Legislature(2019 - 2020)SENATE FINANCE 532
05/06/2019 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB14 | |
| SB91 | |
| HB106 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 106 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 14 | TELECONFERENCED | |
| += | SB 91 | TELECONFERENCED | |
HOUSE BILL NO. 106
"An Act relating to school bond debt reimbursement."
9:28:29 AM
AT EASE
9:29:34 AM
RECONVENED
REPRESENTATIVE TAMMIE WILSON, SPONSOR, explained that House
Bill 106 would extend the termination date for the school
bond debt
Co-Chair von Imhof explained that currently there was a
moratorium on school bond debt reimbursement through 2020,
the bill would extend it an additional 5 years.
9:31:08 AM
9:31:19 AM
Co-Chair von Imhof OPENED public testimony.
9:31:35 AM
JIM ANDERSON, ANCHORAGE SCHOOL DISTRICT, ANCHORAGE (via
teleconference), spoke in opposition to the bill. He
explained that the current house budget already cut prior
year bond debt reimbursement by 50 percent going back 20
years. He said that adding the additional burden on
receiving no debt assistance through 2025 would put the
onus on Anchorage taxpayers. He stated that shifting the
states responsibility for bond debt did not decrease the
requirement but shifted it to those living in incorporated
areas. He stressed that supporting education meant
supporting the operation of school, the people in them, and
their capital needs.
9:33:06 AM
Co-Chair Stedman understood that the bill would be a
moratorium on adding new reimbursement requirements onto
the state going forward. He did not think the bill impacted
the accumulated school construction already undertaken. The
state would still annually consider how much debt the state
would be reimbursing. He wanted to clarify for the public
that the bill would block new projects from being added
until an alternative policy could be crafted.
Co-Chair von Imhof affirmed that Co-Chair Stedman was
correct, and the bill was a look forward and not a look
back. She asked whether the Anchorage School District had
done an excess capacity analysis on its 60 elementary
schools.
9:34:24 AM
Mr. Anderson answered in the affirmative and specified that
the school board had been briefed in the fall. It had been
recommended that the Mount Spur school should be closed,
and some programs should be merged. He related that the
recommendation had been based on the city planners
assessments on sum population growth in certain areas over
the next 20 years. He said that the analysis would be done
annually in the future. He thought that closing schools was
an emotional issue but believed that if membership
continued to decrease more schools would be closed.
Co-Chair von Imhof recalled that the body passed a bill the
previous year allowing for school closures and holding
harmless the revenue for a step-down of four years. The
intent had been to encourage schools to have conversations
about capturing capacity in schools. She thought that if
emotions ran high and people did not want to close their
local schools that was a choice that board would have to
make, and the cost would be passed onto the local
taxpayers. She asserted that the control was within the
school district to make the decision whether to maintain 60
elementary schools, 8 middle schools and 8 high schools.
9:36:57 AM
Senator Micciche looked at the table on the document titled
"State Portion Reimbursement Principal and Interest," (copy
on file). He was curious about the proportion related to
major maintenance versus new school construction of the
$800 million in bond debt. He noted the disparity between
organized and unorganized boroughs.
9:38:35 AM
NILS ANDREASEN, EXECUTIVE DIRECTOR, ALASKA MUNICIPAL
LEAGUE, relayed that the Department of Education and Early
Developments (DEED) 6-year plan showed $464 million in
needs for FY20; $189 million in needs for FY21; and an
average over the next 6 years of $231 million. For the 355
projects listed the total in upgrades was $1.4 billion. He
said that the requests that had been submitted by school
districts did not account for the full scope of need, only
priorities relative to each budget year, and were not
included in the states deferred maintenance numbers. For
the school construction program DEED showed the average
need between FY15 and FY20 was $234 million, with an
average of $230 million paid over those years. He furthered
that the number of schools funded by the $190 million in
FY20 was approximately 6, the school bond debt
reimbursement for that same year of under $100 million
accounted for nearly 30 schools. He stressed that without
the reimbursement those districts able to bond for the debt
would have to compete with REA school districts for
funding, or other municipal school districts that lacked
the tax base to bond for a greater share of debt. He asked
how the state identified the unaversive need and what was
the plan to address the need. He believed that the proposed
moratorium did not meet the states constitutional
obligations. He thought that the 5-year extension was
nothing but a recognition that the state did not have a
plan to address new school construction. He believed that
the legislature could seek other options that would benefit
both the state and municipal districts.
9:42:34 AM
9:42:42 AM
Co-Chair von Imhof CLOSED public testimony.
9:43:21 AM
Senator Micciche thought the state could not afford new
schools and he would likely support a moratorium of some
kind. He asked what percentage of the debt had to do with
new schools, and how much had to do with maintenance of old
schools.
