Legislature(1995 - 1996)
04/28/1995 03:15 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE LABOR & COMMERCE STANDING COMMITTEE April 28, 1995 3:15 p.m. MEMBERS PRESENT Representative Pete Kott, Chairman Representative Norman Rokeberg, Vice Chairman Representative Jerry Sanders Representative Beverly Masek Representative Kim Elton Representative Gene Kubina Representative Brian Porter MEMBER ABSENT All members present COMMITTEE CALENDAR SB 25: "An Act repealing vegetable dealer licensing and regulation." PASSED OUT OF COMMITTEE HB 217: "An Act relating to employment of teachers." HEARD AND HELD HB 284: "An Act relating to the Alaska Commercial Fishing and Agriculture Bank." PASSED OUT OF COMMITTEE * HB 249: "An Act authorizing the McGrath Kuskokwim River Ice Classic." SCHEDULED BUT NOT HEARD HB 263: "An Act relating to certification of workers who handle hazardous waste; and providing for an effective date." SCHEDULED BUT NOT HEARD * HB 109: "An Act relating to telephone directory listings and solicitations." SCHEDULED BUT NOT HEARD CSSB 53(JUD): "An Act relating to regulation of risk retention or purchasing groups; to preemption of the regulation of insurance agents and insurance producers; to the general powers of the director of the division of insurance; to insurance examination hearings; to insurer certificates of authority; to annual and quarterly statements, taxes, and prohibited acts of insurers; to reinsurance credit allowed a domestic insurer; to risk based capital for insurers; to insurer assets and liabilities; to insurer investments; to insurance holding companies; to regulation, licensing, examination, and trade practices of insurance producers, managing general agents, third-party administrators, brokers, independent adjusters, and reinsurance intermediary managers; to surplus lines insurance; to criminal insurance acts; to premium increases in automobile insurance; to insurance rating; to assigned risk pools; to filing and approval of certain insurance policy forms; to required insurance coverage for acupuncture, nurse midwives' services, mammography, and phenylketonuria; to health insurance provided by small employers; to transfer of an insurer's status as a domestic insurer; to quarterly statements of benevolent associations, fraternal benefit societies, and health maintenance organizations; to reciprocal insurers; to the definition of 'member insurer' for purposes of the Alaska Life and Disability Insurance Guaranty Association; to electronic insurance data transfer and insurance funds transfer; to the definitions of `managing general agent' and `person' applicable to insurance law; to automobile assigned risk plans; placing a person employed by the division of insurance as an actuary or assistant actuary into the exempt service; amending Alaska Rule of Civil Procedure 45; and providing for an effective date." SCHEDULED BUT NOT HEARD HB 288: "An Act relating to procurement preferences for corporations and partnerships owned by persons with disabilities." SCHEDULED BUT NOT HEARD (* First public hearing) WITNESS REGISTER SENATOR DAVE DONLEY Alaska State Legislature Capitol Building, Room 11 Juneau, AK 99801-1182 Telephone: (907) 465-3892 POSITION STATEMENT: Sponsor of SB 25 ED KERN Marketing & Product Inspection Division of Agriculture Department of Natural Resources P.O. Box 949 Palmer, AK 99645 Telephone: (907) 745-7200 POSITION STATEMENT: Testified in opposition to SB 25 GUY STRINGHAM, Teacher P.O. Box 991 Dillingham, AK 99576 Telephone: (907) 842-1075 POSITION STATEMENT: Testified against HB 217 BOB COLLINS, Principal Valdez Junior/Senior High School P.O. Box 2535 Valdez, AK 99686 Telephone: (907) 835-2313 POSITION STATEMENT: Testified in support of HB 217 JOE JOSEPHSON Attorney at Law 880 "H" Street Anchorage, AK 99501 Telephone: (907) 276-0151 POSITION STATEMENT: Testified on HB 217 MARTI HUGHES, Vice President Anchorage Council of the PTA; and President, Hanshew Junior High 12825 Lindsay Circle Anchorage, AK 99516 Telephone: (907) 345-8337 POSITION STATEMENT: Testified on HB 217 BOB DOYLE, Assistant Superintendent Finance Mat-Su School District 1900 Porcupine Trail Wasilla, AK 99654 Telephone: (907) 376-3172 POSITION STATEMENT: Testified on HB 217 JOHN CYR, Teacher; and Vice President, NEA-Alaska P.O. Box 2776 Palmer, AK 99645 Telephone: (907) 745-2015 POSITION STATEMENT: Testified on HB 217 KATHI GILLESPIE, Representative Alaska PTA 2741 Seafarer Loop Anchorage, AK 99516 Telephone: (907) 345-5335 POSITION STATEMENT: Testified in support of HB 217 JOHN GILLESPIE 2741 Seafarer Loop Anchorage, AK 99516 Telephone: (907) 345-5335 POSITION STATEMENT: Testified in support of HB 217 LUCY HOPE, President Mat-Su Education Association P.O. Box 870887 Wasilla, AK 99687 Telephone: (907) 376-4796 POSITION STATEMENT: Testified in opposition to HB 217 ROBERT VAN SLYKE, Superintendent Juneau School District 10014 Crazy Horse Drive Juneau, AK 99801 Telephone: (907) 463-1700 POSITION STATEMENT: Testified on HB 217 CLAUDIA DOUGLAS NEA-Alaska 114 Second Street Juneau, AK 99801 Telephone: (907) 586-3090 POSITION STATEMENT: Testified against HB 217 DAN BECK, Assistant Superintendent Delta/Greely School District P.O. Box 527 Delta Junction, AK 99737 Telephone: (907) 895-4658 POSITION STATEMENT: Testified in support of HB 217 RON GLEASON, Principal Juneau/Douglas High School 10014 Crazy Horse Drive Juneau, AK 99801 Telephone: (907) 463-1900 POSITION STATEMENT: Testified on HB 217 MARILYN LEAHY, Member Valdez School Board P.O. Box 689 Valdez, AK 99686 Telephone: (907) 835-2801 POSITION STATEMENT: Testified in support of HB 217 WILLIE ANDERSON NEA-Alaska 114 Second Street Juneau, AK 99801 Telephone: (907) 586-3090 POSITION STATEMENT: Testified against HB 217 VERNON MARSHALL, Executive Director NEA-Alaska 114 Second Street Juneau, AK 99801 Telephone: (907) 586-3090 POSITION STATEMENT: Testified against HB 217 BOB DEITRICK, President-Elect Juneau Education Association 4421 Teel Court Juneau, AK 99801 Telephone: (907) 789-0951 POSITION STATEMENT: Testified on HB 217 REPRESENTATIVE IVAN IVAN Alaska State Legislature Capitol Building, Room 503 Juneau, AK 99801 Telephone: (907) 465-4942 POSITION STATEMENT: Sponsor of HB 217 CHERYL SUTTON, Administrative Assistant to Representative Carl E. Moses Alaska State Legislature Capitol Building, Room 204 Juneau, AK 99801 Telephone: (907) 465-6848 POSITION STATEMENT: Sponsor of HB 284 ED CRANE, President Alaska Commercial Fishing & Agriculture Bank 2550 Denali, Suite 1201 Anchorage, AK 99503 Telephone: (907) 276-2007 POSITION STATEMENT: Testified on HB 284 TOM WRIGHT, Legislative Assistant to Representative Ivan Ivan Alaska State Legislature Capitol Building, Room 503 Juneau, AK 99801 Telephone: (907) 465-4942 POSITION STATEMENT: Answered questions regarding HB 217 CARL ROSE Association of Alaska School Boards 316 West Eleventh Street Juneau, AK 99801-1510 Telephone: (907) 586-1083 POSITION STATEMENT: Testified on HB 217 PREVIOUS ACTION BILL: SB 25 SHORT TITLE: REPEAL VEGETABLE DEALER LICENSING SPONSOR(S): SENATOR(S) DONLEY, Ellis, Halford, Miller, Taylor, Torgerson, Green; REPRESENTATIVE(S) Navarre, Brown JRN-DATE JRN-PG ACTION 01/13/95 20 (S) PREFILE RELEASED - 1/13/95 01/16/95 20 (S) READ THE FIRST TIME - REFERRAL(S) 01/16/95 20 (S) L&C, FIN 03/07/95 (S) L&C AT 01:30 PM FAHRENKAMP RM 203 03/07/95 (S) MINUTE(L&C) 04/11/95 (S) L&C AT 01:30 PM FAHRENKAMP RM 203 04/11/95 (S) MINUTE(L&C) 04/12/95 994 (S) L&C RPT 4DP 04/12/95 994 (S) FISCAL NOTE (DNR) 04/20/95 1125 (S) FIN REFERRAL WAIVED 04/22/95 (S) RLS AT 02:30 PM FAHRENKAMP RM 203 04/24/95 1208 (S) RULES TO CALENDAR 4/24/95 04/24/95 1208 (S) READ THE SECOND TIME 04/24/95 1209 (S) ADVANCED TO THIRD READING UNAN CONSENT 04/24/95 1209 (S) READ THE THIRD TIME SB 25 04/24/95 1209 (S) COSPONSOR(S): HALFORD, MILLER, TAYLOR 04/24/95 1209 (S) TORGERSON, GREEN 04/24/95 1209 (S) PASSED Y18 N- E2 04/24/95 1215 (S) TRANSMITTED TO (H) 04/25/95 1490 (H) READ THE FIRST TIME - REFERRAL(S) 04/25/95 1491 (H) LABOR & COMMERCE 04/25/95 1520 (H) CROSS SPONSOR(S): NAVARRE 04/26/95 1560 (H) CROSS SPONSOR(S): BROWN 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 BILL: HB 217 SHORT TITLE: TEACHER EMPLOYMENT RIGHTS & RETIREMENT SPONSOR(S): REPRESENTATIVE(S) IVAN JRN-DATE JRN-PG ACTION 03/29/94 (H) HES AT 03:00 PM CAPITOL 106 03/01/95 531 (H) READ THE FIRST TIME - REFERRAL(S) 03/01/95 531 (H) HES, JUDICIARY 03/07/95 (H) HES AT 03:00 PM CAPITOL 106 03/07/95 (H) MINUTE(HES) 03/29/95 (H) HES AT 03:00 PM CAPITOL 106 04/11/95 (H) HES AT 02:00 PM CAPITOL 106 04/11/95 (H) MINUTE(HES) 04/13/95 (H) HES AT 02:00 PM CAPITOL 106 04/13/95 (H) MINUTE(HES) 04/18/95 1344 (H) HES RPT CS(HES) NT 2DP 1NR 1AM 04/18/95 1344 (H) DP: BUNDE, TOOHEY 04/18/95 1345 (H) NR: G.DAVIS 04/18/95 1345 (H) AM: ROBINSON 04/18/95 1345 (H) FISCAL NOTE (DOE) 04/19/95 (H) JUD AT 01:00 PM CAPITOL 120 04/19/95 (H) MINUTE(JUD) 04/20/95 1408 (H) L&C REFERRAL ADDED 04/21/95 (H) JUD AT 01:00 PM CAPITOL 120 04/21/95 (H) MINUTE(JUD) 04/22/95 1446 (H) JUD RPT CS(JUD) NT 5DP 1DNP 04/22/95 1446 (H) DP: VEZEY, PORTER, GREEN, BUNDE, TOOHEY 04/22/95 1446 (H) DNP: FINKELSTEIN 04/22/95 1446 (H) ZERO FISCAL NOTE (DOE) 04/26/95 (H) L&C AT 03:00 PM CAPITOL 17 04/26/95 (H) MINUTE(L&C) 04/27/95 (H) L&C AT 07:00 PM CAPITOL 17 04/27/95 (H) MINUTE(L&C) BILL: HB 284 SHORT TITLE: AK COMMERCIAL FISHING & AGRICULTURE BANK SPONSOR(S): SPECIAL COMMITTEE ON FISHERIES JRN-DATE JRN-PG ACTION 03/27/95 933 (H) READ THE FIRST TIME - REFERRAL(S) 03/27/95 933 (H) FSH, LABOR & COMMERCE, FINANCE 04/05/95 (H) FSH AT 05:00 PM CAPITOL 124 04/19/95 (H) FSH AT 05:00 PM CAPITOL 124 04/19/95 (H) MINUTE(FSH) 04/20/95 1398 (H) FSH RPT 2DP 2NR 04/20/95 1398 (H) DP: MOSES, ELTON 04/20/95 1398 (H) NR: OGAN, AUSTERMAN 04/20/95 1399 (H) 2 ZERO FISCAL NOTES (REV, F&G) 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 BILL: HB 249 SHORT TITLE: MCGRATH KUSKOKWIM RIVER ICE CLASSIC SPONSOR(S): REPRESENTATIVE(S) NICHOLIA JRN-DATE JRN-PG ACTION 03/10/95 701 (H) READ THE FIRST TIME - REFERRAL(S) 03/10/95 701 (H) LABOR & COMMERCE 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 BILL: HB 263 SHORT TITLE: CERTIF. OF HAZARDOUS WASTE WORKERS SPONSOR(S): LABOR & COMMERCE JRN-DATE JRN-PG ACTION 03/17/95 778 (H) READ THE FIRST TIME - REFERRAL(S) 03/17/95 778 (H) LABOR & COMMERCE, FINANCE 03/29/95 (H) L&C AT 03:00 PM CAPITOL 17 03/29/95 (H) MINUTE(L&C) 03/31/95 (H) L&C AT 03:00 PM CAPITOL 17 03/31/95 (H) MINUTE(L&C) 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 BILL: HB 109 SHORT TITLE: TELEPHONE DIRECTORY LISTING/SOLICITATIONS SPONSOR(S): REPRESENTATIVE(S) BROWN,Navarre,B.Davis JRN-DATE JRN-PG ACTION 01/23/95 115 (H) READ THE FIRST TIME - REFERRAL(S) 01/23/95 116 (H) LABOR & COMMERCE, JUDICIARY 01/26/95 148 (H) COSPONSOR(S): B.DAVIS 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 BILL: SB 53 SHORT TITLE: OMNIBUS INSURANCE REFORM SPONSOR(S): LABOR & COMMERCE JRN-DATE JRN-PG ACTION 01/25/95 83 (S) READ THE FIRST TIME - REFERRAL(S) 01/25/95 84 (S) L&C, JUD 02/28/95 (S) L&C AT 01:30 PM FAHRENKAMP RM 203 03/02/95 (S) L&C AT 01:30 PM FAHRENKAMP RM 203 03/02/95 (S) MINUTE(L&C) 03/07/95 515 (S) L&C RPT CS 1DP 4NR NEW TITLE 03/07/95 516 (S) ZERO FISCAL NOTE (DCED) 03/27/95 (S) JUD AT 01:30 PM BELTZ ROOM 211 03/27/95 (S) MINUTE(JUD) 04/05/95 (S) JUD AT 01:30 PM BELTZ ROOM 211 04/05/95 (S) MINUTE(JUD) 04/06/95 891 (S) JUD RPT CS 2DP 3NR NEW TITLE 04/06/95 892 (S) PREVIOUS ZERO FN (DCED) 04/10/95 (S) RLS AT 01:00 PM FAHRENKAMP ROOM 211 04/10/95 (S) MINUTE(RLS) 04/18/95 1058 (S) RULES TO CALENDAR 4/18/95 04/18/95 1065 (S) READ THE SECOND TIME 04/18/95 1065 (S) JUD CS ADOPTED UNAN CONSENT 04/18/95 1066 (S) ADVANCED TO THIRD READING UNAN CONSENT 04/18/95 1066 (S) READ THE THIRD TIME CSSB 53(JUD) 04/18/95 1067 (S) PASSED Y16 N3 E1 04/18/95 1067 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 04/18/95 1068 (S) COURT RULE(S) FAILED Y12 N7 E1 04/18/95 1068 (S) TAYLOR NOTICE OF RECONSIDERATION 04/19/95 1088 (S) HELD ON RECONSIDERATION TO 4/20 04/20/95 1122 (S) RECON TAKEN UP - IN THIRD READING 04/20/95 1123 (S) PASSED ON RECONSIDERATION Y17 N3 04/20/95 1123 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 04/20/95 1123 (S) COURT RULE(S) SAME AS PASSAGE 04/20/95 1126 (S) TRANSMITTED TO (H) 04/21/95 1417 (H) READ THE FIRST TIME - REFERRAL(S) 04/21/95 1417 (H) LABOR & COMMERCE, JUDICIARY 04/28/95 (H) JUD AT 01:00 PM CAPITOL 120 04/28/95 (H) MINUTE(JUD) 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 BILL: HB 288 SHORT TITLE: PROCUREMENT PREFERENCES/STATE LEASES SPONSOR(S): REPRESENTATIVE(S) JAMES JRN-DATE JRN-PG ACTION 03/29/95 979 (H) READ THE FIRST TIME - REFERRAL(S) 03/29/95 979 (H) LABOR & COMMERCE 04/03/95 (H) L&C AT 03:00 PM CAPITOL 17 04/03/95 (H) MINUTE(L&C) 04/07/95 (H) L&C AT 03:00 PM CAPITOL 17 04/07/95 (H) MINUTE(L&C) 04/21/95 (H) L&C AT 03:00 PM CAPITOL 17 04/21/95 (H) MINUTE(L&C) 04/24/95 (H) L&C AT 03:00 PM CAPITOL 17 04/24/95 (H) MINUTE(L&C) 04/28/95 (H) L&C AT 03:00 PM CAPITOL 17 ACTION NARRATIVE TAPE 95-49, SIDE A Number 000 The House Labor and Commerce Committee meeting of April 27 was reconvened by Chairman Pete Kott at 3:15 p.m., April 28, 1995. He then adjourned the meeting of April 27. CHAIRMAN PETE KOTT then called the April 28, 1995, meeting to order at 3:16 p.m. All members were present. SB 25 - REPEAL VEGETABLE DEALER LICENSING Number 031 The first order of business was SB 25, "An Act repealing vegetable dealer licensing and regulation." SENATOR DAVE DONLEY, ALASKA STATE LEGISLATURE, sponsor of SB 25, said the bill repeals the existing statute regarding vegetable licensing. The current statutes require that anybody in Alaska who wishes to purchase and sell vegetables has to get a special license and post a special bond to do so. It seems like an unnecessary involvement of state government. In the effort of trying to reduce the number of laws we currently have, this is a prime candidate. He said he would be happy to address any questions. Number 047 REPRESENTATIVE GENE KUBINA moved to pass SB 25 out of the House Labor and Commerce Committee with individual recommendations. REPRESENTATIVE BEVERLY MASEK and CHAIRMAN KOTT objected in order to hear from a person who wanted to testify via teleconference. Number 067 ED KERN, Marketing & Product Inspection, Division of Agriculture, Department of Natural Resources, Palmer, testifying via teleconference, was in opposition to SB 25. He said a resolution from the Mat-Su Chapter of the Alaska Farm Bureau was passed the previous day which he read into the record: "The Mat-Su Chapter of the Alaska Farm Bureau opposes the passage of SB 25 and HB 134. This legislation would do away with the requirement for licensing and bonding of buyers of vegetables in Alaska. It can only hurt Alaskan producers. This law presently costs the state of Alaska nothing and guarantees that the background of vegetable buyers will be checked out by the bonding company before they can be licensed by the state. "HB 133 advocates prompt payment to truckers and committee substitute (CS) for HB 140 is a bill pertaining to bonding of fish buyers. We find it hard to understand why, since both of these bills are reasonable, bonding to pay farmers is unreasonable." MR. KERN noted the resolution is signed by Preston Pyrah, President, Alaska Farm Bureau, Mat-Su Chapter. Number 110 CHAIRMAN KOTT removed his objection. He said there is a motion to move SB 25 out of committee with individual recommendations. He asked if there was an objection. Hearing none, SB 25 was passed out of the House Labor and Commerce Committee. HB 217 - TEACHER EMPLOYMENT RIGHTS & RETIREMENT CHAIRMAN KOTT announced the next order of business would be HB 217, "An Act relating to employment of teachers." He noted there were people wishing to testify via teleconference. GUY STRINGHAM, Teacher, testified via teleconference from Dillingham. He said he is a high school teacher and has taught American Government and American History for a number of years. He noted he has been involved with labor relations - employee representative kind of work. He said he would make two observations regarding the legislation. MR. STRINGHAM said his first observation in reading the bill is that it will complete the slide of teachers into second class citizenship in that one of the great rights all American citizens have under the Constitution is the right to a hearing before the court and their peers. If the bill is passed in its present form, they would lose that right. He suggested adding wording to the bill to say the cost of any hearings, trials or any kind of court hearing be born by the people and not with public money. He said he thinks this would then preclude a lot of the kinds of releases, the kinds of taking away of teacher's jobs. MR. STRINGHAM referred to the area of administration and said he disagrees with the meaning of the bill. He said he finds most administrators fairly (indisc.). If he reads the bill correctly, teaching will be the only profession in the world where somebody has to take two to five years to decide if they've got a good employee. Mr. Stringham said what has happened in the past with this tenure bill is that because of the lack of (indisc.) evaluation and good progressive discipline to help teachers overcome weaknesses or to help their (indisc.) strength, they have seen an erosion of a PR campaign. When a teacher reaches tenure, they have the right to a job forever. He said anybody who knows how this operates or how it should operate knows that any teacher can be removed in six months with a good progressive discipline program carried out by competent administrators. Mr. Stringham said he works for competent administrators and he doesn't see a need for the bill at all unless we're trying to allow incompetent (indisc.) system. MR. STRINGHAM referred to the status of teachers in general. He said for him to have to go forward to a court only in a due process which says he is going to have a hearing at a local level with people. The way hearings are currently, people don't really have good a judicial background unless a lot of high priced lawyers are brought in. He said they are going forward with little legal expertise into the court of law and they are not going to get due