Legislature(1999 - 2000)
04/14/2000 06:22 PM Senate FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
April 14, 2000
6:22 PM
TAPES
SFC-00 # 89, Side A and Side B
90, Side A and Side B
CALL TO ORDER
Co-Chair John Torgerson convened the meeting at
approximately 6:22 PM
PRESENT Co-Chair John Torgerson, Senator Al Adams, Senator
Lyda Green, Senator Loren Leman, Senator Randy Phillips,
Senator Gary Wilken
Also Attending: REPRESENTATIVE FRED DYSON; REPRESENTATIVE
ALAN AUSTERMAN; JIM NORLAND, Director, Division of Public
Assistance, Department of Health and Social Services;
KRISTEN BOMENGEN, Assistant Attorney General, Human
Services Section, Civil Division, Department of Law; KATHY
GELLISPY, Legislative Co-Chair, Anchorage School Board;
CARL ROSE, Executive Director, Association of Alaska School
Boards; PEGGY ROBINSON, President, Anchorage School Board;
CHARLIE BOLLY, Vice-President, Governmental Relations,
Usibelli Coal Mine, Incorporated; SCOTT MCALLISTER, salmon
seining fisherman, Member, United Salmon Association,
United Fisherman of Alaska, Southeast Seiners Association;
CHRIS NORRIS, Icicle Seafoods; BRET FREID, Economist,
Department of Revenue
Attending via Teleconference: From Anchorage: BARBARA
NICKLOS, Director, Division of Child Support Enforcement,
Department of Revenue; JIM POSEY; ANTHONY HUSSY, Chair,
Academic Policy Council, Walden Pond Charter School; MARY
CARTER, Board Member, Walden Pond Charter School; LORNA
REECE; STEPHANIE MADSEN, Vice-President, Pacific Seafood
Processors Association; From Fairbanks: DON SHIRCEL,
Director, Family Services Division, Tanana Chiefs
Conference; GAIL MCCANN; KITTY MATHERS; JOHN TIEMESSEN;
MISSY LIEBERMAN; MIKE FISHER, Assistant Superintendent,
Fairbanks North Star School District; From Mat-Su: BARBARA
GERARD; From Kodiak: TOM WISCHER, Member, United Salmon
Association; VIRGINA ADAMS; From Cordova: HERB JENSEN,
representing, United Salmon Association, Cordova District
Fishermen United, Copper River Salmon Producers
SUMMARY INFORMATION
HB 98-PUB.ASSISTANCE: PROGRAMS/GRANTS/CONTRACTS
The Committee heard from the Department of Health and
Social Services, the Department of Law and the Department
of Revenue. The bill was held in Committee.
HB 191-CHARTER SCHOOLS
The Committee heard from the sponsor and members of the
public. Four amendments were considered and adopted. The
bill moved from Committee.
HB 344-HARDROCK LAND EXCHANGE/HEALY RR LEASE
The Committee heard from a representative of the mining
industry. The bill moved from Committee.
HB 363-SALMON PRICE REPORTS/SALE OF FISH
The Committee heard from the sponsor, the Department of
Revenue and members of the public. One amendment was
considered and adopted and the bill moved from Committee.
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 98(HES) am
"An Act relating to contracts for the provision of
state public assistance to certain recipients in the
state; providing for regional public assistance plans
and programs in the state; relating to grants for
Alaska Native family assistance programs; relating to
assignment of child support by Alaska Native family
assistance recipients; to paternity determinations and
genetic testing involving recipients of
This was the first hearing for this bill in the Senate
Finance Committee.
JIM NORLAND, Director, Division of Public Assistance,
Department of Health and Social Services, testified that
this bill would help to continue the progress of welfare
reform in the State Of Alaska.
Mr. Nordland stated the authority to run the federal
programs at the state government level is one of the main
reasons for welfare reform's success in Alaska and other
states. He explained that state governments have been able
to use this power to dramatically reduce caseloads, help
families return to work and out of poverty. In exchange for
the flexibility, he said states are receiving a specific
amount of money from the federal government, known as a Cap
Block Grant. He attested this arrangement between the
federal government and Alaska's government has worked very
well to reduce welfare dependency.
In addition to granting ownership of welfare programs to
the states, Mr. Nordland stated the federal law allows
tribes in the Lower 48 and the 13 regional Alaska Native
non-profit organizations to run their own welfare programs
as well. He shared that funding for the Native-operated
programs is taken from the amount allocated to the state.
Mr. Nordland noted that while states are required to
participate in funding the state-operated welfare programs,
there is no requirement in federal law for any entity to
contribute to the funding of Native-operated programs.
However, he said that the state contributes approximately
fifty percent of the funds needed to operate the Native-run
programs.
Mr. Nordland then explained that this bill allows for the
expenditure of state funds for Native-operated welfare
programs. He stressed that the only eligible organizations
that can receive these funds are the 13 regional non-profit
Native organizations.
Mr. Nordland added that the intention is to transfer from
the state, the amount of money needed to pay for benefits,
administration, child care, work services, etc. He said
this money is currently being paid by the state to serve
the same participants in programs that would now be run by
Native organizations. He pointed out this is the reason for
the bill's zero fiscal note.
