03/07/2005 09:00 AM Senate FINANCE

                                                                                                                                
     HOUSE BILL NO. 158                                                                                                         
     "An Act relating to the public school account and renaming the                                                             
     public school account as the public education fund; and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
REPRESENTATIVE KEVIN MEYER,  Co-Chair of the House Finance Committee                                                            
which sponsors  this bill, stated that, in addition  to changing the                                                            
name of  the Public  School Account  to the  Public Education  Fund,                                                            
this  legislation  would allow  funds  appropriated  to K-12  public                                                            
education to  remain in the Fund "for  educational purposes"  rather                                                            
than allowing  them to annually  lapse into  the General Fund.  This                                                            
has regularly  occurred due to the fact that the Legislature  "tends                                                            
to overestimate"  the number of students who would  be in the public                                                            
school system.  As a result, the Legislature and the  Administration                                                            
"fight" each year over  the use of education funding that lapsed the                                                            
previous year.  While this legislation  would not alter the  current                                                            
public education  funding mechanism, as the base student  allocation                                                            
(BSA) level is determined  by separate legislation; it would support                                                            
"truth in budgeting" in  that money budgeted each year for education                                                            
would  continue to  support education  and pupil  transportation  as                                                            
opposed to lapsing  into the general fund and being  used to support                                                            
other general  government services. This year's lapsed  amount could                                                            
amount to approximately $14 million.                                                                                            
                                                                                                                                
Co-Chair  Green supported  the language that  would allow  education                                                            
funding  to remain  in "an  on-going account"  as  opposed to  being                                                            
lapsed. She noted that  expenditures from the Fund would continue to                                                            
require appropriation.                                                                                                          
                                                                                                                                
Representative Meyer concurred.                                                                                                 
                                                                                                                                
Co-Chair Wilken  declared that addressing  the lapsed funding  issue                                                            
in this  manner would  serve to  remove the  "annual argument"  that                                                            
occurs  each year  between the  Administration  and the Legislature                                                             
regarding public  education funds that the Legislature  had "battled                                                            
for" the  previous year.  Such funds  could be  viewed "as a  spring                                                            
board for the next year."                                                                                                       
                                                                                                                                
Co-Chair Green  agreed that the funds  could provide "a little  head                                                            
start on the next year's financing."                                                                                            
                                                                                                                                
Senator Olson asked regarding these funds' lapse history.                                                                       
                                                                                                                                
Representative  Meyer stated that  the lapsed funds typically  range                                                            
between eight and fourteen million dollars.                                                                                     
                                                                                                                                
Co-Chair Wilken moved to report the bill from Committee with                                                                    
individual recommendations and accompanying fiscal note.                                                                        
                                                                                                                                
There being no objection HB 158 was REPORTED from Committee with                                                                
zero fiscal note #1, dated February 18, 2005 from the Department of                                                             
Education and Early Development.