Legislature(2003 - 2004)

04/30/2003 03:18 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                         April 30, 2003                                                                                         
                           3:18 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Tom Anderson, Chair                                                                                              
Representative Nancy Dahlstrom                                                                                                  
Representative Carl Gatto                                                                                                       
Representative Norman Rokeberg                                                                                                  
Representative Harry Crawford                                                                                                   
Representative David Guttenberg                                                                                                 
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Bob Lynn, Vice Chair                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 259                                                                                                              
"An Act relating to public school transportation, and to the                                                                    
minimum wages for school bus drivers; and providing for an                                                                      
effective date."                                                                                                                
                                                                                                                                
     - MOVED CSHB 259(L&C) OUT OF COMMITTEE                                                                                     
                                                                                                                                
HOUSE BILL NO. 269                                                                                                              
"An Act establishing the Safety Code Task Force; and providing                                                                  
for an effective date."                                                                                                         
                                                                                                                                
     - MOVED CSHB 269(L&C) OUT OF COMMITTEE                                                                                     
                                                                                                                                
HOUSE BILL NO. 272                                                                                                              
"An Act relating to motor vehicle dealers."                                                                                     
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                  
                                                                                                                                
HOUSE BILL NO. 47                                                                                                               
"An Act prohibiting discrimination by credit rating or credit                                                                   
scoring in certain insurance rates; and providing for an                                                                        
effective date."                                                                                                                
                                                                                                                                
     - REMOVED FROM AGENDA                                                                                                      
                                                                                                                                
PREVIOUS ACTION                                                                                                               
                                                                                                                                
BILL: HB 259                                                                                                                  
SHORT TITLE:PUPIL TRANSPORTATION FUNDING/DRIVER WAGES                                                                           
SPONSOR(S): REPRESENTATIVE(S)GATTO                                                                                              
                                                                                                                                
Jrn-Date   Jrn-Page                     Action                                                                                  
04/11/03     0934       (H)        READ THE FIRST TIME -                                                                        
                                   REFERRALS                                                                                    
04/11/03     0934       (H)        EDU, L&C, FIN                                                                                
04/16/03                (H)        EDU AT 7:00 AM CAPITOL 124                                                                   
04/16/03                (H)        Heard & Held                                                                                 
                                   MINUTE(EDU)                                                                                  
04/16/03                (H)        L&C AT 3:15 PM CAPITOL 17                                                                    
04/16/03                (H)        <Bill Hearing Postponed>                                                                     
04/22/03                (H)        EDU AT 11:00 AM CAPITOL 124                                                                  
04/22/03                (H)        Moved CSHB 259(EDU) Out of                                                                   
                                   Committee                                                                                    
04/22/03                (H)        MINUTE(EDU)                                                                                  
04/23/03     1069       (H)        EDU RPT CS(EDU) NT 1DP 3AM                                                                   
04/23/03     1069       (H)        DP: GATTO; AM: WILSON, OGG,                                                                  
                                   SEATON                                                                                       
04/23/03     1070       (H)        FN1: (EED)                                                                                   
04/30/03                (H)        L&C AT 3:15 PM CAPITOL 17                                                                    
                                                                                                                                
BILL: HB 269                                                                                                                  
SHORT TITLE:SAFETY CODE TASK FORCE                                                                                              
SPONSOR(S): REPRESENTATIVE(S)DAHLSTROM                                                                                          
                                                                                                                                
Jrn-Date   Jrn-Page                     Action                                                                                  
04/15/03     0985       (H)        READ THE FIRST TIME -                                                                        
                                   REFERRALS                                                                                    
04/15/03     0985       (H)        L&C, FIN                                                                                     
04/28/03                (H)        L&C AT 3:15 PM CAPITOL 17                                                                    
04/28/03                (H)        Heard & Held                                                                                 
04/28/03                (H)        MINUTE(L&C)                                                                                  
04/30/03                (H)        L&C AT 3:15 PM CAPITOL 17                                                                    
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
EDDY JEANS, Manager                                                                                                             
School Finance and Facilities Section                                                                                           
Education Support Services                                                                                                      
Department of Education and Early Development (EED)                                                                             
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Provided comments and responded to                                                                         
questions during discussion of HB 259.                                                                                          
                                                                                                                                
MELODY DOUGLAS, Chief Financial Officer                                                                                         
Kenai Peninsula Borough School District                                                                                         
Soldotna, Alaska                                                                                                                
POSITION STATEMENT:   Provided comments, suggested  an amendment,                                                               
and responded to questions during discussion of HB 259.                                                                         
                                                                                                                                
MIKE FISHER, Chief Financial Officer                                                                                            
Fairbanks North Star Borough School District                                                                                    
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:   Provided comments  during discussion  of HB                                                               
259.                                                                                                                            
                                                                                                                                
STEVEN KALMES, Director                                                                                                         
Transportation                                                                                                                  
Anchorage School District (ASD)                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION  STATEMENT:     Provided   comments  and   responded  to                                                               
questions during discussion of HB 259.                                                                                          
                                                                                                                                
LARRY WIGET, Executive Director                                                                                                 
Public Affairs                                                                                                                  
Anchorage School District (ASD)                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION  STATEMENT:     Provided   comments  and   responded  to                                                               
questions during discussion of HB 259.                                                                                          
                                                                                                                                
BRUCE JOHNSON, Director                                                                                                         
Quality Schools/Quality Student Services (QS2)                                                                                  
Association of Alaska School Boards (AASB)                                                                                      
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Provided comments  during discussion  of HB                                                               
259.                                                                                                                            
                                                                                                                                
ZACK WARWICK, Staff                                                                                                             
to Senator Gene Therriault                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:    As  staff  to  the  sponsor  of  SB  180,                                                               
companion  bill  to HB  269,  commented  on proposed  changes  to                                                               
proposed Amendment 1 to HB 269.                                                                                                 
                                                                                                                                
ACTION NARRATIVE                                                                                                              
TAPE 03-44, SIDE A                                                                                                            
                                                                                                                                
[Not on  tape, but reconstructed  from the  committee secretary's                                                               
log notes, was:                                                                                                                 
                                                                                                                                
CHAIR TOM ANDERSON  called the House Labor  and Commerce Standing                                                             
Committee  meeting  to  order  at   3:18  p.m.    Representatives                                                               
Anderson,  Gatto, Crawford,  and Guttenberg  were present  at the                                                               
call to  order.  Representatives  Dahlstrom and  Rokeberg arrived                                                               
as the meeting was in progress.                                                                                                 
                                                                                                                                
HB 259 - PUPIL TRANSPORTATION FUNDING/DRIVER WAGES                                                                            
                                                                                                                                
CHAIR ANDERSON announced  that the first order  of business would                                                               
be  HOUSE  BILL  NO.  259,  "An Act  relating  to  public  school                                                               
transportation, and to the minimum  wages for school bus drivers;                                                               
and providing for an effective  date."  [Before the committee was                                                               
CSHB 259(EDU).]                                                                                                                 
                                                                                                                                
Number 0021                                                                                                                     
                                                                                                                                
REPRESENTATIVE GATTO, speaking  as the sponsor, said  that HB 259                                                               
deals with student transportation,  and that the governor intends                                                               
to cut the  transportation budget by 20 percent.   He opined that                                                               
20 percent is  too big a cut for school  districts to accept, and                                                               
that the  alternative plan offered  by HB 259 has  the governor's                                                               
support.  Under HB 259, he explained:                                                                                           
                                                                                                                                
     We take  the [fiscal  year 2003] FY  03 money  that was                                                                    
     spent  on  student  transportation and  we  essentially                                                                    
     give  it to  the districts  to  spend it  any way  they                                                                    
     want.   If indeed they  find efficiencies, they  get to                                                                    
     keep the  money and use  the money in the  classroom or                                                                    
     in any way  they like.  If they struggle  and they have                                                                    
     to spend  it all, well, then,  they spend it all.   But                                                                    
     because  there  is a  dilemma,  and  that is  simply  a                                                                    
     choice between  two undesirables,  either you  take the                                                                    
     FY 03 money  and keep it or you go  with the governor's                                                                    
     proposal,  which  is  a  20 percent  cut.    Since  the                                                                    
     governor  supports this  bill,  I  feel fairly  certain                                                                    
     that he would not do anything  to change it.  Now, each                                                                    
     district gets  a certain amount  of money  per student,                                                                    
     and as you increase enrollment,  you get more money ...                                                                    
     for  student transportation,  much like  you do  in the                                                                    
     [foundation] formula.                                                                                                      
                                                                                                                                
     Well, we've  gone along  with the  [foundation] formula                                                                    
     for  some time  and agree  that that  is the  mechanism                                                                    
     that we use:   we like to, essentially,  give money per                                                                    
     student.     That's  what  happens  in   this  bill....                                                                    
     Basically,  it  says, "Whatever  you  got  in [FY]  03,                                                                    
     you'll keep."   What  will happen, as  years go  by, is                                                                    
     much the  same thing  that happens to  the [foundation]                                                                    
     formula, and  that is:   as time  goes by,  ... someone                                                                    
     can  certainly bring  this legislation  up  and ask  to                                                                    
     amend  it and/or  increase the  funding per  student to                                                                    
     take  into  account  increased  fuel  costs,  increased                                                                    
     insurance, the  cost of new  buses, wage  increases, et                                                                    
     cetera, which  gives us  an opportunity  - in  the same                                                                    
     way we deal  with the [foundation] formula  - to simply                                                                    
     add money, per student, to this formula.                                                                                   
                                                                                                                                
REPRESENTATIVE GATTO continued:                                                                                                 
                                                                                                                                
     Some people will gain more  than others, I'm sorry that                                                                    
     that happens,  but it  does happen.   And  there didn't                                                                    
     seem to be a good  way to make [transportation funding]                                                                    
     happen short  of the  basic way  that we've  done here.                                                                    
     And  I believe  firmly that  it works  pretty well.   I                                                                    
     have support from  [Matanuska-Susitna] Mat-Su [and] ...                                                                    
     Fairbanks.  I talked to  Carol Comeau for the Anchorage                                                                    
     district,  and she  said, as  of yesterday,  [that] she                                                                    
     had  not taken  a  position on  it  because she  wasn't                                                                    
     familiar with it  yet - she would have to  read it, and                                                                    
     maybe after that  point take a position  of whether she                                                                    
     liked  it or  not.    But I  haven't  found any  school                                                                    
     district  that's said,  "I've read  it, I've  talked to                                                                    
     you, and  I don't like it."   I haven't found  that.  I                                                                    
     bet it exists, but I haven't found it.                                                                                     
                                                                                                                                
     So  I'd  like  you  to  approve  [CSHB  259(EDU)],  and                                                                    
     hopefully we want  to move it on so that  it meets with                                                                    
     a bill  that will be  coming from the Senate  side, and                                                                    
     we have plans for attaching  it the funding formula and                                                                    
     moving it  through so that  before the session  ends we                                                                    
     have transportation  funded through this bill  [and] we                                                                    
     have the funding formula with the increases ....                                                                           
                                                                                                                                