Mr. Nordland shared that the Tanana Chiefs Conference
(TCC), an Interior Alaska organization operating under the
Doyon Native Corporation is currently operating a welfare
program. He said that the state could appropriate federal
funding to this organization so long as the program it
operates is the same as the one operated by the states'
Alaska Temporary Assistance Program (ATAP). However, he
stated that TCC had planned to run its program differently
than the state, and without this legislation, would be
unable to receive funding. He deferred to a representative
from the TCC to detail the culturally relevant approach of
the Native-operated program.
Mr. Nordland stressed that the department supports giving
flexibility to the Native organizations so that the
programs can be run with more local control and with better
cultural relevancy.
Mr. Nordland qualified there are limits as to how different
the Native-operated programs could be from the state-
operated program. He stated that Alaska's congressional
delegation inserted language into federal law requiring
Native programs to be comparable to the state program. He
said the department has worked with the Native
organizations to design the comparability criterion, which
have been approved by the US Secretary of Health and Human
Services.
Mr. Nordland summarized that if this legislation passes,
there would be a Native-operated program comparable to the
state program but somewhat different in order to meet local
and cultural circumstances.
Senator Green then asked if this legislation requires
federal "blessing" before the funds could be allocated.
Mr. Nordland affirmed the plan does need to get federal
approval.
Mr. Nordland concluded his presentation saying that the
department supports the legislation because it is believed
the welfare reform efforts could be more successful if the
Native organizations are allowed to operate their own
programs. He attested that the organizations know the needs
of their region and the people and that the programs could
be run more effectively than the state could.
Senator Leman asked if federal law allows allocations to
other organizations besides Native organizations. He
referred to earlier discussion he had with the witness on
this matter where he shared his desire to broaden the
localization of the welfare reform programs.
Mr. Nordland replied there is a specific provision in
federal law applying only to tribes in the Lower 48 and
Native Alaskan organizations. He advised however, that
there is no reason the state cannot contract the programs
out to municipalities or other entities. In fact, he said
many states have privatized the services to for-profit
organizations.
Senator Green asked if privatization or shifting the
programs to the local level would require federal approval
as well.
Mr. Nordland answered federal approval would not
necessarily be required.
Amendment #1: This amendment inserts a new subparagraph on
page 11, line 22 to read as follows.
(4) establish the same maximum number of
months of benefits as is established for the
state program under AS 47.27.015 (a)(1); and
(5)
[This amendment was not offered at this meeting but was
discussed.]
Senator Adams requested the department comment on the
proposed amendment. He described it sets uniform standards
for the maximum amount of benefits that could be collected
by participants of either the state or Native-operated
welfare programs.
Mr. Nordland stated that the department supports the
amendment, referring to his earlier statement about the
comparable criterion between the two programs. He noted
that the issue of consistent benefit eligibility was
overlooked when the criterion was developed. He told the
Committee that federal law allows the Native organizations
to negotiate with the federal government on the length of
time benefits could be collected by participants. He said
the reason for this allowance is to give some Indian
reservations an exemption from the 60-month lifetime
benefits limit. He stressed that this exemption was outside
the bounds of the comparability arrangement between the
state and Alaska Native organizations. He said the
department supports holding Native-operated programs to the
60-month limit just as the state-operated program is. He
commented that this amendment "plugs a loophole in this
bill."
Mr. Nordland stressed that villages with an unemployment
rate of over 50 percent would be exempt from the 60-month
limit whether the residents participate in a state-operated
or Native-operated program. He expressed that this
amendment does not apply to specific communities but rather
the operator of the program. This is to prevent
participants of a Native-operated program who do not live
in a community with more than 50 percent unemployment to
receive more than 60 months of benefits, according to Mr.
Nordland. In this manner, he said, the exemption would be
based on the community itself rather than the operator of
the program serving it and possibly other communities as
well.
Co-Chair Torgerson asked for an explanation of Section 5.
Mr. Nordland replied that this section was part of changes
made to the bill by the House of Representatives relating
to child support payments. He believed the language to be
conforming to other child support enforcement statutes.
KRISTEN BOMENGEN, Assistant Attorney General, Human
Services Section, Civil Division, Department of Law,
testified that this section is the result of a
comprehensive review of the child support provisions. The
purpose, she said is to ensure that child support payments
that are collected on behalf of participants who are
receiving public assistance under Native-operated programs
are distributed to that Native organization. She stated
that the intent is to remove any possible barriers to
making appropriate distributions.
Co-Chair Torgerson asked if the child support payments only
included those collected under court order.
Ms. Bomengen replied all child support payments are subject
to distribution to the program's operator.
Co-Chair Torgerson wanted to know if "petitioning the
court" in the language relating to enforcement of child
support orders could include tribal courts.
Ms. Bomengen confidently stated that is not the intent to
petition any tribal court.
Co-Chair Torgerson wanted assurance.
Ms. Bomengen expressed it is not a function of the Division
of Child Support Enforcement to operate in tribal court.
Instead, she said the agency follows the rulings of state
court. She said there is no intention to expand the
agency's efforts into tribal courts.
Co-Chair Torgerson acquiesced, but asked about the recent
Supreme Court ruling in John v. Baker, which authorizes
tribal courts to issue child support orders.
Ms. Bomengen needed an opportunity to review the court case
before giving a specific opinion on the matter.
