03/12/2015 03:30 PM Senate EDUCATION
| Audio | Topic |
|---|---|
| Start | |
| HCR2 | |
| SCR1 | |
| SJR2 | |
| SB64 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| + | HCR 2 | TELECONFERENCED | |
| += | SJR 2 | TELECONFERENCED | |
| += | SCR 1 | TELECONFERENCED | |
| *+ | SB 64 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE EDUCATION STANDING COMMITTEE
March 12, 2015
3:31 p.m.
MEMBERS PRESENT
Senator Mike Dunleavy, Chair
Senator Charlie Huggins, Vice Chair
Senator Cathy Giessel
Senator Gary Stevens
Senator Berta Gardner
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
CS FOR HOUSE CONCURRENT RESOLUTION NO. 2(EDC)
Designating January 24 - 30, 2016, as Alaska School Choice Week.
- MOVED CSHCR 2(EDC) OUT OF COMMITTEE
SENATE CONCURRENT RESOLUTION NO. 1
Relating to a legislative task force on civics education.
- MOVED CSSCR 1(EDC) OUT OF COMMITTEE
SENATE JOINT RESOLUTION NO. 2
Proposing an amendment to the Constitution of the State of
Alaska relating to contracting state debt for postsecondary
student loans.
- MOVED SJR 2 OUT OF COMMITTEE
SENATE BILL NO. 64
"An Act relating to school bond debt reimbursement; and
providing for an effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HCR 2
SHORT TITLE: JAN 24 - 30, 2016: AK SCHOOL CHOICE WEEK
SPONSOR(s): REPRESENTATIVE(s) GATTIS
01/26/15 (H) READ THE FIRST TIME - REFERRALS
01/26/15 (H) EDC
02/04/15 (H) EDC AT 8:00 AM CAPITOL 106
02/04/15 (H) Heard & Held
02/04/15 (H) MINUTE(EDC)
02/06/15 (H) EDC AT 8:00 AM CAPITOL 106
02/06/15 (H) Moved CSHCR 2(EDC) Out of Committee
02/06/15 (H) MINUTE(EDC)
02/09/15 (H) EDC RPT CS(EDC) NT 4DP
02/09/15 (H) DP: KREISS-TOMKINS, DRUMMOND, SEATON,
KELLER
02/23/15 (H) TRANSMITTED TO (S)
02/23/15 (H) VERSION: CSHCR 2(EDC)
02/25/15 (S) READ THE FIRST TIME - REFERRALS
02/25/15 (S) EDC
03/12/15 (S) EDC AT 3:30 PM BUTROVICH 205
BILL: SJR 2
SHORT TITLE: CONST. AM: G.O. BONDS FOR STUDENT LOANS
SPONSOR(s): SENATOR(s) MACKINNON
01/21/15 (S) PREFILE RELEASED 1/9/15
01/21/15 (S) READ THE FIRST TIME - REFERRALS
01/21/15 (S) STA, EDC, FIN
02/10/15 (S) STA AT 9:00 AM BUTROVICH 205
02/10/15 (S) Moved SJR 2 Out of Committee
02/10/15 (S) MINUTE(STA)
02/11/15 (S) STA RPT 3DP 2NR
02/11/15 (S) DP: COGHILL, MCGUIRE, WIELECHOWSKI
02/11/15 (S) NR: STOLTZE, HUGGINS
02/24/15 (S) EDC AT 3:30 PM BUTROVICH 205
02/24/15 (S) Heard & Held
02/24/15 (S) MINUTE(EDC)
03/12/15 (S) EDC AT 3:30 PM BUTROVICH 205
BILL: SCR 1
SHORT TITLE: CIVICS EDUCATION TASK FORCE
SPONSOR(s): SENATOR(s) STEVENS
01/21/15 (S) READ THE FIRST TIME - REFERRALS
01/21/15 (S) EDC, FIN
02/26/15 (S) EDC AT 3:30 PM BUTROVICH 205
02/26/15 (S) Heard & Held
02/26/15 (S) MINUTE(EDC)
03/12/15 (S) EDC AT 3:30 PM BUTROVICH 205
BILL: SB 64
SHORT TITLE: SCHOOL BOND DEBT REIMBURSEMENT
SPONSOR(s): FINANCE
03/02/15 (S) READ THE FIRST TIME - REFERRALS
03/02/15 (S) EDC, FIN
03/12/15 (S) EDC AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
REPRESENTATIVE LYNN GATTIS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of HCR 2.