Number 0378                                                                                                                     
                                                                                                                                
EDDY  JEANS,  Manager,  School Finance  and  Facilities  Section,                                                               
Education  Support Services,  Department of  Education and  Early                                                               
Development (EED), said that the  EED and the administration have                                                               
been working  closely with  Representative Gatto  on HB  259, and                                                               
remarked  that Representative  Gatto gave  a good  explanation of                                                               
what the bill does.  He pointed  out that the current system is a                                                               
reimbursement  system  in which  the  EED  outlines, through  the                                                               
regulatory  process,  what  a  reimbursable   expense  is.    For                                                               
example:    "We  set  the   minimum  mileage  that  students  are                                                               
transported for  reimbursable purposes at  one and a  half miles;                                                               
you have  to have eight students  down a road to  extend a route;                                                               
those  sorts  of things."    He  explained that  currently,  when                                                               
school  districts  need  route  extensions or  want  to  add  new                                                               
routes,  they simply  submit a  request to  the EED;  if the  EED                                                               
determines that the change is  really needed, the EED approves it                                                               
and it becomes an expense to the state.                                                                                         
                                                                                                                                
MR. JEANS  remarked that under  the current program, there  is no                                                               
incentive for  school districts  to save  money because  they are                                                               
not able  to retain money if  they do find any  efficiencies.  In                                                               
addition, when school districts are  prorated - as the governor's                                                               
budget  recommends -  when new  routes  are added,  that cost  is                                                               
spread  across  the state  and  "everybody  pays  for it."    For                                                               
example, he added:                                                                                                              
                                                                                                                                
     A district  may be expecting  75 percent or  80 percent                                                                    
     reimbursement  right now,  but  when we  get into  next                                                                    
     year, if we add  10-15 routes, that reimbursement level                                                                    
     is going to  drop because we don't  have any additional                                                                    
     funds.   So the  district's rate of  reimbursement will                                                                    
     be reduced based on an increased need statewide.                                                                           
                                                                                                                                
MR. JEANS referred  to what became known as  Amendment 1, labeled                                                               
23-LS0767\W.1, Ford, 4/23/03, which read:                                                                                       
                                                                                                                                
     Page 2, lines 16 - 19:                                                                                                     
     Delete all material.                                                                                                       
                                                                                                                                
     Renumber the following bill section accordingly.                                                                           
                                                                                                                                
Number 0623                                                                                                                     
                                                                                                                                
MR. JEANS additionally mentioned  a proposed amendment that would                                                               
change the effective date of the  bill from July 1, 2004, to July                                                               
1,  2003.   He  relayed  that  the administration  supports  both                                                               
amendments.                                                                                                                     
                                                                                                                                
REPRESENTATIVE GUTTENBERG  asked how many school  districts don't                                                               
contract pupil transportation.                                                                                                  
                                                                                                                                
MR. JEANS  said he would have  to research that issue.   He added                                                               
that  a  number  of  districts   operate  one  route;  that  some                                                               
districts that have  split programs - for  example, Anchorage and                                                               
Kenai; and that  some districts are 100 percent  contracted - for                                                               
example, Mat-Su, Fairbanks, Kodiak, and Juneau.                                                                                 
                                                                                                                                
REPRESENTATIVE GUTTENBERG asked whether  a few years ago, "didn't                                                               
we realign  the contracts for  bidding purposes so that  we would                                                               
get some  more competitive bids,  and was there  any efficiencies                                                               
built into ... that when that happened?"                                                                                        
                                                                                                                                
MR. JEANS replied:  "We did do  that with the Railbelt area."  He                                                               
said that he would argue  that some efficiencies were achieved in                                                               
that  instance  because  an outside  contractor,  First  Student,                                                               
Inc., came into the state and bid.   He noted that prior to that,                                                               
there  was  only one  major  provider  in  the state  -  [Laidlaw                                                               
Education Services  ("Laidlaw")].   He predicted  that additional                                                               
efficiencies may  be achieved via  future bids by  First Student,                                                               
Inc., because  the initial  costs of getting  into the  state are                                                               
quite high.   Because that company's  bus fleet is only  going to                                                               
be five  years old when the  contract expires in three  years, he                                                               
said,  he is  hoping  that the  daily rates  could  be lowered  a                                                               
little bit.                                                                                                                     
                                                                                                                                
REPRESENTATIVE GUTTENBERG  asked whether school  districts submit                                                               
requests to the EED to remove or shorten routes.                                                                                
                                                                                                                                
MR.  JEANS said  yes, adding  that when  school districts  submit                                                               
requests for  changes to routes,  they are  asked to go  back and                                                               
evaluate existing routes.                                                                                                       
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  expressed  concern that  even  though                                                               
existing contracts  are already in  place, HB 259 will  result in                                                               
pupil transportation  being funded  in another fashion  than what                                                               
was anticipated  when the  contracts were  signed.   He indicated                                                               
that this  might affect whether  the money needed to  fulfill any                                                               
existing contracts will come out  of the classroom or whether any                                                               
exiting relationships with contractors will be altered.                                                                         
                                                                                                                                
Number 0871                                                                                                                     
                                                                                                                                
MR. JEANS replied:                                                                                                              
                                                                                                                                
     You're correct  that districts do have  those contracts                                                                    
     in  place.   As  I  understand  it,  every one  of  the                                                                    
     contracts has  an escape clause  based on the  level of                                                                    
     state funding.   In other  words, if the  state doesn't                                                                    
     fully fund  the transportation request,  districts have                                                                    
     an opportunity to  open up those contracts  and try and                                                                    
     get  a better  rate.   This  would happen  even if  the                                                                    
     program was prorated.  Districts  would still have that                                                                    
     ability;  they are  not limited  to  simply taking  the                                                                    
     money out  of the classroom.   In those cases  where we                                                                    
     have  municipal school  districts, they  could back  to                                                                    
     the  municipality.   Districts could  also charge  user                                                                    
     fees to cover that loss in  state aid.  So, there [are]                                                                    
     avenues available  to [districts],  but as long  as the                                                                    
     state is  providing 100 percent  reimbursement, there's                                                                    
     no  real incentive  or reason  for [districts]  to look                                                                    
     for these other cost savings.                                                                                              
                                                                                                                                
REPRESENTATIVE  GUTTENBERG asked:    "Do you  consider it,  then,                                                               
[that] it would  be an efficiency or [a] way  to have gained more                                                               
control, by negating  the contracts and having  the school boards                                                               
do  it themselves,  to show  those  efficiencies?   Do you  think                                                               
that's a route that's appropriate here."                                                                                        
                                                                                                                                
MR. JEANS replied:                                                                                                              
                                                                                                                                
     Right now,  the way the  current system is set  up, the                                                                    
     state  says  what  the  state's  willing  to  pay  for,                                                                    
     through  our  regulations.   With  this  proposal  ...,                                                                    
     districts  would  get  a grant  based  on  the  current                                                                    
     amount   that   they're   spending  per   student   for                                                                    
     transportation  services.   Now, if  this bill  passes,                                                                    
     the  [EED] would  repeal all  of  its regulations,  and                                                                    
     then it  would be up to  the local school board  to try                                                                    
     [to] identify the efficiencies.   Right now, we provide                                                                    
     reimbursement  if a  child lives  beyond a  mile and  a                                                                    
     half.   Is a mile  and a half,  or ... two  miles, [or]                                                                    
     two and a half miles too  far for a high school student                                                                    
     to walk?   In some  communities, yes, [and]  in others,                                                                    
     no.     But  right  now,  the   state  reimburses  that                                                                    
     regardless  of your  grade level.    Those are  choices                                                                    
     that are  better left  ... at the  local level,  not at                                                                    
     the state level.                                                                                                           
                                                                                                                                
Number 0994                                                                                                                     
                                                                                                                                
REPRESENTATIVE GUTTENBERG noted that HB  259 refers to $1,200 per                                                               
student.   He  relayed  that  he has  students  in the  Fairbanks                                                               
school district  that walk  to school, as  well as  students that                                                               
live quite a distance - at  the extreme measures of that borough.                                                               
He  added that  he has  students in  the entire  "Denali borough"                                                               
from  Cantwell to  Anderson, and  opined that  very few  of those                                                               
students  get  a  chance  to  walk  to  school.    Therefore,  he                                                               
remarked, he  is concerned  about the  per student  dollar figure                                                               
and  how it  will  be  affected by  the  discrepancies between  a                                                               
student living downtown  and a student living in a  rural part of                                                               
the road district.                                                                                                              
                                                                                                                                
MR. JEANS replied:                                                                                                              
                                                                                                                                
     The  per  student  dollar amounts  are  arrived  at  by                                                                    
     taking what  the districts are  going to  be reimbursed                                                                    
     in  the  current year,  [and]  dividing  that by  their                                                                    
     total     student     population    excluding     their                                                                    
     correspondence students.   So  it's reflective  of what                                                                    
     they're currently spending on  a per student basis this                                                                    
     year.  The one piece  that this bill would not address,                                                                    
     that  is currently  built into  our current  system, is                                                                    
     inflation.    And  every  one  of  the  contracts  have                                                                    
     inflation built into them, so  that's another cost that                                                                    
     is simply passed on to the state.                                                                                          
                                                                                                                                
REPRESENTATIVE  GATTO surmised  that Representative  Guttenberg's                                                               
concern  centers   around  taking  care  of   students  that  are                                                               
handicapped  or  live far  away.    He  offered  that the  FY  03                                                               
appropriation  that school  districts received  included all  the                                                               
money needed to  transport all students to school in  the way the                                                               
district  wanted to.   House  Bill  259 doesn't  change that,  he                                                               
assured the  committee, adding that  the $1,200 amount  listed in                                                               
the bill  is simply a cap  - no district shall  receive more than                                                               
$1,200 per student  - because some districts  "charged" more than                                                               
$1,200 per student.  In FY  04, School districts will get all the                                                               
money they spent previously in FY 03, he reiterated.                                                                            
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  clarified  that his  concern  centers                                                               
around the flexibility  of HB 259.  Using a  comparison between a                                                               
child  that moves  into the  district  across the  street from  a                                                               
school and a  child that moves into the district  45 miles from a                                                               
school,  he  asked what  happens  then  with  regard to  how  the                                                               
funding provisions of HB 259 work.                                                                                              
                                                                                                                                
Number 1147                                                                                                                     
                                                                                                                                
MR. JEANS replied:                                                                                                              
                                                                                                                                
