, if HB 281 is passed, it is more difficult to change a law than it is to initially pass a law. HB 281 does provide what Representative Vezey believes most courts would interpret as the pledge of the full faith and credit of the State of Alaska for those bonds. That is more than those bonds have now. REPRESENTATIVE VEZEY said that is a subject of debate in and of its own. If the state of Alaska puts its full faith and credit behind those bonds, Representative Vezey would imagine that the financial managers on the East coast would probably care less what is done to the AHFC as long as the bonds are guaranteed. Number 1080 CO-CHAIR BUNDE conceded that he was not a bond attorney, but he thought the quasi-governmental agencies that issue bonds have the full faith of the state if the bonds ever went to court. However, some people like to be meticulous. REPRESENTATIVE VEZEY assured Co-Chair Bunde if that was the case, the bond rating company would not be the least bit concerned. CO-CHAIR BUNDE announced that Representative Rokeberg joined the meeting at 2:20 p.m. Number 1120 MR. FAUSKE said the AHFC is the only housing finance corporation in the United States that has its own general obligation (G.O.) rating. That is very significant, because there is no other such corporation that has that. The AHFC is a stand-alone organization and the credit is based on the full faith and credit of the corporation. Therefore, if the legislature or some other body were to take significant acts that impaired the ability of the corporation to service its debt, any number of things could happen. MR. FAUSKE did not wish to discuss those possibilities at the moment. He only wanted to state that Section 3 assures the full agreement with the legislature that the legislature will not impair the corporation's ability to service its debt. It is also in the spirit of the language that the corporation cannot be utilized in full force to solve all the fiscal problems of the state. MR. FAUSKE said, "The AHFC has arrived at what seems to be a reasonable amount of money based on some technical analysis as to fund equity balances of the corporation that meet with the guidelines established to maintain the bond rating that the AHFC currently enjoys." That bond rating is translated into some low mortgage interest rates for the residents of Alaska. MR. FAUSKE explained that a bond rating is a direct result of risk. The higher the rating, the lower the risk. In retrospect, if ratings go the other way, interest rates go up. Number 1212 CO-CHAIR BUNDE did not disagree with the proposal the bill laid out as a reasonable withdrawal of dividends from the AHFC. However, regarding the full faith and credit of the state of Alaska, if the legislature chose to dissolve the corporation, the state would take on its debts and responsibilities. REPRESENTATIVE BRICE thought that was true with any other bonding agency that is quasi-governmental. The AHFC has been able to maintain a substantially high bond rating because it has established through past history that the state is willing to take those golden eggs and stow them away in an appropriate manner. That is what Section 3 intends. CO-CHAIR BUNDE noted that the state has done that in the past, and it has done that without Section 3. Number 1278 REPRESENTATIVE NORMAN ROKEBERG thought that there needs to be teeth in legislation, therefore, he is going to vote against the amendment. CO-CHAIR BUNDE noted that the amendment was moved at the last meeting, and there were objections to the amendment. A roll call vote was taken. Voting "yes" on the amendment were Co-Chair Bunde and Representative Vezey. Voting "no" were Representative Rokeberg, Representative Brice, Representative Robinson, Co-Chair Toohey and Representative Davis. Amendment 1 failed. Number 1318 REPRESENTATIVE ROKEBERG introduced an amendment. It was moved as Amendment 2, and there were objections for purposes of discussion. Amendment 2 modified the title of the bill and deleted Section 4, which provides the bonding authority to provide the $3 million. REPRESENTATIVE ROKEBERG said the reason he brought forth the amendment is because he considered this particular provision a blatant raid on the equity of the AHFC for a special purpose. Representative Rokeberg did not feel that was right, and it was very poor public policy. REPRESENTATIVE ROKEBERG was also concerned about the credit worthiness of the AHFC, and their ability to maintain their credit worthiness and their bond rating. In addition, the university system and all school systems in Alaska should be able to provide the repair and maintenance of their physical plants within their operating budgets and not look for special appropriations to do so. Number 1390 REPRESENTATIVE ROKEBERG appreciated the situation the university was in. However, this bill amounts to one state entity raiding another. The two are not related. If the legislature wants to bond the repair and maintenance of the university system it should do so with a G.O. bond that goes before the vote of the people. That is why Amendment 2 is being offered. Number 1411 CO-CHAIR TOOHEY asked what the difference was between taking $200 million from the AHFC to put into the general fund as was done last year, and what is being provided for in the bill, other than the fact that the bill's provisions have a purpose. REPRESENTATIVE ROKEBERG said the purpose of the $270 million appropriation is to give a predictable annual dividend to the state's general fund. The state can do what it wishes with that money. Representative Rokeberg supports that because it is a sustainable type of dividend. The real estate community and the state supports that. It provides stability. REPRESENTATIVE ROKEBERG said his amendment was offered to further avoid any major raids of bond equity of the corporation. Representative Rokeberg does not feel this is the right cause and purpose. If the legislature wishes to repair and maintain the university with bonding money, the legislature should go to the voters and ask their permission. Number 1470 MR. FAUSKE said Representative Rokeberg's concerns are a separate issue in terms of how to go about this area. Mr. Fauske said he did not wish to discuss the merits of going to the people for a vote or not. HB 281 is a G.O. of the corporation that falls within the parameters of the corporation based on the merger of 1992. MR. FAUSKE said this would have come under the old Alaska State Housing Authority (ASHA). Mr. Fauske believed the repair and replacement of state facilities used to be one of the functions of ASHA. That gave the mechanism whereby the state was operating within the overall umbrella of the corporate activities. MR. FAUSKE stated that at the beginning of the session, up to March of this session, there was a great deal of activity going on as far as funding for the university. This program became part of the process to help eliminate the overall deteriorating maintenance on the university campuses. This agreement has been discussed with the rating agencies. At this level they have considered this $30 million in G.O. as well as the withdrawal from the corporation. MR. FAUSKE concluded it falls within the parameters of what is being done, and within the perusal of the rating agencies and what they have been told the state is trying to do. It does not, however, address the question that Representative Rokeberg is asking. REPRESENTATIVE BRICE said unlike Co-Chair Bunde's amendment which attempted to address a specific concern, the current amendment is probably eviscerating the whole intent of the legislation and would probably be considered dilatory in that sense. HESS Committee members might want to consider some type of an action on that point. On the other point he does believe that when HESS Committee members are talking about the discussion of the AHFC and its corporation's bond authority, HESS Committee members need to discuss establishing also whether or not it is appropriate for the AHFC to be used to adequately fund the deferred maintenance operations at the state university. REPRESENTATIVE BRICE considered the debate that has taken place over the last two years concerning the issue. He has not heard any realtors complain, nor has he heard anyone argue. In addition, Representative Brice has not heard the AHFC get concerned over their bonding rating, as testimony has said that the bill, as is, protects the corporation's bonding authority. Therefore, Representative Brice opposes the amendment. Number 1636 REPRESENTATIVE ROKEBERG asked Mr. Fauske, given the language on Section 4 of HB 281, if the payment of the principal interest would not be a draw-down on the retained earnings and other resources of the corporation. MR. FAUSKE answered yes in that it is coming from corporate receipts. It is not a revenue bond per se because it is a G.O. bond. REPRESENTATIVE ROKEBERG concluded that any retained earnings or profits generated by the lending activities throughout the state, for example, "The homeowners paying their mortgage checks to their servicing agent to the AHFC as the underwriter of their mortgage," are going to finance this bigger bond issue. MR. FAUSKE said following that paper trail, that is correct based on the fact that the AHFC is a profit making corporation, and profits are derived from repayment on mortgages, investment earnings and other mechanisms. Money is coming into the corporation, and the profits are then being utilized as a financial strength to support the bond credit. Number 1695 REPRESENTATIVE ROKEBERG said it was kind of like a phantom tax. CO-CHAIR BUNDE called for a roll call vote on Amendment 2. Voting "yes" on the amendment was Representative Rokeberg. Voting "no" were Representative Robinson, Co-Chair Toohey, Co-Chair Bunde, Representative Vezey, Representative Davis, and Representative Brice. Amendment 2 failed. REPRESENTATIVE VEZEY was expecting to see a schedule