HB 18-INCREASE AMT OF BASE STUDENT ALLOCATION CHAIR NEUMAN announced that the final order of business would be SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 18 "An Act increasing the base student allocation used in the formula for state funding of public education; and providing for an effective date." 11:57:12 AM REPRESENTATIVE WILSON, sponsor, expressed her belief that it is essential to attract and retain the most highly qualified teachers and support staff in order to provide the best program offerings for students. She explained that costs associated with operating schools are increasing and teachers have no control over the regulation of these expenses. Furthermore, although teachers have to assume greater responsibilities due to NCLB standards, they are not receiving monetary awards. Therefore, it is imperative that the legislature increase the student allocation. This bill would increase the student allocation by $325 dollars per student. She related that she has received letters from around the state which have stated that the governor's bill would not allocate sufficient funding for securing basic needs, such as rehiring current teachers for the coming school year. She reviewed some of the specific needs of specific districts. 12:00:50 PM REPRESENTATIVE LYNN requested a spreadsheet comparing the similarities and differences between HB 1, HB 18, and HB 73. REPRESENTATIVE THOMAS inquired as to the effects of increasing quality school grants. MR. JEANS replied that quality schools funding is separate from the foundation program base funding which is discretionary money to allocate as the school board sees fit. The quality schools grants require that the district submit an application, tell how it's going to use those funds to improve student performance achievement and require follow-up reports and assessments. He explained that although an increase in quality schools grant doesn't allow an increase in the local contribution, an increase in the base student allocation will increase the allowable local contribution. REPRESENTATIVE SALMON asked if the department had established what the school district's needs are this year. He noted that it seems that things are always based on Anchorage. He expressed the need to concentrate on the small schools in rural districts. 12:05:37 PM MR. JEANS said the school districts haven't been polled in regard to their fiscal desires. He pointed out that the formula makes adjustments for the size of the student population within communities, and there is more funding provided for smaller student populations and smaller schools. He said there are adjustments with the regional cost differentials that are to assist in offsetting the regional cost differences of providing education. In the end, when the money is put into the formula, he said, those adjustments are being considered through the other factors in the funding formula itself. REPRESENTATIVE SALMON asked if the formula takes into consideration the location of the schools. MR. JEANS replied yes, and restated that the regional cost factor takes into account the varying regional cost factors. In further response to Representative Salmon, he stated that increasing the base student allocation should be making adjustments for those increased costs such as higher fuel costs. 12:09:04 PM STEVE BRADSHAW, Superintendent, Sitka School District, opined that he has serious concerns related to increased demands with special education. He explained that these students have high needs that require multiple special assistants. The costs involved, he said, are extremely high. He mentioned the demands of NCLB standards and opined that the [Sitka School District] has made great leaps forward in the education of Alaskan children but more manpower is required. He expressed his frustration in finding the quality of teachers demanded by statute and not being able to offer them competitive wages. He stated his appreciation of the governor's proposal, but explained that it will not meet his school district's needs. He stated: We've already started the budget process; we'll have to cut $200,000. That means, four teachers in this district. If I take four of the teachers at the bottom of the pay scale, it will cost me four teachers to get through next year. I can't afford to cut four teachers; I've already cut about 13 over the last three years. So, any effort that you can make to help us in the situation would be greatly appreciated. We can get the job done, we can educate every child and not leave any child behind, but I need specialists in the classroom to help my teachers, not only my kids, but my teachers in instruction in reading, writing, and math. I know you've got a tough year in front of you, I appreciate your efforts, and we just need the help, so thank you. REPRESENTATIVE THOMAS pointed out that Sitka is considered the same base as Anchorage and inquired as to the impact loss of that. MR. BRADSHAW stated that the cost of living and the housing costs in Sitka are high, but fuel costs in Southeast are lower than in other parts of the state. He expressed his belief that the Southeast cost factor should be adjusted. 12:14:50 PM BRUCE JOHNSON, Association of Alaska School Boards, (AASB), said that on behalf of AASB, he wanted to thank the committee for taking this issue seriously. The governor's bill is a wonderful starting point, he said. He explained that AASB is working with member districts to look at some of the impacts of a $62 million increase and what it might take to offer the same program as this current year plus appropriate changes relevant to recent mandates. He emphasized that AASB would not shy away from the accountability portion and that many of these measures are helpful in moving ahead. 12:17:22 PM MARY FRANCES, Executive Director, Alaska Council of School Administrators, , related that the association is supportive of any bill that increases the student base allocation. She stated that "SAA" is trying to decide on a specific request for the student base allocation. She pointed out that after years of flat funding and increased inflation, it has been difficult to compensate each year. Therefore, "SAA" looks forward to continued incremental improvement. MARY HAKALA, Coordinator, Alaska Kids Count (AKC), described AKC as a grassroots lobbying effort organized by parents and community members supporting public education. She said this is a statewide network of over 500 individuals. She explained that AKC establishes its goals dependent on what involved parents determine is needed in schools. She related that AKC's priorities this year are to increase foundation funding. She expressed that although AKC appreciated the governor's initial increase proposal, it does not bring the schools into "status quo funding". She said that school programs have suffered in the past, due to the lack of sufficient funding, and AKC would like to see a direction change. [HB 18 was held over.]