     The assumption there  is that you already  have a route                                                                    
     going to [the area 45  miles from the school], and that                                                                    
     child will  just be picked up  on that route.   I don't                                                                    
     believe a  school district is  going to put in  a route                                                                    
     for one child.   Right now we don't  even reimburse for                                                                    
     that; you have  to have a minimum  of eight [children].                                                                    
     And as Representative Gatto  just stated, this reflects                                                                    
     the  systems  that  are currently  in  place  that  are                                                                    
     dealing   with  the   transportation  needs   of  every                                                                    
     district in this  state.  It simply takes  it from this                                                                    
     reimbursable  system and  puts it  into a  grant system                                                                    
     ... on a  per student basis.  The grant  amount will go                                                                    
     up or down based on  the student population change.  So                                                                    
     if  you  have more  students,  you're  going to  get  a                                                                    
     larger allocation in the subsequent  year.  If you have                                                                    
     ... fewer  students, your grant  amount is going  to go                                                                    
     down.                                                                                                                      
                                                                                                                                
REPRESENTATIVE GATTO said that according  to his understanding of                                                               
HB 259,  for every student that  is added, the district  will get                                                               
an additional amount  of money regardless of  whether the student                                                               
lives  across  the street  or  100  miles  away, and  the  school                                                               
district can  do what  it wants  with that  money -  the decision                                                               
will be  made at the local  school district level.   Currently, a                                                               
school district  that has  eight students  living 100  miles away                                                               
from the  school simply  submits the  transportation bill  to the                                                               
state.   He  opined that  the current  system is  unreasonable in                                                               
this regard.   He added  that what he really  wants to do  is put                                                               
more  of  the responsibility  and  accountability  on the  school                                                               
district itself,  and have the  state not  be a part  of deciding                                                               
what's fair,  or how far is  too far, or  how old is too  old, et                                                               
cetera, because  those really are  local decisions.  What  HB 259                                                               
does is allow  the state to say to school  districts, "Here's the                                                               
money, spend it however you think is appropriate."                                                                              
                                                                                                                                
Number 1264                                                                                                                     
                                                                                                                                
REPRESENTATIVE GUTTENBERG offered his  belief that this isn't the                                                               
first time  that the state,  possibly in conjunction  with school                                                               
districts, has tried to build a  more efficient system.  He asked                                                               
what else has been done besides "trying to align the contracts."                                                                
                                                                                                                                
MR. JEANS relayed  that there has been  past discussion proposing                                                               
to  put  the  money  into  the  foundation  formula  program  and                                                               
increasing the base student allocation  such that the $53 million                                                               
currently being  spent on student transportation  would simply go                                                               
into  the foundation  formula  program.   The  problem with  that                                                               
proposal  is  that  the  distribution  of  the  funds  for  pupil                                                               
transportation based  on the profile  of each school  district is                                                               
so different that  that doesn't work.  He remarked  that that has                                                               
led to the creation of the proposal encompassed in HB 259.                                                                      
                                                                                                                                
REPRESENTATIVE CRAWFORD noted that  for "special needs kids," the                                                               
school  district  doesn't  have  a choice  regarding  whether  to                                                               
transport them.  Those children must be transported, he added.                                                                  
                                                                                                                                
MR.  JEANS said  that currently,  school districts  are providing                                                               
transportation to those with special  needs; thus those costs are                                                               
included in this  year's reimbursement.  He relayed  that the EED                                                               
has asked the Anchorage school  district to consider alternatives                                                               
in order to  alleviate the concerns regarding  the "special needs                                                               
population."                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GATTO noted  that adding  a "special  ed" student                                                               
who  lives  far  away  brings  with it  an  extra  expense.    He                                                               
suggested,  however,  that  if the  school  district  is  already                                                               
getting  money for  such a  student  and that  student no  longer                                                               
needs the transportation,  the school district gets  to save that                                                               
money.   He opined  that although nothing  can be  predicted with                                                               
regard  to where  people will  be located,  on average,  within a                                                               
district, transportation  costs and  funds will balance  over the                                                               
long run.                                                                                                                       
                                                                                                                                
REPRESENTATIVE CRAWFORD suggested, however,  that it is that very                                                               
same inability  to predict  how many students  will be  living in                                                               
which  areas  that  prompted the  creation  of  the  reimbursable                                                               
system rather than a grant system.                                                                                              
                                                                                                                                
Number 1467                                                                                                                     
                                                                                                                                
MELODY DOUGLAS, Chief Financial  Officer, Kenai Peninsula Borough                                                               
School  District, remarked  that  HB 259  does  provide for  more                                                               
funding  for  "K-12"  transportation  than  is  outlined  in  the                                                               
governor's budget,  and for that  she is appreciative.   She went                                                               
on to say:                                                                                                                      
                                                                                                                                
     I also  appreciate that one  intent of this bill  is to                                                                    
     allow districts  to spend any savings  realized through                                                                    
     this method in  the classroom.  (Indisc.)  in our case,                                                                    
     with  a continued  declining enrollment,  I think  that                                                                    
     situation  is  highly  unlikely.     I  appreciate  the                                                                    
     concept   that  this   is  a   snapshot  in   time  for                                                                    
     calculating funding  for ... transportation.   I'm very                                                                    
     concerned about  how we'll go forward  after this year.                                                                    
     I  think that  with contracts  ... currently  in place,                                                                    
     certainly, we could ask to  have those contracts opened                                                                    
     and see  what we  could do about  negotiating, perhaps,                                                                    
     some  savings.    I  feel  that  the  contractors  have                                                                    
     (indisc.)  fuel costs  and increased  labor costs  that                                                                    
     they would try to (indisc.),  so I don't know that that                                                                    
     process would be particularly successful.                                                                                  
                                                                                                                                
     [A]   comment   was   made  earlier   about   districts                                                                    
     negotiating contracts to line up  so that we might have                                                                    
     some  leverage  in  the negotiation  process;  I  think                                                                    
     we're in  the fifth year  of a seven year  contract, so                                                                    
     it would be about two  years out that ... the districts                                                                    
     around  the state  could align  for that  purpose.   My                                                                    
     particular comment  - or concern  - is  in relationship                                                                    
     to the special services -  special needs children - and                                                                    
     how those  costs or future  routes would  be addressed.                                                                    
     I also am concerned ...  [that] the system's costs that                                                                    
     we incur  are the same whether  we have one child  on a                                                                    
     bus or we have a full bus.                                                                                                 
                                                                                                                                
     So  we  unfortunately  are in  the  position  of  still                                                                    
     trying  to  analyze  our  data,  not  expecting  to  be                                                                    
     looking at numbers from  this perspective; we're having                                                                    
     to reach into some  interesting spreadsheets, trying to                                                                    
     pull numbers together, so that  we can have some viable                                                                    
     information for  the legislature to consider.   At this                                                                    
     point, I  would respectfully  ask that an  amendment be                                                                    
     made to  create a task  force to study this  matter, so                                                                    
     that we can deal with future changes.                                                                                      
                                                                                                                                
     And I understand that with  the method in place [in the                                                                    
     bill],  that we're  based on  the  current year,  which                                                                    
     takes into account  all of the aspects  of funding, and                                                                    
     just prorating  it on a  per pupil  basis.  And  on the                                                                    
     face, that's a valid way to  look at it but, again, I'm                                                                    
     concerned  about  the  future.   If  we  were  able  to                                                                    
     establish a task  force whereby we put  together a plan                                                                    
     to deal  with these  issues by  December of  this year,                                                                    
     then  the  next  legislative  session,  perhaps,  could                                                                    
     address  that.   Again, I  want  to thank  you for  the                                                                    
     opportunity to comment on HB 259 ....                                                                                      
                                                                                                                                
Number 1600                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  surmised that declining  enrollment such                                                               
as  is  being experienced  in  the  Kenai school  district  makes                                                               
transportation  costs  less  flexible,  with  regard  to  perhaps                                                               
changing existing contracts, because the  routes are the same but                                                               
there are less children on those routes.                                                                                        
                                                                                                                                
MS. DOUGLAS  agreed, adding  that there  are certain  things that                                                               
can be  done, though, such  as route  evaluation.  She  said that                                                               
her school district  is doing everything it can to  deal with the                                                               
declining  enrollment.   She  opined  that HB  259  "would be  an                                                               
extremely quick turnaround  to implement a change  of this nature                                                               
to have in  place for schools to start in  August; so, again, I'm                                                               
asking for  consideration to find  a way to address  these unique                                                               
needs that are different amongst districts in the state."                                                                       
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  Ms. Douglas  whether the  current                                                               
contract in her school district  has compensation increases built                                                               
into it.                                                                                                                        
                                                                                                                                
MS. DOUGLAS  said there is  a clause that addresses  an inflation                                                               
factor  of 1.9  percent,  but other  than that  she  is not  that                                                               
familiar with the contract.                                                                                                     
                                                                                                                                
Number 1710                                                                                                                     
                                                                                                                                
MIKE  FISHER,  Chief  Financial  Officer,  Fairbanks  North  Star                                                               
Borough   School  District,   thanked  the   committee  for   the                                                               
opportunity  to  comment.    He said  that  his  school  district                                                               
reluctantly  supports  HB  259  because   it  is  afraid  of  the                                                               
alternative.  He went on to say:                                                                                                
                                                                                                                                
     We've been beat up  over pupil transportation contracts                                                                    
     and costs the last few  years, and this bill appears to                                                                    
     be an  easy way  to simplify how  the state  deals with                                                                    
     the  issue.    But  it  may  be  too  easy.  ...  While                                                                    
     something  can  be  said for  the  correlation  of  ADM                                                                    
     [average daily  membership] to  busing costs,  it still                                                                    
     leaves a  lot of complex  issues for districts  to deal                                                                    
     with such as ...  the inflationary adjustments that are                                                                    
     typically included  in a long-term contract.   We could                                                                    
     get rid  of the CPI [Consumer  Price Index] adjustments                                                                    
     in  future contracts,  but we  would just  be paying  a                                                                    
     higher static rate from year one of the contract.                                                                          
                                                                                                                                
     We  also  {have]  changes  in  ridership  that  do  not                                                                    
     correspond to  ADM changes;  for instance,  ... changes                                                                    
     in ridership due to  special education busing, boundary                                                                    
     changes,  school openings,  [and No  Child Left  Behind                                                                    
     Act  of  1996  (NCLB)]  and  other  mandates.  ...  The                                                                    
     current  cost  of  special   education  routes  may  be                                                                    
     imbedded  in   the  base,  but  increased   special  ed                                                                    
     ridership, absent any overall  increase in ADM, will be                                                                    
     tough  to absorb.   But  you have  all heard  ... these                                                                    
     arguments   before,  and   they  do   not  individually                                                                    
     preclude any change in how  the pupil transportation is                                                                    
     funded.   They just make  it a more  difficult process.                                                                    
     And we certainly don't have all the answers either.                                                                        
                                                                                                                                
     ... I understand that the  vision is that the districts                                                                    
     will be  able to  become more  efficient and  use those                                                                    
     savings  in  the  classroom, and  the  reality  is  our                                                                    
     district  will first  look  at (indisc.)  efficiencies,                                                                    
     then  we'll start  cutting services,  and then  we will                                                                    
     take  [money]  out  of   the  classrooms  to  subsidize                                                                    
     transportation services. ... Since  I do not anticipate                                                                    
     a willingness  of future  legislatures to  increase the                                                                    
     per  ADM rate,  I  believe this  bill  will impact  the                                                                    
     classroom  instruction beginning  next  year.   Current                                                                    
     competitive contracts  were let two years  ago, and the                                                                    
     closeness of  the bids confirmed  that we are  paying a                                                                    
     fair  rate for  the  services.   We  may  not like  the                                                                    
     price, but it's the market rate.                                                                                           
                                                                                                                                
