Legislature(1999 - 2000)
03/03/2000 09:01 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CS FOR SENATE BILL NO. 105(HES)
"An Act determining the facilities constituting a
school for purposes of public school funding; and
providing for an effective date."
Senator Taylor stated that this legislation corrects
problems with SB 36, legislation passed in a previous
session changing the foundation funding formula for public
schools. He pointed out that Petersburg barely qualified
for the enrollment requirement set out in SB 36. He
continued that in the community of Wrangell there were
three funding units for elementary, middle and high
schools. He noted that because of this, Wrangell would not
receive any significant funding, but rather were required
to institute special taxation programs to make up for the
shortfall. He added that Petersburg or Wrangell have never
taken advantage of the previous school basic funding
formula. He explained the characteristics of a new
committee substitute not presently before the committee,
which would provide for a decline on the present funding
mechanism at 75 percent, then to 50 percent, and finally to
25 percent. He asserted that these funding percents were
created for the purposes of bringing Petersburg and
Wrangell to current levels of necessary allotted monies.
Senator Phillips affirmed that this legislation would only
affect three communities, these being Petersburg, Wrangell
and Delta Greely. He wondered how much each community paid
for their schools.
Senator Taylor responded that these communities pay up to
the cap and above, some of which; is paid out of the city
coffers. He continued that Wrangell increased its real
property taxes by 20 percent, all of which was spent on
education. A discussion ensued between Senator Taylor and
Senator Phillips regarding the non-tax paying status of
Delta Greely.
Senator Wilken gave a historical overview of school funding
for Petersburg and Wrangell, as well as Delta Greely as
illustration of the inequities between tax based and non-
tax based communities, which progressed into a general
discussion about how school expenses are funded statewide
per established formulas. Senator Taylor, Senator
Phillips, Senator Green and Senator Leman participated in
this discussion.
Senator Green referred to discussions from last session
regarding the Department of Education and Early
Development's hesitancy to amend SB 36, until the overall
effects of this legislation could be weighed on a statewide
basis.
Mr. Jeans responded that this is still the department's
position. He noted that the department does recognize the
effects to a school system that falls below the established
formula number. He noted that when a community has more
than 750 students in their system, this community has the
benefit of counting three schools, if three schools
presently exist. He continued that with a drop of
students, this community can only count on funding for two
schools, which can be a substantial cut. He remarked that
a three-year transition formula as proposed in this current
legislation might be inappropriate, but rather a one-year
transition might be in order.
Senator Green asked if the department could foresee any
other community falling into this similar situation.
Mr. Jeans responded that the two communities closest to
this cut-off figure are Petersburg and Delta Junction. He
then responded to various questions about a proposed study
regarding cost differentials, which this study is slated to
be completed next year.
Senator Wilken referred to the efforts of two Accountants,
who are presently trying to align the state's chart of
accounts.
Mr. Jeans responded that in addition to SB 36, the
legislature appropriated additional resources for the hire
of two internal auditors who are compiling comparable data
between school districts. He added that different school
districts were accounting for certain types of expenditures
inconsistently with other school districts. He summarized
that these efforts were an attempt to make these accounts
more uniform.
DAN BECK, Greely School Board testified via teleconference
from Greely. He stated that his community was in the
process of creating a borough. He noted that Greely would
need help with funding their schools once this transition
takes place. He outlined the funds that Greely has lost in
this past year because their student enrollment fell below
the cut-off formula. He stressed that unless Greely can
get some relief, the community will have to lay off 19
teachers and one administrator. He spoke to additional
shortfalls.
Tape: SFC - 00 #45, Side B, 9:49 AM
Mr. Beck responded to a question posed by Senator Leman
regarding the district's ADM (Average Daily Membership)
number at 1022 students, putting them over the threshold.
Mr. Beck noted this number was closer to 891 students.
Senator Phillips asked what the timeline was related to
Greely becoming a borough.
