01/22/2008 03:00 PM House HEALTH, EDUCATION & SOCIAL SERVICES
| Audio | Topic |
|---|---|
| Start | |
| HB273 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 273 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE
January 22, 2008
3:07 p.m.
MEMBERS PRESENT
Representative Peggy Wilson, Chair
Representative Bob Roses, Vice Chair
Representative Anna Fairclough
Representative Wes Keller
Representative Paul Seaton
Representative Sharon Cissna
Representative Berta Gardner
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 273
"An Act relating to school funding, the base student allocation,
district cost factors, and the adjustments for intensive
services and average daily membership calculations; and
providing for an effective date."
- MOVED HB 273 OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: HB 273
SHORT TITLE: EDUCATION FUNDING
SPONSOR(s): REPRESENTATIVE(s) HAWKER BY REQUEST OF JT LEG
EDUCATION FUNDING TASK FORCE
01/04/08 (H) PREFILE RELEASED 1/4/08
01/15/08 (H) READ THE FIRST TIME - REFERRALS
01/15/08 (H) HES, FIN
01/22/08 (H) HES AT 3:00 PM CAPITOL 106
WITNESS REGISTER
REPRESENTATIVE MIKE HAWKER
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 273 as the prime sponsor.
EDDY JEANS, Director
School Finance and Facilities
Department of Education and Early Development (EED)
Juneau, Alaska
POSITION STATEMENT: During hearing of HB 273, answered
questions.
PEGGY TUTTLE, Member
Kodiak Island Borough School Board
Kodiak, Alaska
POSITION STATEMENT: Expressed concerns with regard to the
district cost factors timeline of implementation specified in HB
273.
DAVE JONES, Assistant Superintendent
Kenai Peninsula Borough School District
Soldotna, Alaska
POSITION STATEMENT: Testified in support of HB 273.
KIKI ABRAHAMSON, Teacher
Fireweed Academy
Homer, Alaska
POSITION STATEMENT: Testified in support of HB 273.
WOODY WILSON, Superintendent
Wrangell Public Schools
Wrangell, Alaska
POSITION STATEMENT: Testified in support of HB 273.
BETTY ODELL, President
Kodiak Island Borough School Board
Kodiak, Alaska
POSITION STATEMENT: Testified in support of HB 273.
LARRY LEDOUX, Superintendant
Kodiak Island Borough School District
Kodiak, Alaska
POSITION STATEMENT: Testified in support of HB 273.
STEWART MCDONALD, Assistant Superintendant
Kodiak Island Borough School District
Kodiak, Alaska
POSITION STATEMENT: During hearing of HB 273, testified in
support of the recommendations [of the Joint Legislative
Education Funding Task Force].
LUKE FULP, Director of Finance
Kodiak Island Borough School District
Kodiak, Alaska
POSITION STATEMENT: During hearing of HB 273, thanked the task
force for its work.
JOHN ALCANTRA, Director
Government Relations
NEA-Alaska
Anchorage, Alaska
POSITION STATEMENT: Testified on HB 273.
MARY FRANCIS, Executive Director
Alaska Council of School Administrators (ACSA)
Juneau, Alaska
POSITION STATEMENT: Testified in support of HB 273.
CARL ROSE, Executive Director
Alaska Association of School Boards (AASB)
Juneau, Alaska
POSITION STATEMENT: Testified in support of HB 273.
ACTION NARRATIVE
CHAIR PEGGY WILSON called the House Health, Education and Social
Services Standing Committee meeting to order at 3:07:19 PM.
Representatives Wilson, Roses, Gardner, and Cissna were present
at the call to order. Representatives Keller, Fairclough, and
Seaton arrived as the meeting was in progress.
HB 273 - EDUCATION FUNDING
3:08:17 PM
CHAIR WILSON announced that the only order of business would be
HOUSE BILL NO. 273, "An Act relating to school funding, the base
student allocation, district cost factors, and the adjustments
for intensive services and average daily membership
calculations; and providing for an effective date."
3:09:39 PM
REPRESENTATIVE MIKE HAWKER, Alaska State Legislature, speaking
as the prime sponsor, informed the committee that HB 273 is the
result of much work by many legislators over the past several
years. School funding issues have often faced an impasse during
the final budget process and ultimately stop-gap agreements have
resulted in the past several years. He reviewed the process by
which the Joint Legislative Education Funding Task Force, which
he chaired over the summer, came into existence. The task force
was charged with evaluating proposals based on available facts
and conclusions pertaining to school district cost factors and
the foundation formula, recommending improvements or additions
to the laws providing for education funding, and taking public
comments on education funding and school district cost factors.