of transfers of capital in this bill. He asked if that would be coming in another bill. MR. FAUSKE believed that appears in the agreement between the commissioner of revenue and the corporation which is based on HB 281. CO-CHAIR BUNDE announced that copies were in the bill packets. Number 1807 REPRESENTATIVE BRICE moved HB 281 with individual recommendations and accompanying fiscal notes. There were no objections, and the bill passed out of committee. HB 282 - FINANCING REPAIR/REHAB OF UA BUILDINGS Number 1874 REPRESENTATIVE ROKEBERG said HB 282 is the third bill that has come before the HESS Committee regarding funding for the University of Alaska system. He asked the total amount of bonded indebtedness that the legislature is being asked to authorize for the University of Alaska this session. WENDY REDMAN, Vice President, Statewide University System, replied that there are two bills. One is for $30 million which is just for student housing. In addition, there is now $120 million of additional deferred maintenance. HB 282 authorizes the AHFC to issue bonds in the amount of $45 million with the delayed effective date of July 1, 1996, if cash is not available next year for deferred maintenance. MS. REDMAN said this would not draw down on the AHFC reserves to pay off this debt. This would come from the Alaska debt retirement fund, the way the bill is written. The AHFC would simply be used as the bond issuer. CO-CHAIR BUNDE asked for further public testimony, and there was none. Public testimony was closed. Co-Chair Bunde asked for further discussion from the committee. Number 1980 REPRESENTATIVE ROKEBERG said he was going to vote against the bill. By his calculations, HESS Committee members authorized $111.5 million in new construction and maintenance bonds for the university in the last couple of days. This bill calls for another $45 million. He thinks HESS Committee members should draw the line somewhere. MS. REDMAN noted that HESS Committee members did pass out a straight revenue bond proposal for new housing facilities. Again, that uses AHFC. But generating revenues from the dorm projects will go to pay that bond indebtedness off with a small subsidy from the AHFC. That would be the interest rate subsidy of about $1 million a year. Number 0236 REPRESENTATIVE ROKEBERG asked if the interest rate on that bond, in terms of the interest subsidy, would be at a rate of 3 percent. MS. REDMAN said that was correct. REPRESENTATIVE ROKEBERG asked if that was the interest rate subsidy, the spread, between the cost of their money and what that 3 percent is. MS. REDMAN said again that Representative Rokeberg was correct. REPRESENTATIVE ROKEBERG was not sure at what rate the last bond went out at, but he ventured to say that it is probably over 7 percent, even if it is a tax-free bond. Therefore, there is a 400 basis point spread differential in the $36 million. Number 2072 CO-CHAIR TOOHEY essentially asked Representative Rokeberg to explain his concerns in layman's terms, because as the bill stands, she understands it and she is going to vote for it. REPRESENTATIVE ROKEBERG said he is concerned that on the prior bond issue of $36.5 million, the subsidy is substantial. The earnings of the AHFC are subsidizing the housing bonds HESS Committee members already passed from the committee. Representative Rokeberg hopes that bill passes, because the bill is needed. But this bill is adding to that whole situation by moving out the $30 million bond issue which is entirely paid for by the AHFC. Not one penny is being paid by the university system. REPRESENTATIVE ROKEBERG continued that this bill now asks for another $45 million. Apparently, the debt service is going to be paid for by the state. Therefore, the totality of all this is too much. It is going to be difficult to spend $30 million on a good maintenance program in one year. Representative Rokeberg asked why another $45 million should be given right now. There is even a circuit breaker in HB 282 for a $20 million offset. REPRESENTATIVE ROKEBERG said this is more than the capital budget that is even being contemplated. Number 2148 REPRESENTATIVE VEZEY commented that this money would not be spent in one year. However, it would not be hard to spend the $30 million in one year. The deferred maintenance at the university is growing at $20 million a year, and the university has not even looked at the total facilities. There is a huge backlog of major maintenance which is really reconstruction. REPRESENTATIVE VEZEY also asked Ms. Redman what role private housing is currently playing in the university's housing needs. MS. REDMAN replied that option has been investigated in Anchorage, Fairbanks and Juneau to see if anyone in the private sector was interested. A bill was passed last session that allows the university to offer tax exempt status to private organizations who came onto university property to build. With that bill, the university sought people to build, but it has not been successful in finding interested parties. Number 2200 REPRESENTATIVE VEZEY asked about off-campus housing. MS. REDMAN asked if Representative Vezey meant having private people build facilities for the university off property. REPRESENTATIVE VEZEY asked if the university currently housed students staying off campus in private facilities. MS. REDMAN said yes, but the university does not support that housing. There are just a lot of students who are trying to live in the communities. There is no relationship for a lot of legal reasons with those providers. REPRESENTATIVE VEZEY asked how much of the university's housing needs that was fulfilling. MS. REDMAN answered that it varies in each community. In Juneau, most students are still living off campus. In Anchorage, a huge majority of students are living off campus. About 95 percent of the students are in the community. In Fairbanks, about 40 percent of students are living off campus. Number 2242 CO-CHAIR BUNDE said the reason the university cannot get private entities to pay for housing in Anchorage is because it cannot and will not pay for itself. The AHFC subsidizes at 3 percent, and Co- Chair Bunde still thinks the whole plan will fail. However, he reiterated that he is willing to be proven wrong. Number 2254 REPRESENTATIVE BRICE referred to the concern that all the bonds will be let at once. That is the beauty of bonding versus straight general fund capital money. Straight general fund capital money has to be spent within three years. Bonding authorization lasts a little longer, and the economy is not super heated in Anchorage, Juneau or wherever the projects are taking place. They can be let in smaller amounts to allow for local contractors to do the work. In addition, smaller amounts provide work for Alaska firms, whereas large jobs attract and need large Seattle or Los Angeles firms to do the job. That is the beauty within the bonding proposal. TAPE 95-46, SIDE B Number 000 REPRESENTATIVE ROKEBERG asked to wrap up. He said by passing the bill the HESS Committee members were almost rewarding the mismanagement and mischief of the university. The university should have put their house in order long ago, although Representative Rokeberg realizes it is trying to reorganize currently. He also understands that the university needs help, and he was not saying the legislature should not help the university through some of the bond issues. REPRESENTATIVE ROKEBERG felt, however, that the HESS Committee members should look at the broad scope of things. The HESS Committee just moved $30 million out of the committee, and the university is now asking for another $45 million. Representative Rokeberg suggested that the HESS Committee not give them that $45 million. He thinks $30 million is a good start. Number 060 CO-CHAIR BUNDE observed that these bills go to the Finance Committee, and he does not have any information that would lead him to believe that the Finance Committee will not pick and choose as to what goes out of that committee. Co-Chair Bunde said he would be willing to give the Finance Committee the option to pick and choose. REPRESENTATIVE BRICE moved HB 282 with individual recommendations and accompanying fiscal notes. REPRESENTATIVE ROKEBERG objected, and a roll call vote was taken. Voting "yes" on the passage of HB 282 were Co-Chair Toohey, Co- Chair Bunde, Representative Vezey, Representative Davis, Representative Brice, and Representative Robinson. Voting "no" was Representative Rokeberg. HB 282 was passed from the House HESS Committee. SB 88 - PILOT PROGRAM FOR CHARTER SCHOOLS Number 160 SENATOR BERT SHARP provided the sponsor statement for the bill. He said the issue of charter schools was discussed at length during the two years of the Eighteenth Alaska Legislature. Senator Sharp had the misfortune of having that bill on the Senate side during that time. It was just one small part of the Alaska 2000 propositions in the Senate. It was in two bills, SB 60 and SB 61. Those bills had companion bills in the House. SENATOR SHARP said those two bills, which in all aspects were omnibus education bills, tried to address diverse issues. Each bill was controversial in some way, and each issue tainted or detracted from the other one. This led to the fact that none of them passed. SENATOR SHARP has tried to craft SB 88 to be a single issue bill for charter schools. Charter schools were an item in SB 61 during the Eighteenth Alaska Legislature. This bill allows school districts, teachers and parents the space to be creative. It allows the charter schools to utilize existing school facilities, new facilities, and/or the option of leasing adequate facilities owned by private enterprises within the community. SENATOR SHARP said a geographical application has been done to assure fairness statewide in that one area does not come in and take up the total allocated 30. There are 30 suggested for the pilot program which lasts up to the year 2005. The