Co-Chair Torgerson stated he wanted an understanding of the
impact of the court decision on this legislation. He then
referred to Section 21 that allows the department to adopt
program standards that vary by region. He wanted to know
why standard practices would not be adopted so all Alaskans
are treated equally.
Mr. Nordland responded that the language in Section 21
conforms to other sections of the bill to allow regional
public assistance programs to be established by the
department. He shared that the motivation is to prevent the
department from having to create a separate program for the
few non-Native residents of a Native village, served by a
Native-operated welfare program. He stated that this
provision allows the non-Natives to be served by Native
organizations.
Co-Chair Torgerson understood the intent but claimed the
language instead allows the department to vary program
standards by region. He thought this provision was too
broad-based.
Mr. Nordland responded that the intent is to adopt the
program standards of the Native-operated plan, which would
be comparable yet different than the state-operated
program. In doing this, he said, all residents of a
community could be served by the Native-operated plan.
Ms. Bomengen addressed a concern raised in other committees
regarding a potential equal protection question. She
detailed that the bill contains a requirement that in any
area in which a Native corporation is operating a welfare
program, eligible Alaska Natives must seek their services
from that program and not from a state-operated program.
She spoke of funding for the participant as well as the
Native program in these cases. She suggested the approved
Native-operated programs should be identical to one that
the state would operate if it were to do so.
Ms. Bomengen then explained how the Alaska court applies a
"sliding scale test" to any equal protection challenge.
This test, she said is used to determine whether a greater
or lesser burden is placed on the state to justify a
classification of individuals to be served by one plan or
another, depending on the importance of the individual
rights involved. She detailed how the court determines what
kind of weight should be given to the constitutional
interest impaired by the legislation, examines the purpose
of the legislation, and evaluates the state's interest in
the means employed to further the goals of the state.
Ms. Bomengen stressed that an equal protection challenge to
this legislation would probably claim there to be an
impermissible classification based on the race of the
individual. She said the state's response would then be
based on other equal protection cases that have addressed
the same distinction. She explained this distinction was
created by a federal act, which is born out of the federal
government's trust relationship and responsibilities to
American Indians and Alaskan Natives. Therefore, she
surmised the distinction would be a quasi-political issue
based on the unique political status of indigenous peoples
and not considered a racial classification.
Ms. Bomengen continued detailing why an equal protection
challenge would not succeed saying that, regardless of
whether the state or a Native organization operated the
program, the participant's benefits would not be affected,
services would not be denied and the subsequent impact on
the family would be insignificant. She said this is because
of the comparability requirements for both programs under
state and federal law.
Ms. Bomengen relayed a suggested amendment to the bill made
to the House of Representatives that would allow an
individual who is directed to the Native-operated program
to request service under the state-operated program. A
successful request, she said would demonstrate a compelling
interest to receive services from the state rather than the
Native organization. She added that the Department of
Health and Social Services would develop standards for this
exception in regulation.
Senator Phillips asked if there was a legal opinion on this
matter from the Division of Legal and Research Services.
Co-Chair Torgerson said there was not but noted a request
would be submitted.
Co-Chair Torgerson acknowledged the fiscal note was zero
but wanted information about the federal grant funds and
necessary general fund money to implement the new programs.
Mr. Nordland first commented that not all of the 13
regional Native corporations are interested in operating
welfare programs. He noted that there is already one
Native-operated program established and that the Tlingit-
Haida Corporation and the Association of Village Council
Presidents have expressed interest in establishing their
own program. He then explained that the department would
transfer not only the benefits portion of the welfare
programs to participating Native corporations, but also a
portion of the administrative funds as well. He admitted
this was not easy for the department to do because of the
impact on its administrative abilities. However, he said in
the long run the programs would be run more effectively
with higher caseload reductions.
Mr. Nordland stressed this bill has no impact on the
general fund, either positive or negative.
Senator Wilken wanted to understand the flow of the funding
from the federal level to the beneficiary.
Mr. Nordland detailed that the Native-operated program must
first have a plan approved by the federal government, which
requires some state funding to make the plan comparable to
the state-operated plan. Once the Native-operated plan is
approved, he said a portion of the federal funds provided
to the state go directly to the Native organization. He
expressed that the intent of this legislation is to allow
the state funds to be allocated to the Native organizations
so those programs can be operated at the same level as the
state-operated program.
Senator Wilken wanted to know how the distribution of
federal funds between the state and the Native
organizations was calculated.
Mr. Nordland responded that the amount of federal money
spent on Native clients during the federal fiscal year
1994, in the specified region, is reported to the federal
government as the percentage of the state's block grant to
be allocated to the Native organization. He qualified that
the amount could change in the future when the Temporary
Assistance for Needy Families (TANF) law changes, but would
not change before then.
Mr. Nordland continued that the general funds provided to
the organization are separate from the block grant funds.
He explained further how the TANF program is funded with a
fixed federal block grant, of which the state must expend
at least 80 percent of what was spent in 1994 to
participate in the TANF program without severe penalty. He
shared that the state is currently meeting the required
expenditure amount.
Senator Wilken asked how many families this legislation
would affect.