He then acknowledged the members of the task force and thanked
them for their participation. Representative Hawker related his
belief that the task force developed a proposal that provides a
foundation to stabilize school funding in the state and allow
the focus to turn to achieving academic excellence.
3:14:56 PM
REPRESENTATIVE HAWKER explained that HB 273 includes the
increased funding components recommended by the task force. He
characterized HB 273 as the core funding legislation for
education. He then noted that the proposals the task force
brought forward in legislation were approved by a consensus of
the task force. He mentioned that some of the members of the
task force dissented with the conclusions and the record of
dissent is included in the report the task force provided to the
legislature.
3:18:24 PM
CHAIR WILSON commended Representative Hawker on the process the
task force followed and the progress that was made.
3:19:06 PM
REPRESENTATIVE HAWKER reiterated that the legislation requested
by the task force is the result of a collaborative effort, which
included a great deal of public process. This legislation
addresses the major funding component recommendations that came
out of the task force process. Representative Hawker explained
that HB 273 is a three-year plan that includes a $100 increase
in the base student allocation each year. He noted that the
task force's report recommended a minimum increase of $100
annually. Historically, increases in the base student
allocation has been the only new money coming into the state's
schools. At this time, school districts have experienced very
significant inflation in the cost of their retirement systems.
Therefore, a great deal of the funds the legislature has put in
the base student allocation has went to paying the unfunded past
service liability of the retirement systems. With the
aforementioned in mind, the task force's proposals are
predicated on the passage of SB 25, which involves the state
taking direct responsibility for a material portion of those
retirement liabilities, he explained. If SB 25 fails, the $100
increase in the base student allocation is sufficient.
3:23:16 PM
REPRESENTATIVE HAWKER then turned the committee's attention to
the district cost factors and the intensive needs students
factors provisions in HB 273. The district cost factors are
those factors in the school funding formula that recognize that
it costs more money to do business in certain communities. The
district cost factors have been a concern since the adoption of
the current school funding formula in 1998. The district cost
factor has never been resolved satisfactorily to those
communities most impacted. This legislation proposes the
adoption and phasing in of the Institute of Social and Economic
Research (ISER) cost factors. He acknowledged that there are
concerns with regard to the methodology of the ISER cost factors
and that the numbers are somewhat dated, but it's the best
information available at this time. The district cost factors
are a huge issue for the rural school districts, he noted.
3:26:07 PM
REPRESENTATIVE HAWKER moved on to the intensive needs students
funding, which is a huge issue for the urban school districts.
During the hearings of the task force it became apparent that
the current funding of those needs has fallen behind what it
costs to provide them. In the past, a base multiplier of five
times the base student allocation for a qualifying student was
used. The task force reached a proposal by which it would
progressively increase that multiplier such that it increased to
9 times, then 11 times, and ultimately to 13 times. The
aforementioned would reach a more appropriate level for the
current environment of the schools.
3:28:16 PM
REPRESENTATIVE HAWKER addressed the last factor of HB 273, which
he characterized as a protective measure. He informed the
committee that Alaska uses an enrollment based system.
Therefore, if there's suddenly a decline in enrollment, it's
funding is abruptly cut via the formula. "Schools are parts of
our community that don't really change as abruptly as an
external factor causing an enrollment shift might imply," he
remarked. For example, the closure of a military base might
substantially reduce a school's population. To suddenly
truncate funding is a huge and inappropriate disruption in that
school as it compromises the quality of education in that
community. The aforementioned has been on the Department of
Education and Early Development's plate for some time. The
department had a proposal, which the committee adopted. The
language, as included in HB 273, would provide for a step-down
in funding in the case of abrupt student enrollment changes.
3:29:33 PM
REPRESENTATIVE HAWKER opined that blending those four components
is the crux of the increased financial aid, support, and
commitment to Alaska's schools statewide. He acknowledged that
HB 273 isn't a perfect solution and there could be arguments for
other implementations. However, he highlighted that it was a
very thorough, thoughtful, and well-received public process.
Therefore, he opined that the consensus the task force reached
is a consensus that can be accepted by the state's school
system. He concluded by reminding the committee that HB 273 is
part of a package that includes two other pieces of legislation,
one of which proposes a continual revaluation of the district
cost factors and the other proposes to establish a standing
committee on education in both bodies.
3:32:07 PM
CHAIR WILSON summarized the four provisions of HB 273.