sun sets at that time. The allocation is pretty straight forward on the second page of the bill. Number 289 SENATOR SHARP continued that all charter school proposals must be submitted to the local school board for consideration. Upon their approval by the school board, they then must be forwarded to the commissioner of the DOE for review and compliance to state law. All staffing of charter schools must be done on a volunteer basis, with the principal or administrator of that charter school having the right of final approval of all staff selection. SENATOR SHARP said Section 3 of the bill concerns the funding of charter schools. Section (a) of 3 reads that a local school board shall provide an approved charter school with an annual program budget. The budget shall be not less than the amount generated by the students enrolled in the charter school less administrative costs retained by the local school district, determined by applying the indirect cost rate approved by the DOE. SENATOR SHARP said the amount generated by students enrolled in charter schools is to be determined in the same manner as it would be for a student enrolled in any other school within the school district. No more or no less funding would be available to the school district. This is just an option that could be considered by the school board upon presentation of the proposal. Number 379 SENATOR SHARP said the exciting thing about charter schools is that they provide the opportunity to get children involved with teachers on something that may bring them together in an atmosphere that is more focused on education. There have been areas in other states, particularly in Wisconsin and New Jersey, that found it worked exceptionally well. Charter schools worked primarily in those areas in which the proposals were made for the existing school buildings within the district. Normally, the older buildings were used. SENATOR SHARP said the charter school concept was incorporated with the parents and the teachers who volunteer. The enthusiasm was therefore, a lot higher and more focused on the agenda of the charter school. Number 432 SENATOR SHARP found an interesting paragraph that reads, "This Administration will work to free local districts from regulations and mandates which restrict parents and educators from exploring innovation." That paragraph was from Governor Tony Knowles's State of the State address. SENATOR SHARP thought that was a good challenge. He noted his school district is the one that requested that SB 88 be pushed, and his community really feels that there are some opportunities present. There are also restrictions in the bill on what is allowed. The school board has total control. The school has to be non-secretarian in nature, and meet all other state laws as overseen by the commissioner of the DOE. Number 487 SENATOR SHARP also wanted to point out that the Fairbanks North Star Borough District wrote a letter of support. The DOE notes that the State Board of Education, at the last meeting, voted unanimously in support of the concept of SB 88. There are a few other letters of support in the bill packets. SENATOR SHARP stated there is a very small fiscal note from the DOE for $2,000 for taking care of sending information back and forth between the school districts if the activity is there, and to cover forms that the DOE may require processed. CO-CHAIR TOOHEY said she was very concerned that the schools are going down in value, teaching ability and other aspects. She has often said that she does not want to detract from those concerns by passing legislation such as this. That is her fear. If charter schools are implemented, motivated children, parents and teachers will work together. That is fine. But she fears that such schools are going to jeopardize the attention that should be given to the students the current school system is producing. Number 585 SENATOR SHARP understood that concern. But the opportunity to stimulate parents and teachers is prevalent. Most of the interest in Senator Sharp's community comes from the teachers who want to be involved in a school in which they can have more freedom, challenge the students and challenge themselves. They dislike the total regimentation that is applied school wide. The specs of the bill allows the school boards to relax some of the textbook requirements as long as state standards are met for education. SENATOR SHARP felt if some experimentation was not done in an attempt to find out what works, the system is eventually doomed. However, he conceded that there are different situations in different districts. His grandchildren go to very good schools. However, some of the teachers are very committed in that particular school. Many teachers would like to be challenged somewhere else as they advance in their careers. They would like a chance to experiment and see if something else will work better. This may be their opportunity. Number 658 CO-CHAIR TOOHEY noted that in Section 1 of the bill says that there will not be more than ten charter schools in the Anchorage area. She asked how many charter schools were in Anchorage at the moment, and if the bill was retroactively mandating the total number of charter schools in Anchorage or if those would be added schools. SENATOR SHARP said the only community that he is aware of that has pursued charter schools doggedly is in Anchorage. It seems to have worked well in different areas. SB 88 encourages other school districts to consider the options. There are many reservations, especially in the district in Senator Sharp's area. The people are unsure they will have the power to create their own school. Perhaps the bill will allow those people to relax concerning the standards and regimentation of the schools. SENATOR SHARP reiterated that he has heard good things about some of the efforts made in the Anchorage alternative schools. He thinks the bill is portioned out so one area could not take all the options from the bush area and begin four or five schools. Number 737 CO-CHAIR BUNDE noted that the schools in Anchorage are called "alternative schools," they are not charter schools. There is a polar school, and it is very loose. The students are allowed to vote on the academic focus, therefore, the focus for the month of January was cross-country skiing. REPRESENTATIVE DAVIS said that was the crux of his question to Senator Sharp. He wanted to know if Senator Sharp was aware of any charter schools in the state that meet the criteria he is establishing with the bill. SENATOR SHARP said he was not. But he does know there is excitement out there about the possibility of charter schools. The bill incorporates some fine tuning by everyone who testified in the other body. Those wishes were accommodated without making the bill too heavy on one side or the other. Number 830 CHRISTINE CASLER testified via teleconference that SB 88 is essential for districts to implement updated teacher practices supported by educational research, and to allow parents choices when their children do not learn well in traditional settings. The bill would also alleviate extensive waiting lists for alternative programs which now exist in some districts. Finally, the bill would begin to restore community confidence in education and bring about real change to the status quo which industry and community is demanding. MS. CASLER continued that SB 88 can bring about real hope and change in education for everyone. She urged HESS Committee members to pass SB 88 so education can get exciting for everyone. Number 895 KATHY FUNT testified via teleconference from Gustavus in support of the bill. The idea of site-based management is a fairly new one, and it will involve parents and community members. When those entities are involved in the schools, changes can be made. It is important to have parents and communities involved and accountable. Such involvement would also be very beneficial to the children. She would like to see SB 88 pass, so the communities can give it a try. CO-CHAIR BUNDE assumed there was only one school in Gustavus. MS. FUNT said yes, and that she and other community members were wondering what would happen in the case of a small, single-site community if a charter school is started. She was concerned about people who move to the community and do not like the idea. She wondered what kind of problems might arise. CO-CHAIR BUNDE said Ms. Funt had addressed his concerns exactly. If a charter school is begun where only one school exists, those who are not inclined to be part of that charter school do not have choices. Co-Chair Bunde said that is something to keep in mind. Number 979 ANNIE MACKOVJAK testified via teleconference from Gustavus that she believes SB 88 provides a welcome alternative to the now-existing public schools, but still is within the public school framework. It would allow a school to try innovating teaching techniques, or even to apply old techniques, such as Montessori methods. MS. MACKOVJAK said her husband is from Cleveland, Ohio. He went to a Cleveland Aviation high school. High schools in Cleveland could also focus on science, vocational skills, music or art. She cautioned, however, that charter schools should only be started for educational reasons. As Alaska grows, it should be leveraging educational opportunities. The existence of charter schools is one way to accomplish that. CO-CHAIR BUNDE asked what Ms. Mackovjak thought about the possibility of a group of parents deciding they wanted an agricultural school in Gustavus, while the other parents wanted a fishing based school. He asked if majority would rule in that case. MS. MACKOVJAK said she did not have an answer to that question. She is supporting SB 88 statewide, not only for her area. She sees charter schools as a potential problem in small areas. Number 1069 CO-CHAIR TOOHEY asked Senator Sharp if there was a limit on the number of students a school would have to