process. He thanked the committee for allowing him to testify. Number 190 BOB COLLINS, Principal, Valdez Junior/Senior High School, said he would speak briefly on behalf of Harry Rogers, Superintendent, Valdez City Schools, on the issue of teacher tenure which is related to HB 217. Mr. Rogers recommends extending the tenure from two to four years. He feels very strongly about tenure for certificated teachers in Alaska. Very seldom, if ever, does a certificated teacher lose their job based upon a certificated evaluation process. Mr. Collins said after two years, an administrator is involved in evaluating teachers. It is a major and difficult decision to make regarding recommending tenure or nonretention for a teacher. It is not uncommon for teachers new to a district, especially teachers new to the profession, to have a year or two where they struggle to adjust to the rigors of a classroom and the demands of being a teacher. It is their belief that presently most administrators who evaluate teachers do a good job and they give the benefit of the doubt to the struggling or marginal teacher rather than making the decision on what is best for kids - the students in the school. By lengthening or strengthening the tenure requirements, they believe it will provide teachers, especially new ones to the profession, more time to make the necessary adjustments to the challenges of teaching and to demonstrate their skills. In the long run, the extended time period will allow a more accurate assessment of the teacher's capabilities after they progress throughout the tough and typical adjustment to functioning successfully in the classroom. Lengthening tenure (indisc.) would permit administrators evaluating teachers more time to make accurate assessments of the teacher's strengths, weaknesses and potential as a quality teacher and, therefore, be able to make that critical employment recommendation based upon a true measure of a teacher's ability and what is right for students. MR. COLLINS said he believes that extending the tenure requirements will benefit teachers, administrators and students. Teachers can more accurately demonstrate their true professional skills. Administrators can make more accurate assessments of a teacher's capabilities without a rushed judgement. He said Valdez city schools have 66 certificated staff members and as of FY 96, it is very possible that there would be zero or no nontenured teachers in the district under the current system. He thanked the committee for listening to him. Number 260 CHAIRMAN KOTT noted that the committee had adopted CSHB 217(L&C), dated 4/25/95 the previous day. REPRESENTATIVE KUBINA said he would like to state a conflict. He said Mr. Collins is his wife's boss. He asked Mr. Collins how many nontenured teachers they did not retain because he felt there wasn't enough of a time period to evaluate them properly. MR. COLLINS stated the answer is one. Number 277 REPRESENTATIVE KIM ELTON said it shouldn't take two years to decide if he has a good employee or not. He said he is assuming, per testimony the previous day, that one of the most important jobs an administrator has is teacher evaluation and development. He said he still needs to be convinced why they need four years rather than two years to make a determination on whether somebody will be good teacher or not. He noted he is making an assumption, based on experience in Juneau, that there are a lot of good teachers that are waiting be hired. It may be cost efficient to dip into the pool of talented people who are waiting to teach. MR. COLLINS said it is his feeling as an administrator that it benefits all parties involved in making the assessment. It benefits the teachers by being able to "show their stuff." Mr. Collins said it has been his experience that teachers in the adjustment process of becoming a quality individual in the classroom go through a very rigorous adjustment process in both student management, content orientation, etc. He said it takes an extended period of time to successfully adjust. Two years isn't an adequate amount of time for a teacher to be able to go through that process and for administrators to be able to make a quality judgement. Number 313 REPRESENTATIVE ELTON referred to parents he has spoken with and said the problem they have with teacher tenure isn't the two year or four year period at the beginning, it is teachers who have been in the system for a long period of time. He said Mr. Collins is saying those bad teachers in the system, who are tenured, are there because of the two year period up-front. A good judgement wasn't made because there wasn't a long enough period of time to train or make a decision. MR. COLLINS said he doesn't think that is the case at all. He said they have a fine cabaret of teachers in Valdez. Mr. Collins said what he is indicating is that it would be beneficial to the teachers, students and the administrators to have an additional period of time to make a better assessment regarding the capabilities of a potential teacher. He noted he isn't making a judgement based upon the individuals already on staff. Mr. Collins said he is talking about those who are nontenured and are new to the district. REPRESENTATIVE ELTON said all of the current tenured teachers are a result of a two year tenure program. MR. COLLINS said that would be his understanding. Number 338 JOE JOSEPHSON, Attorney at Law, said he does some work for the National Education Association-Alaska (NEA-Alaska) and its affiliates. He said it seems to him that from the previous testimony there is a paradox in the bill. The previous testifier said that you can't judge a teacher on the question of tenure in less than four years. But under the draft, one would turn around and say in the case of layoffs, we will fire teachers who have passed tenure and who have served the district well. We will have a formula for laying them off regardless of their tenure rights, and keep working with those who have not proved themselves. Mr. Josephson said it seems to him that there is a philosophical inconsistency in having a four year provision coupled with the layoff language that he has seen. MR. JOSEPHSON referred to the question of de novo hearing and the judicial review and said Mr. Stringham made some interesting points. He used the phrase "second class citizen," and he is right. Mr. Josephson said if he fired an employee in his office and the employee believes that Mr. Josephson acted in bad faith, the employee can go directly to court and get a hearing before a mutual judge. If a teacher who is tenured is dismissed by a school board, the teacher's rights are merely to have a hearing before the school board or a hearing officer hired by the school board. If the teacher loses, he/she can could go to court and the judge, under the language in the bill, would be bound to affirm the dismissal of the teacher if there is any substantial basis for that dismissal even if the judge disagrees with it and thinks the school board was wrong. MR. JOSEPHSON said there was a Supreme Court case saying that school boards don't have expertise in these matters and that, under existing law, (indisc.) shouldn't be (indisc.) them. Mr. Josephson said what teachers want, and should have, is at least one neutral fair hearing on the question of dismissal whether the legislature decides it should be through arbitration or through the present de novo hearing. He thanked the committee for letting him speak. Number 381 MARTI HUGHES, Vice President, Anchorage Council of the PTA; and President, Hanshew Junior High, testified via teleconference from Anchorage. She said she would like to urge the committee to include the minimum of a five year probationary period before tenure is granted, and to (indisc.) collective bargaining in the bill. Anchorage Council of the PTA, representing over 12,000 parents and guardians, has passed resolutions supporting a minimum of a five year probationary period before tenure is granted and supporting open collective bargaining. Nationwide, the move is to do away with tenure and go to annual renewable contracts. Nine states currently do not have tenure. She gave an illustration of a scenario regarding teacher tenure. MS. HUGHES said with the budget constraints and cutbacks, the administrators who are responsible for the evaluation are some of the work forces in jeopardy in facing cutbacks. Everyday citizens in their jobs are not protected by tenure. She urged the committee to support the resolution passed by the Anchorage Council of the PTA. Ms. Hughes thanked the committee for listening to her testimony. Number 407 BOB DOYLE, Assistant Superintendent, Finance, Mat-Su School District, testified via teleconference from the Mat-Su Legislative Information Office. He said the district would support taking a look at the issues being addressed by HB 217 and SB 132. Anytime there is an opportunity to allow school boards greater local control, it will improve instruction. He said the state should seriously consider any of those suggestions. Mr. Doyle said he doesn't think HB 217 is "teacher bashing." It is important to look at any kind of tool, in a time of fiscal deficit that we currently have, that would give local school boards some flexibility to deal with the issues that confront them on an every day basis. Anytime we have unfunded mandates or underfunded mandates and we cut budgets without giving boards some flexibility, we're headed towards a disaster. MR. DOYLE said he does support any effort to (indisc.) to improving student achievement. That would include such things as looking at the areas of career paths for teachers, merit pay for teachers, retirement incentive programs and any other issues along those lines. MR. DOYLE referred to the bill and said by eliminating the de novo trial, you aren't removing all judicial review after the school board has actually heard the case. He said he would differ from testimony given by Mr. Josephson in that the private sector doesn't have due process requirements that the public sector employer does. A private sector company can dismiss an employee and they do get one fair hearing before the judge. The public sector employer has to provide due process and that employer has to give a fair hearing. In this case, if a de novo trial is granted, there is an additional hearing where the entire record is thrown out and the previous hearing (indisc.) new. The cost of that can get to the point of $200,000 or more. In these tight budget times, that money can be better used directly in the classrooms. MR. DOYLE said he would support some extensions of tenure and he does think compromises are in order. He said he does think in cases, such as transfer rights where a teacher can be hired into a school for one year and is transferred to another school the following year, does allow a situation where people think that the person is being directly supervised by the same employer both years and that may not be the case. They could have had two different principals during that time and they are going to have to conduct their own independent observations. In many cases, he believes it takes more than two years to do that. MR. DOYLE referred to the 3 percent funding provision and said his concern is that by the time you have actually determined the basic needs (indisc.) enrollment calculations in October, they have already issued year long contracts. They probably won't be issuing layoff notices until the subsequent year. He does think that it is appropriate for school boards to have some latitude but the timing of which to determine that basic need in the 3 percent reduction is critical because they are issuing contracts to tenured teacher for the following year in March and to nontenured teachers by the last day of the school year. Number 463 JOHN CYR, Teacher; and Vice President, NEA-Alaska, testified via teleconference. He said he believes his comments have been faxed to the committee. Mr. Cyr requested the committee postpone passing the bill out of committee as there are so many issues that affect so many people, statewide. It should be dealt with during the interim when all those parties concerned can sit down in a less heated atmosphere and make decisions that everybody can live with. He said he is extremely concerned about the tenure provision. Administrators all over the state have said they need more time to evaluate and yet he sees nothing on the table about mandatory evaluation. There is an awful lot of "smoke and mirrors" that seems to be going on when people want one side of the issue to go one way but they refuse to talk about true evaluation procedure. Mr. Cyr said nobody wants bad teachers in the classroom. MR. CYR referred to the de novo hearing and said he finds it interesting that it takes longer to become a tenure teacher and after you are tenured, it takes employment away from you. It is real clear that school boards are political bodies and sometimes act in a political fashion. To consider a school board hearing a fair hearing is sometimes a stretch of the imagination. MR. CYR referred to the reduction for budgetary constraints and said he agrees with Mr. Doyle. If we're going to look at that, we need to be sure of exactly what kind of conditions exist. He suggested reviewing independent audits of school districts. Mr. Cyr said the issues are very complex and more time is needed to look the issue over. Number 501 KATHI GILLESPIE, Representative, Alaska PTA, testified via teleconference from Anchorage. She said last Saturday, the Alaska PTA, which represents over 19,000 members statewide, passed two resolutions that pertain to HB 217. The Alaska PTA supports extending the probationary period for teacher tenure from two to five years. The Alaska Conference of Parents and Teachers recommends that AS 14.150 A and B be amended to require a minimum of five full school years of employment as a teacher to obtain tenure in the school systems of the state of Alaska (indisc.) teachers who retire on or after the effective date of the act. MS. GILLESPIE said the Alaska PTA supports the opening of contract negotiations to public scrutiny. She said their resolution RESOLVED reads that the Alaska Conference of Parents and Teachers supports rules and collective bargaining and provides (indisc.) and reasonable time for public comment of all issues being considered between the bargaining group and the school board. Therefore, be it further resolved that the Alaska Conference of Parents and Teachers actively seek and support changes to state legislation or regulations which allow for public disclosure and a reasonable time for public comment of all issues being considered between a bargaining group and the school board for collective bargaining. The PTA can no longer stand by silently as the policy of public education and public support for public education (indisc.). There is no smoke and mirrors here except the part that is being born by the NEA. MS. GILLESPIE said parameters for evaluation are negotiated behind closed doors and out of the public eye. In Anchorage, they have negotiated an evaluation process that never holds them accountable for teaching the curriculum that we pay them to teach. For them to use the evaluation process that they wrote to deny the children of this community of quality education is ludicrous. We all know that as oil revenues decline, significant downsizing will occur. Give us some tools to manage our work forces as (indisc.) and effectively. She indicated there is an incredible level of frustration felt by parents and taxpayers. Our kids are the second class citizens here in a system that is set up to protect the employees regardless of their performance. She asked the committee to support HB 217. Number 520 CHAIRMAN KOTT referred to open negotiations and asked Ms. Gillespie if she is addressing the negotiating process or is the PTA interested in understanding or knowing the issues that will be negotiated. MS. GILLESPIE said the frustration is that they are not aware of the issues that are being negotiated. She said they don't necessarily have to sit at the table. In Minnesota, everything is open except for the strategy sessions that the two groups hold. In California, they come before the public with their issues that they will be negotiating. After public comment disclosure, they go into negotiations. If there are any new issues, there is a time for public comment. Ms. Gillespie said our elected officials don't know what the will of the people is on issues that have never been publicly discussed. In Anchorage, 87 percent of the budget is negotiated in the contracts. They are at a disadvantage. She said they are concerned that the budget is being negotiated behind closed doors for a period of three years at a time. Number 533 REPRESENTATIVE KUBINA inquired if Ms. Gillespie had just been elected to the school board. MS. GILLESPIE indicated she was. REPRESENTATIVE KUBINA said he doesn't know of anything in the law which requires that the negotiations be behind closed doors. He said he thinks that all the school board has to do is say that they will be open. He said Ms. Gillespie is in a position to do so. MS. GILLESPIE said that isn't her understanding. She said it is her understanding that the labor relations law doesn't speak to the issue at all. What they have been told by their labor relations person is that both parties have to agree in order for them to be open and the union will never agree to that. Ms. Gillespie said she thinks the public deserves to oversee the spending of public dollars. The development of public policies shouldn't be an option; it should be a guarantee to the children of this state. Number 564 JOHN GILLESPIE was next to testify via teleconference from Anchorage. He indicated his family are products of the public education system of this country. He said their success, as a family and individuals, in the fields of engineering, management, education, space exploration and aviation can be directly attributed to the quality and availability of a publicly supported education system between the period of 1930 to 1975. He said HB 217 will be a good first step in reversing the spiral down that we are