ELWIN BLACKWELL, SCHOOL FINANCE MANAGER, DEPARTMENT OF
EDUCATION AND EARLY DEVELOPMENT, said that he would get
back to the committee with the information.
9:45:23 AM
Senator Micciche guessed that there needed to be a
separation of new construction and major maintenance of
existing schools when it came to bond debt reimbursement.
9:46:10 AM
Co-Chair von Imhof asked whether DEED travelled the state
to inspect the condition of schools and how well the
buildings were being maintained. She wondered whether there
were degrees of differences with regard to maintenance.
TIM MEARIG, FACILITIES DIRECTOR, DEPARTMENT OF EDUCATION
AND EARLY DEVELOPMENT, stated that statute provided for the
department to have an ongoing inspection process with
districts to ensure that minimum standards of care were
met. The division had an individual that travelled to ten
school districts per year to evaluate the compliance with
facility and maintenance practices and retain eligibility
for bond reimbursement and grants. He had not seen a great
deal of disparity in the condition of buildings of the same
age. He admitted that older buildings were more
challenging.
9:48:51 AM
Co-Chair von Imhof assumed that the department had a list
of all the buildings and a matrix through which the
buildings were prioritized based on age and condition.
Mr. Mearig stated that the state did not have a
comprehensive facility evaluation tool or requirement. The
state required a district to have an understanding and
condition of facilities. He said that in the Capital
Renewal portion of the Minimum Standards each district was
required to understand the age and capital needs of their
facilities that were over 1000 square feet.
9:50:23 AM
Co-Chair von Imhof believed the state built a school for
Healy Lake; after which the population dropped, and the
school was not opened.
Mr. Mearig replied that he did not have enough information
to comment on the school at Healy Lake.
Co-Chair von Imhof requested further information on whether
the state was paying to maintain, heat, or insure the
building, and whether there was a plan for the building.
9:51:06 AM
Co-Chair Stedman wanted to know how many schools were close
to the minimum count of 10 students. He agreed with Senator
Micciche's request for a breakdown of the reimbursement
requests. He wanted to add a request for a per capita
numeric. He used examples of the debt carried by Sitka and
Ketchikan. He asserted that his region needed students and
not new schools, but the Mat-Su was the opposite. He
reminded that K-12 education was a constitutional
requirement.
9:54:33 AM
Senator Shower appreciated the comments from the co-chairs
and supported the concept of the bill. He agreed that the
Mat-Su was growing. He had spoken to several individuals in
the educational system. He discussed his educational
background in the State of Florida. He thought that the
committee needed more data in order to make decisions.
9:56:22 AM
Senator Bishop remarked that the committee had had the same
conversation thirty years previously. He mentioned Rampart
School was closed for a period of ten years, after which
population grew and the school reopened. He asserted that
there was nothing static about the equation.
9:57:30 AM
Co-Chair von Imhof thought it was important to use data to
drive policy decisions. She suggested that if DEED wanted
assistance from the committee, more data would be
necessary. She asserted that school maintenance data should
be entered into a database. She thought the age of a school
building was irrelevant. She thought some schools fared
better than others over time due to weather or other
factors. She reiterated the need for DEED to provide
further information.
9:59:36 AM
Senator Bishop addressed FN 1 from Debt Service, OMB
Component 153. The note had zero fiscal impact.
Co-Chair von Imhof set the bill aside.
HB 106 was HEARD and HELD in committee for further
consideration.
10:00:27 AM
RECESSED
2:35:24 PM
RECONVENED
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB106 ver A Sponsor Statement 3.26 (1).pdf |
HFIN 4/1/2019 1:30:00 PM SFIN 5/6/2019 9:00:00 AM |
HB 106 |
| HB106 ver A Back Up Information - School Debt Spreadsheet 4.17.19.pdf |
SFIN 5/6/2019 9:00:00 AM SFIN 2/14/2020 9:00:00 AM |
HB 106 |
| SB 91 CS SB 91 (FIN) v. S work draft.pdf |
SFIN 5/6/2019 9:00:00 AM |
SB 91 |
| SB 91 CS SB 91 (FIN) v. S Explanation.pdf |
HRES 5/8/2019 1:00:00 PM HRES 5/10/2019 1:00:00 PM SFIN 5/6/2019 9:00:00 AM |
SB 91 |
| HB 14 SCS CSHB 14 (FIN) v. H Statutory References.pdf |
SFIN 5/6/2019 9:00:00 AM |
HB 14 |
| HB 14 SCS CSHB 14 (FIN) v. H.pdf |
SFIN 5/6/2019 9:00:00 AM |
HB 14 |
| HB 14 SCS CSHB 14 (FIN) v. H Explanation.pdf |
SFIN 5/6/2019 9:00:00 AM |
HB 14 |