3:32:59 PM
REPRESENTATIVE GARDNER opined that the process of the task force
was fairly flawless and the results of that process show a lot
of promise. Therefore, she related that she would be
disinclined to support any significant changes. She then
inquired as to why, with regard to the average daily membership
(ADM), there's a count date for most students, but an enrollment
date for special needs children.
REPRESENTATIVE HAWKER related that there's a fixed measurement
date when each school's population is determined and after which
the school's funding isn't changed due to any population
changes. Although some would argue that the aforementioned is a
fallacy in the system, the department would argue that it's a
matter of practicality that some of these fixed dates are
adopted. Likewise, the funding for special needs students is a
fixed measurement and doesn't follow the student if he/she were
to move to another district. This is a matter for which the
task force didn't find a solution.
3:35:33 PM
REPRESENTATIVE GARDNER asked if there is any knowledge with
regard to whether students are coming from smaller districts to
larger districts or vice versa. "Who's mostly impacted by the
fact that the funding doesn't follow the kid," she asked.
REPRESENTATIVE HAWKER, recalling public testimony and
departmental testimony, related his understanding that if any
trend was identified it was that this issue was predominant in
the Fairbanks, Anchorage, and Juneau school districts as these
areas have the medical and support facilities for these
students. The testimony related that specific instances can be
identified, however none of the school districts testifying
identified it as a priority concern.
3:37:46 PM
REPRESENTATIVE SEATON, speaking as a member of the task force,
recalled that there was testimony that although the predominant
trend is that over time more [intensive needs students] move
from [smaller school districts to larger school districts], in
any year they may move back to [smaller school districts].
Therefore, it's not something that could be identified as
something one district experienced but another did not.
REPRESENTATIVE HAWKER clarified that this is not just an urban
issue. In fact, the impact of a special needs student is more
profound in a smaller school district. He emphasized that the
funding for [intensive needs students] doesn't just benefit the
larger school districts, because it's truly "a material
component of school funding across the state."
3:39:49 PM
REPRESENTATIVE KELLER inquired as to the definition of an
intensive needs student and the average cost for such a student.
REPRESENTATIVE HAWKER related that the most thorough information
regarding the average cost of intensive needs students was from
the Kenai Peninsula Borough School District and the Anchorage
School District. He recalled that the average cost was about
$70,000-$80,000. However, some intensive needs students may
cost as much as $250,000 and skew the average cost. The school
districts related that they wanted a multiplier of 15-17, he
related.
3:42:19 PM
REPRESENTATIVE KELLER reminded the committee that the governor
has stated that forward funding of education will provide the
opportunity for innovation and improvement of the outcome of the
state's education system. He then requested that Representative
Hawker explain explicitly how [what's proposed in HB 273]
addresses the aforementioned. He asked if the task force heard
from alternative schools such as charter schools because the
legislation doesn't address the funding related to
correspondence programs or charter schools.
REPRESENTATIVE HAWKER, regarding the structure of the budget for
this year and future years, said that's in its genesis.
Although the governor has proposed a funding structure that is
somewhat divergent from the course the legislature has
undertaken in past years, that's "being worked out," he said.
He speculated that ultimately, the legislature will continue to
utilize the education fund and continue to forward fund
education. Forward funding will continue to be a priority, he
emphasized. However, the exact mechanism and structure will be
worked out as the budget process proceeds. Although the task
force did hear testimony regarding charter schools and home
schooling, the task force decided not to include increments for
small charter schools. The task force commended the
aforementioned to the proposed standing committee of education
to take up as a separate issue.
3:46:11 PM
REPRESENTATIVE GARDNER pointed out that one of the elements of
education funding is local contributions. She relayed that some
communities don't provide local cash contributions for
education. She asked if the task force addressed the
aforementioned.
REPRESENTATIVE HAWKER confirmed that those issues were broached.
He noted his own concern with regard to the lack of some element
of local contribution and ownership in the community school. He
then acknowledged the concerns of those in the hinterlands with
regard to the mill rate, which may be viewed as benefitting
larger communities with an increasing property tax valuation
base. As the chair of the task force, Representative Hawker
related his belief that if the task force "were to go very far
on either one of those ... we would've gotten into a policy call
so difficult that we would not have been able to reach consensus
on those items," he opined. Therefore, the committee didn't
make recommendations on those matters other than to commend them
to the proposed standing committee on education.
