Legislature(1993 - 1994)
03/08/1993 09:20 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
March 8, 1993
9:20 a.m.
TAPES
SFC-93, #30, Side 2 (end-000)
SFC-93, #36, Side 1 (000-356)
CALL TO ORDER
Senator Drue Pearce, Co-chair, convened the meeting at
approximately 9:20 a.m.
PRESENT
In addition to Co-chair Pearce, Senators Jacko, Kelly,
Kerttula, Rieger, and Sharp were present. Senator Frank
arrived while the meeting was in progress.
ALSO ATTENDING: Senator Robin Taylor, sponsor of SB 43;
Darsie Beck, Alaska Environmental Lobby; Representative Ron
Larson, Co-chair for House Finance Committee; John Bitney,
staff to Representative Larson; Duane Guiley, Director,
School Finance, Department of Education; Steve McPhetres,
Executive Director, Alaska Council of School Administrators;
Vernon Marshall, Executive Director, National Education
Association-Alaska; Mike Greany, Director, and Karen
Rehfeld, Fiscal Analysts, and other analysts, Legislative
Finance Division; and aides to committee members.
SUMMARY INFORMATION
CSSB 43(RES) - An Act establishing a grant program relating
to transplantation of elk; and providing for
an effective date.
CSSB 43 work draft dated March 3, 1993 was
ADOPTED for discussion purposes. Senator
Taylor, sponsor of SB 43 testified in support
of the bill. Darsie Beck, Alaska
Environmental Lobby, testified in opposition.
CSSB 43(FIN) was REPORTED OUT of committee
with unanimous consent.
CSHB 45(FIN) - An Act making appropriations to the
Department of Education for support of
kindergarten, primary, and secondary
education and community schools programs and
for school construction debt retirement; and
providing for an effective date.
Testimony was heard and discussion was had on
CSHB 45(FIN). Those testified in support
were Representative Ron Larson, Co-chair
House Finance Committee; John Bitney, staff
to Rep. Larson; Duane Guiley, Director,
School Finance, Department of Education;
Steve McPhetres, Alaska Council of School
Administrators; and Vernon Marshall, National
Education Association-AK. CSHB 45(FIN) was
HELD in committee until Wednesday, March 10,
1993.
CS FOR SENATE BILL NO. 43(RES):
An Act establishing a grant program relating to
transplantation of elk; and providing for an effective
date.
C0-CHAIR DRUE PEARCE announced that CSSB 43(RES) was before
the committee and invited Senator Robin Taylor, sponsor of
the bill, to join the committee at the table. A work draft
dated March 3, 1993 was distributed for the committee's
review.
SENATOR STEVE RIEGER MOVED for adoption of the CSSB 43 work
draft dated March 3, 1993. No objections having been
raised, the CSSB 43 work draft dated March 3, 1993 was
ADOPTED.
SENATOR ROBIN TAYLOR asked the committee to consider the
work draft in lieu of the original bill. He said he feared
that the Department of Fish & Game (DF&G) would not perform
a follow up on the previously successful transplant of elk
as specified in the original bill. He said since the recent
transplant in 1987, or as long ago as 1927, when elk had
been transplanted to Afognak Island, that DF&G had made no
effort to study the effect of elk on indigenous species.
Even though studies have not been done, DF&G still maintains
that a study is needed to determine if competition exists
between elk and other deer families. He felt DF&G had
already reached the conclusion that elk and deer compete for
the same food. He maintained that DF&G felt the elk
transplant would fail and it had not. He wanted DF&G to
start managing the existing elk population and determine
when the first hunt might be sustained. He suggested that
the elk could provide a source of food for the residents of
southeast Alaska, and could cut trails through which deer
and other game could pass. He maintained that deer and elk
seemed to be able to co-exist quite well. CSSB 43 would
make it mandatory for DF&G to transplant a certain number of
elk on Kruzof Island, Gravina Island, Cleveland Peninsula,
and Prince of Wales Island in a specified period of time.
He estimated that it would cost approximately $1,000 per
animal.
Senator Taylor passed to the committee photographs and
showed a video of existing transplanted elk. He informed
the committee that in 1987, of the 52 elk transplanted,
approximately half survived. He estimated that the elk
population today is approximately 100 to 120 animals.