Mr. Beck responded that the charter would be submitted
within six weeks.
ART GRISWOLD, Borough Incorporation Committee testified via
teleconference from Greely reiterated this six-week
estimate. He continued that after the necessary signatures
were collected, it would be up to the Boundary Commission
to set a date for a hearing, and it would probably be
within 90 to 120 days after this hearing that a final vote
would take place.
KAREN LIGON, Nome Public Schools, testified via
teleconference from Nome. She stated that in Nome they
absorb the Nome Youth Facility, which is a youth
correctional institution. She added that educational
services are provided here for a capacity of 6 to 12
students. She spoke about an alternative high school with
a student population that fluctuates from 25 to 35 students
there as well. She stressed that it is hard to provide
adequate services to these small schools when it is a
requirement to count them as part of a larger school, which
has the highest ADM.
DEBBIE COOK, Chinook Charter School testified via
teleconference from Fairbanks. She stated the school's
concern with SB 105 dealt specifically with section 1.3,
which states:
(3) in a community with an ADM of greater
than 450 [750], each facility that is administered as
a separate school shall be counted as one school,
except that each alternative school with an ADM of
less than 200 shall be counted as a part of the school
in the district with the highest ADM.
She stated that this section continues to treat charter
schools with less than 200 students for funding purposes,
as if the students are enrolled in the school with the
largest ADM in the district. She asserted that this
creates an inequity with smaller schools. She gave various
examples of how the Chinook Charter School lacks many of
the programs of these larger schools and along with the
established funding formulas, this charter school has a
harder time meeting their costs.
SCOTT WHEAT testified via teleconference from Homer and
stated that he supports this legislation, especially from a
rural perspective.
RICK HARNESS testified via teleconference from Homer to
support this bill. He spoke to the possibility of cutting
staff in Homer schools because of funding shortfalls,
something, which affects the whole community. He also
stressed that funding charter schools takes away monies
that could be used in the public school system.
PATRICK HICKEY, Kenai School District, testified via
teleconference from Kenai. He addressed the issue of how
schools are categorized by this legislation. He suggested
that having a charter school with 26 students, while
funding it along with a community of 600 students in a
larger high school creates an inequitable situation. He
concluded that charter schools should be treated like any
other.
Senator Green responded to Co-Chair Torgerson's concern
that the testimony was turning into a charter school
debate. She pointed out that this legislation in earlier
versions did make reference to charter schools and inferred
that some of the testifiers were referring to this older
version.
ELIZABETH BACOM, Petersburg School Board testified via
teleconference from Petersburg. She highlighted the
negative fiscal impacts created by declining enrollment,
while using the two-school formula as versus the three-
school calculations as was testified to previously. She
listed all those programs that the district stands to
loose, as a result and those that they have already lost.
She also outlined how Petersburg has had to shore up their
resources to save existing funding.
MIKA MACH, Chinook Charter School, testified via
teleconference from Fairbanks regarding the inclusion of
charter schools into this legislation. She requested that
a benchmark be included in section 3 to cover the Chinook
Charter School.
CARL ROSE, Executive Director, Association of Alaska School
Boards stated that the association supports this
legislation, although they are concerned that a present
state funding policy exists under a foundation formula. He
noted the benchmark change from 750 to 450 ADM, his main
point being that whatever the benchmark, it needs to be
consistent from one school district to the next.
Senator Phillips asked Mr. Rose to address the inequity
created by two tax paying jurisdictions that are presently
requesting relief, along with another community, Delta
Greely, a non-paying tax community.
Mr. Rose responded that he does agree that an inequity
exists, but suggested that this issue be addressed through
another avenue. A lengthy discussion ensued between Mr.
Rose, Art Griswold and Senator Phillips regarding this
issue.
Senator Wilken made a motion to adopt SB 105, 1-LS06AA\T as
the committee substitute. Hearing no objection, it was so
moved.
Co-Chair Torgerson ordered the bill HELD in committee.
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