Mr. Nordland listed the TCC program currently serves
approximately 500 families, the Tlingit/Haida organization
serves about 500 families and ABCP would serve
approximately 900 families if it takes over the welfare
program in their area. He said this represents about 20
percent of the entire caseload in the state.
Senator Wilken asked why the transfer of these 1900
families would not make the department's operating costs
smaller.
Mr. Nordland responded that the department still
administers Medicare, Food Stamps, Adult Public Assistance
and other programs. It was difficult for him to say exactly
how the department would manage the reduction in
administrative funds and still operate these other
programs. He used Bethel as an example where over 95
percent of welfare clients are Native and the department
would therefore reduce department staff.
Senator Wilken thought the fiscal note should show a
reduction in state bureaucracy.
Mr. Nordland responded that there is a reduction in the
state bureaucracy but not a reduction in the budget. He
stated that the general funds would be paid to employees of
the Native corporations to operate the program rather than
to state workers. He stressed that the amount of spending
stays the same.
Senator Wilken then asked the purpose of the legislation.
Mr. Nordland answered the reason for transferring welfare
programs to Native organizations is for many of the same
reasons for having local school districts across the state.
That, he expressed is to have some local control with the
programs "closer to home."
Senator Wilken asked if there would ever be an instance of
a non-Native family not provided with services that a
Native family is provided or visa-versa.
Mr. Nordland assured that one entity or another would serve
everyone who is eligible for public assistance.
BARBARA NICKLOS, Director, Division of Child Support
Enforcement, Department of Revenue, testified via
teleconference from Anchorage that she was available to
answer questions regarding the disbursement of child
support payments to the Native organizations who operate a
public assistance program. She assured that the language
pertaining to this allowance does not relate in any way to
tribal court.
DON SHIRCEL, Director, Family Services Division, Tanana
Chiefs Conference testified via teleconference from
Fairbanks listing his education and experience
qualifications. As a social service professional, he
strongly supported both SB 80 and HB 98.
Mr. Shircel spoke in great detail of the early success of
the TCC operated public assistance program and the
satisfaction it has given Native leaders.
Tape: SFC - 00 #89, Side B 7:09 PM
Mr. Shircel read a letter to TCC from a former client as
follows. [Copy not provided.]
Hello,
I'm writing this letter to everyone to let you know
that I have a new permanent job and I'm going to be
O.K. from here on out. I'm also writing to thank each
person for all they have done for my family and I. I
know that there's a lot of work that's put into each
individual case and I really want to thank you for all
that you've done to help me become more self
sufficient. This letter is not only a letter to thank
you for all your hard work, but it's also a letter to
request that I have my case closed. I do realize that
all my benefits will stop and I feel I'm prepared for
this. Once again, thank you and may Lord Jesus bless
you for what you do to help others.
Mr. Shircel expressed that he could not think of a better
way to convey to the Committee what the legislation is
trying to accomplish than this letter could. He believed
that with the passage of the bill, his organization could
have an even greater impact and get more "bang out of each
welfare buck."
Senator Adams asked what does TCC do for a Caucasian
individual living in a rural community in the region, who
otherwise qualifies for the TANF-based program.
Mr. Shircel responded that currently the individual must
apply for services through the state because TCC does not
have the authority to serve him or her.
Senator Adams asked if that qualified Caucasian has a
choice between the Native-operated or the state-operated
public assistance program.
Mr. Shircel answered that without this legislation, that
person does not have a choice but must be served through
the state-operated program.
Senator Green commented that four years ago during
deliberations of SB 98, relating to welfare reform,
suggestions were made to address alcohol, drug abuse,
parent's involvement with children, and possible domestic
violence issues conditional on receiving benefits. She
recalled that on every count it was deemed this was a
violation of individual freedom. She stressed that if
allowances for these issues to be combined in the public
assistance for the Native-operated programs, then the same
allowances should be made for every public assistance
program in the state.
Co-Chair Torgerson requested an improved sectional analysis
from the department and a legal opinion on the equal
protection clause from the Division of Legal and Research
Services.
Senator Green also requested a side-by-side comparison of
the current role of the Division of Child Support
Enforcement and the proposed interaction with the Native-
operated programs, as it relates to TANF and how the funds
circulate. She wanted to know if any funds would be lost if
the legislation passed.
Co-Chair Torgerson ordered the bill HELD in Committee.
SENATE COMMITTEE SUBSTITUTE FOR COMMITTEE SUBSTITUTE
FOR HOUSE BILL NO. 191(HES)
"An Act relating to charter schools."
REPRESENTATIVE FRED DYSON recounted legislation passed in
1995 that established Alaska's first charter school
statutes. He told of a wide movement across the country to
allow parents to participate in creating a school that fits
their needs.
Representative Dyson relayed conversations he had with
Representative Bettye Davis shortly after he was first
elected in which he was told he needed to revisit the
charter school statutes. Representative Davis asserted to
him that the existing statutes would not work. He added
that national experts on the subject have stated that
Alaska's laws are amongst the weakest in the nation.
Representative Dyson stressed that the charter schools in
the state are struggling and that his office along with the
Anchorage School District have been working with charter
schools to craft legislation to allow charter schools to
survive an possibly to prosper.