SENATOR JAY KERTTULA pointed out that CSSB 43 called for an
appropriation but asked if there would be any public
contribution. Senator Taylor maintained that there would be
a significant local contribution and effort, even though
CSSB 43 did not contain the 50 percent match or grant
language of the original bill. Senator Kerttula asked if
there was any additional cost other than the handling cost
of $1,000 per animal. Senator Taylor said that the state
may have to exchange goats for the elk as was done in the
past transplant but that $1,000 per animal should include
veterinarian costs, crates, etc.
SENATOR TIM KELLY asked for clarification on the cost of the
transplant of the elk and asked if the state was funding the
transplant at 100 percent. Senator Taylor said that he
would appropriate any additional funding needed out of
discretionary funds to complete the transplant. Senator
Taylor explained that if the state had to fund it at 100
percent it would not happen. He projected that
approximately 50 percent of the cost would be funded by
volunteer labor and contributions as it had in the last
transplant.
DARSIE BECK, Alaska Environmental Lobby, spoke in opposition
to CSSB 43, on the grounds that transplanting elk was a
biological threat, and that the economic costs and potential
impact on subsistence users far outweighed any benefits. He
said introduction of foreign species into a eco-system
frequently have disastrous ecological and economic
consequences. He offered examples in other parts of the
world of the damage it has caused. He said that wildlife
biologists they have talked to do not endorse CSSB 43. The
greatest threat seems to be the spread of disease to other
wild animals and humans. He said that transplant figures
from DF&G showed that the cost per elk was $5,000. He
called the committee's attention to page 2 of the fiscal
note for DF&G that said "costs for a five year program to
accomplish the above goals would range from $200.0 to $250.0
per year." The Alaska Environmental Lobby suggested it
would be less expensive for the state of Alaska to fund elk
hunting trips for individuals outside the state than to
transplant elk.
Discussion followed between Senators Kerttula, Kelly, Taylor
and Mr. Beck regarding various diseases, their transmission,
and whether elk were indigenous to Alaska.
SENATOR BERT SHARP MOVED for passage of CSSB 43(FIN) from
committee with the accompanying fiscal note. No objections
having been raised, CSSB 43(FIN) was REPORTED OUT of
committee with a zero fiscal note for the Department of Fish
& Game. Co-chairs Pearce, Frank, and Senator Sharp signed
the committee report with a "do pass" recommendation.
Senators Kerttula, Kelly, Jacko and Rieger signed a "no
recommendation."
Recess 9:35am
Reconvene 9:37am
CS FOR HOUSE BILL NO. 45(FIN):
An Act making appropriations to the Department of
Education for support of kindergarten, primary, and
secondary education and community schools programs and
for school construction debt retirement; and providing
for an effective date.
Co-chair Pearce announced that CSHB 45(FIN) was before the
committee and invited John Bitney, staff to Representative
Larson, to join the committee at the table. She also
directed the committee's attention to a handout titled,
"Small Single Site School District Funding" from the
Consortium of Single Site School Districts.
JOHN BITNEY, staff to Representative Larson, said CSHB
45(FIN) provided for the appropriation for the Department of
Education (DOE) to fully fund, at the $61,000 instructional
unit level, the foundation formula for public schools, as
well as full funding for pupil transportation and public
school debt service. Included in the appropriation is an
allocation of $3.3M for single site school districts across
the state of Alaska. He said that it was the intention of
the House, with the early passage of the bill, to give an
indication to school districts of their appropriation level
for public education for next year.
Senator Kelly asked if Section 2 on page 3 had to do with
retirement service. Mr. Bitney agreed that Section 2 listed
the debt service that the state would provide to local
municipalities for school construction debt service. In
answer to Senator Kelly, Mr. Bitney said that this money was
sent to the local municipalities by DOE.
DUANE GUILEY, Director, School Finance, Department of
Education, spoke in support of CSHB 45(FIN). He said the
difference between this bill and the Governor's budget was
that this bill would fund pupil transportation at 100
percent. Another difference is the single site supplement
in the Governor's budget was based upon FY93 actual daily
membership, whereas, in HB 45, it is based upon the school
district's projection for FY94. He asked the committee to
support the FY93 amount at $3,358,050 as opposed to the FY94
projection.