have. SENATOR SHARP answered that there was no limit on the number of students. The bill is fairly loosely structured to allow as much space as possible for the school board and the people who want to propose a charter school. The situation is that the school board should make sure the economics are there so two schools could function within a small school district. If not, Senator Sharp would assume that the school board would not approve of a charter school. SENATOR SHARP said if a proposed charter school has a good proposal in an large area, that would probably not harm the economics because the schools would be operating in separate little towns or villages. CO-CHAIR BUNDE asked Senator Sharp what happens if there is a small student body, and one group of parents wants to establish a charter school. If new parents move to town, they will not have options. Co-Chair Bunde noted that the minimum in state law for establishing a school now is eight students. The former commissioner of education was trying to raise that number to ten. CO-CHAIR BUNDE foresaw that someday the legislature will study small schools to see if they should stay open at all. If a student body consists of 16 students, and those students are divided into two schools, are those schools then subject to closure? SENATOR SHARP assumed that the economics of having instructors in both schools would not allow the school board to even allow a charter school. CO-CHAIR BUNDE said that was assuming the school board would make good, economic decisions. Number 1176 CO-CHAIR TOOHEY noted that the bill has a ten year trial time. SENATOR SHARP stated that assuming it takes two years for anyone to even get a proposal together and considered, and the maximum contract can only be for five years with a possible extension to ten years, the sunset date on the bill is still in ten years. This is strictly a limited project. Number 1203 REPRESENTATIVE ROKEBERG addressed page 4, Section 5. That section refers to teachers' employment agreements. He asked if there was any requirements for certified teachers, or if teachers were to be recruited within the district. He asked from where teachers were being recruited. CO-CHAIR BUNDE believed that all the same regulations that apply to other public schools apply to this bill. Charter schools are simply a facet of the public schools. There must be certified teachers. REPRESENTATIVE ROKEBERG noted that the bill provides for an exemption. SENATOR SHARP said if the school board has a collective bargaining agreement, it must abide by the existing structure of that agreement. SB 88 would not allow the school board to circumvent any agreements that are currently in place. However, the proposal put forward to the school board for a charter school will, in all likelihood, nominate a principal to be in charge of that school. That person has the right, upon selection, to select the staff of that school. No teacher can be forced against their will, it has to be voluntary. REPRESENTATIVE ROKEBERG said he was more concerned about "Aunt Gertrude" having a position created for her in the school. He was also concerned that there could be a mix between exempt and non- exempt teachers. SENATOR SHARP did not think there would be any exempt teachers. REPRESENTATIVE ROKEBERG stated the bill says exempt teachers can be hired if there is an agreement between the district and the bargaining unit. Therefore, there can be exempt teachers. He again asked if there would then be exempt and non-exempt teachers. SENATOR SHARP conceded that there could be both exempt and non- exempt teachers if there is an agreement. REPRESENTATIVE ROKEBERG said therefore, that Aunt Gertrude could be hired as long as she is certified. SENATOR SHARP said that was right. The teacher has to be certified according to state regulations. Number 1341 LYNN JENSEN testified via teleconference from Gustavus. She asked what recourse applicants would have if they were denied the opportunity to become a charter school. She asked if there would be a recourse, or if the denial would be the final word. SENATOR SHARP answered that at the present time, it was the consensus of the Senate committees that the school board should have total responsibility to avoid any problems of fragmenting the community and the school system as such. The school board is elected and responsible for all schools in that district. The bill does not seek to isolate charter schools from responsibility. Number 1380 DAVID CORNBERG testified via teleconference from Fairbanks that he is an independent education consultant involved in education reform. Charter schools is yet another attempt to do better with what is available. He wanted to make three points in support of the bill. First, there are no hard and fast predictive models that show if a program is implemented today, school systems will be better in 2005. In addition, there are no models that show what will not work. MR. CORNBERG felt the important thing about SB 88 from the standpoint of reform is that it be given a chance. He strongly urged just giving charter schools a try, and in the course of doing so, refining Senator Sharp's bill. MR. CORNBERG said his second point refers to the federal charter schools initiative. That initiative comes under the Improving America's Schools Act. That initiative is currently funded at $6 million. He spoke with a Washington, D.C., contact that day and the contact said the President has requested $20 million for next year for that initiative. Number 1452 MR. CORNBERG continued that no school in a state that has no charter school legislation can apply. So, as long as Alaska has no charter school legislation on the books, it cannot apply for that federal initiative. Therefore, Mr. Cornberg strongly urged that the bill be passed at all levels and be put on the books to get the state into a position to apply next fall for some of that money. That money will help fund the charter school initiatives in the state. Number 1473 MR. CORNBERG said his third point regards the concerns with dividing the community. Mr. Cornberg has lived in some very small communities. Apart from the financial concerns, 16 students dividing into two schools will put everyone out of business. The fact is that society is a democracy. In a city with 500 residents, there is only one mayor. People have to look at that. If a democratic constituency decided for a charter school, the people would have to live with that. Small communities are democracies, and democracy applies to education also. MR. CORNBERG strongly urged HESS Committee members to pass SB 88. Number 1505 CATHERINE PORTLOCK testified via teleconference from Anchorage. She asked for the support of HESS Committee members for SB 88. She said charter schools can provide models for improved education at no additional cost. There is overwhelming evidence that children have diverse learning styles and educational needs. When a program is well suited for the child or allows for student differences, students attend more and learn more. MS. PORTLOCK said when parents are given choices for their children, they become more involved in their children's education, which leads to greater academic success and satisfaction with the system. Rather than bleeding resources from other programs, charter school programs have breathed new life and new ideas into public schools across the country. MS. PORTLOCK added parents are with their children, rather than leaving education to the schools or taking their children out of the public schools and trying to home-school. MS. PORTLOCK added that teachers' needs are not often considered, but certainly charter schools can work with differences in teaching philosophies. When teachers feel they are valued and appropriately placed, they will be more effective and more committed. Number 1560 MS. PORTLOCK said public support of the school system is eroding at the same time that funding is becoming scarce. Parents and teachers are demanding proof of improvement in school performance, but are resistant to change. Schools need to be provided for those changes, for parents, children and teachers to feel that the school system is there for them. Number 1599 CARL ROSE, Executive Director, Association of Alaska School Boards (AASB), said the AASB is on record in support of SB 88. Much of the testimony that has already been given substantiates the need for charter schools. The AASB sees, in SB 88, opportunities for communities to become involved. The criteria is set forth. Communities will be empowered to address areas of need. If criteria is satisfied, communities can put together a proposal and bring it before the local board. A local determination is made, economics are examined, and compliance with laws and regulations are satisfied. MR. ROSE said if an opportunity exists, perhaps the school district does not see it. But if a community member does identify and can create that kind of support in a program and proposal, it would be very encouraging. What is contained in the bill meets all the concerns of the AASB. The AASB sees tremendous opportunity for creativity and enthusiasm, and empowerment of communities. Number 1662 LINDA SHARP testified that she has lived in Alaska since 1971. She is the parent of two children. One is in her third year of public schooling in Anchorage, and one who will be eligible for public school next year. She suggested that charter schools are exactly what exist in Anchorage as alternative schools. The alternative schools began in 1972, with Chugach, and went onto Stellar, the ABC Program, the Montessori, and then the expansion of the Chugach concept. Language immersion programs also grew out of the alternative school system. MS. SHARP said there are 13 alternative schools at the elementary level currently operating in Anchorage. Ms. Sharp said the desks, kids, teachers and the money are all included in any school district. Charter