TIM LAMKIN, Staff
Senator Gary Stevens
Alaska State Legislature
Juneau, Alaska,
POSITION STATEMENT: Explained the changes in the CS for SCR 1.
STUART THOMPSON, representing himself
Meadow Lakes, Alaska
POSITION STATEMENT: Testified in support of SCR 1.
LISA SKILES PARADY, Executive Director
Alaska Council of School Administrators (ACSA) and
Executive Director
Alaska Superintendents Association
Juneau, Alaska
POSITION STATEMENT: Testified on SCR 1.
SENATOR ANNA MACKINNON
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SJR 2 and Cross Sponsor of HCR 2.
ROBERT DOTSON, representing himself
Cordova, Alaska
POSITION STATEMENT: Testified in support of SJR 2.
LAURIE PIERRE, Staff
Senator Anna MacKinnon
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented a sectional analysis of SB 64.
MIKE ABBOTT, Chief Operating Officer
Anchorage School District
Anchorage, Alaska
POSITION STATEMENT: Testified about concerns regarding SB 64.
ACTION NARRATIVE
3:31:10 PM
CHAIR MIKE DUNLEAVY called the Senate Education Standing
Committee meeting to order at 3:31 p.m. Present at the call to
order were Senators Huggins, Giessel, Gardner, and Chair
Dunleavy. Senator Stevens arrived shortly thereafter. Chair
Dunleavy noted the committee would hear four bills.
HCR 2-JAN 24 - 30, 2016: AK SCHOOL CHOICE WEEK
3:32:19 PM
CHAIR DUNLEAVY announced the consideration of HCR 2. [CSHCR
2(EDC) was before the committee.]
REPRESENTATIVE LYNN GATTIS, Alaska State Legislature, sponsor of
HCR 2, related that the resolution is about school choice and a
parent's right to choose when, where, and how their child is
educated. Designating January 24 - 30, 2016 as Alaska School
Choice Week, simply acknowledges that our education system is
accountable to families. Alaska has many education
opportunities; public neighborhood schools, public charter
schools, public home schools, optional public schools,
independent home schools, as well as private schools. She said
School Choice Week is a national celebration recognized by
millions of students, parents, educators, schools, and community
leaders for the purpose of raising public awareness to the
importance of effective education options. This truly comes down
to a parent's right to choose how to education their child. She
concluded that HCR 2 is a simple resolution.
CHAIR DUNLEAVY recognized that Senator Stevens was present. He
said the resolution is similar to the Senate version of the
bill. The only change is on line 10; there is an addition of
"optional public schools."
SENATOR GARDNER said she read the Senate version very carefully
to see if it was a voucher bill that supported the use of state
money for private schools. She concluded that it was not a pro-
voucher bill. She said when she researched the national School
Choice movement she recognized that when "public charter school"
is used, it means "voucher schools" that receive state dollars.
She asked if the wording on line 10 is an endorsement of
vouchers.
REPRESENTATIVE GATTIS said it really means "Alaska's school
choices, not vouchers." There are no private charter schools in
Alaska.
CHAIR DUNLEAVY corrected that the resolution states "public
charter schools."
3:35:53 PM
SENATOR HUGGINS said he could add vouchers to the resolution.
SENATOR HUGGINS moved to report CSHCR 2(EDC) from committee with
individual recommendations and attached zero fiscal note. There
being no objection, it was so ordered.
3:36:30 PM
At ease
SCR 1-CIVICS EDUCATION TASK FORCE
3:39:03 PM
CHAIR DUNLEAVY announced the consideration of SCR 1. He said it
is the second hearing of the resolution and he intended to move
it out of committee.
TIM LAMKIN, Staff, Senator Gary Stevens, Alaska State
Legislature, explained the changes in the new CS for SCR 1,
version N. He said the bill is modeled after one from Illinois
and the language was changed to fit Alaska's task force
composition. There is a net change to twelve for the number of
task force members. On page 2, lines 23-26, the task force now
has three representatives and three senators, including one each
from the minority caucus. On page 3, line 1, the NEA member
would be a teacher with significant experience in the area of
civics and social studies.