REPRESENTATIVE ROSES confirmed Representative Hawker's statement
and related that the task force took those items that had been
single-source funded through other mechanisms with the
understanding that they needed to be worked on further. No one
on the task force wanted to totally ignore charter schools,
correspondence schools, or the local contribution. Therefore,
the proposal to create a standing committee on education
resulted in order to have discussion regarding how to really
implement changes in education. In response to how forward
funding will improve education, Representative Roses opined that
taking the money issues off the table allows [the legislature]
to concentrate on the substantive issues of how to do things
differently or better to improve student outcome.
3:50:10 PM
REPRESENTATIVE SEATON interjected that another reason why those
matters weren't addressed by the task force was that they
require a lot of data and analysis. He then related that he's
been asked and would like an answer as to how the step-down
provision applies to small schools that drop below 10 students.
REPRESENTATIVE HAWKER deferred to Department of Education and
Early Development (EED).
3:52:10 PM
REPRESENTATIVE KELLER expressed his difficulty in understanding
how the financial recommendations improve the outcome of the
educational process. Representative Keller said that although
he is supportive of the funding and education of the state's
children, he said he would like for the forward funding to be
tied to incentives that get students excited about school.
3:54:16 PM
EDDY JEANS, Director, School Finance and Facilities, Department
of Education and Early Development (EED), thanked Representative
Hawker for his leadership with the Joint Legislative Education
Funding Task Force. In response to Chair Wilson, Mr. Jeans
related that the definition of an intensive needs student is set
in regulation and specifies that a student must receive seven
criteria of services in order to qualify for intensive needs
funding. The criteria are as follows: 1) receipt of direct
daily instruction from a certified special education teacher; 2)
require multiple services, including related services such as
speech services; 3) all services are not required to be provided
by a special education teacher, but must be supervised; 4)
receipt of continuous special education programming; 5) require
assistance in two or more basic self-help, daily living, or
adaptive skills; 6) assigned a special education aide to provide
individual care and services throughout the school day; and 7)
require transportation services. Mr. Jeans noted that
originally the requirement for an aide was one aide, full-time
all day. However, the State Board of Education relaxed that
regulation such that in situations in which a district can
demonstrate that it can provide the required services, an aide
can have up to three children under his/her supervision at one
time. He opined that the aforementioned needs to be revisited
by the department, especially in light of the level of funding
being considered. The average annual salary of these aides is
about $40,000. At the $80,000 funding level that leaves almost
$40,000 that could be used for equipment and specialized
services.
3:57:57 PM
REPRESENTATIVE GARDNER asked, "Are you saying that if currently
one aide is deemed acceptable for three special needs kids,
because we're putting more money in we'll require each child to
have their own aide?"
MR. JEANS confirmed that has been the standard until this past
year. "It was because of the level of funding being at the
$26,000 level that districts were saying, 'Look, you don't even
pay for a full-time aide, but that's the requirement.'"
3:58:37 PM
REPRESENTATIVE GARDNER asked if there are any adverse impacts on
the students who once had one aide who now share an aide with
two other students.
MR. JEANS replied, "Not yet." He then reminded the committee
that these are severely multi-handicapped, medically fragile
children. He indicated the difficulty in a situation in which
there's a fire and the aide has to choose which of the three
children to move out of the building first. Mr. Jeans
highlighted that there are 1,800 [intensive needs] students
statewide and they deserve one-on-one attention.
3:59:34 PM
REPRESENTATIVE ROSES, recalling his time as a high school
teacher, assured the committee that during a fire alarm the
intensive needs students were taken care of very well. He
informed the committee that his job was to be the first
responder to help with the intensive needs students. Fourteen
adults would be helping with the seven intensive needs students
within thirty seconds, he related. Therefore, Representative
Roses said he didn't believe the concern regarding a fire
situation is valid. He said that he felt that the increase in
funding shouldn't automatically go toward increasing the number
of aides, but rather there should be study on the matter.
CHAIR WILSON and REPRESENTATIVE GARDNER noted their agreement.
4:00:58 PM
REPRESENTATIVE KELLER inquired as to how many of the 1,800
intensive needs students would qualify for federal funding. He
questioned whether the funding for these students should be
education funding. He then asked if there's funding available
through other avenues.
MR. JEANS related his understanding that for certain service
providers, school districts can bill directly to Medicaid.
However, he noted that not all school districts are
participating in that program.
REPRESENTATIVE KELLER remarked that perhaps increasing the
educational funding may remove the incentive for school
districts to seek alternative funding.