schools are not going to take any money or other resources out of the district. Charter schools will not bring in any more children. Charter schools are merely an innovation with what is currently in the district. MS. SHARP said charter schools let parents, teachers and communities propose innovations. Ms. Sharp presented handouts to HESS Committee members concerning education. She also had met a member of the Hispanic community that had been lobbying for charter schools. He believes charter schools will help the 20 to 30 schools in Anchorage that score very low on education tests. Number 1752 MS. SHARP presented a list of Anchorage School District (ASD) elementary schools and their scores. The 30 lowest scoring schools are schools that have no alternative program in them at all. They contain the traditional programs that are defined. All the alternative schools are well into the upper one-half of the scores. MS. SHARP presented some information from "Educational Digest." Many articles, but not all, suggested that charter schools are the best solutions. Vouchers and other ways of solving challenges for schools are not as good. MS. SHARP said her child was accepted, through the lottery system, to an alternative school this year. In Anchorage, the alternative schools are so popular that there are long waiting lists. Over 2,000 children are waiting for access into those schools. Most parents have to be fairly resourceful, because those schools are not located in enough places yet around Anchorage. Therefore, parents must drive twice a day to drop off and pick up their children. Number 1800 MS. SHARP said the alternative school her child is attending used to be the lowest scorer. It also had the highest incidence of violence, the highest teacher turnover, and the greatest dissatisfaction. Two years ago, an alternative program was introduced to the school. Now, about 150 parents are taking their children to that school. Not all the children are in the alternative program, but the $15,000 raised by the PTA has gone to every teacher in the school in equal amounts. Every child has benefit from that money. MS. SHARP said the PTA meetings have 30 to 40 parents attending. One parent is from the regular program. The rest of the parents are from the alternative program. Those parents, according to Ms. Sharp, stand ready to serve any teacher in the building. Resources are not limited to those in the alternative program. Parents of students in the alternative program will help teachers in the "regular" program. MS. SHARP concluded that the program benefits all the teachers and all the students at Anchorage's most needy school. Number 1840 MS. SHARP presented an article out of the December 2, 1991, "Newsweek" magazine entitled, "The Ten Best Schools in the World." Schools were identified that unified around a theme such as math, science or art. When teachers choose where they want to go because of interests and common themes, and when parents choose where to send their child, the parents and teachers are unified and supportive. MS. SHARP felt that charter schools were needed now. The indicators are going down. New schools and wings are opening this year and next year in Anchorage. This is a perfect time to move those willing to a different end of the school and not feel that they are ousting other people. Number 1894 MS. SHARP addressed the opposition to SB 88. She knows people in Anchorage who plan to lobby against this bill. Those people like the voucher idea. Those people are tired of the system and want the system to topple and fail. They are tired of what is going on, and they want vouchers. MS. SHARP said other people are worried that the best and the brightest will leave the public schools and attend charter schools although charter schools are still public schools. She suggested that the best and brightest of the teachers are about 80 to 90 percent of the teachers. There are not that many bad public school teachers. In addition, teachers who choose to teach in a certain program feel that program is bringing out their own particular talents. MS. SHARP also noted that caucasians are the minority in alternative schooling programs. The vast majority of children in her child's new alternative school are not white-European. These children also come from widely varying socioeconomic classes. Number 1960 MS. SHARP said SB 88 meekly challenges the status quo. Charter schools do not entail a huge risk. SB 88 only entails a small step. There is a five year sunset provision, and the school boards are in charge. The AASB is going to oversee the program. No radical changes are taking place. MS. SHARP said the teacher of the year from Kodiak was just honored because she formed partnerships with the community. Charter schools are asking for the chance for partnerships. When parents are asked to be a permanent part of the table, where curriculum and staffing issues are made, the parents are going to help solve the problems that arise. MS. SHARP noted Governor Knowles has sent his children for eight years to Anchorage's public alternative schools. Dr. Halloway, Commissioner of the DOE, wrote Ms. Sharp a letter saying the State Board of Education unanimously endorses the program. Ms. Sharp added the Anchorage branch of the National Education Association (NEA) is not opposed to charter schools. MS. SHARP asked HESS Committee members to "reward the innovations and reward the risk takers, and give people that have new ideas a chance." Number 2032 REPRESENTATIVE DAVIS wondered why SB 88 was necessary if there are already 13 alternative schools in Anchorage and charter schools and alternative schools were the same, as Ms. Sharp indicated. MS. SHARP said SB 88 is a very small step in the right direction. There is no money or major incentives given. SB 88 merely gives the school boards a notice to pay attention and look through the proposals in an up-front way. Whenever there is a superintendent in Anchorage that favors partnerships and choices, a new one is selected every few years. At other times Anchorage has a superintendent and a school board that are afraid. They don't want to be perceived as spending money in this time of cutbacks. MS. SHARP stated that a Russian immersion program was voted down at Bear Valley. The parents were asked two years ago, by the school board, to raise $15,000 with the community for start up costs. The parents and community did this. Sixty-seven percent of the parents at the school said they wanted this program. The superintendent and the school board said "no." Ms. Sharp asked the school board why the program was not implemented. School board members told her that they were warned by the legislature that they should not be asking for more money. The district did not want to look like it was spending more money on programs. MS. SHARP said SB 88 gives school districts permission to investigate these programs. Number 2097 CO-CHAIR TOOHEY asked if Ms. Sharp was asserting that alternative schools were the same as charter schools. MS. SHARP said there is essentially very little if any difference between the programs currently existing in Anchorage and charter schools. CO-CHAIR TOOHEY noted if there are 13 charter schools in Anchorage, then Anchorage is three above its allotment according to the bill. MS. SHARP understood that there would be no more than ten new programs implemented. CO-CHAIR TOOHEY noted the bill said the "State Board of Education may not approve more than 30 charter schools to operate in the state at any one time. It shall approve charter schools in a geographically bound manner as follows: Not more than ten schools in Anchorage, not more than five in Fairbanks...." MS. SHARP said that was not the intent of the bill. She has been in contact with the authors of the bill, and their intent is 30 new charter schools. Ms. Sharp was certain it was not the intent to take away three of Anchorage's current schools. Number 2162 SHEILA PETERSON, Special Assistant to Commissioner Halloway, DOE, said that as Ms. Sharp indicated charter schools are very similar to alternative schools. However, there are distinct differences. The charter school will set up a mechanism to formally approach a local school board with a charter between parents, teachers and the local school board. The charter will stipulate the educational objectives and how those objectives will be accomplished. MS. PETERSON explained that the charter schools will also be more autonomous than alternative schools. A charter school will maintain its own financial operations and will have its own principal who will oversee the charter school's teachers. MS. PETERSON added that alternative schools currently in existence are not charter schools, and therefore, would not fall under the number that is outlined in the legislation. When Commissioner Halloway looked at this legislation, she applied her test, "Is this good for kids?" She came up with a definite "yes." Charter schools are a good concept for children. It will encourage parents, teachers and communities to work together as an academic policy committee to form a charter school. TAPE 95-47, SIDE A Number 000 MS. PETERSON noted that after the proposal for a charter school is approved by the local school board, the State Board of Education must also approve it. She concluded that the DOE does strongly support this legislation. REPRESENTATIVE DAVIS stated that there may be a school that has four or five children. That is not even a unit. Therefore, he asked if there was going to be a proration which would be calculated on a per student basis. There is going to be no new money from within the school district. If the district receives so many units, then Representative Davis understands that funding would be prorated on a per student basis. MS. PETERSON asked if Representative Davis was assuming that the local school board would approve a program of four students for a charter