Number 1796                                                                                                                     
                                                                                                                                
MR. FISHER continued:                                                                                                           
                                                                                                                                
     And  that's not  unique to  the busing;  ... I  shudder                                                                    
     every time  I go to a  full priced movie, talk  to [an]                                                                    
     attorney,  or  fly to  Juneau.    But  if you  ...  are                                                                    
     getting a  fair price,  then the  only other  option to                                                                    
     look at is what  services you're asking your contractor                                                                    
     to provide.  And so really,  the only way to save money                                                                    
     or absorb  cost increases  will be  to combine  and cut                                                                    
     routes.   And so  in an effort  to fill  seat capacity,                                                                    
     which  is  largely  dependent   on  drive  time,  we'll                                                                    
     probably stop busing students living  past some sort of                                                                    
     arbitrary line  or distance from their  ... school. ...                                                                    
     We may  be able to cut  routes if buses do  not have to                                                                    
     drive  to an  outlying  residential area,  but this  is                                                                    
     cutting services, this is not efficiency.                                                                                  
                                                                                                                                
     But the cutting of services leads  me to one of my main                                                                    
     concerns  with  the bill,  and  that  is, what  is  the                                                                    
     intent  of   the  language   change  in   [proposed  AS                                                                    
     14.09.020].  ...  Because  private  schools  have  been                                                                    
     willing to change their school  bell time, it currently                                                                    
     costs   almost  nothing   to  provide   private  school                                                                    
     transportation services in Fairbanks,  and we were able                                                                    
     to  use the  excess  capacity during  certain times  or                                                                    
     route sections to provide some  busing services but, as                                                                    
     mentioned,  that'll  probably  change. ...  If  we  cut                                                                    
     services  and  combine  routes,  excess  capacity  will                                                                    
     disappear,  and we  will  most likely  not  be able  to                                                                    
     continue  to   bus  private  school   children  without                                                                    
     incurring additional costs.                                                                                                
                                                                                                                                
     And  it would  probably  not  be out  of  the realm  of                                                                    
     possibility for  a lawsuit to  be filed. ...  Does this                                                                    
     language change  mean that the  state wants no  part in                                                                    
     interpreting  the state  constitution with  [regard] to                                                                    
     transportation of school  children to nonpublic schools                                                                    
     at public  expense. ... Public  perception is  that the                                                                    
     Fairbanks  school district  was involved  in a  lawsuit                                                                    
     with  private schools  over busing  back  in 1993,  and                                                                    
     actually  it was  the state  and the  Fairbanks private                                                                    
     schools that  had the legal  issues, not  our district.                                                                    
     We   were  directed   by  the   commissioner  of   [the                                                                    
     Department  of] Education  to  continue busing  private                                                                    
     school children.                                                                                                           
                                                                                                                                
MR. FISHER concluded:                                                                                                           
                                                                                                                                
     So  we'll   gladly  continue  to  bus   private  school                                                                    
     children as  long as it  does not impact  public school                                                                    
     services,   but  that   service  may   be  reduced   or                                                                    
     eliminated   in  the   future  if   necessary  to   cut                                                                    
     transportation costs.   So I  just hope the  state will                                                                    
     defend this position.  Thank you for your time.                                                                            
                                                                                                                                
Number 1903                                                                                                                     
                                                                                                                                
STEVEN   KALMES,  Director,   Transportation,  Anchorage   School                                                               
District  (ASD), thanked  the committee  for  the opportunity  to                                                               
testify, and  said that he needed  to start out his  testimony by                                                               
reminding  members  that school  buses  are  the safest  form  of                                                               
transportation in  the United  States today.   He stated  that 98                                                               
percent of the children that are  injured or killed on the way to                                                               
and from  school are either  "walkers, kids riding  bikes, riding                                                               
with parents,  or riding with  teenage drivers."   He went  on to                                                               
say:                                                                                                                            
                                                                                                                                
     Earlier, it  was mentioned that many  districts support                                                                    
     House Bill 259.   I think you find that  because of the                                                                    
     either/or  situation here:   it's  easier  to say  that                                                                    
     we're  willing  to  talk about  [HB  259]  rather  than                                                                    
     losing 25 percent  of our budget next year.   The other                                                                    
     big  premise  ...  of  [HB  259]  is  that  all  school                                                                    
     district  transportation  operations  are  inefficient.                                                                    
     The governor,  in his message,  said that we  could cut                                                                    
     25  percent  and not  eliminate  any  rides.   I  think                                                                    
     that's an extremely inaccurate statement.                                                                                  
                                                                                                                                
     As far  as incentive to  save money, in  Anchorage I've                                                                    
     worked for five superintendents,  and my direction from                                                                    
     every one of  those superintendents has been  to run an                                                                    
     efficient transportation  operation so that we  can put                                                                    
     as many dollars  as possible into the  classroom.  Some                                                                    
     issues that need  to come to the table:   In Anchorage,                                                                    
     37  percent   of  our  buses  are   used  to  transport                                                                    
     handicapped  students,  and  that's 5  percent  of  the                                                                    
     population    of    students    that    are    provided                                                                    
     transportation.   That  transportation  is required  by                                                                    
     state  and  federal  law;   ...  if  transportation  is                                                                    
     required  in the  child's individual  educational plan,                                                                    
     we've got  to provided it  - there's no two  ways about                                                                    
     it.                                                                                                                        
                                                                                                                                
Number 1983                                                                                                                     
                                                                                                                                
MR. KALMES continued:                                                                                                           
                                                                                                                                
     So that leaves ... 95 percent  of our kids, who ride 63                                                                    
     percent of  our buses,  for the  reductions.   We don't                                                                    
     have --  the FY 03  level will reduce our  budget about                                                                    
     $650,000.    We're  not  going   to  find  $650,000  in                                                                    
     efficiencies, so  we will reduce rides  or we'll impact                                                                    
     the classroom next  year.  Some of the  things that are                                                                    
     also concerns  in the future:   our contracts  are [in]                                                                    
     place until  2006.  We  did line up with  Fairbanks and                                                                    
     Mat-Su  and wrote  common language,  and did  have more                                                                    
     bidders and,  as Mr. Fisher indicated,  the prices were                                                                    
     close.   I think that  is the price  of transportation,                                                                    
     what we're currently paying [on] the Railbelt.                                                                             
                                                                                                                                
     We're  going  to see  increased  costs  for labor,  for                                                                    
     fuel,  and for  equipment; that  goes on  every year  -                                                                    
     when we buy buses, we  see increases every single year.                                                                    
     And  right now,  we have  horrendous turnover  with bus                                                                    
     drivers,  and I  think  that has  increased across  the                                                                    
     state; we  have about  40 percent turnover  just during                                                                    
     the summer months.   Some years are  worse than others.                                                                    
     In  my years  in the  Anchorage School  District, we've                                                                    
     had turnover as high as  100 percent over the course of                                                                    
     one  school year.   That's  not a  good way  to run  an                                                                    
     operation.   We need  to pay  our drivers  a reasonable                                                                    
     wage so that they'll continue to work for us.                                                                              
                                                                                                                                
     The big  sales pitch on this  bill is that we  can keep                                                                    
     the money we  save.  Well, ... I submit  that we're not                                                                    
     going  to be  able to  keep  any money  in Anchorage  -                                                                    
     we're  going to  be  reducing routes.    So the  budget                                                                    
     shortfalls will  translate to reductions in  service or                                                                    
     will  impact  the  classroom  in the  out  years.    My                                                                    
     concern about  this is,  this is  a very  complex issue                                                                    
     and we're  trying to solve  it in simple terms;  ADM is                                                                    
     probably not the way to do it, but it is easy.                                                                             
                                                                                                                                
MR. KALMES concluded:                                                                                                           
                                                                                                                                
     We're committed to  [working] with the [EED]  to find a                                                                    
     more equitable way  to implement a way to  take care of                                                                    
     this, but  the way it's set  up now, the 95  percent of                                                                    
     our kids  that ride 63  percent of our buses  will take                                                                    
     all of the cuts.  And  we're concerned any time we have                                                                    
     to  reduce  transportation,  reduce service,  and  have                                                                    
     kids walk to school - they're much less safe.                                                                              
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  noted  that Laidlaw  is  continuously                                                               
advertising  open positions  in  the Fairbanks  area.   He  asked                                                               
whether the situation is similar in Anchorage.                                                                                  
                                                                                                                                
Number 2081                                                                                                                     
                                                                                                                                
MR. KALMES  said that it has  been, adding that in  the last five                                                               
years,  there has  been  an  increase in  the  turnover and  more                                                               
difficulty  attracting  and retaining  drivers  -  the wages  for                                                               
drivers have not  increased significantly over the  years and the                                                               
economy has not  gotten any better.  There are  other jobs in the                                                               
community that are simply more attractive.                                                                                      
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked Mr.  Kalmes whether he  feels that                                                               
the FY 03  allocation has been sufficiently  equitable to provide                                                               
a base for years to come, which is what HB 259 would do.                                                                        
                                                                                                                                
MR. KALMES replied:                                                                                                             
                                                                                                                                
     The way  we're currently reimbursed, it's  based on ...                                                                    
     regulations  and the  cost  of student  transportation.                                                                    
     Years ago,  we used  to be  funded out  of supplemental                                                                    
     appropriations - there  wasn't a separate appropriation                                                                    
     for  transportation  -  and so  every  year,  districts                                                                    
     never knew what  the transportation reimbursement would                                                                    
     be  until September,  when we  got the  check.   So the                                                                    
     separate  appropriation  was  established  so  that  we                                                                    
     wouldn't have an impact on the classroom every year.                                                                       
                                                                                                                                
     We're going  back ..., based  on the  discussions we're                                                                    
     having, to  the way it  used to be, so  that shortfalls                                                                    
     in  transportation  will  come out  of  the  classroom.                                                                    
     It's a  better system than  what we had.   I understand                                                                    
     the department's  need to gain efficiencies  across the                                                                    
     state; I think we've done  some good things in the last                                                                    
     several  years,  and  I  think  we  ought  to  do  them                                                                    
     statewide and we've offered our assistance to do that.                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG, in follow up, remarked:                                                                                
                                                                                                                                