Representative Dyson highlighted some minor points of the
bill that he said everyone could agree on. These, he said
include provisions to double the number of charter schools
allowed to operate and the elimination of the geographical
distribution of the school's locations. He added the bill
also extends the sunset provision of the exiting statute
and allows occupation of public buildings by charter
schools.
Representative Dyson then shared that the most substantial
portion of the legislation addresses funding. Most charter
schools elsewhere in the country, he said are provided
start-up funds, which he said Alaska does not provide. He
did note that the Fairbanks school district has made
attempts to secure funding for a charter school located in
that community.
Representative Dyson next talked about changes made to the
bill in the committee process in attempt to meet criticisms
of the Anchorage and Fairbanks school districts. He stated
that the Senate Health, Education and Social Services
Committee deleted two paragraphs of the original bill
addressing financial requirements plus another provision
stipulating that charter schools receive a share of the
local contribution as well as state funding.
Representative Dyson allowed that the resulting committee
substitute addresses the necessary technical changes but
does not provide additional funding for charter schools.
Representative Dyson spoke of the accounting procedures
necessary to show how the charter school's funding is
expended.
Representative Dyson cautioned that Alaska's charter
schools would not survive without much more help. He
expressed, "I think it's cruel to string them along." He
stated that the current version of the bill gives the
schools no hope since it no longer contains the funding
provisions.
GAIL MCCANN testified via teleconference from Fairbanks
asking the sponsor to not give up on charter schools. She
wanted all public schools to secure more funding as the
University of Alaska has in recent years.
KITTY MATHERS testified via teleconference from Fairbanks
to request the Committee vote in favor of the original
version of the bill. She stressed that the current
committee substitute allows the charter schools to exist,
but not to survive.
JOHN TIEMESSEN, attorney and father of charter school
student, testified via teleconference from Fairbanks about
the need for work on the charter school structure and to
fully fund schools.
MISSY LIEBERMAN, parent of a child in Chinook Charter
School testified via teleconference from Fairbanks in
support of the bill and the idea behind it to help charter
schools get equal funding and not have to compete with
other schools.
BARBARA GERARD testified via teleconference from Mat-Su
about a recent evaluation showing the positive impacts of
charter schools. She stated that this bill strengthens the
charter school process.
JIM POSEY testified via teleconference from Anchorage about
the growth of the local charter school. He expressed the
reduced assistance provided in the committee substitute
"puts an dagger into the hearts" of those who work for
public education.
ANTHONY HUSSY, Chair, Academic Policy Council, Walden Pond
Charter School testified via teleconference from Anchorage
about the school and some of the special needs of their
students.
MARY CARTER, mother and board member of Walden Pond Charter
School, testified via teleconference from Anchorage about
the growth she has seen in her daughter since attending
this school.
LORNA REECE, parent of student of Walden Pond Charter
School, testified via teleconference from Anchorage. She
spoke of her experiences in Anchorage schools and why she
chose to send her son to a charter school.
MIKE FISHER, Assistant Superintendent, Fairbanks North Star
School District, testified via teleconference from
Fairbanks about his concerns with Section 2 of the bill in
subparagraph 5, requiring itemization of administrative
costs, and subparagraph 14, stipulating that the charter
school budget must be increased to reflect operating cost
savings.
KATHY GELLISPY, Legislative Co-Chair, Anchorage School
Board testified in Juneau that the district could not
support the bill. She suggested changing the provision
dictating accounting methods for charter school related
expenditures.
Ms. Gellispy also requested deletion of subparagraph 14
from page 2, lines 27-31 of the committee substitute. She
argued that no school receives funding for services that
are not provided.
Ms. Gellispy went into great detail of the various
expenditures incurred by both charter schools and regular
schools and the hardship the district would incur if the
accounting and funding requirements of this legislation
were imposed.
Tape: SFC - 00 #90, Side A 7:56 PM
Ms. Gellispy offered that the Anchorage School District
wants to work with the legislature to make the charter
school statutes stronger than they currently are.
Ms. Gellispy detailed the handout accompanying the
district's April 14, 2000 memo to the Senate Finance
Committee. [Copy on file] She explained how this list shows
the budgeted cost per student for each of the district's
schools. She pointed out that the average spent per charter
school student is $4,264 compared to the average of $3,732
spent for all other elementary students. She attested that
the district is funding its charter schools in a fair and
equitable manner.
CARL ROSE, Executive Director, Association of Alaska School
Boards, testified in Juneau saying the organization is on
record in support of charter schools. He said the
difficulty with this legislation is the inability to come
to agreement on the appropriation. He surmised that by
attaching charter schools to an already struggling system
is not the way to ensure success for charter schools. He
cautioned of the potential for charter schools to operate
without any oversight of the local school boards, and thus
being funded without requiring any accountability. He
thought the possibility existed that some new charter
schools would not get approval because of these funding
issues. He suggested the legislature adequately fund all
schools.
Amendment #1: This amendment adds a new bill section on
page 3, following line 7 of the committee substitute to
read as follows.
"Sec. 4. AS 14.03.260 is amended by adding a new
subsection to read:
(e) In addition to the amount provided to an
approved charter school in the annual program budget
under (a) of this section, a charter school budget
must include an allocation equal to the amount
determined by dividing the amount of local revenues
contributed under AS 14.17.410(c) by the average daily
membership of the district and multiplying that number
by the average daily membership of the charter
school."
