03/10/1993 09:15 AM Senate FIN

                                                                               
  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  Drue  Pearce  reconvened  the  meeting,  with  all                 
  members in attendance, at approximately 11:05 a.m.  She then                 
  directed that CSHB 45 (Fin) be brought on for discussion.                    
                                                                               
  A draft SCS CSHB  45 (Fin) dated 3/9/93 was  distributed for                 
  committee review.   Co-chair  Pearce also  noted a  proposed                 
  amendment by Senator  Kerttula.  Directing attention  to the                 
  draft Senate Finance  version of  the bill, Co-chair  Pearce                 
  advised of two major changes.  She explained that the House-                 
  passed version of  the bill mistakenly cited  FY 94 numbers.                 
  Those were not the  numbers contained in the bill  passed by                 
  House Finance.  For single site schools, the  Senate Finance                 
  version utilizes Dept.  of Education numbers for FY  93 ADM.                 
                                                                               
                                                                               
  Those are the numbers the House asked be used.  Further, the                 
  twelve single sites listed in the  draft reflect the list of                 
  single sites negotiated with the House majority caucus.                      
                                                                               
  Co-chair  Steve Frank  MOVED for  adoption of the  draft SCS                 
  CSHB 45 (Fin).  Senator Kerttula OBJECTED.  He then inquired                 
  regarding  single  site schools  included within  the draft,                 
  asking if they  were the  sites highlighted in  yellow on  a                 
  tabulated  handout from the  Alaska Department of Education.                 
  Co-chair Pearce answered  affirmatively.  She then  read the                 
  following list of sites which she explained were included in                 
  the House bill but not in the Senate Finance draft:  Galena,                 
  Hoonah, Hydaburg, Kake,  Klawock, Pelican, Skagway,  Tanana,                 
  and Yakutat.  The new total  for single sites is $2,291,770.                 
  The House number, utilizing the  correct FY 93 figures would                 
  be $3,358,050.                                                               
                                                                               
  Senator Kerttula  inquired concerning the  basis for removal                 
  of the above-listed sites.  Co-chair Pearce said, "We worked                 
  with  the House to negotiate a list, and those were the ones                 
  that dropped out."  She  further advised of original  caucus                 
  discussion not to include any single sites within the  bill.                 
  The  House  bill  included  all  twenty-one.    Negotiations                 
  between the  House and  Senate led  to the  compromise list.                 
  Senator  Kerttula   suggested  that  some   of  the  poorest                 
  districts would be impacted by  the cut, specifically noting                 
  Klawock.     Co-chair   Pearce  explained  that,   with  one                 
  exception,  those  that were  removed  are  receiving forest                 
  receipt moneys.   Senator Kerttula  noted that Wrangell  and                 
  Petersburg  both receive forest  receipt funds as  well.  He                 
  observed that  Craig is included in the  Senate Finance bill                 
  and acknowledged that the district  is in "desperate shape."                 
                                                                               
                                                                               
  Senator Kerttula reiterated  his opposition  to adoption  of                 
  SCS  CSHB 45 (Fin).   Co-chair Pearce  called for a  show of                 
  hands on the motion.  The motion CARRIED on a vote of six to                 
  one, and SCS CSHB 45 (Fin) was ADOPTED.                                      
                                                                               
  Senator Kerttula MOVED  for adoption of  his amendment.   He                 
  acknowledged that in  light of corrected House  funding, the                 
  $760,670,230  and  $811,929,330  set  forth   in  the  third                 
  paragraph of the amendment  would have to be adjusted  to FY                 
  93 numbers.    He noted, however, that the  basic purpose of                 
  the  amendment,  to  increase the  instructional  unit  from                 
  $61,000  to $64,000  would not  change.   OBJECTIONS  to the                 
  motion and  amendment were  voiced.   Senator Kerttula  told                 
  members  that  the  instructional  unit  was  negotiated  to                 
  $61,000  during   the  past  session.    In   light  of  the                 
  inflationary spiral, it should have  been raised to $65,000.                 
  The unit had not been raised for five or six years  prior to                 
  the  recent  increase.    There  is  great  support  for  an                 
  additional increase  from the educational  community and the                 
  public.   The increase would approximate $36 million.  Given                 
                                                                               
                                                                               
  new,  unplanned  for,  funding sources  ($1.4  billion), the                 
  legislature  can afford to  modestly raise the instructional                 
  unit.  It  would provide benefits  across the board to  both                 
  urban and rural districts.   Senator Kerttula reiterated his                 
  support for the increase based on need.                                      
                                                                               
  Senator Kelly inquired concerning the funding level prior to                 
  last year's increase to $61,000.   Senator Kerttula answered                 
  that it was previously set at $60,000.                                       
                                                                               
  Co-chair  Pearce  called for  a  show  of hands  on  Senator                 
  Kerttula's amendment.  The motion FAILED on a vote of one to                 
  six, and the amendment was NOT ADOPTED.                                      
                                                                               
  Senator  Kelly  MOVED  that  SCS CSHB  45  (Fin)  pass  from                 
  committee  with  individual recommendations.    No objection                 
  having been raised,  SCS CSHB 45  (Fin) was REPORTED OUT  of                 
  committee.  Co-chairs  Pearce and Frank and  Senators Jacko,                 
  Kelly, Rieger, and  Sharp signed the committee report with a                 
  "do pass" recommendation.  Senator Kerttula signed "increase                 
  inst. unit."                                                                 
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting was adjourned at approximately 11:15 a.m.