     Well  currently,  the  allocation is,  like,  $339  per                                                                    
     student now in Anchorage versus  [$767] in Mat-Su.  And                                                                    
     I  don't  want  you  to   debate  the  merit  of  that,                                                                    
     necessarily, but I think the  thrust of the legislation                                                                    
     is that that ... would be  the basis for ... the future                                                                    
     unless there  was significant change. ...  I'm a little                                                                    
     bit  troubled  by  that;  that  just  makes  this  huge                                                                    
     assumption that  the way it's  done now is  the correct                                                                    
     way  to do  it.   And  I  guess I'm  ...  just kind  of                                                                    
     concerned if you think ...  that's true.  Is the equity                                                                    
     in the system, currently, so we can rely on that?                                                                          
                                                                                                                                
Number 2181                                                                                                                     
                                                                                                                                
MR. KALMES responded:                                                                                                           
                                                                                                                                
     Well, I think  what I said earlier is  that saying that                                                                    
     districts  will be  able  to keep  what  they save,  in                                                                    
     Anchorage, I submit that we're  not going to be able to                                                                    
     make  reductions and  save money  that we  can put  ...                                                                    
     into the  classroom.   It's going to  be the  other way                                                                    
     around - we will be  taking money from the classroom to                                                                    
     fund the  shortfall. ... Can efficiencies  be gained in                                                                    
     other districts?   Well, the  department says so.   And                                                                    
     ... has  everybody done some  of the things  that we've                                                                    
     done on the  Railbelt?  I don't know; I'm  not aware of                                                                    
     that.     But  I   think  by  aligning   contracts,  by                                                                    
     consolidating some of the contracts,  there may be some                                                                    
     savings in Bush areas ....                                                                                                 
                                                                                                                                
MR. KALMES, in response to whether  the ASD supports HB 259, said                                                               
that the ASD thinks that HB 259  is a much better option than the                                                               
governor's proposal.  He added:                                                                                                 
                                                                                                                                
     We  will work  with the  department to  try to  fix the                                                                    
     problem,  but our  problem is  [with] tying  [funds] to                                                                    
     ADM.  We need to  have some mechanism to fund increased                                                                    
     costs,  especially  for   special  education  students.                                                                    
     It's  10 to  15  times more  expensive  to transport  a                                                                    
     special  education  student.  ... We  transport  up  to                                                                    
     several  hundred students  on  a regular  bus per  day.                                                                    
     Those numbers  are drastically  under that  for special                                                                    
     education  [students] simply  because of  their special                                                                    
     needs  and [the]  greater distances  we have  to drive;                                                                    
     $339  in anchorage  won't cover  the cost  of intensive                                                                    
     needs student.                                                                                                             
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked about the state  statute that ties                                                               
drivers' wages to minimum wages.                                                                                                
                                                                                                                                
MR. KALMES said, "It's two times the Alaska minimum wage."                                                                      
                                                                                                                                
Number 2272                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  asked, "[Does]  that have any  impact on                                                               
what you pay in Anchorage?"                                                                                                     
                                                                                                                                
MR. KALMES  replied, "Not yet; it  will come into play  next year                                                               
for the Anchorage School District  and [in 2006] for our contract                                                               
operations."                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG asked:  "What are  you paying now?  Is it                                                               
above ...?"                                                                                                                     
                                                                                                                                
MR. KALMES  responded, "In  Anchorage, we're  paying below."   He                                                               
added that the ASD starts at  about $12 an hour for both district                                                               
and  contract operations;  when [the  tie to]  minimum wage  goes                                                               
into effect, it will be a little over $14 an hour.                                                                              
                                                                                                                                
REPRESENTATIVE GATTO commended Mr.  Kalmes.  He acknowledged that                                                               
there is a  dilemma, which is that there is  a choice between two                                                               
undesirables.   It is  not a  matter of  finding a  solution that                                                               
disqualifies both  of the undesirables, because  the governor has                                                               
the goal  of cost containment.   He said that he  does wish there                                                               
was more money.  However, there  isn't.  He stated, "We only have                                                               
the cut  or this system,  and I  think most people,  when they've                                                               
spent as much time as you  have looking into what happened to the                                                               
system, [they realize]  that this gives you more  money than [the                                                               
governor's  proposal]."   There's really  no guarantee  that [the                                                               
governor's proposal]  won't be cut  again the following  year, he                                                               
added, offering that at least with  HB 259, with it being tied to                                                               
ADM,  it is  very  similar  to the  [foundation]  formula and  is                                                               
therefore the better choice.                                                                                                    
                                                                                                                                
REPRESENTATIVE CRAWFORD  likened the  choice they are  faced with                                                               
to, "Do you want to be shot today  or hung in a couple of weeks."                                                               
He said he did not like the  options he's been given.  He posited                                                               
that there  are a lot more  questions to be asked,  and mentioned                                                               
the transportation  services for  the "school  for the  deaf from                                                               
Wasilla to Anchorage."   He opined that the state  is mandated to                                                               
provide student  transportation and, therefore, there  should not                                                               
be  a  choice  between  a  20-25 percent  cut,  as  the  governor                                                               
proposes, and  a cut that's coming  down the road.   He asked Mr.                                                               
Kalmes  to  suggest  possible  ways  in which  HB  259  could  be                                                               
amended.                                                                                                                        
                                                                                                                                
TAPE 03-44, SIDE B                                                                                                            
Number 2347                                                                                                                     
                                                                                                                                
MR. KALMES replied  that the ASD's big concern is  the special ed                                                               
piece  because those  costs are  much  greater than  transporting                                                               
regular  students.   He  added that  tying funds  to  ADM is  not                                                               
really a measure that affects  pupil transportation.  However, if                                                               
funding is tied to the  actual number of students transported, it                                                               
might result in  a more accurate number than just  looking at the                                                               
total  district   enrollment.     Not  every   district  provides                                                               
transportation  to the  same percentage  of students,  so there's                                                               
some fluctuation when funding is tied to ADM.                                                                                   
                                                                                                                                
REPRESENTATIVE GUTTENBERG  noted that in Fairbanks,  the district                                                               
supplies transportation  to nonpublic schools.   He asked whether                                                               
Anchorage faces a similar situation.                                                                                            
                                                                                                                                
MR. KALMES  said that over the  years, the ASD has  provided some                                                               
transportation,  along regularly  scheduled routes,  to nonpublic                                                               
schools, adding  that there is  really only one  nonpublic school                                                               
that has been  accommodated by that practice.   He explained that                                                               
kids ride  to or  parents take  them to one  of the  schools, and                                                               
then as  the bus is  returning to the lot,  it drops them  off at                                                               
the  nonpublic school.   He  mentioned that  there have  probably                                                               
never  been  more  than  10  or   15  kids,  out  of  the  18,000                                                               
transported, that are transported to nonpublic schools.                                                                         
                                                                                                                                
REPRESENTATIVE  GUTTENBERG mentioned  that  it is  not as  though                                                               
these problems have dropped out  of the air today; these problems                                                               
have been  worked on  for a  long time.   He asked  whether other                                                               
alternative plans have been on the table before.                                                                                
                                                                                                                                
MR. KALMES replied:                                                                                                             
                                                                                                                                
     We have  evaluated the regulations; several  years ago,                                                                    
     ... a task force was  formed to look at the regulations                                                                    
     and see  if there  were ways  that we  could streamline                                                                    
     the  regulations and  ...  get  consistency across  the                                                                    
     state.   We had some discussion  about allowable costs:                                                                    
     ... what's  allowable, what  isn't, ...  what's allowed                                                                    
     in  different parts  of the  state, what's  reasonable.                                                                    
     And  then  we've  also,  recently -  our  last  run  of                                                                    
     contracts - ... got  together [and] we actually changed                                                                    
     the length  of a couple  of our contracts  in Anchorage                                                                    
     so that they would  coincide with Fairbanks and Mat-Su.                                                                    
     And  we  believe that  that  was  positive; it  brought                                                                    
     other bidders  to the state  and we have  another large                                                                    
     company  that's  here now.    So,  ... those  are  some                                                                    
     things that  we've done  regionally.   I think  some of                                                                    
     those things could be done across the state as well.                                                                       
                                                                                                                                
Number 2225                                                                                                                     
                                                                                                                                
LARRY  WIGET,  Executive   Director,  Public  Affairs,  Anchorage                                                               
School District (ASD), opined that  Mr. Kalmes is able to explain                                                               
the needs of pupil transportation  better than anyone else in the                                                               
state.  He  offered the following as a quote  from what he called                                                               
the "Senate Finance Committee Annual Education Report":                                                                         
                                                                                                                                
     To  educate  Alaska's  children, they  must  first  get                                                                    
     safely  to school.    Consistent,  safe, and  efficient                                                                    
     transportation  is  vital  to  the  education  process.                                                                    
     Pupil   transportation  is   not  cheap,   but  it   is                                                                    
     essential.   Money for  transporting students  frees up                                                                    
     funds for  the classroom.   If the state did  not fully                                                                    
     fund  these costs,  districts would  be  forced to  use                                                                    
     classroom dollars  to pay  for getting  students safely                                                                    
     to school.                                                                                                                 
                                                                                                                                
MR. WIGET then added:                                                                                                           
                                                                                                                                
     When  we're  talking about  funding  at  the 03  level,                                                                    
     we're   not   talking   about   fully   funding   pupil                                                                    
     transportation, we're  talking about taking a  hit next                                                                    
     year and  even a  greater hit for  the year  after that                                                                    
     and a  greater hit  down the road.   In  essence, these                                                                    
     will   come  out   of  classroom   dollars.     I  know                                                                    
     [Representatives Rokeberg and  Gatto] this morning were                                                                    
     in  the [House  Special Committee  on Ways  and Means],                                                                    
     and   you  heard   testimony  provided   by  Guy   Bell                                                                    
     [Director,  Division  of  Retirement &  Benefits,  who]                                                                    
     just talked about the 05  increases to the PERS [Public                                                                    
     Employees'  Retirement   System]  and   TRS  [Teachers'                                                                    
     Retirement  System],  and  while   we  don't  have  the                                                                    
     numbers that will  impact us to this point  in time for                                                                    
     TRS,  he  stated  that the  Anchorage  School  District                                                                    
     alone will  have a hit of  $3.5 million in 05.   Take a                                                                    
     look  at other  bills and  proposals from  the governor                                                                    
     that are  under consideration  at this time  - $150,000                                                                    
     for   pupil   transportation,  $775,000   for   tuition                                                                    
     payments for students - all  these will ultimately have                                                                    
     a direct impact on the education of our students.                                                                          
                                                                                                                                
REPRESENTATIVE  ROKEBERG  remarked that  in  a  recent e-mail  he                                                               
received  from Mr.  Bell, the  aforementioned numbers  [regarding                                                               
PERS and TRS] might be closer to $7 million.                                                                                    
                                                                                                                                
Number 2131                                                                                                                     
                                                                                                                                
MR. WIGET said,  then, "I rest my case; we  need full funding for                                                               
pupil transportation."                                                                                                          
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked  what Anchorage's  percentage  of                                                               
special needs children is compared to the rest of the state.                                                                    
                                                                                                                                