Co-Chair Parnell moved for adoption. Senator Wilken
objected.
Co-Chair Parnell explained this amendment requires the
local school districts to share excess local contributions
with the charter schools. He asserted that parents of
charter school students pay property taxes that are used to
fund all public schools except their child's. He said that
this is an issue of equity.
Representative Dyson agreed with Co-Chair Parnell's
statements.
Co-Chair Parnell stated that all public schools should be
funded.
Senator Phillips referred to the Anchorage School
District's list of budgeted funds spent per student of
various schools in the district. He noted how more funds
are spent for charter school students.
Co-Chair Parnell responded that three of the listed charter
schools included special needs students. Secondly, he said
the issue was not about the amount of money spent per
student, which is a red herring. Instead he asserted the
issue is about getting equitable funding at the on-set with
the ability for the school board to make adjustments later.
Senator Phillips thought all of the schools include the
special needs expenditures in their budgets.
[Ms. Gellispy affirmed, but out of range of the recording
system.]
Senator Green noted there may well be a comparability in
the amount allotted to the per student calculation. She
wanted to know if there is a difference in the expenditure
allotted to the charter schools.
Representative Dyson replied that several of those schools
have to pay the costs to occupy a facility, whereas other
schools don't have to pay rent.
Senator Wilken stated that in 1995, the funding for charter
schools was clearly set forth. He quoted, "the amount
generated by students enrolled in charter schools to be
determined in the same manner as would be for a student
enrolled in another public school in that school district."
He stressed this agreement was reached with the intent that
it would be adhered to for ten years.
Senator Wilken noted the amount of money the Anchorage
School District spends for charter school students. He
thought the matter of paying leasing costs for charter
schools is already addressed the organization and operation
of a charter school chapter of state statute.
Senator Wilken understood that the charter school laws were
to allow parents to organize to provide an educational
opportunity that they could not receive in a normal public
school in that district. He stressed that these parents can
negotiate a contract to define their school, which includes
the facility the school will occupy. He added that while
the charter school may have to address disabilities, there
is no library, no band, no athletic program, transportation
requirements, and are not required to have open enrollment,
as a public school must.
Senator Wilken attested that although charter schools have
approached the Fairbanks and Anchorage school districts
with complaints that they don't receive enough money, they
are getting more money than required in the 1995
legislation.
Senator Wilken stressed that this amendment, along with
other proposed changes, "cements in place a 'must do' and a
confrontation between the charter school proponents and the
school board every budget season." He stated that the
message this legislation sends to the school districts is
that they don't know what they are doing and regardless of
the needs of most students, the district must spend a
specific amount on charter school students.
Senator Phillips asked about the location of the Walden
Pond Charter School in the Diamond Mall and other charter
schools' lease agreements.
PEGGY ROBINSON, President, Anchorage School Board, talked
about the charter school's five year lease. It was
established that Walden Pond is the only charter school
that pays rent. The others pay some combination of
utilities.
A roll call was taken on the motion.
IN FAVOR: Senator Donley, Senator Leman, Senator Green, Co-
Chair Parnell and Co-Chair Torgerson
OPPOSED: Senator Adams, Senator Wilken and Senator Phillips
ABSENT: Senator P. Kelly
The motion PASSED (5-3-1)
The amendment was ADOPTED.
Amendment #2: This amendment makes the following changes to
page 2, lines 10 through 13 of the committee substitute as
follows.
Delete
"(5) a statement of the charter school's
funding allocation from the local school board,
including the itemized costs of administrative or
other services to be provided [AND COSTS ASSIGNABLE]
to the charter school [PROGRAM BUDGET];"
Insert
"(5) a statement of the charter school's
funding allocation from the local school board and
costs assignable to the charter school program
budget."
New text underlined [DELETED TEXT BRACKETED]
Senator Wilken moved for adoption. Senator Green objected.
Senator Wilken noted this amendment is connected to
Amendment #3. He expressed that it would be difficult and
expensive for school districts to account for these
expenditures as required in the legislation. He thought
that to require a separate accounting system for under 200
students to keep track of itemized costs was unreasonable.
He pointed out, for example, that the charter schools in
Fairbanks uses the district's discipline system but the
district does not charge the charter school for that
service. He suspected there would be great difficulty in
trying to establish an accounting method to itemize that
particular service in addition to the multiple other
similar services that are interrelated between the district
and the charter schools.
Representative Dyson had no objection to the amendment
since he thought the premise of the language would not
change. He stated that the belief that the bill would
require establishment of a separate accounting system was
"either grossly misunderstood or a red herring." He noted
that the district would still be responsible for showing an
accounting of all expenditures.
Co-Chair Torgerson thought the word "itemize" was the
difficulty.
The amendment was ADOPTED without objection.
Amendment #3: This amendment deletes subparagraph (14) on
page 2, line 27, through page 3, line 1 of the committee
substitute.
"a clause providing that the charter
school's budget shall be increased to reflect
operating cost savings achieved by the charter school;
in this paragraph, "operating cost savings" means the
estimated value of educational or related services
provided by the district to all schools in the
district that are not provided to the charter school;
(15)"
Senator Wilken moved for adoption. Co-Chair Torgerson
objected for an explanation.