currently in. The time has come for business, interested taxpayer, voters and legislators to take a stand for their kids. Mr. Gillespie said he supports HB 217. He asked the committee to include an amendment to provide for open negotiations with public school employees. Allowing open negotiations will involve the public in a meaningful way by allowing public comment in issues critical to their children's education. He said he believes this will result in an increase of public support for the system. MR. GILLESPIE said rolling back teacher tenure will result in improved performance. He informed the committee he has been a supervisor in private industry for the past 15 years and has had to deal with many employee performance issues as well as downsizing operations. Individuals who feel they have been wrongly terminated have the right to (indisc.) against employers. He said he doesn't believe special provisions are necessary over and above the rights of other citizens. Mr. Gillespie urged the committee to report HB 217, with an amendment for open negotiations, to the floor. Number 598 LUCY HOPE, President, Mat-Su Education Association, testified via teleconference from Mat-Su. She indicated concern with some of the effects of the bill. Ms. Hope said she believes that two years is an adequate time to evaluate teachers on a probationary period. The Mat-Su School District has an excellent evaluation tool that was developed jointly by teachers and administrators. It is very effective. She said she believes that is the most important component in improving instruction. Ms. Hope said extending the probationary period without improving the evaluation process will not do this. Extending the tenure provision can have some economic impact. She said the previous week, she received a phone call from a teacher who has taught in the school district for two and a half years. He has not achieved tenure. He asked what the status was of HB 217 as he had applied for a loan for a house at his bank and the bank told him he would denied until he achieved tenure. MS. HOPE said she is concerned about the teachers who live in a community for four or five years before being allowed to purchase a house. It is another example of teachers being second class citizens. Ms. Hope said she is also concerned about extending the ability of school districts to layoff tenured teachers. Revenue is declining but Mat-Su is growing at a rate of 4 percent to 5 percent a year. Next fall that will equate to about 500 new students. The ability to layoff more teachers will not help kids in the school district. Ms. Hope urged the committee to hold the bill. Number 617 ROBERT VAN SLYKE, Superintendent, Juneau School District, was next to testify in Juneau. He said he believes there is something to be gained by extending tenure. Two years tends to be a bit short, but whether four or five years is necessary, he doesn't know. Two years is certainly short. Mr. Van Slyke said he thinks there are times when we don't give our nontenured employees a fair shake. He said the district firmly believes that when they hire somebody, they make an investment in them. They would like to have an opportunity to help them be successful. If the period is too short, there is a tendency to cut them loose, and some of those people, with a little more time, may have turned out to be very good teachers in the long run. On the other hand, they have kept people in an attempt to be fair and have regretted it. MR. VAN SLYKE referred to the layoff provision and said they would like to see it. He said they reduced staff by approximately 40 teaching positions last year because of financial constraints. Mr. Van Slyke said if anything happens where they don't receive all of their funding, either locally or from the foundation program, they are going to be in trouble. He said they would be at the point where they will have very few nontenured people to layoff. If this situation were to continue in subsequent years, they would be in a position where they wouldn't be able to afford to pay the salaries of all the tenured people unless there were people retiring. MR. VAN SLYKE referred to the language in the bill and said he has concern with the 3 percent figure. He said this is because they have been wringing their budget for three years and they had to make drastic cuts last year and will this year. He said we can have the same level of basic need and still be in trouble...(END OF TAPE) TAPE 95-49, SIDE B Number 000 MR. VAN SLYKE referred to the elimination of de novo and said they support it. Employees who are nonretained or dismissed can be afforded a hearing that is fair and equitable. If there are any due process violations, the person would have a recourse to court. He said they have concerns about the lengthy process when you have to go to superior court and start over as there are expenses associated with that. Mr. Van Slyke said he applauds the efforts put forth in drafting the bill and he thinks it has some positive features. Number 070 REPRESENTATIVE KUBINA said there are several proposals regarding education this year. There is HB 217. Currently there is a proposal by the House majority to retain funding at last year's level which is about an $18 million cut to education. The Governor has a retirement incentive program (RIP) bill in place. He asked Mr. Van Slyke to prioritize those three things. MR. VAN SLYKE said first and foremost should be full funding. That is the number one priority. He said he would also like a RIP bill so maybe they could get through negotiations successfully. He said they are currently in negotiations and have asked for some concessions from their bargaining units in order to get by. Mr. Van Slyke said they would also like some money and latitude the RIP bill might provide to bring back some of the teachers that they had to layoff. He noted they have approximately 20 teachers on recall. Number 094 REPRESENTATIVE ELTON commented that Juneau is extremely lucky to have Chief Administrator Bob Van Slyke. He noted he is leaving soon and will be replaced by Mary Robidoux. REPRESENTATIVE NORMAN ROKEBERG referred to the 3 percent funding and contract timing problems and asked Mr. Van Slyke to expand on the issue. MR. VAN SLYKE said, "I think on the 3 percent figure, for example, the so called flat funding, you know, that's proposed, which I consider a cut because it would cut our revenue by about $500,000 at the state level plus it would reduce the amount that the local assembly could contribute under the cap by another $115,000 - well that's about ten teaching positions, but that's still under $300,000 - I mean under 3 percent. And, I think -- you know my figures are that we've got about eight people that we could nonretain and, you know, we could have a reduction. My point is we could have a reduction of less than 3 percent and still be in a world of hurt. In fact, we're in a world of hurt now because we've just run out of wiggle room. As far as the contract period, you know it's a -- I'm not exactly sure how it would work. I guess there would have to be some regulations established to implement you know whatever statute the legislature did enact. I don't know whether that gets at your question or not." Number 130 REPRESENTATIVE KUBINA asked if Juneau was at the cap. MR. VAN SLYKE said Juneau is at the cap and has been at the cap. He noted there are six districts, Juneau, Kenai, Valdez, Ketchikan, Sitka and Fairbanks. REPRESENTATIVE ROKEBERG asked if the cap is because of the disparity calculation in the formula. MR. VAN SLYKE said it is because the state chooses to take into account federal impact data. It is not a federal requirement, it is a state choice under the current foundation system. REPRESENTATIVE ROKEBERG asked if the disparity has an impact. MR. VAN SLYKE responded the disparity test does. It results in the cap. REPRESENTATIVE KUBINA said there is a state solution. MR. VAN SLYKE responded in the affirmative. Number 160 CLAUDIA DOUGLAS, NEA-Alaska, was the next witness to come before the committee. She said she is sorry that the education community has not been able to come together and come to a resolution on some of the issues, because she truly doesn't believe this is in the best interest of kids and public school systems. Ms. Douglas referred to Ms. Gillespie and said she will play a very important role and hopes she will look at the evaluation procedure very carefully. MS. DOUGLAS said she happens to have the Alaska regulation that says, "Responsibility for evaluation of performance of professional employees results with the individual school districts." She said it goes on to describe how that process can be followed. MS. DOUGLAS gave committee members some information on tenure. She also gave them a survey conducted on tenure around the state. According to the figures, there are 41 states that have either a two or three year period of tenure and different continuing contract provisions. She said there are two states that have a five year tenure process and two states that have a four year tenure process. Ms. Douglas noted Colorado wasn't listed in the information but currently has a three year provision with a renewal contract. MS. DOUGLAS gave the committee information regarding a survey in terms of the appeal process and said if Alaska teachers lose the de novo hearing, we would be the only state that has an impartial hearing officer or arbitrator at some point in the review process. MS. DOUGLAS referred to tenure and said it is a very sensitive issue. It is simply going from nontenure to a tenure position or from temporary employment to permanent employment. School districts have high standards for hiring new teachers and NEA- Alaska supports those standards. She said they support high standards for people that enter the profession. They would even consider some sort of an extension of the two year provision if there was something included in the evaluation that said it had to be conducted in some way. MS. DOUGLAS referred to the National Teacher of the Year being from Kodiak, Alaska, and said the model established in Kodiak involving the parents and the community in changing the way that they offer education is the way we should be going. She said they shouldn't have to come to the legislature and ask them to make laws to make changes. MS. DOUGLAS referred to the way the bill is structured and said she thinks it is an insult to many practicing teachers that go into their classrooms every day who are trying to do the best job they can. She urged the committee to give them the task to go back and work with the community to try to work out some sort of solution. Ms. Douglas said she doesn't believe having this in law and making the changes this way is best for kids. MS. DOUGLAS referred to the layoff provisions and said she can't accept the fact that there is going to be less money for school districts than what they currently get. She urged the committee not to pass the bill out. Number 246 REPRESENTATIVE KUBINA asked if the university system has tenure. MS. DOUGLAS said she believes they have a seven year tenure period. After the seventh year, she doesn't believe they are required to have evaluations. Currently, in public schools even tenured teachers have a year requirement for an evaluation. She said she believes that at the university level, once you do have tenure, there isn't a requirement for an evaluation procedure. She noted it may vary from university to university. Number 264 REPRESENTATIVE BRIAN PORTER said the committee has heard people from both sides of the issue say they really don't think it is appropriate to have to come here and deal with these issues. He said he would subscribe to that notion also. He asked Ms. Douglas if she would support repealing everything. MS. DOUGLAS said there should be some kind of a task force, seminar or something to say to the people in the education community, parents, etc., to work on during the interim to try and reach some kind of consensus based on research or what is going on in other school districts. She said she would like to work on some of the ideas of things occurring around the nation. Number 284 REPRESENTATIVE ROKEBERG referred to the termination of the de novo trial proceedings and asked MS. DOUGLAS to explain the current process. MS. DOUGLAS said currently, a tenured teacher that is dismissed has an opportunity to request a hearing in front of the school district. She said she believes that can be done either in front of the district or a hearing officer appointed by the school district. Those are the same group of people that sign and negotiate contracts and hire teachers. She said she believes that board members are often very close to the criticism or comments. It seems very difficult to have a fair hearing at that level. Lets say the teacher is denied retention. At that point the teacher can request to have a de novo hearing in front of the superior court judge. At that point, the judge can review and hear the evidence. There can be no additional charges made but the school districts or the teacher can bring in new evidence, but they can't change the charge. At that point, the judge can make a decision. REPRESENTATIVE ROKEBERG asked what happens if the teacher doesn't request a hearing. MS. DOUGLAS said they have lost their job. REPRESENTATIVE ROKEBERG asked if they have a right at that time to ask for judicial review. MS. DOUGLAS said it has to go before the board first. Number 314 CHAIRMAN KOTT said if the board denies the teacher the job or tenure and it is taken to de novo trial, who would pay the bill. MS. DOUGLAS said the teacher has come through the association and the association has had a motion to support that, the association will pay for part of the teacher's expenses. The district picks up the district expenses. She said it is her understanding that it is a shared responsibility. Each side pays their own. Ms. Douglas referred to binding arbitration and said some things are different. Sometimes the district has to pay all or the association has to pay all. CHAIRMAN KOTT asked what the hearings cost. MS. DOUGLAS said some are $100,000. She noted she doesn't have the statistics. Number 337 REPRESENTATIVE ROKEBERG asked Ms. Douglas if she could distinguish between the cost of having a hearing and a de novo trial. MS. DOUGLAS said in the current situation, having the hearing usually is less expensive. If it goes to a de novo trial, it usually involves attorneys. REPRESENTATIVE ROKEBERG asked if attorneys aren't normally present at the hearing level. MS. DOUGLAS responded not always on the association's part, but they can be sometimes. REPRESENTATIVE KUBINA referred to a section of the bill and asked why the word "arbitration" was included. MS. DOUGLAS said she believes it should have been deleted from the CS that came from the Judiciary Committee. She said they currently are not entitled to it, so it doesn't need to say that they aren't entitled to it, because they're not. Number 403 REPRESENTATIVE ELTON asked Ms. Douglas if she could give an idea of how often a de novo trial occurs annually. MS. DOUGLAS said at the most, five a year. She indicated she wasn't exactly sure. CHAIRMAN KOTT referred to a House Health, Education and Social Services Committee meeting, and said de novo costs were discussed and there were five recent cases that dealt with nonretention and the total cost was $721,000. REPRESENTATIVE ELTON said if we're talking about two to five cases a year, we may be talking about the wrong end of the problem. He said he thinks the cost of buying out the contract for the previous superintendent in Juneau was two years of salary and legal costs in excess of $300,000. He said it still hasn't been resolved and is ongoing. Number 440 DAN BECK, Assistant Superintendent, Delta/Greely School District, was next to testify from Delta Junction. He referred to Section 6(c) and said in times of reduced revenues and increased (indisc.) costs the school districts must have the effective tools to deal with staff reduction. He informed the committee they were preparing to deal with the massive layoffs associated with the realignment of Fort Greely. Although they may be in somewhat of a unique situation, he believes that many or all of the school districts can more effectively deal with programmatic and sensible reductions enforced to put student needs first. He encouraged passage of HB 217. He noted the section he should have referred to was Section 5 that deals with layoffs and the ability of districts to layoff not on seniority, but on programmatic needs. If a district has primary needs and a secondary teacher is more senior, the district should be able to layoff a secondary teacher and place programmatic needs first. REPRESENTATIVE KUBINA asked if the law specifically says it has to be by seniority. MR. BECK said it doesn't, but noted HB 217 would define that a lot clearer. He referred to the local bargaining unit trying to set ground rules in anticipation of the bill and said they don't know what is going to happen the first time it comes up with an individual teacher. They could end up in court. REPRESENTATIVE KUBINA said the Delta/Fort Greely area is anticipating some real problems because of the closure of the base. He said we're certainly hopeful that the RIP bill will pass which will help them immensely. Number 478 RON GLEASON, Principal, Juneau/Douglas High School, testified in support the committee substitute for the extension of tenure from two to four years. He said as a building practitioner, he found himself wanting to respond to questions he heard earlier. Mr. Gleason said there are two points as to why he would support the committee substitute. The first is as a building principal, he would love to have the luxury of having evaluation being his only responsibility. Implementation of instructional programs, providing educational leadership, supporting staff, community school relations, dealing with school discipline, violence, drug and alcohol issues are all extremely time consuming components of his job. The second point is, "What is a good teacher?" He said in Juneau we think that teaching is a complex