REPRESENTATIVE HAWKER informed the committee that the federal
government is in a significant push back of all Medicaid
refinancing efforts. In fact, in this year the budget for
Department of Health and Social Services (DHSS) includes about
$130 million worth of Medicaid refinancing push backs.
4:04:36 PM
MR. JEANS noted that DHSS has provided two fiscal notes for HB
273, one of which is for the foundation program and the other
for the military youth academy. In further response to an
earlier question, Mr. Jeans clarified that the ADM count for
intensive needs students is performed on the last day of the
[ADM] count period in order to allow the development of
students' individual education plans (IEPs) and to ensure that
they meet the seven criteria to qualify for funding. In further
response, Mr. Jeans clarified that the base student count and
the intensive needs student count is based on enrollment, not
attendance. The base count is a 20-day count that ends the
fourth Friday in October and is based on enrollment. The
intensive needs count, he reiterated, is performed on the last
day of the count period and is based on enrollment.
4:06:36 PM
PEGGY TUTTLE, Member, Kodiak Island Borough School Board, began
by thanking the Joint Legislative Education Funding Task Force
for the time it spent working on these issues and expressing her
appreciation for this legislation. However, she expressed
concern for the five-year district cost factor timeline as the
timelines for other needs are on a three-year timeline. The
district cost factors really impact Kodiak in terms of the high
cost of fuel, electricity, and transportation. With regard to
transportation, there will be increased costs for transportation
for sports teams due to the reduction in ferry service.
Furthermore, the Kodiak Island Borough School District has a
$700,000 deficit for extra expenses this year due to the higher
cost of fuel. In fact, fuel had to be flown into Karluk, which
increased the cost by $3.00 a gallon merely to get the fuel to
the location. The aforementioned resulted in the fuel to Karluk
costing over $6.00 per gallon.
4:08:47 PM
DAVE JONES, Assistant Superintendent, Kenai Peninsula Borough
School District, began by thanking the committee for its
increased support for education over the last few years as they
have allowed the district to maintain levels of service in spite
of inflationary costs while providing some additional services.
The aforementioned has resulted in substantial increased student
achievement in the district. He also recognized the significant
amount of time and effort spent by the Joint Legislative
Education Funding Task Force and its staff. The task force's
recommendations will well serve the students of Alaska, he
opined. Mr. Jones related that the Kenai Peninsula Borough
School District fully supports the declining enrollment
protection and the intensive needs students increments specified
in HB 273. Under HB 273, the trend of money being pulled from
general student funding to cover the costs for intensive needs
students will no longer occur, and therefore general education
funding will remain in that area to help increase the assessment
results of the general students. The Kenai Peninsula Borough
School District also supports the implementation of the district
cost factor recommendations. Although the Kenai Peninsula
Borough School District would like for it to occur faster than
five years, it will accept the proposed timeline, he said. The
base student allocation increases over three years will help to
make long-term innovative plans in the districts. Although Mr.
Jones related appreciation of the governor adopting the
recommendations of the Joint Legislative Education Funding Task
Force as well as the $100 increase, which was the minimum
suggested.
MR. JONES commented that there are two recommendations not
included in HB 273 that shouldn't be forgotten. As mentioned
earlier by Representative Hawker, this legislation is based on
the assumption that SB 125 will pass in a form substantially
similar to the version in existence at adjournment of the last
session. Without the protection and funding of SB 125,
districts across the state won't be able to fund the retirement
costs. The second recommendation not included in HB 273 is for
EED to recalibrate pupil transportation funding levels for
fiscal year 2009 utilizing the most recent actual audited costs
for the school districts. He related his understanding that EED
has those numbers.
4:15:21 PM
REPRESENTATIVE ROSES, regarding the comments in support of the
area cost differential being implemented faster, related that at
the onset of the task force's meetings there was almost
unanimous agreement to implement 50 percent. There was no
conversation regarding 100 percent. The task force also
discussed a 9 or 11 multiplier for intensive needs students. As
more school districts testified, the task force began the
process of discussing how it would implement 100 percent of the
area cost differential while realizing that a number of
committee members weren't pleased with the data being used.
Therefore, the decision was to implement the 50 percent and
phase-in the remainder over a three- to five-year period. The
aforementioned would allow the proposed education standing
committee to establish a Blue Ribbon task force to develop
better studies and numbers. As a result, the task force decided
to move down from an intensive needs multiplier of 11 to a
multiplier of 9 and phase it in over a three-year period as
well.