school, and asked how much money would be appropriated to those four students. She answered that at the minimum, it would be four times what an average child would be generating in that school. The local school board would have to make that decision, and whether or not it felt that was in the best interest of the school district. REPRESENTATIVE DAVIS said "plus an approved indirect cost rate." MS. PETERSON said he was correct. CO-CHAIR BUNDE said that as there are schools in Alaska with four students as the total population, it is possible that there would be charter schools composed of four, six or eight students. MS. PETERSON stated if that was the choice of the local school board and the State Board of Education, that could be so. With the State Board of Education overseeing the charter schools program and making the approval, it will be looked at on a statewide perspective. If, in the wisdom of the board, it was felt that having a charter school for six children was in the best interest of the state, it would be approved. However, the board could also not approve such a school if it was not in the best interest of the state. Number 149 CO-CHAIR TOOHEY could not believe that a charter school would be allowed to operate with four students. There is a great demand for these schools, at any rate. Therefore, Co-Chair Toohey relies on the wisdom of the State Board of Education and the school board. CO-CHAIR BUNDE noted that the school boards approve of 21 schools in the state that have 12 or fewer students. Number 207 ROBERT GOTTSTIEN, Member, State Board of Education (SBE), testified in support of charter schools. He noted that the state is trying to do more with less. The same struggle is taking place in education. Charter schools are a chance to do more with less. In a sense, if the education community is not given opportunities to experiment, succeed and fail, the foundation formula would need to be raised even more. MR. GOTTSTIEN said schools need to innovate, and learn how to produce better results. If the education community is denied by the legislature the opportunity to figure out how to do things better, then the legislature has a responsibility to figure out how to give children the opportunities they are not be allowed to receive from the schools. MR. GOTTSTIEN believes that charter schools help children in critical ways. It is very important to get more parental involvement in education. Charter schools are the way to do just that. More value can be retrieved from education if parents are brought into the process. Charter schools are different than alternative schools. More power and authority is given to charter schools. Top-down decision making did not work in the Soviet Union, and it does not work in education. MR. GOTTSTIEN said it must be recognized that the failures of the USSR are the same factors that public education is being criticized for. The USSR did not care about the individual. It was concerned about the general public. Public education is in that situation. Alternative schools are trying to get away from that, but public schools have never attempted to try and deal with the discrete problem of every child. Number 370 MR. GOTTSTIEN said the best way to solve the discrete problem of every child is to help bring the parent into the process and to give each teacher freedom to identify and deal with those problems. Hopefully, the parents will be involved as well. MR. GOTTSTIEN concluded that there are two choices. One is to continue business as usual, and expect less result for more money. Charter schools and education reform seek to do better and to create a better value and results. Charter schools can do those things more economically. Parents can do what they think is more important for their children. They do not have to decide on what is good for everyone, and how to solve everyone's problems. MR. GOTTSTIEN said parents can focus on solving the problems of their own children with the resources that are available. If HESS Committee members are as conscientious as they appear to be in dealing with the fiscal gap, charter schools are right in line. If HESS Committee members want to continue business as usual, then charter schools and choices will not be supported, and HESS Committee members will have to accept an escalating cost in education that otherwise would not be necessary. Number 485 CO-CHAIR BUNDE closed public testimony and opened up committee discussion. REPRESENTATIVE BRICE felt comfortable with the bill. REPRESENTATIVE DAVIS thought the testimony of Mr. Gottstien was right on target. Alternatives need to be offered, and local school districts need flexibility so problems can be addressed in more unconventional ways. Latitude needs to be offered and parents need involvement. REPRESENTATIVE DAVIS said one can walk into a classroom and see that there is a niche for some of those that do not belong and do not want to be in the organized, structured classroom. There are alternatives and options, and those need to be provided. Most districts are offering options to some degree already. SB 88 is imposing requirements for more parental and cohesive involvement from a community standpoint. REPRESENTATIVE DAVIS fully supports SB 88. When the Education 2000 omnibus package came before the legislature, this is one of the first things that jumped out at him. He can identify with charter schools because of the Kenai alternative schools. Representative Davis has toured that school, and he knows the people there. He appreciates them and understands the value of that program in the district. SB 88 is an extension of the alternative programs, is more detailed and community based. Number 635 REPRESENTATIVE ROBINSON associated herself with the remarks of Representative Davis. She felt SB 88 was an excellent bill. A few years back, Representative Bettye Davis came forward with such an idea and it was not well received. At that point, people were not really open to the ideas. More parental involvement is needed, and Representative Robinson is very glad that this bill is before the legislature. She made a motion to move CSSB 88(FIN) out of the House Hess Committee with individual recommendations and accompanying fiscal notes. CO-CHAIR TOOHEY asked to comment first. She was fearful that the best and the brightest were going to be put in charter schools. She did not want the state to forget that the school system is failing. But with any luck, the whole system will go to charter schools if they become as good as everyone says they are. Co-Chair Toohey, therefore, appreciates that possibility and she supports SB 88. Number 707 REPRESENTATIVE ROKEBERG was concerned about children with disabilities and their involvement with charter schools. MS. SHARP said she has visited the 13 alternative schools in Anchorage, and those schools welcome children with special needs the same as other children are welcomed. Those children's names go into the lottery and their names are drawn. Nothing on the lottery indicates that those children have special needs. It is the desire of the parents that put them into the lottery for the school. Those children are dealt with the same as they would ever be. They still have an individual education plan as mandated by federal law, and those children are served by special educators. Number 780 MARILYN WILSON, Legislative Assistant to Senator Sharp, said SB 88 does not intend to discriminate whatsoever. REPRESENTATIVE DAVIS directed Representative Rokeberg to the statement in the bill that read, "The charter school will comply with all state and federal requirements for the use of public funds." Representative Davis thought the federal requirements that go along with the title programs would be applicable to charter schools. Number 814 CO-CHAIR BUNDE said everyone is shaped by their own personal experiences, even though we all try to understand other points of view. Co-Chair Bunde has worked in public schools and has had family and friends in the schools for 27 years. He has seen education fads come and go. CO-CHAIR BUNDE said where he grew up, 50 years ago they consolidated schools because it was too expensive to have what were, in essence, charter schools. Each little community had its own school. The non consolidated schools could not offer the broad program that the bigger school could. Therefore, Co-Chair Bunde questions, if not in this year, then in five or ten years, what the costs of charter schools will be. Number 869 CO-CHAIR BUNDE said when he first went to work in the Anchorage public schools, the latest fad was to build elementary schools without walls. That was going to solve the problems of the educational community. Last year, funding was given to put in the final wall for those wall-less schools because they did not work. CO-CHAIR BUNDE noted that Bear Valley Elementary School was mentioned by Linda Sharp, and that school is in Co-Chair Bunde's district. Co-Chair Bunde's perception of what went on while trying to establish that immersion program is very different. There was incredible anger among the parents. Some felt the program was being crammed down their throats, and others felt they were being thwarted. CO-CHAIR BUNDE recalled that parents were reduced to yelling at each other at the school bus stop. This type of program does not build community. Number 914 CO-CHAIR BUNDE said one could look at East St. Louis for the success of magnet schools. Federal courts demanded that "a ton" of money be put into magnet schools, and those schools failed miserably. America is a melting pot and there are two great facilities for encouraging a melting pot. One is the draft. People of all stripes went to the military and learned from each other. The draft is gone, and now the last remaining facet of the melting pot is the educational system. Charter schools is going to now fractionalize that. CO-CHAIR BUNDE asserted that at a time when people yell about