process. Therefore, accessing the quality of a person's current performance, also interjecting a projection of what that person will be, is an extremely complex process. Angry parents calling, which may lead to an investigation, is also a component. In many cases if not most, in his experience, we find a cadre of people that feel strongly in support of a teacher for whom they have received a number of angry calls. It always boils down to nothing but time and hard work. He asked do we look at classroom management as a tool? Do we look at student performance? Do we look at the ability to communicate - interpersonal skills. That is another critical component of an effective teacher. Not only is a person being assessed as to their current performance, but they have to make a read as to their ability to pursue professional growth. Are they compatible with the desires of that particular community regardless of their pre-service training. It is an extremely complex situation. A four year period would provide much better results for our students and employees than a two year period. CHAIRMAN KOTT asked Mr. Gleason how many evaluations he is responsible for. MR. GLEASON responded 30 certified teacher and 15 classified support staff, annually. CHAIRMAN KOTT asked how long it takes to evaluate the individuals. MR. GLEASON explained they are predicated on at least a single direct classroom observation and typically, multiple observations. For a nontenured teacher in Juneau, they make four observations a year. Number 563 REPRESENTATIVE KUBINA said being an administrator of a school isn't a simple thing. Being a teacher isn't a simple thing any more. He said it is very complicated and he thinks too many things are being pushed off on the schools. If we could get rid of them and do our function of teaching and administering a teacher in a school, the whole thing would be simplified. REPRESENTATIVE ELTON said if all administrators were like Mr. Gleason, we wouldn't have the need for any laws to regulate behavior in the district. We expect good judgement and reasonable application of common sense. Representative Elton said he would be interested in Mr. Gleason's discussions with parents. MR. GLEASON said in his experience with parents, they feel relatively powerless regarding addressing concerns with tenured teachers. REPRESENTATIVE ELTON said he can see where the extension of tenure would be a good and helpful managerial tool for Mr. Gleason. He asked Mr. Gleason if he thinks it will resolve the concerns of the PTA people who have testified. MR. GLEASON said he liked Ms. Douglas' view in developing an effective tool that involves the professionals, parents and all interested constituents. He said he would like to see the evaluation tool addressed at the level of the constituents. Number 614 REPRESENTATIVE PORTER asked Mr. Gleason if he sees any reason why an evaluation tool would have to be in statute. MR. GLEASON said he doesn't think that would be a good thing to do. Number 617 MARILYN LEAHY, Member, Valdez School Board, testified via teleconference from Valdez. She said Mr. Gleason put their case forward very well in that not only is the public scrutinizing the performance of our schools, but they're also escalating their demands of what subjects need to be taught. They are also demanding that the schools continue to educate at higher and higher levels of competence. Ms. Leahy noted unlike other professions, the market forces don't apply to teachers. She said as a school board member, she wishes she could believe that we are going to continue to support and increase support for education. Ms. Leahy stated budgets are shrinking both at the state and local levels. We still need to ensure that the people selected to be in the classroom are going to be able to deliver a high quality of instruction over the long term. Ms. Leahy explained that the issues have to do with ensuring the quality in our school systems that the parents and the public are demanding. MS. LEAHY referred to the layoff provisions and said they have to do with the financial status. She doesn't see this as an abstract discussion. We don't want to get rid of our teachers. We would like to have as many teachers as possible and as small as possible student/teacher ratio. TAPE 95-50, SIDE A Number 000 MS. LEAHY said she thinks the bill is fair to teachers and protects the best interest of the students. She asked the committee to support the bill and move it out of committee. Number 014 WILLIE ANDERSON, NEA-Alaska, was the next to come before the committee. He said he would focus on the de novo trial judicial review. Mr. Anderson said he would review what happens when you terminate a teacher's employment. First, the principal makes the recommendation to the superintendent. The superintendent concurs with that recommendation. Then the superintendent makes the recommendation to the board. The board concurs with that recommendation. After the board concurs with that recommendation, the superintendent has the right to send a letter of nonretention or dismissal to a teacher. So the board participates in part of the decision to nonretain the teacher. Then the teacher has 15 days to request a hearing before that board. The hearing is requested and the board reviews the information again. He noted he has handled a number of these cases and in every case, the board retains its earlier decision. He said what we're seeking is a fair hearing. Mr. Anderson asked how do you get a fair hearing when the board that makes the final decision about your retention has already made a decision about your nonretention. The process is convoluted and you cannot get a fair hearing from a board that has already made a decision. For the board to make a fair hearing, they would have to reverse their earlier decision. Mr. Anderson stated there are no other employees, state, public or private, who has that type of situation. Under the provisions in the bill, that is what would happen. MR. ANDERSON said currently there are negotiated agreements in many of the school districts around the state. He said they can negotiate and arbitrate a ten-day suspension without pay. An independent arbitrator comes in and renders a decision on that cause and he/she can reinstate the ten-day suspension. We can arbitrate a transfer denial. An independent arbitrator comes in and makes a decision about that decision, but we are denying an independent hearing officer to make a decision about the retention of a person's career. Mr. Anderson said that is the problem with the bill as it is currently structured. MR. ANDERSON said he tends to believe that people have the belief that we are going to get an independent hearing from a school board. Mr. Josephson stated that the court in Mat-Su has stated that the board has no independent judicial review training. Administrative procedure, as currently constituted in state law, is different than what is constituted here. He said what he is asking of the committee is a fair hearing whether it is a de novo trial which is currently in law, or a binding arbitration decision. He said they want one shot at the apple for a fair hearing. People have characterized that you get two shots at the apple. You get a board hearing and you get a de novo trial. He said get rid of the board hearing because we know the outcome of the board hearing. They've already made their decision earlier when they concurred with the superintendent's recommendation. Mr. Anderson said his request is one fair hearing. He thanked the committee. Number 103 REPRESENTATIVE KUBINA said Mr. Anderson brought up a very good point in where it is one where Valdez has had only two grievances in the 17 years that he has been involved in Valdez. He noted he served as president of the union for many years. Representative Kubina said Mr. Anderson raised a good point. A superintendent goes to a school board and they talk about it. He said that board not backing up that superintendent is almost like a vote of no competence. That board, 99 percent of the time, will go along with what the superintendent has done and especially if it is public knowledge. If they didn't agree with the superintendent, it is like giving the superintendent a vote of no competence. He/she would be humiliated or contradicted to all their employees. Number 134 REPRESENTATIVE ELTON said this is similar to some experiences he has been involved in during his service on the local assembly. The assembly would make a determination on issuing a major mine permit to an operator who wanted to invest hundreds of millions of dollars in this community. That permit decision made by the assembly can be appealed and it is heard by the assembly again. They would be sitting as a quasi-judicial body. He said when the assembly heard the appeal for the second time, it was compelling to know that their decision sitting as a quasi-judicial body was appealable to the superior court. Without that appeal, you're more apt to make a political decision than not. He said that may also be the case here because if a school board knows that their second hearing process can be reviewed and can be second guessed, you induce a much better second hearing on the part of the school board. CHAIRMAN KOTT said he thinks there is a bit of a problem in the way the bill is set up. He said he would agree that the school board would reaffirm their earlier decision. Number 172 REPRESENTATIVE ROKEBERG asked Mr. Anderson how prevalent is it to use hearing officers in the state. MR. ANDERSON informed him that the Anchorage School District uses hearing officers. Generally, the school board concurs with the hearing officer's decision. He said he hasn't seen a case in Anchorage where the school board hasn't concurred with the hearing officer's decision. REPRESENTATIVE ROKEBERG referred to the hearings and asked if counsel is present. MR. ANDERSON explained that generally for a tenured teacher there is counsel representatives on both sides. For a nontenured teacher, there is generally counsel representing the school board and a person who doesn't have legal training, like himself, representing the teacher. REPRESENTATIVE ROKEBERG asked who are the hearing officers. MR. ANDERSON explained there is a panel of hearing officers that the Anchorage School District has impaneled. CHAIRMAN KOTT asked Mr. Anderson how many cases he has observed. MR. ANDERSON said he has participated in twelve of the cases in Alaska during the last eight years. Number 198 VERNON MARSHALL, Executive Director, NEA-Alaska, came before the committee to give his testimony. He said Mr. Gleason made a great point relating to the time it takes to evaluate staff. He said maybe we should be saying that the time should be prioritized because the development of any staff is critical to management of any system, whether it is a school district, a newspaper or a police force. If you assume that you have 50 staff members, 35 teachers and 15 support staff, and if we spent three hours on three people on the average, that is 150 hours a year. He said if we really did well and get 300 hours a year, we're only looking at maybe 4 percent of this individual's time if they put in eight hours a day, five days a week, for 180 days of instruction or 7,200 hours. The critical issue is still time. Mr. Marshall said he thinks a beginning teacher does need help and assistance. They need more than a set of keys and a box of chalk to do their jobs. They need the mentoring and the assistance that valuable administrators can provide them. Mr. Marshall said he thinks that if we set up a system that delays that process two more years, we are doing not only a disservice to children, but we're doing a disservice to that teacher. Nothing currently in the bill prescribes any kind of mentoring, any kind of in-service, any kind of accelerated certification, or any kind of classroom management training. He said we're not even talking about five year programs at the college level to prepare teachers for the classroom. We're not talking about site-based decision making, but yet for some reason it is in the wisdom of someone to indicate that we need to move from two to four years of probation. MR. MARSHALL referred to the layoff provision and said they are concerned about that section. He referred to page 3, line 7, and said it does provide for a layoff of teachers because of decreased school attendance. It also indicates that if the basic need of the school district, determined and adjusted under the law, decreases by 3 percent or more from the previous year. Mr. Marshall said he sees this as a tremendous safety valve. He said in other words, there are bills before the legislature that will fund schools next year at about $59,000. Mr. Marshall said he feels that if the basic need in the school district is $61,000 and if you reduce that basic need by 3 percent or $1,830, you have a value of $59,170. The disincentive here is not to fund the unit. There is a burden and a responsibility on government to ensure that schools are adequately funded and that they are provided the necessary resources to be innovative, different, and meet the challenges of the new decade. Mr. Marshall said it is unfair to expect both administrators, school boards, systems and teachers to do more with less. Every year they have to deal with the fact that they aren't getting any kind of adjustment for inflation, but yet they're expected to, in a sense, absorb those costs into the system. Now we come forward with a provision in the law that mandates that the state will allow a school district to balance budgets on the backs of children and tenured teachers. MR. MARSHALL referred to line 8 and said that section only applies to tenured teachers. So in effect, we could apply this section if this adjustment takes place. We get rid of tenured teachers. There is no responsibility or requirement to get rid of nontenured teachers. For the most part, the seniority system is not effective or operative at all if this provision is triggered. He said at the same time, class sizes will likely increase. MR. MARSHALL referred to page 3, line 17, relating to the layoff provision and said that is all permissive. It is indicating a school district may do that. There is nothing in there that requires a school district to provide for provisions that deal with layoff or retention. The same is carried through on line 24 where the section may not be inconsistent with provisions of this section. He referred to lines 21 through 25, and said they do feel they have many collective bargaining agreements in school districts throughout the state. These have been decided locally. They deal with this issue, but yet this particular provision will circumvent what has been decided over time on the local level. Mr. Marshall said he is concerned about line 31. He said if a person is laid off in September, October, November or December, they may look very carefully at line 31. They have no job and will probably be drawing unemployment. They will probably will look for extra funds so they will go and be treated as a terminated employee for the purposes of pulling out money from their teacher retirement account. If they have spent their retirement and if they ever enter the system again, it will be too hard to pay back that money plus the interest to get back into the system if they have another ten years of service and wanted to achieve retirement. MR. VERNON referred to judicial review and said what they are most concerned with is relative to judicial review based on the record and what the judge will do. It is his understanding that the judge will apply what is called a substantial basis test. Basically, that test will be, "Is there any rationale or evidence evident in the record to support the decision." In other words, a decision was made to nonrenew a teacher. Is there any rational evidence or is there any rationale that supports the decision. He said he has been told by their lawyer that the judge is not going to have the ability to go back and say, "Well I believe this record is wrong. I believe the school board was wrong and based on what I believe..." He said the judge cannot overturn that particular decision. MR. VERNON referred to the burden of proof and asked if the burden shifts when you send the record to the judge. Now is the burden of proving that the school district was wrong shifted to the teacher or does the school district still have the burden of proving its case against the tenured teacher. He explained another step in this process that hasn't been discussed relates to the Professional Teachers Practice Commission (PTPC). The PTPC can very well take up the case after the dismissal if it is an incompetence immorality charge and the teacher can lose their license to practice in the state of Alaska. MR. VERNON referred to the terms of probation and before the bill was in the HESS Committee, it was argued that basically what we want to do is set up a system that somewhat equates to what applies to state employees. Currently, if you are a range 13 or below, you have a six month probationary period. After the six month probationary period, you have a just cause standard to dismiss that individual. If you are a range 14 and above, you have a one year probationary period and just cause becomes the standard for dismissal of that employee. Mr. Vernon indicated in the case of the bill, we are saying, "You are an at will employee, you can be dismissed for no reason, any reason, just because." For four years within a district, you're gone. There is no reason. He referred to denial of tenure and said if tenure is denied to him in a school district, he has no recourse to the courts. When you compare that to other public employees, it is not fair. He said they are willing to look at ways to improve evaluation. Number 369 BOB DEITRICK, President-Elect, Juneau Education Association, came before the committee to testify. He said he is beginning his third term with the Juneau Education Association. During his tenure as an association representative as well as a teacher in the Juneau School District, he has had the opportunity to observe, witness and participate in many of the issues the committee is addressing