4:17:18 PM
REPRESENTATIVE HAWKER turned to the recalibration of the pupil
transportation rates, which is included in the task force's
recommendations. That recommendation required EED to sort
through audits and finalize specific numbers. He related that
his office has just been provided those numbers. He further
related that he fully intends to incorporate that additional
spending prior to HB 273 reaching the House floor.
4:18:25 PM
KIKI ABRAHAMSON, Teacher, Fireweed Academy, began relating she
was pleasantly impressed with the quality and ease of the entire
process of the task force. Ms. Abrahamson opined that some of
the problems discussed [in the task force] are magnified in
small underfunded charter schools. Although she said she
understood the reasons to commend the charter school funding
issues to the proposed education standing committee, she
emphasized the need to not forget charter schools. Ms.
Abrahamson said that she's an advocate for HB 273, and opined
that funding all students with an increased base allocation,
providing the districts with more reasonable funds for intensive
needs, and adjusting district cost factors is a huge step in the
right direction for all of Alaska's students.
4:20:57 PM
WOODY WILSON, Superintendent, Wrangell Public Schools, also
thanked the task force for its hard work. Mr. Wilson praised
the declining enrollment aspect of HB 273. Had this aspect been
in place a few years ago when he was the superintendent in
Haines, [the Haines School District] probably wouldn't have been
sued by the union. Further, the intensive needs students, and
district cost factors are crucial aspects of the legislation as
well. He noted that the area cost differential has been a
significant issue for Wrangell as it has been funded at the same
rate as Anchorage for a number of years, although it costs more
money to run schools in Wrangell than Anchorage. Mr. Wilson
then expressed concern with fully funding intensive needs
students in 2011 while the cost study won't be completely funded
until 2013. He expressed the need to have an increase [in the
cost factors] this year, particularly because of energy costs.
Funding the base student allocation in advance will make a huge
difference in the operation of each school and provide a
stabilizing effect, he opined. He then informed the committee
that $30,000-$40,000 a year has to be taken out of classroom
instructional funds to pay for transportation, and therefore he
said he was pleased that the transportation costs will be
reviewed. Mr. Wilson concluded by relating his support for HB
273.
4:25:55 PM
CHAIR WILSON noted, for the record, that Mr. Wilson is her
husband.
4:26:13 PM
BETTY ODELL, President, Kodiak Island Borough School Board,
thanked everyone for their work to analyze and stabilize
education funding. Ms. Odell informed the committee that this
is her sixth year on the school board and every year there's a
$2 million increase in the budget due to increases in the cost
of health insurance, salary, and fuel. In fact, the [Kodiak
Island Borough School District] is looking at a deficit this
year. She related that [the Kodiak Island Borough School Board]
is in favor of HB 273 and is counting on the $200 increase to
the base student allocation, as proposed by the governor.
4:28:12 PM
LARRY LEDOUX, Superintendant, Kodiak Island Borough School
District, stated that one of the most important aspects of the
passage of HB 273 is the ability to perform effective planning,
which will help focus attention on every child. He also noted
his support of the increase in funding for intensive needs
students. This will allow the focus to be on the needs of the
individual child rather than the cost to educate that child.
Mr. LeDoux opined that under the school district's mission, his
responsibility is to ensure that every child reaches his/her
full potential. He then noted that he shares the concerns
outlined by Mr. Jones and Mr. Wilson. He informed the committee
that this year alone, the Kodiak Island Borough School District
has a transportation deficit of $242,000. Although it's not
included in HB 273, Mr. LeDoux expressed concern with the hold
harmless for small schools. The Kodiak Island Borough School
District had four schools with enrollment [fluctuating] from 10
to 14 students during the ADM count, which meant considering the
possibility of closing these schools. Mr. LeDoux highlighted
that despite these increases, severe financial shortfalls will
still be experienced as he estimated that the fuel and
electricity increases alone will total over $700,000. He
concluded by expressing the hope that the committee will do what
it can to move closer to full funding of cost differentials,
intensive needs students, and other areas in HB 273.
4:32:14 PM
CHAIR WILSON asked if any of the schools in the Kodiak Island
Borough School District had to close.
MR. LEDOUX replied no, but added that next year the district
does plan on closing two schools. He noted that the facilities
of the closed schools will still have to be maintained [in order
to be prepared in the case of reopening], although no funding
will be received for that.
4:32:42 PM
REPRESENTATIVE GARDNER asked whether Mr. LeDoux supports the
state having a minimum school size. If so, she asked if Mr.
LeDoux has any recommendations as to a mechanism for making the
determination that a school should be closed due to declining
numbers.