Senator Rieger asked if DOE was in support of additional
district support on page 2. Mr. Guiley said DOE was not in
support of the single site supplement but had included it in
the budget two years ago because that money was available.
REPRESENTATIVE RON LARSON, Co-chair for House Finance
Committee, said that the committee had wanted the bill to
be as current as possible, and had decided to use FY94
numbers. He said, for consistency purposes, the House
Finance Committee decided it was better to use FY93 numbers,
and that was the reason the amended CSHB 45(FIN) was before
Senate Finance Committee.
Senator Kerttula said that some southeast schools received
forest receipts to assist their unique educational problems.
He asked if those forest receipts had come under
consideration when funding was given to the single site
school districts. Representative Larson said that between
seven and twenty-one schools had been considered for single
site designation. Last year, it was decided that funding
could not be determined by forest receipts since those
receipts varied considerably from year to year. Senator
Kerttula felt that forest receipts should at least be able
to be estimated so they might be taken under consideration.
Co-chair Pearce asked Mr. Guiley if last year's forest
receipts would be made available to the committee.
SENATOR GEORGE JACKO asked why FY93 figures were used
instead of FY94. Representative Larson said in the past the
prior year's figures were used to estimate funding. FY93
figures were used to remain consistent.
Senator Rieger asked if legislative action had been taken
last year to create a new school district. Representative
Larson explained that by a popular vote of the people, it
was decided that the Yupik School District, not a single
site school district, and Tanana, a single site, would
operate separately from the REAA.
Senator Kerttula said that last year the instructional unit
had been set at $61,000. Varying districts using backup
information had said that figure was not high enough because
of the inflationary spiral and other costs. He asked how
that funding could be accomplished without increasing the
instructional unit. Representative Larson said that CSHB
45(FIN) was a $3.2M increase over the Governor's proposal.
He said the increase has been caused by a greater percent of
gifted and talented, and special ed children within the
school districts, not necessarily from an increase in
enrollment. Mr. Guiley submitted that the supplemental
request for FY93 is $6.4M, and of that, $5.1M is an increase
in special ed.
STEVE MCPHETRES, Executive Director, Alaska Council of
School Administrators (ACSA), spoke in support of CSSB
45(FIN). He said that early funding for schools was of
great benefit to the teachers and school districts for
planning and preparation for the coming school year. He
said that there was a need for an increase in the
instructional unit values but ACSA did appreciate the fact
that this bill fully funded instructional units at $61,000,
and recognized the single site school districts. He
explained that in 1986, the legislature recognized that the
educational formula was in need of adjustment. He hoped
that DOE would come forward with a new formula, but until
then, he hoped the committee would pass CSSB 45(FIN) for
early funding for schools.
Senator Rieger asked for an explanation of single site
school districts. Mr. McPhetres said a multiple-site school
district has a multiplication factor that is different from
single site school districts, and increases its potential
for higher instructional unit values. Senator Rieger asked
if the single site funding brought equality to single site
schools. Mr. McPhetres said that the educational formula
needed to be changed instead of a one-time a year funding to
try to equalize that funding. He added that some
communities do not have a tax base and therefore are unable
to adequately fund their educational needs. In answer to
Senator Kerttula, Mr. McPhetres said that ACSA did support
an increase in the instructional unit.
VERNON MARSHALL, Executive Director, National Education
Association-Alaska, spoke in support of CSSB 45(FIN) since
it did not cut funding to schools. He said NEA-AK supported
an increase in the instructional unit to $67,000. He said
student enrollment is increasing, and some needs in the
school districts are not being met by the $61,000
instructional unit. He said that NEA-AK also supports early
funding so that school districts may budget and plan for the
coming school year. In response to Senator Kelly's
question, Mr. Marshall said that NEA-AK supported other
programs such as student lunch programs but the funding for
those programs was not meeting all the needs of the students
either. He suggested that a breakfast program in some
schools is necessary so that children may attend school with
a healthier attitude.
Senator Kerttula made note that funding for tuition students
had been reduced in SB 45. He wanted to point out that not
all items had been increased.