SENATOR HUGGINS moved to adopt the CS for SCR 1, labeled 29-
LS0237\N, as the working document before the committee.
CHAIR DUNLEAVY objected.
MR. LAMKIN continued to describe the changes in the bill. On
page 3, lines 4-6, the reference to a member of the media was
deleted and replaced with a student. Also, on page 3, lines 7
and 8, a civics non-profit member was deleted and replaced by
someone from the judicial branch of government. Representation
by the superintendent was also deleted since school board
representation was maintained.
3:41:57 PM
SENATOR GARDNER pointed out that there is an even number of task
force members and she assumed they would work for consensus.
MR. LAMKIN said historically there is consensus with task
forces. In the event of a tie, a motion would fail.
CHAIR DUNLEAVY opened public testimony.
3:42:41 PM
STUART THOMPSON, representing himself, testified in support of
SCR 1. He discussed his belief in citizen participation. He said
he has five methods for financing civics education. He said he
will fax his comments to the committee.
3:47:23 PM
LISA SKILES PARADY, Executive Director, Alaska Council of School
Administrators (ACSA), and Executive Director, Alaska
Superintendents Association, testified on SCR 1. She requested
that a superintendent be left on the task force. She maintained
that school board members have a different role than
superintendents.
CHAIR DUNLEAVY closed public testimony.
SENATOR STEVENS voiced appreciation for Mr. Thompson's support.
He recognized the problem of funding the task force. He
appreciated Dr. Parady's comments. He said he would not mind
adding the superintendent position back, but there is a limit to
the number of members.
3:51:21 PM
SENATOR HUGGINS asked for clarification of the status of the
fiscal note.
MR. LAMKIN said there is a fiscal note for the original version
of the bill and a replacement is being considered. He explained
that it is the sponsor's intent to have the bulk of task force
members who reside in or near Anchorage.
CHAIR DUNLEAVY said there could be a discussion of the fiscal
note in Senate Finance.
3:52:37 PM
At ease
3:52:46 PM
CHAIR DUNLEAVY said they would move the bill out of committee
with a fiscal note that could be discussed in Senate Finance.
SENATOR HUGGINS moved to report CSSCR 1(EDC), version N, from
committee with individual recommendations and attached fiscal
note. There being no objection, the motion carried. [The
assumption is that Chair Dunleavy removed his objection to the
adoption of version N.]
3:53:35 PM
At ease
SJR 2-CONST. AM: G.O. BONDS FOR STUDENT LOANS
3:55:17 PM
CHAIR DUNLEAVY announced the consideration of SJR 2. He shared
that the resolution is a constitutional amendment for General
Obligation bonds for student loans. The committee heard SJR 2 on
February 24 and also heard public testimony, which is still
open. There is a zero fiscal note. He said the committee has
received responses to questions posed at the last meeting from
Diane Barrans from the Alaska Commission on Post-Secondary
Education.
SENATOR ANNA MACKINNON, Alaska State Legislature, sponsor of SJR
2, read from the sponsor statement: SJR 2 is our way of trying
to reduce student loan debt for those who currently have debt in
the state of Alaska and those that may have debt in Alaska's
future. Article IX, sec. 8, of the Alaska Constitution currently
says that the state only can use the full faith and credit of
Alaska for capital improvement or for housing loans for
veterans. This would amend that to allow post-secondary
education to offer loans to students, thereby creating a lower
loan rate for students, and our hope is to reduce student debt.
CHAIR DUNLEAVY opened public testimony.
ROBERT DOTSON, representing himself, testified in support of SJR
2. He shared that he is helping support three grandsons through
college. He said he objects to the high interest rates for
student loans.
CHAIR DUNLEAVY noted the fiscal note has zero impact. He said if
both bodies pass SJR 2, it goes to the public for a vote.
SENATOR MACKINNON agreed. She explained that after two years the
public would vote again before any bond would be issued.
CHAIR DUNLEAVY closed public testimony.
