Legislature(2021 - 2022)DAVIS 106
03/23/2022 08:00 AM House EDUCATION
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| Audio | Topic |
|---|---|
| Start | |
| HB312 | |
| HB350 | |
| HB108 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED | ||
| += | HB 108 | TELECONFERENCED | |
| += | HB 312 | TELECONFERENCED | |
| += | HB 350 | TELECONFERENCED | |
HB 350-SCHOOL BOND DEBT REIMBURSEMENT
8:10:14 AM
CO-CHAIR STORY announced that the next order of business would
be HOUSE BILL NO. 350, "An Act relating to school bond debt
reimbursement; and providing for an effective date."
8:10:41 AM
CO-CHAIR DRUMMOND, as prime sponsor, stated that HB 350 simply
would open up the process for school districts to collaborate
with the governing bodies within their communities to create
school bonds for presentation to their voters. She added that,
according to the Department of Education and Early Development
(DEED), the process would take a couple of years before the
first set of bond issues would come before voters and the
legislature, thus the fiscal note would be indeterminate. There
would not be a funding commitment until 2024, when the
legislature and the governor could agree to return to the school
bond debt reimbursement promises, as made and fulfilled for
decades. She urged the committee to move the proposed
legislation to the House Finance Committee where future
implications could be discussed.
8:12:13 AM
REPRESENTATIVE PRAX questioned whether Legislative Legal
Services has been consulted on the issue of one community
obligating the entire state to pay for school bonds. He
expressed the concern that the state would be committing to
bonds without a statewide vote.
CO-CHAIR DRUMMOND responded that the legislature is mandated to
spend a certain amount of funding on rural schools and
communities that do not have taxing authority. She asserted
that the Alaska State Constitution directs that a system of
public schools be maintained, which not only means paying
teachers and providing students with transportation, but also
maintaining school facilities. She argued that communities with
taxing authority contribute to the operation of schools through
the foundation formula and also contribute when a school is
built, repaired, or remodeled. She directed attention to a
spreadsheet from 2015, showing that when the school bond debt
moratorium was first put in place there were 21 school districts
around the state that had bond issues at various levels of
repayment, including all the urban school districts that had
passed a significant amount of bond issues. She said that in
2015 Senate Bill 64 [passed during the Twenty-Ninth Alaska State
Legislature] ended school bond reimbursement for new bond debt
from 2016 until 2020. In 2020 the legislature extended the
moratorium to 2025. Since 2015, only Anchorage and the North
Slope Burrough have put school bonds before their voters, taking
on 100 percent of the responsibility for paying off the bond
debts. She stressed that paying off the debt is expensive. She
said that before the moratorium the state reimbursed Anchorage
an average of 65 percent of school bond debt. She offered the
comparison that a property tax before the moratorium of $35
would equal a $100 property tax now. She deduced that the
proposed legislation would actually be a tax reduction on local
property taxes. She expressed appreciation for the support of
the proposed legislation.
REPRESENTATIVE PRAX stated that he understands the history of
school bond debt in the state; he expressed the belief that the
problem would be that [a decision to build a new school would
force those who have no voice in the matter to pay for that
school]. He questioned whether Legislative Legal Services has
been asked for an opinion. He argued that the vote on school
bonds should be put to the legislature.
8:17:03 AM
REPRESENTATIVE HOPKINS posed the question to Representative Prax
on how the proposed legislation would not conform to the Alaska
State Constitution, specially.
REPRESENTATIVE PRAX explained that, in his opinion, it would be
unfair for certain communities to obligate the legislature. He
stated that the legislature is supposed to represent the entire
state, but the legislature would not get a vote on bond issues.
He said, "For four years I've watched bond elections and ...
their selling point is somebody else is going to pay for it."
REPRESENTATIVE HOPKINS stated that [school bond reimbursement]
was in effect for several decades before the 2015 cancellation.
He asserted that if school bond debt reimbursement was not
legally sound, then it would have been challenged decades ago.
He voiced his strong support of HB 350.
8:18:31 AM
REPRESENTATIVE CRONK expressed the understanding that any new
bonds after 2015 would not be reimbursed, and HB 350 would
continue only what was in place before 2015. He requested
clarification that any bonds after 2015, up to this point, would
not be reimbursed.
8:19:08 AM
CO-CHAIR DRUMMOND stated that, prior to 2015, the state was
reimbursing school bond debt. She asserted that the proposed
legislation would simply return to the procedures in place
before 2015. She pointed out that the indeterminate fiscal note
for the proposed legislation relays that DEED does not know how
many municipalities would qualify under the program and when
they may seek voter approval for new school capital debt. The
school districts and municipalities would work with DEED to
determine projects that would qualify and to determine the
reimbursement amount. She stated that a new school building
would qualify at a different level of reimbursement than major
repairs of school facilities. She stated that DEED maintains a
list of priority capital projects that is currently around $200
million. She added that every school district in the state has
projects which qualify for reimbursement. She said that capital
funds should be applied to those projects "because the state may
stop reimbursing, but the kids don't stop trooping through the
schools ... and the buildings continue to wear and tear and need
repair." She argued that the state is way behind on this.
8:22:02 AM
CO-CHAIR STORY observed that once new school bond debt
reimbursement is approved, the Matanuska-Susitna Borough would
have more new bonds; because of the increase in student
enrollment, new buildings would be needed. She expressed the
opinion that it is the state's responsibility to help, and this
is a way to help.
8:22:50 AM
REPRESENTATIVE HOPKINS moved to report HB 350 out of committee
with individual recommendations and the accompanying fiscal
notes. There being no objection, HB 350 was reported out of the
House Education Standing Committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Draft CS for HB 108 versionW.pdf |
HEDC 3/23/2022 8:00:00 AM |
HB 108 |
| HB 108 Version W Legal Services memo.22-150mjt.pdf |
HEDC 3/23/2022 8:00:00 AM |
HB 108 |
| FN HB108CS(EDC)-EED-SSA-3-17-22.pdf |
HEDC 3/23/2022 8:00:00 AM HL&C 4/4/2022 3:15:00 PM |
HB 108 |