MR. WIGET  said he did not  have the exact numbers,  but surmised                                                               
that there are  a greater number of such children.   Referring to                                                               
the military bases  around Anchorage, he noted  that Anchorage is                                                               
also  a "primary  overseas  assignment for  people  who have  ...                                                               
special  education students."    He mentioned  that  the EED  has                                                               
directed  the  ASD  to  provide  transportation  from  Mat-Su  to                                                               
students so  they could attend  the "Alaska State School  for the                                                               
Deaf and  Hard of  Hearing" program in  Anchorage," and  thus are                                                               
currently transporting four students                                                                                            
                                                                                                                                
REPRESENTATIVE  ROKEBERG  surmised,   "Under  the  current  plan,                                                               
you're ASD is reimbursed for those  type of costs, and under this                                                               
plan, they wouldn't be."                                                                                                        
                                                                                                                                
MR. WIGET concurred.                                                                                                            
                                                                                                                                
REPRESENTATIVE  GATTO noted  that Guy  Bell had  told the  [House                                                               
Special  Committee on  Ways  and  Means] that  when  one does  an                                                               
actuarial value, the future is  determined by looking at the past                                                               
and then making projections.  Representative Gatto said:                                                                        
                                                                                                                                
     Likewise, ... every district in  the state, is going to                                                                    
     look  backwards  and  say:   "What  percentage  of  our                                                                    
     students  were  special ed?    How  much money  did  we                                                                    
     spend?   What  [do] our  routes  look like?"   And  the                                                                    
     assumption  has to  be  - since  I  cannot predict  the                                                                    
     future and  you can't  and the  director can't  - which                                                                    
     students  will  be coming  in  the  district to  change                                                                    
     that.   We don't  know.   You might  wind up  being the                                                                    
     luckiest district in the state.                                                                                            
                                                                                                                                
MR. WIGET pointed out, however, that it is a known fact that                                                                    
costs are going up.                                                                                                             
                                                                                                                                
Number 2033                                                                                                                     
                                                                                                                                
REPRESENTATIVE GATTO countered:                                                                                                 
                                                                                                                                
     Yes  they  are, and  we  understand  that. ...  They're                                                                    
     going  up in  your  district,  my district,  everyone's                                                                    
     district.   We  cannot  simply separate  out, and  say,                                                                    
     "Certain  districts are  better  than other  districts;                                                                    
     certain districts might have  higher costs."  The point                                                                    
     of using  ADM was  it was a  number that  you recognize                                                                    
     what that number  is.  You receive a  certain number of                                                                    
     dollars based on a specific  number.  It's quite simple                                                                    
     to do  it that  way.   In the old  way, you  would just                                                                    
     say, "We  have these  additional costs," and  submit it                                                                    
     to the state.                                                                                                              
                                                                                                                                
     The state,  ... the  governor especially,  is objecting                                                                    
     to  that  method.    The  governor's  solution  to  his                                                                    
     objection is,  as you  know, a  simple, straightforward                                                                    
     ... 20 percent reduction.   Now, we don't ... want that                                                                    
     alternative.   No matter  how much  we argue  about, "I                                                                    
     want plan three,"  we only have plans one  and two, and                                                                    
     we want  to make the  best deal for  one and two.   And                                                                    
     maybe  in the  future, next  year, we'll  revisit this,                                                                    
     but we  need to essentially  have this in  place before                                                                    
     we can revisit it.  And that's why it's here.                                                                              
                                                                                                                                
MR. WIGET remarked that it  will then be the legislature's policy                                                               
call on how  to best fund education.  In  response to a question,                                                               
he replied:                                                                                                                     
                                                                                                                                
     I think,  definitely, when Jim  Clark [Chief  of Staff,                                                                    
     Office  of the  Governor], makes  a statement  that the                                                                    
     governor supports  this piece of legislation,  a number                                                                    
     of  people take  that to  heart.   We're hoping,  as we                                                                    
     indicated earlier,  in working  with the  department as                                                                    
     this  bill moves  through the  process,  that there  is                                                                    
     some flexibility to make some adjustments too.                                                                             
                                                                                                                                
REPRESENTATIVE CRAWFORD said  he did not think  they were limited                                                               
to just two choices.                                                                                                            
                                                                                                                                
REPRESENTATIVE GATTO  remarked, "The Senate did  account for this                                                               
in their  budget."  He  said he hopes that  there is time  for HB                                                               
259 to be  sent to the governor for his  quick approval, and then                                                               
the  legislature can  be  done with  this phase  and  move on  to                                                               
energize some other  aspect of funding education.   "As you know,                                                               
we do have  a very major change in the  formula that we're moving                                                               
forward, and  we need to  emphasize and concentrate an  awful lot                                                               
of our  efforts in that area,  and even that has  some amendments                                                               
and changes," he added.                                                                                                         
                                                                                                                                
Number 1866                                                                                                                     
                                                                                                                                
BRUCE   JOHNSON,   Director,  Quality   Schools/Quality   Student                                                               
Services  (QS2),  Association  of Alaska  School  Boards  (AASB),                                                               
thanked  Representative Gatto  for  attending  the AASB's  recent                                                               
"fly in."  He went on to say:                                                                                                   
                                                                                                                                
     We have  some concerns.   We believe  this is  a policy                                                                    
     call.   We're moving  from one system  of funding  to a                                                                    
     grant program; that's clearly a  policy call.  How that                                                                    
     is formulated  is of concern  to us, and we  would like                                                                    
     to see  it impacted in  some ways, particularly  [as it                                                                    
     relates] to  special education.  We  believe that there                                                                    
     is a  trend in  our state for  ... those  students that                                                                    
     are  required to  be transported  to school  by federal                                                                    
     law ... to  reside in the hub areas or  seek to move to                                                                    
     the   hub  areas   -  [Ketchikan,   Juneau,  Anchorage,                                                                    
     Fairbanks]  -   because  ...  the  massive   number  of                                                                    
     services that  some of these kids  require, even beyond                                                                    
     transportation,  just  aren't  available,  readily,  in                                                                    
     some of the rural communities.                                                                                             
                                                                                                                                
     We also  recognize that  the ADM  piece is  a difficult                                                                    
     one, particularly  in [a] declining  student enrollment                                                                    
     situation  - fewer  dollars  coming in.    If you  take                                                                    
     "Alaska  Gateway":   we  all  know  the highway  system                                                                    
     there probably  fairly well  - it goes  out so  far and                                                                    
     turns around,  and whether you  pick up 10  students or                                                                    
     you pick  up 20  students -  and with  "Alaska Gateway"                                                                    
     and declining  enrollment, it's going  to have  a major                                                                    
     impact, plus  we're starting from the  perspective that                                                                    
     they've  been capped  and lose  $100,000 kind  of right                                                                    
     off  the bat.   It's  very different  in an  urban area                                                                    
     such as Fairbanks  - I understand they  have about 140-                                                                    
     plus  routes  - if  they  lose  100 students  they  may                                                                    
     actually be  able to make  some tweaks  and adjustments                                                                    
     to create efficiencies.                                                                                                    
                                                                                                                                
     We recognize  there may be a  door "A" and a  door "B."                                                                    
     What we're  hoping is that  maybe "B" can get  a little                                                                    
     bit better before the end  of this session, and that we                                                                    
     [can] work towards amending that  in positive ways that                                                                    
     would mitigate  some of  the challenges  that districts                                                                    
     are going  to face,  because I think  it is  clear that                                                                    
     these costs are going to  go up, [and] they will impact                                                                    
     the classroom probably sooner rather than later. ...                                                                       
                                                                                                                                
CHAIR ANDERSON closed public testimony on HB 259.                                                                               
                                                                                                                                
Number 1747                                                                                                                     
                                                                                                                                
REPRESENTATIVE GATTO  made a  motion to  adopt Amendment  1 [text                                                               
provided previously].                                                                                                           
                                                                                                                                
Number 1727                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  objected for the purpose  of discussion.                                                               
He referred to a memorandum by  the drafter as a good argument in                                                               
favor of  Amendment 1.   He  surmised that  via Section  3, which                                                               
would be deleted by Amendment  1, Representative Gatto was making                                                               
the assumption that at a later  date there would be an adjustment                                                               
to the formula.                                                                                                                 
                                                                                                                                
REPRESENTATIVE  GATTO said  that  Amendment 1  is  an attempt  to                                                               
prevent  "turf  warfare,"  and suggested  that  Section  3  would                                                               
negate the value of HB 259.                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  surmised, then,  that if Amendment  1 is                                                               
adopted, it would  take an affirmative action on the  part of the                                                               
legislature to  make any  future adjustments  to the  formula set                                                               
out in HB 259.                                                                                                                  
                                                                                                                                
REPRESENTATIVE GATTO said yes.                                                                                                  
                                                                                                                                
REPRESENTATIVE ROKEBERG removed his objection.                                                                                  
                                                                                                                                
Number 1638                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD said he objected to Amendment 1.                                                                        
                                                                                                                                
REPRESENTATIVE GATTO remarked that  the effective date in Section                                                               
4, page 2, line 20, should be changed to July 1, 2003.                                                                          
                                                                                                                                
Number 1620                                                                                                                     
                                                                                                                                
CHAIR  ANDERSON asked  whether Representative  Gatto intends  for                                                               
the change in the bill's effective  date to be added to Amendment                                                               
1 as a friendly amendment.                                                                                                      
                                                                                                                                
REPRESENTATIVE GATTO indicated he did.                                                                                          
                                                                                                                                
REPRESENTATIVE CRAWFORD, after  noting that he did  not object to                                                               
changing the effective date, said  that he objects to the removal                                                               
of Section  3 because  then there  would be  nothing in  the bill                                                               
authorizing an adjustment to the formula for rising costs.                                                                      
                                                                                                                                
Number 1578                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG   said  he   objects  to   changing  the                                                               
effective date.                                                                                                                 
                                                                                                                                
CHAIR ANDERSON announced, then, that  the change to the effective                                                               
date  would be  considered  Conceptual Amendment  2, rather  than                                                               
just a friendly amendment to Amendment 1.                                                                                       
                                                                                                                                
Number 1567                                                                                                                     
                                                                                                                                
CHAIR ANDERSON  noted that Amendment  1, without any  changes, is                                                               
before the committee.                                                                                                           
                                                                                                                                
The committee took an at-ease from 4:25 p.m. to 4:26 p.m.                                                                       
                                                                                                                                
Number 1563                                                                                                                     
                                                                                                                                
A roll  call vote was  taken.  Representatives  Dahlstrom, Gatto,                                                               
Rokeberg,   and  Anderson   voted  in   favor  of   Amendment  1.                                                               
Representatives  Guttenberg   and  Crawford  voted   against  it.                                                               
Therefore, Amendment 1 was adopted by a vote of 4-2.                                                                            
                                                                                                                                
Number 1514                                                                                                                     
                                                                                                                                
REPRESENTATIVE GATTO made a motion  to adopt Conceptual Amendment                                                               
2, to  change the effective  date from July  1, 2004, to  July 1,                                                               
2003.                                                                                                                           
                                                                                                                                