in the bill. The first issue he would like to address is the acquisition of tenure. He explained he has testified before the Alaska 2000 Committee that we do need to take a look at how tenure is granted in Alaska. Mr. Deitrick said he does not believe that somebody who teaches for two years should automatically be granted tenure. He does believe that somebody who has taught two years should have an opportunity to apply for tenure. There should be a built in provision and funding provided to local school districts to provide a peer review committee, master teachers, and to provide a mentoring process so that when we are granting tenure to a person in the school district that we, as a school district, believe this is an individual that we want to keep in our community to work with our children. Mr. Deitrick said he believes four years is a lengthy time period. If we have an inadequate teacher, we shouldn't be dumping money into their pockets for four years. He said he thinks if a person, after two years, applies for and is not granted tenure, they should have one year to get their act together in working with a mentor or master teachers, etc. MR. DEITRICK referred to the area of layoffs and said we have a layoff provision in our negotiated agreement. He said he thinks the negotiated agreement speaks well to the process for layoffs of nontenured teachers and can, in fact, go into a tenured teacher layoff under certain conditions. MR. DEITRICK said the 3 percent figure in the bill causes him great concern. If the 3 percent figure is a result of a drop in enrollment, then how are we going to define what a substantial drop in enrollment is in order to (indisc.) attack the tenured teaching force. If any bills are passed that lowers the value of the instructional unit, it will be a major impact on our professional, experienced staff that are in our communities. He referred to the 3 percent figure and said in the Juneau School District last year, about 50 teachers were laid off and nearly half of them were rehired so they didn't have a break in service. During this school year, when we have about 20 teachers out there on a recall list, our school board hired additional administration. They increased the number of administrators in the bargaining unit. They have also increased the school board budget so they can pay their Alaska Association of School Board dues while we have teachers sitting out there waiting for jobs. He said he doesn't believe the 3 percent figure is going to allow equal treatment in our system. He thinks that the administrative direction that he has been observing in our community is a concern. In 1987, we had a number of teachers on layoff and there was also a unilaterally imposed salary cut in their bargaining unit. At the same time, school administrators received a salary increase. He asked who is going to monitor how school districts are laying off and spending money. MR. DEITRICK referred to hiring preference and said a number of negotiated agreements speak to this. At the same time, we've seen a number of grievances occur and what defines preference. There is no definition of preference in the bill. Who is going to define preference in a hiring or rehiring process as well as qualifications. He said they attempted to negotiate language which provides definition for qualifications and when they try to deal with qualifications in working with the school board or administration, there is always an attack on what is the definition of qualifications. Mr. Deitrick asked if it is based on being endorsed in a certain area or is it having a Type A Certificate. MR. DEITRICK said we also need to be careful with local control. He believes local control is a key point that we need to consider when legislation is being written that will affect negotiated agreements. He said we sit down with school boards and negotiate a contract that we believe we can all live with. If we truly believe that the bargaining process is a valid process in this state, lets not mess with local control. MR. DEITRICK referred to the teacher retirement system refunds and said people coming back into the system to work wish that they had not taken that money out. He said it impacts them the rest of their lives. MR. DEITRICK referred to budget considerations for layoff and said we need to encourage an early retirement bill. We also need to encourage local retirement incentives. Last year, the school district and the Association of School Boards negotiated an early retirement incentive plan where teachers received $10,000 if they resigned or retired. They had to meet certain conditions on the salary schedule to save money for the district. The Juneau School District saved nearly $1 million and that is what allowed the rehire of about half of the teachers that were laid off the previous spring. MR. DEITRICK referred to the trial de novo and said he thinks Mr. Anderson spoke to it very well. He said you need to be aware of what goes into the evaluations. He said he questions the types of comments that are going into evaluations and whether they are valid and whether they are observable. Trying to get them removed is like pulling teeth. He said they can't go in and say, "This is an unfair statement. This is an inadequate statement. Remove it from the evaluation." All they can do is attach a rebuttal. Mr. Deitrick said if evaluations are going to be used for a board hearing in proving a teacher's incompetence, they need to have some way of having a counter position and an impartial hearing in order to present their case. He said he believes that as an association, we can work jointly with school districts on nonretention of even tenured teachers. MR. DEITRICK said we are here as professionals, we can work together and the bill takes away that opportunity and takes away what he believes is their professional right. He urged the committee not to move the bill. Number 462 There being no further testimony, CHAIRMAN KOTT closed public testimony. He said it is the intent of the chair to recess until 7:00 p.m. Number 470 CHAIRMAN KOTT called the meeting back to order at 7:17 p.m. Members present were Representatives Kott, Porter, Kubina, Elton, Rokeberg and Masek. REPRESENTATIVE PORTER said there is a work draft of the bill before the committee. He said he has a technical amendment on page 2, to remove lines 10 and 11. Because of the removal of a previous paragraph, that wording isn't necessary. CHAIRMAN KOTT said he would concur with that. He said Representative Porter made a motion to delete on page 2, lines 10 and 11. Chairman Kott asked if there was an objection to Amendment 1. REPRESENTATIVE ELTON said he doesn't object, but he assumes that means they are going to have to make a minor adjustment on line 9 to move the "and" up to line 6. He said he would assume it is incorporated in the motion that Representative Porter made. CHAIRMAN KOTT said they will delete the semicolon and add "and". He asked if there was an objection to that motion as amended. Hearing none, the motion carried. Number 510 REPRESENTATIVE KUBINA moved to delete Section 6. REPRESENTATIVE ROKEBERG objected. REPRESENTATIVE KUBINA said he made the motion because of the discussion about school boards and them already making their decision and they're the ones the teachers will appeal to. He said he was uncomfortable working on the whole bill. CHAIRMAN KOTT said, "There is an objection, we'll just discuss it. I would agree, based on what I heard, that there is a little bit of a problem here but I think if we delete Section 6 in its entirety, then we have nothing. In the event that there is a teacher that is fighting tenureship available...." REPRESENTATIVE ROKEBERG said, "No, I don't agree with that." CHAIRMAN KOTT said, "(Indisc.) over the status quo." REPRESENTATIVE ROKEBERG said, "We'd go back to status quo which would be get rid of the judicial review and still have a de novo trial." CHAIRMAN KOTT said, "I think based on some of the discussion we heard, a de novo trial is an expensive proposition." Number 537 REPRESENTATIVE PORTER said he has a degree of discomfort of the total process that is left. He indicated he has more discomfort with the requirement for de novo trial and the expenses that can be incurred. Representative Porter said revenues are such that they are going to have to come down more. Now is the time to provide opportunities for school administrations to manage... REPRESENTATIVE ELTON indicated concern with the bill as there are some elements he likes and some he dislikes. He said there are some elements that address some problems but he isn't sure they are the right answers. He said he doesn't think parents are all that concerned about extending teacher tenure from two to four years. He said the parents that he has spoken to are more concerned about teachers who are tenured that are in the system. HB 217 doesn't address that problem. Representative Elton referred to the problems the administrators have discussed and said the bill may be a small managerial tool. The problems they have discussed are funding and the RIP management provision. He suggested the committee set up a subcommittee and incorporate some of the different suggestions. REPRESENTATIVE KUBINA withdrew his motion. REPRESENTATIVE PORTER said for the last two years these issues have been in the legislature. He said he thinks that passing the bill out, the closer it gets to fruition and the closer people are going to be forced together and maybe come up with a solution before it gets passed into law. He said there is just too much diverse opinion on these issue. To him, the further the bill moves along the process of being passed, the more motivation there will be for the parties involved to work something out. REPRESENTATIVE ELTON said the closer the bill gets to fruition, the less the school boards and the PTA are going to be inclined to want to talk. CHAIRMAN KOTT said the issue has been dealt with over the last two years and it is frustrating to see things not move forward. He said he hates to invoke any kind of legislation action in these areas as he would much rather see the sides come together. TAPE 95-50, SIDE B Number 006 REPRESENTATIVE MASEK said she has some serious problems with the bill. She said people from her district have been contacting her regarding the bill. There are many teachers who are really concerned with what the legislation will do. She noted she is a freshman legislator and this is the first time she has heard about the issue. She said the issue is a really complex issue and there are many different sides and people who the bill will affect statewide. Representative Masek said rural Alaska is completely different from the urban areas. She is afraid the ramifications that the bill will bring about is going to hurt the quality of education for our children. Representative Masek said she would like to see more work done on the bill. We need to do what is best for the state. She said she is proud of the fact that the Mat-Su Valley has the highest SAT scores. The quality of education can be improved, however, she doesn't believe the bill falls within those lines. She feels there is a need to do more work on the bill. CHAIRMAN KOTT said the goal for better education in the state is a goal for the whole committee. He said he appreciates Representative Masek's concerns and comments. Number 073 REPRESENTATIVE ROKEBERG pointed out the bill had substantial work done on it in the House HESS Committee. There was a very large subcommittee where numerous people were involved. The bill was substantially changed and substantial compromises have already been made. He said he has problems with certain aspects of the bill, particularly the judicial review provisions. The bill is needed to provide the administrations of the various school districts in the state a tool in which they can manage their budgets and their personnel. Without the layoff provisions, there is going to be a major crisis occurring overnight because the districts will find themselves in a position where their hands will be tied in managing their budget and personnel problems. The biggest advantage of the bill would be in the rural areas. Number 115 CHAIRMAN KOTT said he must apologize because when the bill was read across, he saw the word "arbitration" and requested it be referred to the House Labor and Commerce Committee. He said he never even look at it and probably shouldn't have made the request. REPRESENTATIVE KUBINA said the fact is there is only one part of the bill that is really clear cut and that is the tenure. The layoff clause is not clear cut at all. There has to be more to the lay off provision than just saying the board can layoff. How does it relate to nontenured teachers? He asked if anyone is going to look at it to approve some kind of a plan besides a school board who could then just arbitrarily start laying people off. Is there something that needs to go to the commissioner? Have they looked at other things? Is it fair to hire administrators and then layoff teachers? The problems that were mentioned on the judicial review. He said there is only one part of the bill he sees is clear cut and dry. Representative Kubina indicated concern with the layoff provision. He said he would suspect the layoff provision would cause far more court battles. There hasn't been any testimony from Legislative Legal Services to explain the ramifications of what the layoff provision or the judicial review provision means. REPRESENTATIVE PORTER said in the House Judiciary Committee, there didn't seem to be any indication that this would foster litigation. Unfortunately, that is the way disputes are resolved. Whenever there is a new statute that doesn't please everyone, it more than likely will be tested. Nobody said this is unconstitutional or this is in violation of an existing case law that would be struck immediately upon being presented. Number 180 CHAIRMAN KOTT referred to page 3, line 8, "This section does not apply to a teacher who has not acquired tenure rights," and said he thinks it was inserted by the Judiciary Committee. It was supposed to be a clarifier but to him it is confusing. REPRESENTATIVE PORTER explained there is another section in existing law that deals with tenured teacher. He said he wanted to make sure this wasn't to be held in conflict with that. CHAIRMAN KOTT said when he read this he thought now we're just hitting the tenured teachers and the nontenured teachers were off the hook. He said in essence, there is another provision in law that does cover nontenured teachers. REPRESENTATIVE KUBINA said he doesn't think there is a clause that says you have to let go of nontenured people before you can layoff tenured people. REPRESENTATIVE PORTER said there is nothing in the section that would conflict with that statement if it is in law some place. That would be the deciding factor. This section doesn't apply to nontenured teacher layoff. In other words, he doesn't know what the requirements of the statute are for laying off a nontenured teacher. What is being said on line 8 is that whatever it is, it isn't that the school district has to establish a 3 percent basic need loss or a loss of attendance. He noted he doesn't know what it says. REPRESENTATIVE ELTON said he has the same interpretation as Representative Kubina. We're talking about a new section. We're not talking about an existing section. The sentence on line 8 leads him to believe that when basic need is determined under statute, it decreases by 3 percent or more, and districts may place teachers in a layoff status. But then when you read the last sentence, it makes it seem as if when that circumstance arises, the 3 percent decrease, it would only apply to the tenured teacher. Representative Elton said he thinks he understands what the provision was meant to do, but in the context of the new section, his interpretation is a lot like the chairman's. Number 237 REPRESENTATIVE PORTER said with the information that Representative Kubina has furnished, there is no doubt in his mind that the law which says nontenured teachers must be laid off before tenured teachers is the driving law on that issue. He said what line 8 means is defining criteria set up in lines 3 through 7. It is clear that they are not talking about nontenured teachers, they're talking about tenured teachers. REPRESENTATIVE KUBINA said that sentence only applies to AS 14.20.177 (a). REPRESENTATIVE PORTER indicated that is correct. REPRESENTATIVE ELTON said, "Why couldn't we say, `This paragraph' then." REPRESENTATIVE ROKEBERG said, "Because it goes on to (b) and (c)." REPRESENTATIVE ROKEBERG asked if they wouldn't want (b) and (c) to apply to both tenured and nontenured teachers. REPRESENTATIVE PORTER said that is why it says "section." REPRESENTATIVE ROKEBERG referred to talking about primary, secondary, seniority and things like that, you don't want to take those other people into account. He asked if you wouldn't have to amend the other statute with the same kind of criteria. REPRESENTATIVE PORTER said, "The sponsor of the legislation and those testifying for it said this section -- whole section applies to tenured teachers. There is another total section that deals with nontenured teachers and they wanted to make sure that this section only applied to tenured teachers." REPRESENTATIVE ROKEBERG asked if (b) and (c) wouldn't have to be put in the nontenured provisions in the statute if that were to be balanced. REPRESENTATIVE PORTER said this bill doesn't deal with the nontenured teachers and he would just as soon not open that up. REPRESENTATIVE ELTON said the committee heard testimony that this is a problem. He said he doesn't know if this is a problem or not. CHAIRMAN KOTT said since there evidently is another section that covers nontenured teachers, it is probably not as much of a problem that he had initially thought. He said he wasn't aware that there was another section. REPRESENTATIVE ELTON asked if there is another section that covers nontenured teachers. He said his understanding was that the nontenured were covered under contractual provisions and not under statutory provisions. REPRESENTATIVE KUBINA explained