diversity, charter schools look to taking "all the math people and putting them over here, and all the art people over here." Co- Chair Bunde has a problem with SB 88 in Alaska, because of the mobile population of this state. The average Alaskan has been in Alaska five years. A group of parents get a charter school going, and in a few years, their kids are out of it, or they are out of Alaska. CO-CHAIR BUNDE said meanwhile, the people who live in that neighborhood have no choice, they are stuck dealing with the inertia of undoing a charter school. Number 996 CO-CHAIR BUNDE agrees that the biggest problem facing schools today is parental involvement. Therefore, charter schools take the most active parents, those who are most interested and most concerned, and pull them out of the public schools and put them into their own special little world. This is the wrong way to go. CO-CHAIR BUNDE asked about student leaders. Leaders need followers and followers need leaders. Therefore, when all the best and the brightest are pulled out, there will be an imbalance. The area that cannot get the parents together to form a charter school becomes a dumping ground. The dullest and the least abled will be placed there. Number 1038 CO-CHAIR BUNDE stated that of course teachers like charter schools. Who would not want to teach highly motivated kids. Parents like charter schools, but what keeps them from getting involved in their current school. There is incredible inertia out there. Recently, an alternative school, the incredibly popular Polar School in Anchorage had a huge lottery. A group decision determined that the focus of the school for the month of January was cross-country skiing. Now parents are wondering what monster they have created. CO-CHAIR BUNDE previously stated he is willing to be proven wrong on certain topics. He does not support charter schools, and he will not vote for it. However, he will not hold the bill in committee because obviously, the committee likes the bill. CO-CHAIR BUNDE called for a roll call vote. Voting "yes" on CSSB 88(FIN) were Co-Chair Toohey, Representative Vezey, Representative Rokeberg, Representative Robinson, Representative Brice, and Representative Davis. Voting "no" was Co-Chair Bunde. CSSB 88(FIN) passed out of the House HESS Committee. HB 119 - EXEMPT SCHOOLS FROM CERTAIN DEC FEES Number 1160 CO-CHAIR BUNDE noted that since this was the first public hearing on HB 119, he would not ask HESS Committee members to vote on it at this hearing. REPRESENTATIVE GENE KUBINA, sponsor of the bill, explained that HB 119 would exempt schools from having to pay the Department of Environmental Conservation (DEC) fees for inspecting kitchens and food programs. In 1992, the legislature authorized the DEC to charge user fees. This was a way for DEC to pay for part of their budget. Fiscal year (FY) 1993 was the first year the DEC engaged in that practice. REPRESENTATIVE KUBINA continued that during FY 93 and FY 94, the DEC did not charge schools because it did not want to add to the budget problems of the schools. Evidently, the DEC subsequently had some legal counsel which advised that it cannot arbitrarily choose who it is going to charge for services. Therefore, this year, FY 95, the DEC began charging school districts for inspecting kitchens and food programs. REPRESENTATIVE KUBINA said the net effect is a shift of $25,000 from schools to the DEC's budget. The DEC has never charged schools before. Representative Kubina felt the school budget, which has not been getting cost of living increases, is more important than the budget of the DEC. The DEC is also better able to absorb the costs. REPRESENTATIVE KUBINA noted that this is a policy decision by the legislators concerning who is going to pay out of what budget. He feels that the DEC should continue to pay. Therefore, the bill was introduced. Number 1238 CO-CHAIR TOOHEY asked how many visits the DEC makes to a school in a nine month period or each school year. REPRESENTATIVE KUBINA said the DEC makes a minimum of one visit per school year. CO-CHAIR TOOHEY said she could not believe that the charge would be so extensive for one visit. REPRESENTATIVE KUBINA noted that the charge was for several schools. A smaller school district would not pay as much. The total cost, statewide, is about $25,000. That is why there is a fiscal note of $25,000 that would, in essence, come back out of the DEC budget. Representative Kubina asked HESS Committee members to remember that the DEC had not been charging schools up to this point anyway. Number 1280 REPRESENTATIVE DAVIS asked if there are currently other exemptions in this program. REPRESENTATIVE KUBINA said in the original law, nonprofit agencies were exempted. He felt that had it been considered at the time, the legislature would have also exempted schools. REPRESENTATIVE DAVIS asked if nonprofit organizations included senior citizen centers and pioneers' homes. REPRESENTATIVE KUBINA said he felt the exemptions were for homeless shelters and other such entities. REPRESENTATIVE DAVIS said he would like to see a list of current exemptions. Number 1345 KIT BALLANTINE, Acting Director, Division of Environmental Health, DEC, said the only exemption from the fees occur if an entity qualifies as a charitable organization under IRS regulations rather than a nonprofit. Schools do not qualify as charitable organizations. They are therefore not exempt under IRS guidelines and they are therefore not exempt from DEC fees. MS. BALLANTINE said although the legislation was passed in 1992, the fees were not implemented until late in 1993, because of the regulatory process. Therefore, the DEC had not been charging any fees until late 1993. These fees, however, will make a significant difference in the DEC budget. The $25,000 is much needed. MS. BALLANTINE recalled that in 1993, the DEC actually had to ask for a supplemental due to a lack of fee collection. Last year, the DEC actually had to transfer money from another component because it did not collect fees. Therefore, that $25,000 will make a difference in the DEC budget. Number 1406 CO-CHAIR TOOHEY asked how many visits the DEC makes each year to schools. MS. BALLANTINE answered that the DEC makes at least one visit per year per school. The visits and fees would also include any technical assistance, training of food service staff, spot checks, follow up checks, etc., for schools. CO-CHAIR TOOHEY asked if a breakdown chart was available per visit. MS. BALLANTINE said the visits depend on the seating and the type of facility. For example, a large full food service kitchen may serve many satellite kitchens that would warrant a $200 fee. A small satellite kitchen which only serves food would be charged only $25 to $50. The fees are determined by the extent of the food service and the number of seats. Therefore, the scale is sliding. Number 1472 REPRESENTATIVE DAVIS commented that he has studied situations such as this for a number of years. He has problems with a state agency, run with state general fund dollars, suing, fining or charging another state agency. It is just money going around in circles, and no good is done. Last year, the Kenai School District was fined in excess of $200,000 by the Occupational Safety and Health Administration (OSHA). That money went to the Department of Labor. REPRESENTATIVE DAVIS noted that although there is some local input, much of the money for that district is state dollars. The Department of Law fines and sues other agencies, and it is just moving money from one hand to the other. This is ludicrous. He does not know what other method can be employed to discipline or punish state agencies, but there must be another method than creating a paper trail and money exchange. Number 1530 CO-CHAIR TOOHEY said she would like the DEC to train one person in every school kitchen to do the job of the DEC inspectors. REPRESENTATIVE BRICE agreed with Representative Davis in that the funding exchange is circular. The school districts get money from the state. The district must then give the money right back to the state to pay for these inspections. Representative Brice felt that addressing some of these concerns can alleviate a few school district problems. It would be a small step, but it would be the first step in a long journey. Number 1594 REPRESENTATIVE VEZEY stated that the consequences of this bill becoming law are not all that apparent. A law was passed in the Eighteenth Alaska Legislature which mandated that the DEC continue to provide these oversight services and continue to charge fees to pay for the services. If public agencies are exempted from paying these fees, the DEC is put into a position of having to go back and either raise fees where they can or ask the legislature to raise fees on the private sector. REPRESENTATIVE VEZEY said therefore, a tax would be put on the private sector for a service that is being forced upon it. No one in the private sector volunteers for these exemptions. The state says it is going to do something, and those in the private sector are going to pay for it. The DEC would establish fees by regulation. It would be forced to raise fees to remaining entities to cover costs. Number 1644 CO-CHAIR BUNDE added that as the money rotates, there is also a certain amount of evaporation that takes place. He said the bill would be held in committee. SB 58 - USE OF THE TITLE "INDUSTRIAL HYGIENIST" Number 1692 AARON TRIPPLER, Director of Government Affairs, American Industrial Hygiene Association (AIHA), said the AIHA is the world's largest association of occupational and environmental health professionals. AIHA has long been involved with the process of title protection for the profession of industrial hygiene. The practice of industrial hygiene is an important tool for protecting the health and safety of workers, their families and the community. MR. TRIPPLER said with an increased emphasis on the