MR. LEDOUX said that practically speaking there has to be a
minimum school size and 10 "is as good a number as any."
However, there needs to be a mechanism for the process of
enrollment moving below 10. The mechanism needs to be flexible
enough to address the needs of the children. He said that he
doesn't know what that mechanism is, although he supported a
phase-in of the closure of a school in order to avoid shocking
the community.
4:33:53 PM
REPRESENTATIVE SEATON inquired as to the increase in health care
costs for the Kodiak Island Borough School District.
MR. LEDOUX specified that this year the district's health care
costs will increase 21 percent and the estimated increase for
next year is between 9 and 15 percent. These are costs that the
district can't control as the district is self-insured.
4:34:28 PM
CHAIR WILSON inquired as to what Mr. LeDoux specifically means
when he refers to "health insurance."
4:34:51 PM
MR. LEDOUX specified that he's referring to the district's
employee health plans, which increase every year and place an
incredible strain on the district's budget. In fact, the
district's fuel and electricity increases, estimated health
increases, and step and column increases for classified and
certified staff total over $2 million. Therefore, the challenge
before the district is to get every dollar it can to meet the
needs of individual children.
4:35:45 PM
REPRESENTATIVE ROSES remarked that although the increases in
medical costs can't be controlled, the way in which the district
handles these increases are. He highlighted that there are
other options that can be explored.
4:36:30 PM
STEWART MCDONALD, Assistant Superintendant, Kodiak Island
Borough School District, emphasized that if the recommendations
[of the Joint Legislative Education Funding Task Force] don't go
through, the Kodiak Island Borough School District would be
facing an immense crisis. He expressed particular support for
the $200 increase in the governor's proposal. With regard to
the increase for the intensive needs students, Mr. McDonald
pointed out that the costs to provide the services to such a
student in a small school are even higher than if that student
attended an urban school. Mr. McDonald relayed that the public
is really excited about the potential funding increases and the
possibilities it offers. Therefore, the district has been
engaged in much planning.
4:40:06 PM
REPRESENTATIVE FAIRCLOUGH stated that although she plans on
supporting HB 273, she cautioned those who have testified that
they are counting on the governor's budget as that's a gamble.
She expressed the hope that folks are being prudent in their
planning processes.
4:41:07 PM
LUKE FULP, Director of Finance, Kodiak Island Borough School
District, thanked the Joint Legislative Education Funding Task
Force for taking the time to address school districts' needs
throughout the state and creating legislation that moves in the
right direction.
4:41:32 PM
JOHN ALCANTRA, Director, Government Relations, NEA-Alaska, began
by informing the committee that he represents 12,500 plus public
school employee members of NEA-Alaska. He then applauded the
efforts of the Joint Legislative Education Task Force and echoed
Ms. Abrahamson's comments regarding the task force. He opined
that for the intensive needs student funding to begin to
approach the actual cost is a great step. With regard to the
base student allocation, Mr. Alcantra highlighted that the $100
increase to a $5,380 base falls short. Therefore, NEA-Alaska
will work to increase the base student allocation, he related.
4:45:35 PM
MARY FRANCIS, Executive Director, Alaska Council of School
Administrators (ACSA), related that she is speaking on behalf of
all the school principals, superintendents, and finance officers
in the state. She noted that the committee should have a
resolution from ACSA in support of the recommendations brought
forth by the Joint Legislative Education Task Force. She
commended Representative Hawker and the task force for its work.
Ms. Francis related that ACSA supports a $200 base student
allocation as well as a three-year implementation of the
district cost factors. At a minimum, ACSA supports the
recommendations of the task force moving forward and would hope
that the work of the task force isn't second-guessed, she
stated. Ms. Francis concluded by stating support for HB 273.
4:48:28 PM
CARL ROSE, Executive Director, Alaska Association of School
Boards (AASB), testified in support of HB 273. Mr. Rose
highlighted that the committee has the opportunity to implement
some changes to Senate Bill 36. He, too, commented on the task
force process and how it was able to obtain a full view of the
impact of various matters on education and come to a level of
consensus. Mr. Rose pointed out that the $100 base student
allocation proposed in HB 273 may be a deal breaker because
[districts] are looking for $200 a year as it would ultimately
amount to $1,200 in 2011 rather than $600 under the $100 base
student allocation. He related that his greatest fear is that
there will be a grant-cash process because no agreement can be
achieved, and therefore the process starts at ground level. Mr.