4:00:45 PM
SENATOR HUGGINS moved to report SJR 2 from committee with
individual recommendations and attached zero fiscal note. There
being no objection, the motion carried.
4:01:07 PM
At ease
SB 64-SCHOOL BOND DEBT REIMBURSEMENT
4:03:16 PM
CHAIR DUNLEAVY announced the consideration of SB 64. He said it
is the first hearing of the bill.
SENATOR ANNA MACKINNON, Alaska State Legislature, sponsor of SB
64, read the sponsor statement. Alaska is facing a $3.5 billion
revenue shortfall this year and projected into next year. One
thing we can do to take care of Alaska is to take care of our
fiscal house as quickly as possible. The current bill before you
proposes to sunset current state aid regarding reimbursement for
major maintenance and school construction. This is a measure
that is outside of our control in anticipating our future debt-
to-credit ratio needs. I understand that it is a valuable tool
for communities that can provide bond indebtedness. This doesn't
prevent schools from going forward and providing that
indebtedness.
She said she originally wanted an effective date of January 1,
2015. That date was rejected and is a policy consideration for
the committee. It takes into account that people go to bond
market in April and October and sell bonds. A municipality may
be getting ready to market to sell bonds. She opined that
January 1, 2015, is the correct date and the people of Alaska
will understand that the state is not in the position to go
forward with reimbursing at a higher level. The bill does not
eliminate the program, but sunsets it for five years.
4:06:04 PM
SENATOR GARDNER asked if January 1, 2015, is the correct date.
SENATOR MACKINNON said yes; it is retroactive. She related that
Legislative Legal expressed concern about retroactivity and the
possibility that Anchorage might have a bond proposition that
voters expect to be reimbursed for.
CHAIR DUNLEAVY requested a sectional analysis.
LAURIE PIERRE, Staff, Senator Anna MacKinnon, Alaska State
Legislature, presented a sectional analysis of SB 64. She
clarified that the year bonds are issued is listed in state
statute. The most recent one was issued from October 1, 2006, to
May 1, 2015. Legislative Legal suggested a May 1 sunset date so
as not to affect that bond.
4:08:17 PM
MS. PIERRE related that Section 1 sunsets the bond debt
reimbursement provisions for school construction and major
maintenance for five years, May 1, 2015 to July 1, 2020.
Section 2 begins on page 6, line 21, and restricts the
reimbursement of bonds authorized after May 1, 2015. Also, on
page 7, lines 1 through 11, it deletes language relating to
bonds authorized after May 1, 2015.
Section 3 page 12, line 17, through page 13, line 2, inserts
language relating to bonds authorized on or after July 1, 2020,
and reduces reimbursement from 70 percent for standard projects
to 50 percent, and from 60 percent for non-standard projects to
40 percent.
4:10:04 PM
Section 4 restricts the commissioner from approving an
application for bond debt reimbursement between May 1, 2015, and
July 1, 2020.
Section 5 restricts the commissioner from approving an
application for bond debt reimbursement between May 1, 2015, and
July 1, 2020.
Section 6 repeals sections 1, 4, and 5 of this Act on July 1,
2020.
Section 7 is the retroactivity clause and applies to Sections 1,
4, and 5.
Section 8 states that Section 3 takes effect on July 1, 2020.
Section 9 is the immediate effective date.
4:11:22 PM
SENATOR STEVENS requested clarification of a hypothetical
situation; if the voters of Anchorage approved a bond package on
April 7, 2015, it would be funded at a 70/30 ratio, but other
districts that vote at a later date would not have that
opportunity.
MS. PIERRE said that is correct.
4:12:28 PM
MIKE ABBOTT, Chief Operating Officer, Anchorage School District
(ASD), testified about concerns regarding SB 64. He said ASD
relies on general obligation debt for all capital projects, at
about 90 percent, with smaller contributions from legislative
grants, federal sources, and the operating budget. ASD has taken
advantage of multi-year bonding programs for capital projects
and voters appreciate that approach. ASD hopes to continue that
funding method.
He explained that ASD's six-year capital improvement program
anticipates going forward with debt reduction. New bonds have
been sold at lower rates and old debts have been refinanced at
lower rates. He said ASD is not involved in the state grant
process and would not score well compared to other area
projects. He concluded that ASD is uncertain if it could meet
its capital requirements going forward with this bill.