environment today, there is the possibility of unqualified individuals representing themselves to the public as capable of protecting health and safety. The result could be devastating. MR. TRIPPLER continued that title protection for the profession of industrial hygiene simply protects that profession and those titles so everyone is assured the individual calling themselves an industrial hygienist is qualified. The AIHA is not trying to exclude anyone from involving themselves in the industrial hygiene profession. It is only that those unqualified individuals cannot use the term. Number 1757 CO-CHAIR TOOHEY said she had been approached this session by the dietitians and nutritionists. They also wanted a bill to protect the words "dietitian" and "nutritionist." Co-Chair Toohey commented at that time that she is a dietitian. She is a mother and a grandmother therefore, she is a dietitian. Anytime one person feeds another, he/she is a dietitian. Co-Chair Toohey resents the fact that the someone would restrict her calling herself a dietitian, a nutritionist or a feeder of people. CO-CHAIR TOOHEY did not want to besmirch the industrial hygienist profession, but anytime laws are passed that restrict calling oneself or anyone else a name, the English language is being restricted. CO-CHAIR TOOHEY said she could call herself a doctor if she wanted to, and that is her business as long as she does not do unprofessional things. She has a problem excluding the use of a word or a series of words because one group wants to keep their own esoteric membership. Number 1822 MR. TRIPPLER said there are many professions that use title protections. Such titles include certified public accountants and waste water treatment operators. The AIHA does not want to restrict a person from calling him/herself an industrial hygienist, as long as he/she does not represent him/herself to the public and claim that he/she has the qualifications necessary to assist someone else by legal standards as an industrial hygienist. MR. TRIPPLER said a certified industrial hygienist has a degree in the sciences, five years experience, and passes a two day examination. There are many consequences that could result from people posing as industrial hygienists. For example, the schools in the state of New York, a few years ago, were closed down at the beginning of the year because of an asbestos threat. That threat was the result of the school contracting with individuals who called themselves industrial hygienists qualified in asbestos abatement. MR. TRIPPLER said the schools eventually had to go back and find a truly certified industrial hygienist to clean up the asbestos situation. Therefore, the AIHA is not trying to restrict people from participating in the field. A person just cannot present themselves to the public as a certified industrial hygienist. Number 1884 PENNY GOODSTIEN, Representative, Anchorage Branch/Midnight Sun Section, AIHA, said she has been working for 17 years as an industrial hygienist. There have been people in Anchorage that have presented themselves as industrial hygienists. There is much money to be made doing health and safety work. MS. GOODSTIEN recounted a story in which she was working as a substitute site safety manager. A man who was an environmental engineer told people he was also an industrial hygienist. He was in charge for months, and he put the organization on the wrong respirator all summer long. Luckily no one was hurt. Someone could have become very seriously ill. That man also did incorrect air sampling and did not know what he was doing. Number 1923 MS. GOODSTIEN said the man called himself an industrial hygienist and everyone believed him. In addition, Ms. Goodstien has seen people make business cards claiming they are certified industrial hygienists. That indicates quite a bit of training, and further training must be taken every year by actual certified industrial hygienists. The charlatans were hired based on the credentials they claimed to have. There is presently no way to protect the public. MS. GOODSTIEN feels this is a public health issue more than it is an issue of protecting the industrial hygienist profession. It is the public who hires the industrial hygienist. There are cases all over the country in which fraud was prevalent. In Arizona, a shopping center spent $2 million to remove asbestos that was not there because a non qualified person identified asbestos. That person was getting a kickback from the laboratories and making quite a bit of money. MS. GOODSTIEN concluded therefore, it is not only a public health issue, it is an economic issue. CO-CHAIR TOOHEY asked her to elaborate on the economic problem. MS. GOODSTIEN said when a business or organization, such as the Arizona shopping center, hires a non qualified person who makes a wrong "diagnosis," and $2 million is spent correcting a problem that does not exist, that creates economic problems. The shopping center was shut down, stores lost money. Therefore, not only are there health issues, but people can end up spending a lot of money they do not need to spend. Number 1995 JANET OGAN, Legislative Secretary to Senator Loren Leman, testified on behalf of the sponsor of the bill that SB 58 was introduced at the request of the Midnight Sun Section of the AIHA. Presently, according to the AIHA, there are 15 certified industrial hygienists in Alaska. AIHA recommends this legislative and regulatory language to provide title protection. The title protection defines titles and definitions used by the profession. It establishes legal recognition and protects industrial hygiene titles. MS. OGAN said those titles may be used by only those who meet the criteria outlined in the definitions. An individual who does not meet the criteria may practice within the scope of the meaning of industrial hygiene so long as the individual does not use the titles, initials or represents him or herself to the public as an industrial hygienist. MS. OGAN noted that other states have also implemented this legislation such as California, Illinois and Tennessee to name a few. Many other states are planning to introduce such legislation this year. Number 2057 CO-CHAIR BUNDE noted that the bill refers to people who have graduated from a college or university that is accredited by the Alaska Council on Postsecondary Education. Therefore, he said a traditional college or university would give such degrees. He said there must be college programs in industrial hygiene, but understood that one could also have degrees in biology, chemistry or engineering. MS. OGAN said Co-Chair Bunde was correct. There is a board exam that must be taken and passed. A college degree is not the only requirement necessary to be certified. Number 2085 REPRESENTATIVE DAVIS said he had a little trouble identifying with the bill, as he has never belonged to a profession that needed to protect its name. He has either been a ditch digger, which no one wants to admit; or a politician, which no one wants to admit. JEFF CARPENTER, Member, Midnight Sun Section, AIHA, spoke via teleconference in support of SB 58. He added that this legislation will also insure that state or local government agencies do not restrict the practice of industrial hygiene. The prohibition that occurs in SB 58 has also been done in other states. However, other states are even more restrictive. In California, a registered architect must sign off on asbestos abatement plans even though that architect may have no knowledge of asbestos health hazards and work place health hazards in general. The architect may have no specific training in industrial hygiene at all. MR. CARPENTER said an industrial hygienist or even a certified industrial hygienist must take their plan to an architect, get a stamp of approval on it, and then proceed with their work. SB 58 would insure that state or local government agencies do not restrict the practice of industrial hygiene by qualified persons identified in SB 58. Number 2169 CO-CHAIR TOOHEY asked how long the schooling and testing would take for a biologist to become an industrial hygienist. MR. CARPENTER said he has a degree in biology. He did not begin his studies in college with the forethought of becoming an industrial hygienist. However, he wanted to give something to the community. As a biology graduate, he needed to gain experience in anticipating, evaluating, recognizing and controlling health hazards in the workplace. MR. CARPENTER continued that typically, to gain membership to a professional organization such as the AIHA, five years of professional practice is required in anticipating, evaluating, recognizing and controlling health hazards in the workplace. In addition to that experience, one must submit references, work experiences and an application to the American Board of Industrial Hygiene. A two day certification exam is then taken. Number 2229 CO-CHAIR BUNDE closed public testimony and asked for the wish of the committee. Representative Davis made a motion to move SB 58 am from committee with individual recommendations and accompanying fiscal notes. Co-Chair Toohey objected, and a roll call vote was taken. Voting "yes" were Representative Davis, Representative Rokeberg, and Co-Chair Bunde. Voting "no" were Co-Chair Toohey, and Representative Vezey. SB 58 am passed out of the House HESS Committee. TAPE 95-47, SIDE B Number 000 CONFIRMATION HEARING - BOARD OF NURSING CO-CHAIR BUNDE noted the names before the committee: Belle Cunningham, Kathleen Kloster and Joe Senungetuk. He read, "This does not reflect any intent by any of the members to vote for or against these individuals during further hearings for confirmation purposes." Co-Chair Bunde asked for the wish of the committee. CO-CHAIR TOOHEY moved that the names be forwarded to the House floor. There were no objections, and the names were forwarded. ADJOURNMENT Number 070 CO-CHAIR BUNDE adjourned the meeting at 4:23 p.m.