Senator Rieger asked Mr. Guiley if there was an actual
increase in special ed student enrollment or had special ed
reclassification caused the funding increase. Mr. Guiley
said that there definitely was an increase in the incident
rate for special ed students in schools. He said one reason
may be that schools are doing a better job of identifying
special ed students. Although schools are audited every
five years, he could not speak to the justification of the
increased incident rate. Discussion followed between
Senator Rieger and Mr. Guiley regarding students chosen for
special ed, and the funding and restrictive environment that
follows those students.
At this time, Mr. Guiley provided the committee with copies
of a memo dated January 7, 1992, listing the requested
forest receipts data (copy of file). He said that the memo
may have been written in 1993. He explained that forest
receipt money goes straight to the borough or city, and by
state statute, a certain portion of that money is required
to be set aside for schools. He believed the remaining
portion is used for roads.
Senator Jacko asked if there were any other arrangements in
the state for severance taxes. Mr. Guiley said there were
other localities that had their own severance tax but forest
receipts is a federal program with legislation attached
stating how those funds must be used. He explained that of
the thirty-two organized school districts, only about two-
thirds have a property tax that comes up to four mills.
Some districts have other types of taxes--hotel bed
receipts, raw fish tax, and sales tax.
In answer to Senator Kelly, Mr. Guiley said that he would
provide data dating back to 1988, showing the increase in
special ed funding per district by year. Mr. Guiley
explained that if three students are classified as
intensive, it would generate one unit of funding or $61,000
to the district. Discussion followed between Senator Kelly
and Mr. Guiley regarding school districts that were above
the norm because of their percentage of special ed students.
Mr. Guiley explained that DOE did not place a limit for the
district on the number of students that could be classified
as special ed.
Senator Rieger asked where Alaskan students stood in
relation to other states in regard to SAT or other test
results. Mr. Guiley said that he did not have the data but
would provide it to the committee. Senator Kerttula offered
that Mat Su area students' test results had risen, and some
were at the top of the national standings.
Co-chair Frank asked how the Governor's budget request
compared to prior years lists by DOE for the single and dual
site school districts. Mr. Guiley said in FY92 there were
direct appropriations of $2,131.0 and that amount was
attributed to fifteen single site city and borough districts
only, excluding REAA's. In answer to Co-chair Frank, Mr.
Guiley said that DOE has never gone on record in complete
support of the single site supplement, in that DOE does not
have the data to support 100 percent for all the districts
on the list. The only thing the districts have in common is
their size, and that they only have one funding community.
Mr. Guiley supplied the committee with a list of school
districts showing the prior year's funding and national
forest receipts dated March 9, 1993 (copy on file).
Senator Jacko asked what figures DOE supports for pupil
transportation. Mr. Guiley said that the Governor's budget
set aside a proration of 10 percent equaling $25,718,100.
Senator Rieger asked the logic behind having different
lists. Mr. Guiley said that the Governor had asked DOE to
prepare a budget that fully funded education. He went on to
explain a short history of legislative school funding.
In answer to Senator Rieger, Mr. Guiley stated the very
small districts that have values of less than $100.0 in
support of each student were St. Mary's, Hydaburg, Klawock,
Nenana, Kake and Hoonah. The statewide average runs $241.0
in support of each student. In the range of $100.0 to
$200.0 in support of each student are Tanana, Galena,
Yakutat, Craig and Nome. The required local contribution,
for example, for Nenana is equal to $60,449. The single
site supplement would more than make up their contribution.
Senator Rieger asked if that was the ratio for the other
single site school districts. Mr. Guiley answered that it
was dependent upon full value determination and not related
to student population.
Co-chair Pearce asked John Bitney, staff to Representative
Larson, if the numbers that DOE proposed in their budget
presentation to the legislature differs somewhat than the
numbers that the House Finance Committee finally settled on.
She wanted to know if the difference was pupil
transportation. Mr. Bitney said that the reduction in
funding was the difference between the increased
instructional unit value and the original unit value single
site school districts received.
In answer to Senator Jacko, Mr. Bitney said that the bill
that passed the House included funding for pupil
transportation not including an administrative fee.
With no further testimony to be heard, Co-chair Pearce
announced that CSHB 45(FIN) would be held in committee. She
also announced that Senator Kerttula's amendment #1,
increasing the formula level per unit, would be held with
the bill.
Recess 10:30am
Reconvene 10:32am
ADJOURNMENT
The meeting was adjourned at approximately 10:32 a.m.
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