Senator Wilken stressed that this language was a troubling
inclusion in the bill. He predicted this would foster
tensions each year between the charter schools and the
school board. He suggested that this is giving credit for
not doing something, which he remarked, is backward
thinking.
Co-Chair Torgerson removed his objection.
Representative Dyson emphasized that this language is also
misunderstood. He stressed that there would be no
negotiations involved in this process. The school board is
an advisory seat and the charter school can make no threats
but must do what the board instructs. He shared that if a
charter school can ease expenditures for the other schools,
for example, by removing students from an over-crowded high
school, the district can share a portion of the net savings
with the charter school. He restated that if a district
identifies savings as a result of the existence of a
charter school, the savings could be passed along to the
charter school.
Senator Leman said Representative Dyson's comments make
sense if the intent is interpreted to pass along some, but
not all of the net savings.
Representative Dyson responded that "the school district is
in the driver's seat" and could pass along all, none, or a
portion, of the savings to the charter school.
Co-Chair Torgerson noted the language "shall be increased"
is not optional.
Senator Leman countered that the language does not
stipulate what factor of the savings. He thought the
language was poorly worded but that some of the money
should be passed along to encourage further savings. He
stressed that the legislature needs to provide a better
incentive to quell the formula funding cost increases.
Representative Dyson offered to change "shall" to "may".
Senator Wilken commented that Amendment #1 set the baseline
and this subparagraph increases that base by considering
whether the charter school has a band, library and/or a
transportation system.
Senator Green noted Representative Dyson's example did
happen in the Mat-Su school district. She shared that the
district's charter school does have a band and has a
variety of students, but has also eased overcrowding in the
other schools. She noted that most charter schools are
filling a need, have a big waiting list and should be
supported.
Senator Green supported extending the sunset date of the
existing charter school statute at the very least.
Senator Wilken moved to withdraw his motion to adopt
Amendment #3.
The amendment was WITHDRAWN without objection.
Amendment #4: This amendment deletes "shall" and inserts
"may" on page 2, line 27, of the committee substitute. The
amended language reads as follows.
(14) a clause providing that the charter
school's budget may be increased to reflect operating
cost savings achieved by the charter school; in this
paragraph, "operating cost savings" means the
estimated value of educational or related services
provided by the district to all schools in the
district that are not provided to the charter school;
Co-Chair Parnell moved for adoption.
There was no objection and the amendment was ADOPTED.
Senator Wilken commented that this is an important issue
and that while he supports charter schools, he does not
want their interest to be championed at the expense of the
other 129,000 students in the public K-12 education system.
He stressed that the original legislation was an experiment
but that the agreement was to wait ten years to review its
success before making changes.
Co-Chair Torgerson asked if the sponsor had reviewed the
fiscal note.
Representative Dyson had.
Co-Chair Torgerson asked if the sponsor believed it takes
one to two people to run the program. He thought the
estimated cost of the legislation was too high.
Co-Chair Parnell offered a motion to move CS HB 191 (FIN)
as amended from Committee with accompanying $161,300 fiscal
note from the Department of Education and Early
Development.
The bill was MOVED from Committee.
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 344(FIN)
"An Act authorizing a land exchange between the
Department of Natural Resources and Alaska Hardrock,
Inc.; approving a long-term lease of certain Alaska
Railroad Corporation land at Healy; and providing for
an effective date."
This was the first hearing for this bill in the Senate
Finance Committee.
CHARLIE BOLLY, Vice-President, Governmental Relations,
Usibelli Coal Mine, Incorporated, testified to Section 3 of
the bill, regarding the Alaska Railroad Corporation land
currently under contract with his company. He gave a
detailed history of how the company has developed and used
that land.
Co-Chair Torgerson interjected to ask if the witness
supports the bill.
Mr. Bolly affirmed he does.
Co-Chair Parnell offered a motion to report CS HB 344 (FIN)
from Committee with accompanying Department of Natural
Resources zero fiscal note.
Without objection the bill MOVED from Committee.
AT EASE to 8:41 PM
SENATE COMMITTEE SUBSTITUTE FOR COMMITTEE SUBSTITUTE
FOR HOUSE BILL NO. 363(L&C)
"An Act relating to salmon product reports and to the
sale of fish; and providing for an effective date."
This was the first hearing for this bill in the Senate
Finance Committee.
REPRESENTATIVE ALAN AUSTERMAN told the Committee the bill
was introduced on behalf of salmon harvesters initially as
an update of current statutes regarding canned and thermal
salmon. He stated that the legislation also adds several
other products currently handled by the salmon industry. He
said the canned salmon reports addressed in the bill have
existed since before statehood.
Representative Austerman continued that the bill adds fresh
and frozen headed and gutted salmon products, fresh and
frozen fillets and salmon roe to the reporting
requirements. It also adds a requirement for salmon
processor to report production areas.
Representative Austerman shared that the bill has been
revised a number of times since its introduction. He
pointed out that original statute requires any processor
producing more than 1000 pounds of canned or thermal
product to submit this report. An amendment to the bill, he
said raises that amount to one million pounds.
Senator Wilken wanted to know if the reports records the
wholesale number of cans produced after the business tax is
incurred. He asked what purpose the reports serve.