there is a nonretention section that says, "A teacher who has not acquired tenure rights is subject to nonretention the following school year. (Indisc.) expression of contract for any cause that the employer determines adequate." He said you could dump a nontenured teacher for two years because of anything. You don't even need to give a reason. REPRESENTATIVE KUBINA discussed a situation he encountered as a nontenured teacher. Number 330 CHAIRMAN KOTT asked if there was further debate. REPRESENTATIVE ROKEBERG referred to Section 6 and said he doesn't know if it is right or wrong. CHAIRMAN KOTT referred to Section 6, line 7, page 4, and said it refers to arbitration. Since that was removed in the original bill it should probably read, "attain tenure rights is not entitled to judicial review if arbitration has been removed." CHAIRMAN KOTT said he would like to know the views of the sponsor of the bill. Number 347 REPRESENTATIVE IVAN IVAN said the committees have worked hard on the bill and this is the third committee of referral. Some amendments were made in the HESS Committee. We compromised on the amendments were made. He said he has heard debate from both sides and he feels the bill is a good bill that will give some flexibility to the school districts in the event of declining revenues. He said he would like to see the bill move forward. He said he felt discussion was provided and an ample opportunity was given to all parties throughout the process. CHAIRMAN KOTT said in light of it being late in the legislative session and the bill still needs to go to the House floor and then through the Senate, he would be extremely surprised if the bill made it to the Governor for his signature. He said he would suspect that wherever the bill ends up, Representative Ivan would be willing to work with both sides in coming up with a compromise. REPRESENTATIVE IVAN said his interest is to see the bill pass. REPRESENTATIVE ELTON said, "I don't know if this is a good idea or not, so I'll fess up before I make this suggestion. I wonder, Representative Ivan, if this would be a possible solution. If we amended tenure, it's now four years in this bill - I think Sections 1 and 2, if we amended that to three years, moved Sections 1 and 2 forward and then worked on the interim on the layoff and the binding arb or de novo trial or judicial review provisions in the interim, would that be acceptable? Move it forward as a simpler bill addressing tenure at three years perhaps and then keeping the more complicated portions behind for interim work? REPRESENTATIVE IVAN said he presented the bill as it is and he would like to see it advance and become law as it is. Number 406 CHAIRMAN KOTT said he moved that on line 7, strike the words "arbitration or." He asked if there was an objection. Hearing none, the conceptual amendment was adopted. REPRESENTATIVE ROKEBERG moved CSHB 217(L&C), Version R, out of committee with individual recommendations and accompanying fiscal notes. REPRESENTATIVE ELTON AND CHAIRMAN KOTT objected. Chairman Kott said there is additional work that needs to be done. He asked Representative Rokeberg to respectfully withdraw his motion. Number 422 REPRESENTATIVE ROKEBERG withdrew his motion. REPRESENTATIVE IVAN said he understands a similar bill was introduced in the previous two sessions. He said they have not received anything from NEA-Alaska throughout the committee process except they explained what was wrong with the bill and that they didn't agree with it. He said there has not been any suggested language, changes or negotiations until it reached the House Labor and Commerce Committee. It has gone through the committee process as all bills do. CHAIRMAN KOTT asked if he knew whether either side has come to the table and tried to work things out. REPRESENTATIVE IVAN said he believes that in the HESS subcommittee, NEA-Alaska was involved in working on the bill. He said he feels they were given full opportunity to address the bill. Number 452 CHAIRMAN KOTT called for a five minute at ease at 8:04 p.m. CHAIRMAN KOTT called the meeting back to order at 8:15 p.m. He said his intent is to lay HB 217 aside and bring up HB 284. HB 284 - AK COMMERCIAL FISHING & AGRICULTURE BANK CHAIRMAN KOTT announced HB 284, "An Act relating to the Alaska Commercial Fishing and Agriculture Bank," was before the committee. CHERYL SUTTON, Administrative Assistant to Representative Carl E. Moses, came forward to explain the bill. She said the bill was sponsored by the House Special Committee on Fisheries. Ms. Sutton said the committee packets include sectional summaries from Legislative Legal Services and Alaska Commercial Fishing & Agriculture Bank (CFAB). She noted CFAB did an excellent job of doing cross references to the sections of the statute and the sections of the bill. In addition, there is a sponsor statement, two zero fiscal notes and numerous letters of support. She said she would like to add that the numerous letters of support, it does not represent a small portion of the numbers of letters that have been sent to Representative Austerman in support of the bill. MS. SUTTON explained HB 284 seeks to modify and refit CFAB's enabling statute to reflect the evolving commercial law and the present day fishing economy's needs. CFAB was created in 1978 and much has changed in both commercial law and the fishing economy since that time. There are two significant changes that would be enacted with the passage of HB 284. First, is permanent ownership by the state through retirement of all but $1 million of the state's initial investment of $32 million. Second, the broadening of the purposes and circumstances for which a fisherman may use his limited entry permit as collateral. The intent of the changes is to make CFAB's loan program more compatible with the needs of the seafood industry. She noted Ed Crane, President, CFAB, is in attendance to offer testimony and answer technical questions. Ms. Sutton said it is an 18-page bill and appears to be very intimidating, but it is not. Number 500 ED CRANE, PRESIDENT, CFAB, said as Ms. Sutton indicated CFAB was an effort of the 1978 legislature to approach a form of privatization of financing of the seafood and agriculture industries and Alaska. The concept was one which was an effort to replicate institutions in what is known as a federal farm credit system in the Lower 48. It was essentially to create a private financing cooperative which would serve only Alaska residents and companies, in which ultimately would become self- sustaining. The state of Alaska invested initially $32 million as seed capital so that this new institution would have equity. Over the years, CFAB on the strength and with the use of that equity has borrowed consistently. They borrow from an institution called "A Bank For Cooperatives" located in Denver, to the point where they have at times had over $100 million of loans outstanding even though there has never been more than $32 million of state capital. In total over the years, they have made over $600 million in loan advances. The theory was that over time, the equity owned by borrowing members would be accumulated and replace the state's equity. Mr. Crane said when you become a borrower, you must buy stock in CFAB. They do business only with stockholders and every customer must become a stockholder. Mr. Crane said as of today, they have a little over $17 million of money that has been invested by the borrowing members. MR. CRANE said another part of the concept is embodied in the existing statute which said that by the year 2000 or within 20 years of the state's initial investment, which took place in 1980, CFAB must retire or repurchase that stock from the state, the entire $32 million. As of today, they have retired $22 million of it and there is still $10 million left and five years to do it in. MR. CRANE said the most significant thing the bill does is to modify that requirement so that CFAB will only retire $31 million of the total $32 million. He said $1 million of state capital will remain as permanent equity. CFAB will survive with the $1 million of state capital in addition to whatever member capital is acquired. Mr. Crane said there was a reasons for that. One is there is an unintended anomaly in the original statute which says that when the entire $32 million is retired, the statute lapses. If the statute lapses, there is no CFAB. MR. CRANE explained the other more significant thing is a large part of CFAB's service to commercial fishermen and the needs of commercial fishermen is premised on the fact that CFAB is the only private lender which has the statutory authority to take a lien on limited entry permits. No other lender, other than the state's own fishing loan program, can do that. Because limited entry permits are such a significant part of any fisherman's capitalization, it is an increasingly important part of CFAB's business, as they finance for new permits and use permits as collateral for loans for other purposes. In an effort to maintain that special status, CFAB believes it is important to continue the relationship of the state as an owner with CFAB, which in turn rationalizes not only that special status but the other points of relationship between CFAB and the state. MR. CRANE explained the other points of relationship is the legislature does have, both under the existing statute and the proposed revision, the authority to direct the legislative auditor to make any sort of audit on CFAB which it chooses. It was done several years ago. In addition to that, state bank examiners in the Department of Commerce and Economic Development examine CFAB each year. It is recorded and submitted to the legislature and the Administration. Mr. Crane explained the legislative auditor has access to CFAB's independent outside auditors. Finally, the Governor of Alaska appoints two of CFAB's seven directors. The other five are elected from among the borrowing members. MR. CRANE said CFAB is strange in structure. He noted the state Supreme Court has on occasion commented in effect that CFAB is a little bit further removed from the state than the Alaska Railroad and some other institutions. MR. CRANE said the change he referred to is in Section 9 of the bill, which is somewhat convoluted language. It does not specifically mention $32 million, but what it does say is that it continues to require CFAB to repurchase all the shares of the stock owned by the state except for $1 million, whatever amount exceeds $1 million. MR. CRANE explained the remainder of the bill is essentially a revision of CFAB's statute, 44.81. He said there is much that wasn't changed. He referred to Sections 10 through 26 and said they relate to the experience CFAB has had over the past 15 years, and some of the inconsistencies and gaps that they have encountered in the existing statute. There is also some conformity with some of the ways fishing economics have changed and the variety of laws affecting commercial lenders. Mr. Crane said there are broader powers in respect to permit financing and that is found in Section 20. He said he would be happy to answer questions. Number 630 REPRESENTATIVE PORTER asked if CFAB is the entity that makes the agriculture loans also. MR. CRANE indicated it was. He noted in practice, and if you exclude the certain kinds of timber loans that we classify as agriculture, they do very little in the way of farm loans. He said he believes they only have one loan on the books. CHAIRMAN KOTT asked Mr. Crane what CFAB's relationship is with the federal farm credit system. MR. CRANE said CFAB is a borrower of what is called the National Bank for Cooperatives, which is one of the institutions of the federal farm credit system. He noted there is a variety of institutions in that system and each of them have undergone quite a few changes over the last few years. TAPE 95-51, SIDE A Number 001 REPRESENTATIVE ELTON said, "...substantive change I wanted to note for the other committee members and one that I thought a lot about and we had some discussion on it in the previous committee was there is an expansion of power for CFAB into getting into -- I hesitate to use the word `venture capital' because it's not -- it allows the bank to acquire an equity interest in businesses or enterprises that will advance commercial fishing and agriculture in the state. At first I was a little bit bothered by that but the more I think about it, I think the better I feel about it. I think the bank has an extensive history, especially over the last eight or nine years, and has demonstrated that they have the ability to do that kind of stuff, and frankly, I think it is probably good for those two economic sectors. So, I have no problems with it and I'm prepared to move the bill with individual recommendations if there are no further questions." Number 022 REPRESENTATIVE PORTER asked if the eventual goal is to devest that interest. REPRESENTATIVE ELTON said that is probably the goal. He gave an example of the bank foreclosing on a fish cannery and not having the ability to operate that cannery. He said that is one provision that he isn't sure how it evolved. The second provision does allow them to acquire equity interest. Representative Elton said he would guess that the best picture would be a business decision made by his board of directors. MR. CRANE said what Representative Elton is referring to is on page 8, Section 17, subparagraph 14 which addresses subsidiaries. That is an example of the type of situation that they have run into. Several years ago, CFAB acquired, through foreclosure, a processing plant on Ugamak Bay near Kodiak Island. They could not find a buyer but found a company that wished to lease and operate it for at least a season. CFAB had a great deal of concern about exposing the total bank assets to whatever liabilities might arise from being the landlord of an operating food factory. So CFAB created a subsidiary and incorporated it under the general business statute and transferred the plant to it and passed the paperwork back and forth to try and legally insulate the bank from whatever might occur. He noted nothing did occur. CFAB's attorneys said the statute doesn't say they could have a subsidiary. The statute is one which will always be strictly interpreted that says you can do this, this, this and this. It doesn't mention that you maybe can't do that. Mr. Crane said that is the genesis of that particular paragraph. MR. CRANE said another thing the CFAB has considered, which would have relevance, is the documentation from marine mortgages and Coast Guard documentation and registration of vessels. Now there is the processing of individual fishing quotas regarding transfers and applications which are fairly technical. CFAB has developed some expertise in the area and they have thought about creating a subsidiary, at least on paper, to offer those services to commercial banks and other institutions that would have occasion to use them. MR. CRANE referred to paragraph 15 and said venture capital does seem like a much grander concept than anything they have interest in. This is inspired because quite frequently CFAB is approached by fishermen, groups of fishermen or people (indisc.) on the street who have an idea for some type of value added processing or a new product. He said there are times when it looks like there might be some potential but those ideas may not be bankable. They are not anything that would meet the standards for credit and there is a very clear and definite higher level of risk than is appropriate for a lender. CFAB has looked at many of those ideas and have thought it might be worthwhile to perhaps invest some of CFAB's money, not as a lender but with full knowledge that it is "X" dollars of capital that you're prepared to put at risk just as any venture capitalist does. The objective would be to divest it. It is purely to act as a development institution. Mr. Crane explained CFAB is not a large institution; their total footing is a little less than $40 million. He said he isn't talking about investing millions of dollars but perhaps several thousand. MR. CRANE said, "We do spend money, not a lot of money, but we do spend money each year to advertise, to support things like fishing seminars and other things that go on for commercial fishermen. We see this really as potentially another form of that. One of our directors, former Senator Eliason of Sitka, is one of CFAB's directors and he did appear before the Fisheries Committee and Representative Elton posed that question to him as to the extent the board had discussed this particular point and if the board was comfortable. I believe he was quite positive in his affirmation there." Number 166 REPRESENTATIVE KUBINA made a motion to pass HB 284 out of the House Labor and Commerce Committee with individual recommendations. REPRESENTATIVE ROKEBERG objected for the purpose of a question. He asked Mr. Crane what the equity portion of CFAB's balance sheet is. MR. CRANE said approximately $27 million to $28 million. He noted that is $10 million of state equity and a little over $17 million of members' equity. REPRESENTATIVE ROKEBERG referred to subsection 15 being the venture capital provision and asked if it was a new provision. MR. CRANE responded that is new. REPRESENTATIVE ROKEBERG asked if there have been loans against limited entry permits. MR. CRANE responded they have given loans for 15 years. REPRESENTATIVE ROKEBERG asked what kind of a loan to equity ratio they use on those types of loans. He said there is volatile pricing. MR. CRANE said there is volatile pricing and for that reason, they do not approach it in terms of loan to equity. He said their loans are based on projected cash flow and the borrower's ability to service the debt. That may mean they will lend a person 82 percent of what he is paying for the permit or they may lend 45 percent. He said they don't have a flat standard. Number 200 REPRESENTATIVE ROKEBERG withdrew his objection. Number 201 CHAIRMAN KOTT said there is a motion to move HB 284 from the House Labor and Commerce Committee with individual recommendations and a zero fiscal note. He asked if there was further objection. Hearing