Number 1506                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG objected.   He  surmised that  there had                                                               
been testimony  which suggested that changing  the effective date                                                               
would bring with it the possibility  of matching the bill up with                                                               
the Senate version of the  budget.  He asked Representative Gatto                                                               
to confirm this.                                                                                                                
                                                                                                                                
[Representative Gatto's answer was inaudible.]                                                                                  
                                                                                                                                
REPRESENTATIVE  ROKEBERG said  he is  worried about  implementing                                                               
"this" in  the face of  future contract costs and  other variable                                                               
costs.  He  added, "This bill is  being passed with a  gun to the                                                               
school  districts' heads  ... -  that  really troubles  me."   He                                                               
indicated that he's supported  fully funding pupil transportation                                                               
this year.   He  remarked that  he is  not sure  why HB  259 came                                                               
before  the  House Labor  and  Commerce  Standing Committee,  and                                                               
added that he does have some reservations about the bill.                                                                       
                                                                                                                                
Number 1436                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  withdrew  his objection  to  Conceptual                                                               
Amendment 2.                                                                                                                    
                                                                                                                                
Number 1429                                                                                                                     
                                                                                                                                
CHAIR ANDERSON  asked whether there  were any  further objections                                                               
to  Conceptual  Amendment  2.     There  being  none,  Conceptual                                                               
Amendment 2 was adopted.                                                                                                        
                                                                                                                                
Number 1405                                                                                                                     
                                                                                                                                
REPRESENTATIVE  DAHLSTROM  moved  to  report  CSHB  259(EDU),  as                                                               
amended,  out of  committee with  individual recommendations  and                                                               
the accompanying fiscal note.                                                                                                   
                                                                                                                                
Number 1391                                                                                                                     
                                                                                                                                
REPRESENTATIVE GUTTENBERG objected.  He stated:                                                                                 
                                                                                                                                
     [There are]  a few things  involved here.  One  of them                                                                    
     is the  efficiencies and where they're  going.  Another                                                                    
     one is, we  are policy makers, ... the  governor can do                                                                    
     what  he  wants, but  we  set  policy,  we do  the  ...                                                                    
     operating    budget,   and    I   think    that's   our                                                                    
     responsibility.   And  if we  ... believe  that student                                                                    
     transportation  should be  funded, we  should do  that.                                                                    
     And the  governor can do what  he may.  It's  my belief                                                                    
     that we  should fund  pupil transportation for  a whole                                                                    
     slew of reasons.  ... People have come to  me, and I've                                                                    
     heard  from two  of my  school boards  and others  that                                                                    
     they don't like this and they  feel that there is a gun                                                                    
     to their head, and I don't  like that either.  And when                                                                    
     my  time  comes  to  vote, I'm  voting  to  fund  pupil                                                                    
     transportation, and that's  my option - not  to give it                                                                    
     away ...  or negotiate  it away  - that's  my privilege                                                                    
     and  that's  what  I  have here  and  that's  what  I'm                                                                    
     exercising.                                                                                                                
                                                                                                                                
REPRESENTATIVE CRAWFORD said:                                                                                                   
                                                                                                                                
     I  think that  even if  this doesn't  make the  full 20                                                                    
     percent cut right  off the bat, I don't  think that was                                                                    
     a good  option - I  would have  voted against that.   I                                                                    
     think that eventually this will  affect [the] safety of                                                                    
     our kids.   And I think  it's the wrong way  to go; I'm                                                                    
     going to [be] against it.                                                                                                  
                                                                                                                                
REPRESENTATIVE  ROKEBERG said  that he  has serious  reservations                                                               
about  HB 259,  and  reiterated that  he  supports funding  pupil                                                               
transportation.   He remarked  that the issues  raised by  HB 259                                                               
are extremely difficult and need  to be exposed to public debate.                                                               
He added:                                                                                                                       
                                                                                                                                
     We  have to  resolve  some of  these particular  issues                                                                    
     from a budgetary  standpoint ... plus the  needs ... of                                                                    
     the  children   of  the   state.     There's  certainly                                                                    
     inequities  in  this state;  for  example,  I might  be                                                                    
     tempted to add  an amendment on [the]  floor to provide                                                                    
     public  transportation to  all the  private schools  in                                                                    
     Anchorage,  which  would  probably  take  up  half  the                                                                    
     budget of the whole  Fairbanks school district, ... but                                                                    
     then we'd of course have to  pay the bill - and there's                                                                    
     a lot  of strange  things going on  in this  state ....                                                                    
     I'm  going  to  vote  to  pass this  bill  out,  but  I                                                                    
     probably have serious reservations about supporting it                                                                     
     ....                                                                                                                       
                                                                                                                                
CHAIR ANDERSON indicated that he  agrees with the testifiers from                                                               
the school  districts, but feels  that the bill should  be passed                                                               
on to the next committee of referral and debated more.                                                                          
                                                                                                                                
Number 1212                                                                                                                     
                                                                                                                                
A roll  call vote was  taken.  Representatives  Dahlstrom, Gatto,                                                               
Rokeberg,  and   Anderson  voted  in  favor   of  reporting  CSHB                                                               
259(EDU),  as   amended,  out  of  committee.     Representatives                                                               
Guttenberg  and  Crawford  voted  against it.    Therefore,  CSHB                                                               
259(L&C)  was  reported  out  of the  House  Labor  and  Commerce                                                               
Standing Committee by a vote of 4-2.                                                                                            
                                                                                                                                
HB 269-SAFETY CODE TASK FORCE                                                                                                 
                                                                                                                                
Number 1196                                                                                                                     
                                                                                                                                
CHAIR ANDERSON announced  that the final order  of business would                                                               
be HOUSE BILL NO. 269, "An  Act establishing the Safety Code Task                                                               
Force; and providing for an effective date."                                                                                    
                                                                                                                                
CHAIR  ANDERSON, noting  that no  one wished  to testify,  closed                                                               
public testimony on HB 269                                                                                                      
                                                                                                                                
Number 1179                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM, sponsor of  HB 269, turned attention to                                                               
Amendment  1, labeled  23-LS0974\A.1,  Bannister, 4/30/03,  which                                                               
read:                                                                                                                           
                                                                                                                                
     Page 1, line 8:                                                                                                            
     Delete "member"                                                                                                            
     Insert "state senator"                                                                                                     
                                                                                                                                
     Page 1, line 9:                                                                                                            
     Delete "member"                                                                                                            
     Insert "state representative"                                                                                              
                                                                                                                                
     Page 1, line 10, following "member":                                                                                       
     Insert "of the administration"                                                                                             
                                                                                                                                
     Page 2, line 6:                                                                                                            
     Delete "one family"                                                                                                        
     Insert "a consistent set"                                                                                                  
                                                                                                                                
     Page 2, line 6:                                                                                                            
     Delete "and"                                                                                                               
                                                                                                                                
     Page 2, line 8, following "codes":                                                                                         
     Insert "; and                                                                                                              
     (3)   discuss and  make recommendations on  the methods                                                                    
     and  authority  for  local  governments  to  amend  and                                                                    
     administer safety codes"                                                                                                   
                                                                                                                                
     Page 2, line 12:                                                                                                           
     Delete "act as"                                                                                                            
     Insert "participate on"                                                                                                    
                                                                                                                                
     Page 2, line 12, following "task force.":                                                                                  
     Insert "The president of the  senate and the speaker of                                                                    
     the house  of representatives  may jointly  appoint the                                                                    
     following additional members to the advisory panel:                                                                        
     (1)  a municipal building official;                                                                                        
     (2)  a municipal fire prevention official;                                                                                 
     (3)  a journeyman mechanical installer;                                                                                    
     (4)  a journeyman plumber;                                                                                                 
     (5)  a journeyman electrician;                                                                                             
     (6)  a building developer;                                                                                                 
     (7)    a  representative  of the  Alaska  Oil  and  Gas                                                                    
     Association;                                                                                                               
     (8)  a representative of a pipeline operator;                                                                              
     (9)   a representative from the  Alaska Housing Finance                                                                    
     Corporation;                                                                                                               
     (10)    a  representative of  the  Alaska  Homebuilders                                                                    
     Association; and                                                                                                           
     (11)     a  representative  from  a   regional  housing                                                                    
     authority.                                                                                                                 
     (d)    If   additional  organizations,  or  industries,                                                                    
     trades,   or   professions    show   an   interest   in                                                                    
     participating,  the president  of  the  senate and  the                                                                    
     speaker  of the  house of  representatives may  jointly                                                                    
     appoint additional members to the advisory panel.                                                                          
     (e)"                                                                                                                       
                                                                                                                                
     Reletter the following subsections accordingly.                                                                            
                                                                                                                                
Number 1164                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM indicated that the first four changes                                                                  
made by Amendment 1 are clarifying changes; that the next 2                                                                     
changes   add  a   new  proposed   paragraph   (3)  -   regarding                                                               
recommendations   on  methods   and  authority   -  to   proposed                                                               
subsection  (b);  that  the next  change  is  another  clarifying                                                               
change;  and   that  the  last   two  changes  clarify   who  may                                                               
additionally be  appointed jointly to  the advisory panel,  add a                                                               
new  proposed subsection  - regarding  the  possible addition  of                                                               
other interested parties to the  advisory panel - while splitting                                                               
current proposed  subsection (c)  into two  separate subsections,                                                               
and reletter the remaining subsections accordingly.                                                                             
                                                                                                                                
CHAIR ANDERSON  surmised that some of  the aforementioned changes                                                               
proposed  by  Amendment  1  are  in  response  to  questions  and                                                               
concerns raised at the bill's previous hearing.                                                                                 
                                                                                                                                
REPRESENTATIVE DAHLSTROM agreed.                                                                                                
                                                                                                                                
Number 0910                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM made a motion to adopt Amendment 1.                                                                    
                                                                                                                                
Number 0902                                                                                                                     
                                                                                                                                
REPRESENTATIVE   ROKEBERG  objected.     He   indicated  that   a                                                               
constituent  of  his had  sent  him  an e-mail  listing  numerous                                                               
concerns about  the bill.   He suggested  that Amendment  1 would                                                               
create two different  groups, and is stacked in favor  of one set                                                               
of  codes  over  another.    He  opined  that  there  is  a  huge                                                               
unfairness in the  makeup of the initial  membership, adding that                                                               
he is  very concerned about that.   He mentioned that  he is also                                                               
concerned that Amendment 1 could  create a very ungainly thing in                                                               
that the advisory panel could be  bigger than the task force.  He                                                               
said   that  he   is  not   sure  that   all  of   the  potential                                                               
representatives  listed  in  Amendment  1  actually  need  to  be                                                               
included, because he  is not sure that their  respective areas of                                                               
expertise will add  anything in terms of  developing and adopting                                                               
building codes.  Turning attention  to the portion of Amendment 1                                                               
that changes page  2, line 12, he  asked Representative Dahlstrom                                                               
what  replacing "act  as" with  "participate on"  is intended  to                                                               
accomplish.                                                                                                                     
                                                                                                                                