Representative Austerman surmised that the original intent
was to provide wholesale price information to the state and
any other interested parties.
Co-Chair Torgerson asked if these reports are confidential.
Representative Austerman affirmed and explained that more
than three processors must be operating in a particular
area before the reports on that area could be released to
the public.
TOM WISCHER, Kodiak area fisherman and Member, United
Salmon Association, testified via teleconference from
Kodiak that the bill fills a gap, eases mistrust between
fishermen and processors, and would give good business
information to fisherman across the state.
VIRGINA ADAMS, Commercial Salmon Fisherman out of Kodiak,
testified via teleconference from Kodiak.
Tape: SFC - 00 #90, Side B 8:50 PM
Ms. Adams continued recounting the efforts to obtain
accurate accounting information on the status of the salmon
industry. She approved on the one million-pound requirement
saying it protects smaller processors.
HERB JENSEN, representing, United Salmon Association,
Cordova District Fishermen United, Copper River Salmon
Producers, testified via teleconference from Cordova in
favor of the bill and what it would provide to the state.
STEPHANIE MADSEN, Vice-President, Pacific Seafood
Processors Association, testified via teleconference from
Anchorage that the association opposed the bill saying it
was not just revision of the report but a significant
expansion of the report. She detailed the additional pages
required.
She requested the frequency of the reports be reduced from
three times annually to two, if the bill passes.
SCOTT MCALLISTER, salmon seining fisherman, Member, United
Salmon Association, United Fisherman of Alaska, Southeast
Seiners Association testified in Juneau about the efforts
behind this bill to improve reporting procedures.
He answered Senator Wilken's question regarding the
relationship between harvesters and processors, saying
there is a relationship that shares the risks and results.
Senator Phillips asked where was the sunset provision in
the bill.
CHRIS NORRIS, Icicle Seafoods in Ketchikan and Norton
Sound, testified in Juneau that she believed the bill is an
intrusion and serves no purpose to private business.
Senator Wilken understood that this bill would increase
reporting requirements by a factor of five to give better
information, after the product has been sold and delivered,
in order to return some of that revenue to the fishermen
according to a pre-agreed upon arrangement.
Ms. Norris gave her understanding of the reason for the
report was to foster the idea that if fishermen have a
better idea of the salmon market and prices paid, they
would have a better leverage to negotiate prices. She noted
that her company and fleet were not involved in the 1997
strike. She believed the reporting system originated out of
frustration of fishermen. She stressed it is unfair to
paint the whole processing industry negatively.
BRET FREID, Economist, Department of Revenue testified
about the sunset clause currently in the statute. He
explained that a previous version of the bill repealed the
sunset, but that the repeal has been removed in the current
committee substitute.
Mr. Freid stated that the department does not have a
position on the collection of data because there is no
direct link with taxation. He shared that the salmon is
taxed at the price paid to the fisherman not the wholesale
value or the profits.
Mr. Freid qualified that the department could do a good job
preparing the reports and meeting the requirements of the
bill. He spoke to the fiscal note that shows the need for
three-quarters of one position to operate the program at a
total operating cost of $38,000 for the first year with an
additional $20,000 in capital funds to set up a database.
Co-Chair Torgerson asked that if the Department of Revenue
does not oversee this program, what other agency could hold
confidential information.
Mr. Freid suggested the Department of Fish and Game.
Co-Chair Torgerson commented that this is a good report and
that if the legislation passes, the matter of which
department has oversight could be revisited.
Amendment #1: This amendment makes the following change to
page 5, lines 23 and 24 of the committee substitute.
Delete
"September 30, 2000, must cover the period of May
1, 2000, through August 21, 2000"
Insert
"January 31, 2001, must cover the period of
September 1, 2000, through December 31, 2000"
The amended language reads as follows.
TRANSITION. The first report required by AS
43.80.050, as amended by secs. 3 - 5 of this act, is
due January 31, 2001, must cover the period of
September 1, 2000, through December 31, 2000, and must
be filed by a fish processor whose business sold more
than 1,000,000 pounds of salmon products at first
wholesale during the 12-month period ending August 31,
2000.
Senator Leman moved for adoption and explained that the
implementation of the program would be delayed by one
reporting period so the department would have an
opportunity to set up a database. He spoke with interested
parties and found concurrence from all sides of the issue.
Representative Austerman approved of the amendment saying
the delay is better for both the processors and the
department.
There was no objection and the amendment was ADOPTED.
Senator Wilken asked if the portion of the report protected
as confidential is the final average wholesale price report
recipient.
Mr. Freid corrected that the identification of a specific
processor, the wholesale price and the total pounds of
salmon should not be identifiable. He stated that only the
summary of all information is published.
Senator Leman relayed a suggestion he made when the bill
was heard in the Senate Labor and Commerce Committee that
electronic filing would be more efficient and cost-
effective. He noted that while the initial set-up cost
would be higher, the long-term costs would be lower for
both the department and the processors.
Senator Leman offered a motion to report from Committee,
SCS CS HB 363 (L&C) as amended with $38,400 fiscal note
from the Department of Revenue.
The bill was MOVED from Committee.
ADJOURNED
Senator Torgerson adjourned the meeting at 9:15 PM.
SFC-00 (1) 04/14/00
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