none, HB 284 was passed out of committee. HB 217 - TEACHER EMPLOYMENT RIGHTS & RETIREMENT CHAIRMAN KOTT announced the committee had HB 217 before them once again. He noted he has received some proposed amendments. He asked Representative Ivan if he wanted to make some additional comments or offer suggestions regarding the bill. REPRESENTATIVE IVAN noted he was in the hospital as the bill passed through some of the committees of referral. He asked that Tom Wright be recognized by the committee to discuss the bill. TOM WRIGHT, Legislative Assistant to Representative Ivan Ivan, said one of the things discussed was the judicial review, de novo trials. One suggestion that was made, which they wouldn't have any objection to, is having the judicial review right after the decision to nonretain. If the school board makes a decision to nonretain, rather than having that hearing and rather than going to de novo and re-creating a whole new record, they would go right straight to superior court. It will eliminate one step of the process. It will go from the decision by the school board to nonretain right to superior court. There would be a record created that would only have to be done one time. REPRESENTATIVE ELTON asked if there has been any feedback from any of the groups. It would seem to him that the initial argument that might be advanced against that would be that you have a local school board and you're taking away some of the opportunity that they have to be involved in the process. MR. WRIGHT said he spoke briefly with Mr. Rose and he can tell the committee NEA's position. Mr. Wright said there was testimony that the principal makes the decision, he gives his opinion to the superintendent, the superintendent makes a decision, then the school board makes the decision. Mr. Wright said what he heard from NEA is that they feel the cards are stacked on one side of the deck. He said what he is saying is de novo is a too expensive proposition to keep on the books. We don't have the money we had when de novo was established. Lets eliminate one of those steps and go right to superior court. The record will have to be established but it will not have to be re- created. Number 275 REPRESENTATIVE ROKEBERG said he supports the suggested amendment and he would be happy to offer it as such. He said it alleviates some of the questions he had about due process in Section 6. REPRESENTATIVE KUBINA asked if we are then going to do away with Section 14.20.180 and go straight to a de novo trial. MR. WRIGHT said basically without that one step. REPRESENTATIVE KUBINA said the step being taken out is 14.20.180 which would be the step before judicial review. REPRESENTATIVE PORTER said the process currently in the bill is an administrative hearing, objective or not, and a judicial review as opposed to a de novo trial. The option is if that isn't satisfactory to the individual teacher, they can go directly to a de novo trial. REPRESENTATIVE KUBINA said he doesn't have a problem with the conceptual amendment. He said he would like to hear, on the record, from the different groups what their positions are. Number 331 CARL ROSE, Association of Alaska School Boards, asked Representative Kubina to repeat the question. REPRESENTATIVE KUBINA referred to a teacher who has tenure rights and is nonretained and said the employer gives the notification of dismissal. If they're laid off, they will have the choice of appealing to the school board or to the superior court. Number 340 REPRESENTATIVE PORTER said if the teacher elects to have a review by the school board and they are still nonretained, their appeal from that is a non de novo judicial review. Their option though is to skip over the administrative process and go directly to trial. REPRESENTATIVE KUBINA said the section doesn't deal with layoffs as he reads it. It deals with dismissals. MR. ROSE said, "For the record, I could agree with that. I would agree with what has been said here if people feel that they cannot get an impartial hearing from the board that renders a decision and chooses to go directly to court. They think that's fair - fine. If they choose to have the hearing at the local level and establish the record and have that record reviewed, that's fine. I think it's a choice the teacher should be able to make." MR. MARSHALL said they have consistently argued that whatever the appeal step is, should be unbiased. Number 366 CHAIRMAN KOTT said there is a conceptual amendment that has been offered. REPRESENTATIVE ROKEBERG moved the conceptual amendment. CHAIRMAN KOTT said there is a motion to move the conceptual amendment that provides the option either/or, skipping over the administrative hearing and going directly into a de novo trial or what is currently contained in Section 6. Chairman Kott asked if there was an objection. Hearing none, Amendment 5 was adopted. CHAIRMAN KOTT asked Representative Ivan or Mr. Wright if they had additional recommendations. MR. WRIGHT said he had one which he briefly discussed with Mr. Rose. One of the concerns in the layoff provisions is there is some uncertainty whether or not the layoffs will take place after there are no nontenured teachers. There seems to be a question of whether or not layoffs can take place when there are still nontenured teachers within that school. He asked if there was the possibility of incorporating language that nontenured teachers will be laid off first prior to tenured teachers. He noted that has been the intention throughout the bill process. Mr. Wright said he knows that brings up some questions relating to primary and secondary teachers. We don't want a secondary teacher going to primary if they aren't endorsed in that category and vis a versa. REPRESENTATIVE KUBINA noted the terms in the bill are incorrect. It should be elementary and not primary. MR. WRIGHT said their intention is that the layoffs would take place after the nontenured teachers. He said he thought that was stated, but to clear the concept up, a sentence should be inserted to clarify that. Number 410 REPRESENTATIVE PORTER said, "I think, and again, I would say conceptually but one option for this would be to put -- remove line 8 and put it at the beginning after `layoffs' and before `(a)' and let it say, `This section does not apply to a teacher who has not acquired tenure rights,' and then add some kind of language to say, `nor does it supersede the provision of' whatever that specific cite is for the other statute that says nontenured teachers will be laid off before tenured teachers." REPRESENTATIVE KUBINA said he doesn't think there is actually a provision for layoffs. MR. WRIGHT said Representative Kubina is right. This is a whole new section in the layoff provision. He said he understood that nontenured teachers would the first to undergo any action should there be fiscal constraints or a decrease in school attendance. He noted the primary/secondary options should also be defined. REPRESENTATIVE PORTER asked what the terms are for laying off a nontenured teacher. An unidentified speaker said there wouldn't be. REPRESENTATIVE KUBINA said there needs to be a clear statement that says nontenured teachers will be nonretained or laid off, prior to tenured teachers being considered for layoff. REPRESENTATIVE PORTER suggested changing line 8 to say, "This section does not apply unless...." He asked if the past practice was that nontenured teachers are let go, within a school, before there is a layoff in that school. MR. ROSE said it is district wide. He said the appropriate terms are you nonretain a nontenured teacher and you lay off tenured teachers. He said that is what we're trying to provide here because the law is silent on how to reduce staff. Number 445 REPRESENTATIVE PORTER said this section does not apply until there are no remaining nontenured teachers in the district. REPRESENTATIVE PORTER said he would move that conceptually. CHAIRMAN KOTT said on page 3, line 8, insert something to the effect that this section does not apply until there are no remaining nontenured teachers within the same district and classification. MR. ROSE suggested saying something to the effect that layoff for tenured teachers cannot be invoked until you've exhausted all nontenured teachers within the district. CHAIRMAN KOTT asked if that would be regardless of a requirement to fill an obligation to teach a certain course. MR. ROSE said he thinks there may be one exception and that may be special education. He said that may be one area where the certification will be required. REPRESENTATIVE KUBINA noted Alaska is very unique in that we have many small communities. You can't strengthen a law too much or it could be too restrictive on a district. REPRESENTATIVE KUBINA asked if there is a need to exempt special education teachers. REPRESENTATIVE KUBINA said there are certain requirements in the law that you have to have certification in special education to teach. Number 487 MR. ANDERSON interjected that the reality of how the system works is you lay the people off and then call them back; it is called recall. You recall the people in the areas that you need. If you lay off all the nontenured teachers and you need five special education teachers, you recall the special education teachers even though they may be lower in seniority status than someone else, because that is the person you need for the job. He noted this happened in Juneau last year. Every special education teacher was recalled into the Juneau School District this year. They also hired an additional special education teacher who wasn't laid off in spite of the fact that there were still people on the layoff list. REPRESENTATIVE KUBINA said special education is the only place you do that because the law requires a certification. Number 503 REPRESENTATIVE PORTER moved to amend page 3, line 8, to say that this section does not apply unless all nontenured teachers have been nonretained in the district. He said the bill drafters could put that in the proper form. CHAIRMAN KOTT asked if there was an objection to Amendment 6. Hearing none, Amendment 6 was adopted. Number 514 MR. WRIGHT referred to the question of what triggers the layoff and said he doesn't know. Original language in the bill said, "Substantial decrease in revenues." That did not work. He said they wanted to find a mechanism in place that would take into account local, state and federal funding. The only mechanism they found to do that was under the basic need provision which takes into account all three funding mechanisms. He said this was the only mechanism he found that describes what was originally called "substantial." REPRESENTATIVE PORTER referred to the testimony in Juneau where a witness had big problems with the 3 percent figure. He asked about lowering the percentage. REPRESENTATIVE ROKEBERG indicated he had the same thought. REPRESENTATIVE ELTON said the problem with the 3 percent is those districts who have been responsibly funding to their cap are the ones that are probably going to suffer the most. He said he would like time to think about this issue. REPRESENTATIVE ELTON referred to page 3, lines 21 through 25, paragraph (d) and said you would be moving local control. He asked why we need that. Number 557 REPRESENTATIVE PORTER said he doesn't think the paragraph is necessary. He said he doesn't think that contracts entered into after the effective date of this law may be anything but consistent with this law. REPRESENTATIVE ELTON said if the Juneau School District found a better way of coming to a trigger, this section would preclude them from adopting that. REPRESENTATIVE PORTER said through the negotiation process, if a district reached a different conclusion than what is stated in any of the paragraphs, we have precluded them from doing that by including the paragraph. He said you can't write a statute that changes an existing contract, but every statute you write may not be contradicted by a future contract. REPRESENTATIVE ELTON read from line 24, "...bargaining agreement entered into between a school district or regional educational attendance area and a bargaining organization representing teachers on or after the effective date of this section may not be inconsistent with the provisions of this section." We're saying if Juneau comes up with a better trigger mechanism, they can't use that because it would be inconsistent with the trigger mechanism that is in paragraph (a). REPRESENTATIVE KUBINA said it is sort of like the grievance procedure. All collective bargaining teacher contracts have to have a grievance procedure with binding arbitration for the terms of the contract. So the grievance procedure may be somewhat different in each contract but they all have to have one. You can still negotiate layoff provisions within a contract as long as they are not inconsistent, but you can fine tune them immensely. Number 578 REPRESENTATIVE PORTER asked if there is anyone that thinks that deleting (d) would change a thing. MR. WRIGHT said he has spoken to the drafter of the bill and he thought it is consistent to have (d) in the bill. REPRESENTATIVE ELTON said when the bill comes back with the conceptual amendments, it would be very helpful to have the drafter in attendance. CHAIRMAN KOTT said that request will be made. Number 597 REPRESENTATIVE KUBINA said he still has four amendments for the section. He suggesting hearing from the two groups present about their thoughts. Number 603 MR. ROSE said there are two concepts as to what would trigger the layoff. The suggestion was that there be third party verification and a whole bunch of hoops that we might have to jump through to validate the need. He said he objected to those because we're elected officials and the range of policy that we deal in requires that we have some latitude. Mr. Rose said he is the one that came up with the idea that we address something that we can prove we can show. So we came up with the 5 percent trigger, but then we found that 5 percent trigger was a lot farther away. He said there has to be some accountability for the public. Mr. Rose said if a trigger is set that is too low and there isn't a fair threshold, then there is a lot of commotion at the local level. He believes the 3 percent figure is probably a good idea and is something that can be readily identified. He said it would be fine to add language that it needs to be verified by the commissioner of the Department of Education (DOE). Mr. Rose said now we have something we can verify. He referred to substantial and asked who verifies substantial. Saying 3 percent, verified by a third party which would be the commissioner of the DOE, would be a good idea for his organization. MR. WRIGHT said the 3 percent figure at first was an arbitrary figure. He said he went to the DOE and asked them to do an analysis, based on FY 96 basic need, as to what a 3 percent decrease would look like. For some districts, it is substantial.... (END OF TAPE) TAPE 95-51, SIDE B Number 001 MR. WRIGHT continued ...while the bigger school districts are going to have to take a hugh hit before this triggers. REPRESENTATIVE ELTON said if the legislature decides to "flat fund," the foundation unit will drop to about $59,000. He asked if that alone determines basic need. What happens if the legislature does that and then Anchorage Assembly, for example, reduces a school district request by $3 million. If the flat funding didn't do it, would that trigger the lowering of the.... He said what bothers him about the trigger mechanism is that outside forces are being imposed on a district. A community, even though they're not at the cap, could under fund and then you'd end up laying off teachers. He said he isn't sure he is comfortable with that. There was discussion regarding the formula being used for reaching the cap and how it would compare between Anchorage and Pelican. Number 101 REPRESENTATIVE KUBINA explained tenure was designed to keep politics out of the retention of teachers. The whole point of tenure was to take politics out of it. At times, education can be a real political football. REPRESENTATIVE KUBINA referred to his district of Valdez and said its 3 percent is $156,000. Because of Sheffield's accelerated depreciation of the pipeline and terminal, we are at our cap and are reducing the city share, by law, by $200,000 a year. The fact is also that the school district has a $3 million cushion in that they have been planning for this. There really is no reason for them to start laying off tenured teachers when they have the money in the bank. The 3 percent doesn't take in enough of the universe. Number 137 MR. MARSHALL said, "We proposed I guess back in HESS and Judiciary that the lay off provision be for -- where you have decrease in school attendance on line 5, add in `or because of a financial emergency in the school district.' We went through the drill of verification. We wanted it verified by a third - you know - some third party. You may get away from trying -- because I think you're going to have great difficulty in getting a percentage that everybody can walk away from the table from. I mean because in a (indisc.) the context of trying to figure out what kind of funding school districts are going to get for FY 96 right now. We're anxious because we know there are two bills out there that will make this thing happen. I mean the reality of the situation is if, you know, the House bill or the Senate bill goes through, we're looking at an instructional unit that is prorated down to about this area. We also have anxiety about what's going to go on next year when we come here and we deal with the Contract for America and the cuts that they've made to schools. I would rather, you know us -- or I would like to suggest that we look at, you know, a financial emergency -- and we did craft an amendment -- and I guess that our anxiety is that, you know, we would like to know that it is a legitimate loss in money and we have indicated here -- and we're just saying that the district attempts to negotiate, you know, cuts within the budget. If you put a proposal on the table in your management and we don't negotiate, you made the attempt. That's all we're saying. Now if we haven't got