REPRESENTATIVE  DAHLSTROM first  pointed out  that both  the task                                                               
force and  the advisory panel are  already a part of  HB 269, and                                                               
so Amendment 1 is not  creating another group that didn't already                                                               
exist in the  original legislation.  On the issue  of whether the                                                               
bill favors  one set of  codes over another, she  reiterated that                                                               
"the  officials and  the people  that were  added," as  listed in                                                               
Amendment  1, came  from suggestions  resulting  from the  bill's                                                               
last  hearing.   She  added  that  the  people  she spoke  to  in                                                               
creating the list in Amendment  1 were building officials, people                                                               
from  the "fire"  industry, actual  laborers, and  union "folks."                                                               
She offered her belief that Amendment  1 is not weighted in favor                                                               
of either set of building codes.                                                                                                
                                                                                                                                
REPRESENTATIVE DAHLSTROM,  in response  to a question  from Chair                                                               
Anderson, said  that the  purpose of  the task  force is  to come                                                               
back to  the legislature on the  first day of the  second regular                                                               
session  with  recommendations.     Returning  to  Representative                                                               
Rokeberg's question regarding the change  to page 2, line 12, she                                                               
indicated  that the  words "participate  on" better  reflect that                                                               
the advisory panel is composed  of nonvoting members, whereas the                                                               
task force is composed of voting members.                                                                                       
                                                                                                                                
Number 0569                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG, in response to  a question, said that he                                                               
maintains his objection  to Amendment 1.  He  turned attention to                                                               
page  1,  line  11,  which  says:    (4)  the  following  members                                                               
appointed jointly by the president  of the senate and the speaker                                                               
of the house  of representatives:".  He said that  he is not sure                                                               
he  agrees  with  the  requirement that  the  president  and  the                                                               
speaker must  get together to  decide who the task  force members                                                               
outlined  in   subparagraphs  (A)-(F)  are;  he   called  such  a                                                               
requirement  an extra  burden given  the speaker  and president's                                                               
already large workload  and the amount of time  necessary to make                                                               
such a selection in an impartial fashion.                                                                                       
                                                                                                                                
REPRESENTATIVE DAHLSTROM  said she is confident  that the speaker                                                               
and president's  staff will  be very  efficient in  helping those                                                               
two  gentlemen prioritize  their workload  so  as to  be able  to                                                               
fulfill the  requirements of  HB 269.   She  added, "I  also have                                                               
confidence  in  [the speaker  and  president's]  ability to  make                                                               
fair,  good choices;  they, along  with  the rest  of us,  raised                                                               
their  hands and  swore to  do  what was  best for  the state  of                                                               
Alaska, and I have confidence that they will do that."                                                                          
                                                                                                                                
REPRESENTATIVE  CRAWFORD  suggested   volunteering  the  minority                                                               
leaders to help in the selection  process.  He said that although                                                               
he  has concerns  because he  does not  know who  leadership will                                                               
appoint to the  task force, he assumes that  the people appointed                                                               
are going to do the best job that they can.                                                                                     
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  said  he agrees  with  Representative                                                               
Crawford.   He added that  when the  task force comes  before the                                                               
legislature next January,  "they are going to have to  sell us on                                                               
what they did," and therefore  he thinks that during the upcoming                                                               
task force  meetings, everybody will  be at the  table, everybody                                                               
will  have  their  say,  and   there  will  be  a  conscientious,                                                               
deliberative process.                                                                                                           
                                                                                                                                
CHAIR ANDERSON mentioned  that he hopes there  will be neutrality                                                               
on the task force.                                                                                                              
                                                                                                                                
Number 0238                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  noted that  "this issue" was  before the                                                               
committee on at  least three occasions last year,  and that there                                                               
was a  lot of  hard work  done in  an attempt  to fix  "the whole                                                               
thing."   He  opined that  a legislative  solution was  prevented                                                               
from  going forward  because  of political  inertia  and a  small                                                               
group of  people.  He said  that he views  HB 269 as "an  end run                                                               
around that  whole process"  of adopting  conforming legislation,                                                               
and posited that  there is no reason why a  solution could not be                                                               
figured out  by the  legislature, because,  right now,  there are                                                               
three  different  statutes  that  conflict with  each  other  and                                                               
conforming legislation needs to go forward.  He added:                                                                          
                                                                                                                                
     I  would like  to see  this process  be fair,  [and] go                                                                    
     forward; I  appreciate Representative  Dahlstrom's work                                                                    
     on this  ..., but  I think  it needs  to be  balanced a                                                                    
     little better than  it is right now.   So I'm concerned                                                                    
     about that.   I'd hate to  have all this work  put into                                                                    
     it, and  [then] this  bill somehow not  make it  to the                                                                    
     floor for some reason. ...  I wouldn't want to see that                                                                    
     happen. ... It just doesn't  seem to be fair.  Wouldn't                                                                    
     you agree Mr. Chairman?                                                                                                    
                                                                                                                                
CHAIR ANDERSON said yes.                                                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG  went on to  say, "I think ...  we really                                                               
need  to  make  sure  we  get  this  balanced  right."    Turning                                                               
attention back  to the issue  of Amendment 1,  he said he  has no                                                               
objection  to Amendment  1's first  seven  proposed changes,  but                                                               
does  have  "heartburn"  with  the   proposed  additions  to  the                                                               
advisory panel.   He suggested  that because of the  large number                                                               
of  task  force  members  representing  various  aspects  of  the                                                               
construction  industry, the  task  force could  wind up  weighted                                                               
with members  that have a  predisposition to a particular  set of                                                               
codes                                                                                                                           
                                                                                                                                
TAPE 03-45, SIDE A                                                                                                            
Number 0001                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  said  that  after action  is  taken  on                                                               
Amendment 1,  he would be  offering another amendment  that would                                                               
add, to page 1 of HB  269, "a municipal building official" and "a                                                               
fire prevention  official" to  the list  detailing the  makeup of                                                               
the task force.   He opined that adding these  two members to the                                                               
task force itself  would balance it.  And then,  of course, there                                                               
would be no  need to have either "a  municipal building official"                                                               
or "a municipal fire prevention  official" on the advisory panel;                                                               
therefore, those two members could be deleted from Amendment 1.                                                                 
                                                                                                                                
REPRESENTATIVE  DAHLSTROM   said  she   would  prefer   to  leave                                                               
Amendment 1 as is.                                                                                                              
                                                                                                                                
Number 0143                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG suggested,  then, deleting from Amendment                                                               
1  the  language  pertaining to  the  additional  advisory  panel                                                               
members.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  DAHLSTROM  pointed  out  that  according  to  the                                                               
language  in  Amendment  1, the  appointment  of  any  additional                                                               
advisory  panel members  is optional  rather than  mandatory, and                                                               
that  according to  the language  in HB  269, the  advisory panel                                                               
merely gives advice to the task force.                                                                                          
                                                                                                                                
The committee took an at-ease from 4:55 p.m. to 5:02 p.m.                                                                       
                                                                                                                                
Number 0277                                                                                                                     
                                                                                                                                
ZACK WARWICK,  Staff to  Senator Gene  Therriault, sponsor  of SB                                                               
180, companion  bill to  HB 269, referring  to the  suggestion of                                                               
adding  "a municipal  building official"  and "a  fire prevention                                                               
official" to the task force, said:                                                                                              
                                                                                                                                
     First  of all,  the  municipal  building official  does                                                                    
     have  a vested  interested;  these are  the people  who                                                                    
     design the International [Building]  Code, ... so there                                                                    
     is  a vested  interest  and a  hard  sway towards  that                                                                    
     side.  We feel that the  task force, as written now, is                                                                    
     completely  even:   three, one  side; three,  the other                                                                    
     side;  and three,  impartial.    I know  Representative                                                                    
     Rokeberg  commented   that  there  are   [several]  ...                                                                    
     construction-related  trades there;  ... it  is my  ...                                                                    
     understanding  that the  general contractors  do prefer                                                                    
     the International  [Building] Code  - that is  why they                                                                    
     were  ... listed,  as the  three ...  that are  leaning                                                                    
     towards  [the International  Building Code.]   If  this                                                                    
     task force came  back with a document  that was leaning                                                                    
     or swaying  in any  direction, and  it came  out during                                                                    
     the task  force that this  task force was  swayed, then                                                                    
     it's going  to come back  with a document  that's going                                                                    
     to  be completely  worthless  to  the legislature,  and                                                                    
     basically  waist  $20,000.   And  we  feel that  adding                                                                    
     those  two to  the task  force  would sway  it in  that                                                                    
     direction.                                                                                                                 
                                                                                                                                
Number 0411                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  withdrew   his  prior  suggestions  and                                                               
offered the following as an amendment to Amendment 1:                                                                           
                                                                                                                                
     Remove   "a  municipal   building   official"  and   "a                                                                    
     municipal fire  prevention official" from  the advisory                                                                    
     panel;  add to  the  task force  "a municipal  building                                                                    
     official" and  "a fire prevention official;  and delete                                                                    
     "nine" and  insert "eleven"  on page 1,  line 6,  of HB                                                                    
     269.                                                                                                                       
                                                                                                                                
Number 0604                                                                                                                     
                                                                                                                                
REPRESENTATIVE   DAHLSTROM  expressed   her   objection  to   the                                                               
amendment to Amendment 1.                                                                                                       
                                                                                                                                
Number 0627                                                                                                                     
                                                                                                                                
A  roll  call  vote  was taken.    Representatives  Rokeberg  and                                                               
Anderson  voted  in  favor  of  the  amendment  to  Amendment  1.                                                               
Representatives Guttenberg, Crawford,  Dahlstrom, and Gatto voted                                                               
against it.  Therefore, the amendment  to Amendment 1 failed by a                                                               
vote of 2-4.                                                                                                                    
                                                                                                                                
CHAIR  ANDERSON  observed  that   the  question  now  before  the                                                               
committee was whether to adopt Amendment 1.                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG maintained his objection to Amendment 1.                                                                
                                                                                                                                
Number 0651                                                                                                                     
                                                                                                                                
A  roll  call  vote  was   taken.    Representatives  Guttenberg,                                                               
Crawford,  Dahlstrom,  Gatto,  and  Anderson voted  in  favor  of                                                               
Amendment  1.     Representative   Rokeberg  voted   against  it.                                                               
Therefore, Amendment 1 was adopted by a vote of 5-1.                                                                            
                                                                                                                                
Number 0707                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM moved to report  HB 269, as amended, out                                                               
of   committee   with    individual   recommendations   and   the                                                               
accompanying  fiscal  notes.   There  being  no  objection,  CSHB                                                               
269(L&C)  was  reported  out  of the  House  Labor  and  Commerce                                                               
Standing Committee.                                                                                                             
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
Number 0719                                                                                                                     
                                                                                                                                
There being no further business before the committee, the House                                                                 
Labor and Commerce Standing Committee meeting was adjourned at                                                                  
5:10 p.m.                                                                                                                       

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