4:17:28 PM
SENATOR HUGGINS said Wasilla has had many new students and
construction demands. He asked what the trend is in Anchorage.
MR. ABBOTT replied that ASD anticipates a slight growth in
enrollment over the next six years; a slight decline is
anticipated next year.
SENATOR HUGGINS asked for retrospective data.
MR. ABBOTT said over the last five years the district has
declined in enrollment by about three percent.
4:19:18 PM
SENATOR STEVENS said the bill has unusual wording. He asked what
is on the Anchorage ballot for April 7, and how the 70/30 split
would work.
MR. ABBOTT replied that there is a single bond proposal,
Proposition 1, for a little over $59 million. About 2/3 of the
bond is to be reimbursed at 60 percent and 1/3 at 70 percent,
for a blended rate of about 64 percent. Of the $59 million, $56
million is for four elementary renewal projects. Individual
costs range between $12 million and $19 million. No new school
construction is planned within the six-year CIP.
4:22:12 PM
CHAIR DUNLEAVY noted SB 64 is an attempt to get a handle on
revenue and would provide breathing space for the state to
replenish its coffers. He stated he would hold the bill in
committee today. He thanked the sponsor and noted the bill goes
to Senate Finance next.
SENATOR MACKINNON said there are four major cost drivers in
Alaska's budget; K-12, Health and Human Service - Medicaid
growth, PERS/TRS, and school debt reimbursement, which has
totaled $3 billion since FY 1972. The legislature has had no
control except to step up and pay just under $120 million
annually. She stated support for what ASD is doing, but
maintained that it is time to reduce expenses. She stressed the
need to retroactively date the bill to prevent large bonds in
the fall. She concluded that SB 64 is totally about fiscal
restraint.
CHAIR DUNLEAVY asked Mr. Abbott about the 60 percent
reimbursement and if ASD followed DEED guidelines.
MR. ABBOTT explained that three of the elementary school
projects are eligible for 60 percent reimbursement under DEED
regulations because ASD is adding a small amount of square
footage to try and improve the security of the front entrances.
It is less expensive to add a few square feet rather than
remodel an old structure. It would be eligible for 70 percent if
that were not done, but would be more expensive.
4:28:02 PM
SENATOR HUGGINS assumed there would be a retroactive date
proposed. He asked what that would do to ASD's bond proposition.
CHAIR DUNLEAVY asked Mr. Abbott to consider a proposed amendment
to that effect.
MR. ABBOTT explained that the ballot language authorized by the
Anchorage Assembly describes school debt reimbursement as it is
currently defined in statute - it is not guaranteed and is
subject to appropriation. The voters are on the hook for the
entire amount of the indebtedness and the entire amount of
annual debt service.
CHAIR DUNLEAVY commented on the trend of a declining student
population in Alaska. He summarized that the bill is a result of
the financial situation in the state.
SENATOR MACKINNON noted SB 64 is a Senate Finance Committee
bill.
CHAIR DUNLEAVY held SB 64 in committee.
4:31:44 PM
There being nothing further to come before the committee,
Senator Dunleavy adjourned the Senate Education Standing
Committee at 4:31 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HCR 2 - Resolution.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| HCR 2 - Sponsor Statement.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| HCR 2 - Fiscal Note.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| SCR 1 Committee Substitute.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| SCR 1 Amendments in CS.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| CS for SCR 1 Testimony.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| CS for SCR 1 Fiscal Note.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| SJR 2 Diane Barrans Response to Question.pdf |
SEDC 3/12/2015 3:30:00 PM |
|
| SB 64 - Legislation.pdf |
SEDC 3/12/2015 3:30:00 PM |
SB 64 |
| SB 64 - Sponsor Statement.pdf |
SEDC 3/12/2015 3:30:00 PM |
SB 64 |
| SB 64 - Sectional Analysis.pdf |
SEDC 3/12/2015 3:30:00 PM |
SB 64 |
| SB 64 - Fiscal Note.pdf |
SEDC 3/12/2015 3:30:00 PM |
SB 64 |