Rose then turned to the five-year phase-in of the cost
differential, which many would prefer to be a three-year phase-
in. However, he emphasized that the important thing is that HB
273 is the best product that [the task force] could develop.
Mr. Rose concluded by relating his full support for HB 273 and
moving on to the House Finance Committee.
4:53:06 PM
MR. ROSE, in response to Representative Gardner, explained that
the $100 base student allocation compounds each year to result
in a $600 increase overall. For every $100 increase, that
increase is on top of the total base student allocation of the
prior year. He reminded the committee that this is a three-year
phase-in. Mr. Rose pointed out that the cost differential
amounts to about $148 million and for intensive needs it amounts
to about $42 million. Although Mr. Rose said that he would like
to see more, he didn't want to do anything that craters the
public policy providing the mechanism to move forward.
4:55:05 PM
REPRESENTATIVE ROSES thanked Mr. Rose for his years in service
to education. He inquired as to how many years Mr. Rose has
worked on school issues.
MR. ROSE informed the committee that he was first elected to the
school board in Skagway in 1974 and there were discussions of
forward funding then.
4:55:59 PM
CHAIR WILSON, upon determining no one else wished to testify,
closed public testimony.
4:56:11 PM
REPRESENTATIVE SEATON asked if the step-down procedure was
answered for schools falling below an enrollment of 10.
MR. JEANS explained that the hold harmless for declining
enrollment will be calculated on the school size adjusted ADM
for the district as a whole. Therefore, schools that fall below
10 students are funded with the largest school in the district,
which means that the adjustment is substantially smaller. The
adjustment may or may not be enough to trigger the hold
harmless, it depends on the size of the district. If it's a
situation in which there are a number of schools, as was
described for the Kodiak Island Borough, then the hold harmless
would likely be triggered and phased-down over a three-year
period.
4:57:18 PM
REPRESENTATIVE FAIRCLOUGH posed a situation in which there are
multiple years of decline that exceed 5 percent. In such a
situation would [the school district] continue to qualify in the
first year for the 75 percent or is it held to the cycle of
where the decline started.
MR. JEANS answered that in the past he has ran it both ways and
whatever benefitted the district was given.
4:57:49 PM
REPRESENTATIVE FAIRCLOUGH related her belief that a school
district that bases its future funding on last year's allocation
is appropriate and schools should be held harmless on that
point. However, she expressed concern with regard to the long-
term implications of increasing school funding by almost $100
million and how that funding will be sustained in an environment
of declining oil revenue.
MR. JEANS said that he hasn't had those discussions with the
Department of Revenue, and noted that the legislature has the
power of appropriation.
4:58:55 PM
REPRESENTATIVE SEATON praised the work on the task force, and
emphasized that all of the issues were fully, publicly vetted.
He remarked that he was very pleased with the results of the
task force.
5:00:26 PM
REPRESENTATIVE FAIRCLOUGH expressed concern with regard to the
sustainability of the increases proposed in the legislation.
She acknowledged that [the appropriations] are up to the
legislature. However, she said she looked to the administration
to lead because it's the one making the recommendation. She
then expressed concern that the discussion has been about adding
aides without knowing the quantitative benefit versus smaller
classroom sizes or other options. Although she said she fully
supported the funding going into the classroom, she related her
hope that the funding wouldn't get used up with the bureaucracy
at the top.
5:01:33 PM
CHAIR WILSON recalled the budget cuts when she first entered the
legislature and the work that went into cutting without
impacting education, which was accomplished.
5:02:23 PM
REPRESENTATIVE FAIRCLOUGH identified other legislation that is
critical to the [success] of this discussion. In Senate
Finance, there is legislation related to fiscal planning for the
administration in order to see long-term resources. There is
also legislation related to pension obligation bonds as well as
legislation that would return to the old retirement system,
which she characterized as negatively impacting this discussion.
5:03:52 PM
REPRESENTATIVE GARDNER commented that although she had
contemplated an amendment, she maintains her confidence in the
process and thus will support HB 273. She explained that she
had contemplated the notion of having two [intensive needs
students] per aide and placing the remaining funds into alcohol
treatment. She pondered how the aforementioned would impact the
numbers of the severely disabled.
5:05:04 PM
REPRESENTATIVE ROSES moved to report HB 273 out of committee
with individual recommendations and the accompanying fiscal
notes. There being no objection, it was so ordered.
5:05:46 PM
ADJOURNMENT
There being no further business before the committee, the House
Health, Education and Social Services Standing Committee meeting
was adjourned at 5:06 p.m.
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