enough sense to pick up on the fact there is a problem and we better, you know, talk because I think the dialogue on the local level is critical then... You know, we've made a tragic mistake. "The second is that, you know, somehow teachers, in this case, tenured teachers aren't taking the brunt of the attack. I mean you heard I don't know who it was that said, `Well, you know we had a financial emergency but we hired two or three administrators or we bought a new car or something. I'm exaggerating on the car. I mean we'd like to see that -- you know there is (indisc--coughing) you prorate a reduction in a school district. I mean it's not teachers taking it all, but you look at administration, you look at school board operating costs and, you know, laying it out there. Create a committee, do whatever to see if you can bring those costs down. "Then we've said the layoff of tenured teachers are necessary notwithstanding the district's attempt to negotiate in its reduction in administrative and school board costs. It's necessary, you've got to do it, fine, it's done. And then we even threw in a provision that the necessary savings can't be achieved by laying off nontenured teachers and go after tenured teachers. And I think if you get the verifications in -- and I think you'd want that, I mean you want folks to fully understand there is no big grandiose boogie bear plan to get you. We have a problem. Here's the problem. Here's what we're doing. And if you could put financial emergency in, put some tests in, I think this section -- whole section is fine." REPRESENTATIVE PORTER said he wouldn't have any great concerns except the process, in his mind, should not get into other financial decisions that the district has made. Number 222 MR. WRIGHT referred to an amendment he thinks was offered by Mr. Anderson in the House Judiciary Committee. He said one of the provisions was exigent circumstances. Mr. Wright said to him there was no clear cut definition of exigent circumstance. That to him meant the same as substantial decrease. He said he thinks a solution can be reached as far as a school district budget. For instance, if there is a reserve in that school district's budget, that can be looked into. He said he doesn't think other budgets outside of the school district budget should be considered. REPRESENTATIVE ELTON noted other budgets outside the school district budget, in many cases, can't be applied because many of the communities are already at the cap. Number 240 MR. ROSE said if you have enough checks and balances, you don't need a school board anymore. He said there are elected officials to provide oversight for the school district and he believes they need to be called to task. We don't control our revenue and we build our budgets in public. The public process is there. You can have a number of verifications and triggers but he would encourage the legislators not to look past the local levels of governance. He continued to discuss public process. MR. ROSE referred to the way the foundation works and said when you talk about basic need, you're talking about instructional units times $61,000, times the area cost differential. That's basic need. When you talk about state aid, you back out local contribution and you back out 874. That gives you state aid. The whole idea is that every local municipality is to pay a minimum, required by law. If you go below that minimum, you don't qualify. So you have to pay that portion. The locals can only go up, they can't go below the minimum. Mr. Rose said that is why he thinks basic need was selected instead of state aid. MR. ROSE said the only thing he didn't take into consideration was the testimony about the time lines. If you did have a student count and it was determined that you were deficient the 3 percent, but you've already entered into contracts, that creates another problem but at least you have a mechanism to address the decrease in revenue. MR. ROSE said he would ask the committee not to look past the locally elected officials and local governments as they should be called upon to perform. He referred to the hoops and verifications and said he thinks it would call into question the performance of the locally elected officials who can be replaced if they don't perform. Number 293 REPRESENTATIVE KUBINA said he would always assume that whatever is going to happen is going to happen when the contracts come out at the end of the year. MR. ROSE said he hadn't thought about the time lines. He thought the 3 percent is a good figure. He said if this is a problem for a particular school district, perhaps a supplemental is the way you would look at that. It would probably require a supplemental to get through the year if they didn't have the funding. REPRESENTATIVE KUBINA said what we're doing is changing the law, a protection that was built in for teachers. They're giving up that protection. This is giving them an out from that protection, basically a guarantee of a job. There are reasons that is not going to be there. Representative Kubina said he is uncomfortable not having something in place so that politics can't take place. He noted he isn't sure what that is. Number 321 REPRESENTATIVE ELTON said he isn't sure they can agree on a trigger mechanism. He referred to Section 5, the trigger mechanisms and everything else, and said the only reason it is needed is because the legislature isn't meeting their duty of fully funding education. He said the legislature isn't adjusting for inflation more than once every decade. CHAIRMAN KOTT asked Mr. Wright if he would have an objection of inserting the language after the 3 percent, "previous year as verified by the commissioner." MR. WRIGHT said that is fine. REPRESENTATIVE ELTON said the 3 percent is the problem. CHAIRMAN KOTT said he realizes that, but if the 3 percent is included, it certainly should be verified by a third party. MR. ROSE asked what is the threshold for an emergency. MR. MARSHALL said he would use financial emergency in the bill rather than the exigency provision that was in the House HESS and Judiciary versions. Then you do provide the steps when you go through the verification process. He said we're dealing with an issue where we don't have school districts that are getting less aid from one district to another unless you want to deal with Adak. They had a financial emergency and they're gone. Mr. Marshall said they are being asked to somehow make a determination that they don't have a clear picture of. He said he doesn't know that he can give a clear definition of a financial emergency. If there is a financial emergency, let the parties sit down and show where a district is actually losing money. Number 372 MR. ROSE said if you say fiscal emergency or exigency, he can see people bringing in issues such as lack of inflation proofing. He indicated someone could say we are fiscally strapped because of a lack of inflation proofing, because of fixed costs, plus we've lost a few dollars here. He said he would think a 3 percent trigger is better. When you say fiscal emergency, you're making a case for reducing. He said people can get real creative. Mr. Rose said he would like to be able to deal with something that is identifiable and agreeable. If we have something that is identifiable and agreeable, there is a place from which we can start. REPRESENTATIVE KUBINA said the situation with Adak was a financial windfall. He said he had an Adak board member lobbying him this week and they don't even have kids anymore. He questioned why they are spending state dollars lobbying legislators. He said we know they have about $3 million in the bank because of closing down. When you don't have kids anymore or less students, we don't need any of this. There are provisions in the bill for dismissing tenured teachers when you've got less students. That is not the problem. The same will be with Fort Greely. They will get federal impact aid. They're guaranteed not to lose more than 25 percent of their foundation. So that's not the problem. You may want early retirements or something so that you don't dump them. The problem is pretty much everybody else and it is very slight. He asked if he was wrong. Number 404 MR. ROSE said he thinks the hold harmless clause is an aid for most of the school districts. In the case of Sitka when they lost their mill, they qualified for that hold harmless clause. He said that was a real help and he doesn't know if they had to lay anyone off. If there is something we can agree on that is identifiable and understandable, they would be agreeable. When you say an emergency, what does an emergency mean? REPRESENTATIVE ELTON suggested saying, "A financial emergency as certified by the commissioner." The commissioner is a noninvolved professional that could apply different criteria in a REAA than he/she might apply in Anchorage or Juneau. MR. ROSE said he thinks the state is diverse enough where maybe that is the only (indisc.). REPRESENTATIVE ELTON said he would advance that as a conceptual amendment. MR. MARSHALL said the language on financial emergency verified by the commissioner of the DOE is much better than (indisc.). Mr. Marshall said on line 3 it would say, "A decrease in school attendance or because of a financial emergency as verified by the commissioner of Education." REPRESENTATIVE ROKEBERG said he has difficulty with this. There was discussion regarding the wording. CHAIRMAN KOTT asked if they wouldn't again be removing local control. MR. ROSE said by including the 3 percent trigger, you're losing local control. He said they would rather be able to make these decisions and stand accountable, but it appears it is either a 3 percent trigger which is kind of uniform for an entire state, or something that is verifiable by the commissioner which provides us to address the diversity. REPRESENTATIVE ROKEBERG said he thought the local boards could cook their budget. He asked if that isn't some portion of local control even if you have a numeric standard. MR. ROSE said if Representative Rokeberg is talking about the commissioner of the DOE verifying, he would imagine he is talking about the finance director having access to all of the state audits. He said he thinks to invoke a lay off, you probably have to satisfy an extraordinary standard. Mr. Rose said he believes school boards are prepared to do that at the local level without the trigger, but it doesn't appear that is acceptable. MR. WRIGHT said we're not going to come up with one standard that is going to fit Anchorage or one standard that will fit Pelican. He said maybe this is the best solution, but he would make the decision nonappealable. Once the commissioner makes the decision, the decision stands. Number 495 REPRESENTATIVE KUBINA questioned what the amendment would be. REPRESENTATIVE PORTER said on page 3, lines 6 and 7 would be strickened. Line 5 would read "...decrease in school attendance or because of a financial emergency as verified by the commissioner of the Department of Education that is nonappealable." Number 504 MR. MARSHALL asked how they could deny a parent or NEA-Alaska the right to go to court and say that they don't agree there is an emergency. These are public schools. REPRESENTATIVE ROKEBERG explained he is dealing with that exact issue on another major piece of legislation. What you can't do under due process is deny anybody to bring a cause of action on a constitutional issue. Therefore, if there is a constitutional issue about denial of schools, etc., in education which is in the Alaska State Constitution, you probably would be able to build a cause of action. On the other hand, by stipulating nonappealability in the statute, they will look at a higher standard as to what forms a cause of action. It would have to be a pure constitutional issue. CHAIRMAN KOTT said there is a motion to move Amendment 7 which adds after the word "because" on line 5, "of a financial emergency as verified by the commissioner of the Department of Education", and delete lines 6 and 7. There being no objection, Amendment 7 was adopted. Number 548 MR. MARSHALL referred to page 3, line 17 of the layoff provision and asked if it is permissive to say, "...a school district may give preference..." MR. WRIGHT said they would prefer "shall." REPRESENTATIVE ROKEBERG said by leaving it permissive, it gives the district the flexibility rather than to mandate. Number 562 MR. MARSHALL asked if this could be bargained. REPRESENTATIVE ROKEBERG said he thinks so. REPRESENTATIVE KUBINA said as long as it stays within the parameters, he would suspect most school districts will try to bargain. Number 570 REPRESENTATIVE ELTON said he would move Amendment 8. He explained it would change the tenure to three years. He said he feels very strongly that if an administrator can't decide in two years, the board has a problem with the administrator. This is compromise language that makes it three years instead of four year. REPRESENTATIVE PORTER objected to Amendment 8. He said with all the testimony he has heard over the last two years, it is clear to him that the PTAs, school board associations and administrators want (indisc.). REPRESENTATIVE ROKEBERG said he would contemplate an amendment to raise it from four years to five years. CHAIRMAN KOTT asked Representative Rokeberg if he is moving an amendment to the amendment. REPRESENTATIVE ROKEBERG said he wouldn't do that at this time. CHAIRMAN KOTT noted the original bill had five years. REPRESENTATIVE PORTER said there is no doubt in his mind that if the committee put it to three years, there would be an amendment on the House floor to put it back to two years. REPRESENTATIVE ELTON said he thinks that the committee should set a number that they can agree to. He said we should come to a resolution that the committee thinks is best. TAPE 95-52, SIDE A Number 006 REPRESENTATIVE ELTON said the committee can bring up all kinds of experiences and issues, but what he thinks they are doing is making a substantive change in changing tenure from two years. He said he would rather stair step up than leap up and start falling back. Representative Elton said the tenure problem he is hearing about is not about new teachers, it is about teachers who are in the system and have been in the system for ten years. The bill has nothing to do with that. Number 028 REPRESENTATIVE ROKEBERG said he would like to point out for the record that he received a fax from Kathi Gillespie, President, Anchorage Council on PTAs, pointing out that there are 11 states that have no tenure provisions whatsoever. He said this is a trend because over the last four years, four states have eliminated tenure for contractual based performance. Representative Rokeberg said the important thing is we are going in the right direction in following a national trend. A roll call vote was taken on Amendment 8. Representatives Kubina, Elton and Masek voted in support of the amendment. Representatives Kott, Porter and Rokeberg voted against the amendment. So Amendment 8 failed to be adopted. Number 072 REPRESENTATIVE KOTT withdrew the remaining two amendments he put on the table because they cover the judicial review section. CHAIRMAN KOTT said Amendments 9 and 10 have been withdrawn. Number 079 REPRESENTATIVE KUBINA moved Amendment 11. CHAIRMAN KOTT objected so Representative Kubina could explain it to him. REPRESENTATIVE KUBINA read, "A decrease in school revenue causing a financial emergency. The commissioner of Education shall verify their emergency. The commissioner must also certify the school district has done everything possible to reduce costs including reducing administrative costs, administrative travel, and school travel, lobbyist fees, etc. Nonessential costs." The whole point of the amendment is to make a school district, when they file something with the commissioner saying they're in an emergency, that they are not just looking at teachers, but are looking at their overall.... Representative Kubina said to him it makes no sense to pay for things that are not related to teaching kids and lay off teachers. REPRESENTATIVE ELTON asked Mr. Rose if his association is a school board expense or is he a lobbyist. MR. ROSE explained about 42 percent of their revenue is derived from dues and the rest is generated through entrepreneur (indisc.). REPRESENTATIVE ELTON asked if the dues would be considered an administrative or a school board expense. MR. ROSE responded a school board expense. REPRESENTATIVE PORTER indicated he would oppose the amendment. CHAIRMAN KOTT said it probably would induce more litigation. Number 133 REPRESENTATIVE KUBINA said there are a lot of things a school district does spend money on. He said he believes there needs to be a statement that whatever a school district is going to submit to the commissioner needs to state that the school district has looked at reducing expenses in the district and not just at teachers. He said Representative Porter's language was added regarding the financial emergency. He suggested the second sentence read, "The commissioner must certify that the district has done everything possible to reduce costs." REPRESENTATIVE PORTER said the wording "everything possible to reduce costs" could constitute firing the janitors. He noted it wasn't his language, it was the language he heard everybody agree to. Changing it now seems to be redundantly unnecessary. Representative Porter said he would not support the amendment in any form. MR. WRIGHT said he thinks it will go into the wrong section of the bill. REPRESENTATIVE KUBINA agreed, and said everyone knows where it was supposed to go. Number 170 REPRESENTATIVE KUBINA withdrew Amendment 11. CHAIRMAN KOTT asked if there were further amendments. REPRESENTATIVE ELTON said he has further amendments but they are on the judicial review portion of the bill. He said he will hold them. Number 193 CHAIRMAN KOTT asked if there were any further amendments for HB 217. There were none. Chairman Kott said a new committee substitute would be written and would be before the committee the following Monday. REPRESENTATIVE ELTON asked that the drafter of the bill be in attendance. ADJOURNMENT CHAIRMAN KOTT adjourned the meeting at 10:20 p.m.