Legislature(2009 - 2010)CAPITOL 106

03/02/2009 08:00 AM EDUCATION


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 147 EDUCATION FUNDING FOR INSTRUCTION TELECONFERENCED
Moved Out of Committee
*+ HB 58 EDUC LOAN REPAYMENT PROGRAM TELECONFERENCED
Heard & Held
+= HB 126 FOSTER CARE/CINA/EDUCATION OF HOMELESS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
HB 147-EDUCATION FUNDING FOR INSTRUCTION                                                                                      
                                                                                                                                
8:04:37 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON announced that the  first order of business would be                                                               
HOUSE BILL  NO. 147,  "An Act  repealing the  minimum expenditure                                                               
for instruction requirements for public schools."                                                                               
                                                                                                                                
8:05:19 AM                                                                                                                    
                                                                                                                                
HANNAH  HARRISON, Staff,  to Representative  Paul Seaton,  Alaska                                                               
State Legislature, paraphrased from  the sponsor statement, which                                                               
read as follows [original punctuation provided]:                                                                                
                                                                                                                                
     HB 147 repeals  AS 14.17.520, a ten  year old provision                                                                    
     in  Alaska  statutes requiring  that  70%  of a  school                                                                    
     district's operating  expenditures be dedicated  to the                                                                    
     instructional   component  of   the  district   budget,                                                                    
     regardless  of  their  geographical  location,  student                                                                    
     population size, or any other  factor.  AS 14.17.520 is                                                                    
     considered an  accountability measure to  ensure school                                                                    
     districts   are   spending   funds   on   instructional                                                                    
     programs.                                                                                                                  
                                                                                                                                
     The  rising  cost of  education  is  affecting the  way                                                                    
     school  districts   address  their  spending.     Fuel,                                                                    
     electricity,  and  building  maintenance  expenses  can                                                                    
     radically change from year to year.                                                                                        
                                                                                                                                
     There are two types of  school districts that have been                                                                    
     chronically  unable   to  meet  the   70%  requirement:                                                                    
     districts that  have an operating budget  of $3 million                                                                    
     or  less and  those that  spend  20% or  more of  their                                                                    
     budget on  operation and maintenance.   Currently, if a                                                                    
     school district is unable to  meet the 70% requirement,                                                                    
     they  must file  a waiver  through the  State Board  of                                                                    
     Education  &  Early  Development which  can  either  be                                                                    
     approved or  denied.  Approval  allows the  district to                                                                    
     operate  with  their  submitted  budget,  but  requires                                                                    
     justification for their failure  to comply with the 70%                                                                    
     requirement.    Denial  of a  waiver  can  require  the                                                                    
     district to revise its budget to meet the 70%.                                                                             
                                                                                                                                
     AS  14.17.520,  has  become   outdated.    The  current                                                                    
     statewide assessment system  is a better accountability                                                                    
     program to  determine if  school districts  are meeting                                                                    
     their  student's   needs  through   good  instructional                                                                    
     practices.    The   state  assessment  system  measures                                                                    
     student   proficiency    in   reading,    writing   and                                                                    
     mathematics from one  year to the next.   In fact, with                                                                    
     the  passage of  SB  285 last  year  the department  of                                                                    
     education  has  the  authority  and  responsibility  to                                                                    
     intervene  in chronically  low  performing schools  and                                                                    
     districts.     SB  285   requires  the   Department  of                                                                    
     Education  to  redirect  school district  resources  to                                                                    
     improve  instructional  practice intended  to  increase                                                                    
     student  proficiency.     This   accountability  system                                                                    
     provides  a better  use of  school  district and  state                                                                    
     resources to increase student achievement.                                                                                 
                                                                                                                                
     Repealing AS 14.17.520 will  remove the 70% requirement                                                                    
     and  waiver process,  saving  almost  half of  Alaska's                                                                    
     school districts, the State Board  of Education and EED                                                                    
     staff a redundant yearly process  that does not measure                                                                    
     the effectiveness  or ability of a  district to deliver                                                                    
     a quality educational program to its children.                                                                             
                                                                                                                                
8:08:59 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON opened public testimony                                                                                            
                                                                                                                                
8:09:29 AM                                                                                                                    
                                                                                                                                
RICHARD  CARLSON, Superintendent,  Klawock City  School District,                                                               
stated  support   for  HB  147,   paraphrasing  from   a  written                                                               
statement,   which   read   as  follows   [original   punctuation                                                               
provided]:                                                                                                                      
                                                                                                                                
     While I represent the Klawock  City School District, it                                                                    
     is worth noting that the  State Board of Education, the                                                                    
     Alaska  Association of  School Boards,  and the  Alaska                                                                    
     Association  of  School  Administrators have  all  been                                                                    
     vocally in opposition to the 70 percent rule.                                                                              
                                                                                                                                
     Klawock  is  a  small,   single  site  school,  of  125                                                                    
     students,  located   on  Prince  of  Wales   Island  in                                                                    
     southeast Alaska.  The  student demographics include 74                                                                    
     percent   Native   Alaskan,    and   66   percent   are                                                                    
     impoverished.   If you take  a look at  the educational                                                                    
     statistics,  our  school  should not  be  a  successful                                                                    
     school;  based on  what statistics  say about  minority                                                                    
     and  impoverished   students.    However,   our  school                                                                    
     district has  bucked that trend.   We have  always made                                                                    
     Adequate Yearly  Progress (AYP),  the drop-out  rate is                                                                    
     consistently around  2 percent,  attendance rate  is 95                                                                    
     percent, and test  scores are impressive.   Most of our                                                                    
     students go  on to  postsecondary education.   Recently                                                                    
     we  were  named as  one  of  the  top high  schools  in                                                                    
     America by U.S. News and World Report.                                                                                     
                                                                                                                                
     By every  measure we are a  successful school district,                                                                    
     and  yet annually,  I have  to spend  a good  amount of                                                                    
     time  and energy  justifying how  I  expend our  money.                                                                    
     Annually I have  to write a waiver.  And  it's not just                                                                    
     the process of  writing the waiver.   During the coarse                                                                    
     of the year determinations  must be made, for instance,                                                                    
     on how much of our  time is spent transporting students                                                                    
     to  swimming   classes;  that  is   considered  counted                                                                    
     towards  the 70  percent.   Or  how  much our  activity                                                                    
     director's  time is  dedicated towards  activities that                                                                    
     would qualify for the 70  percent, for example academic                                                                    
     decathlon  or music  festival.    It becomes  extremely                                                                    
     time consuming and burdensome.                                                                                             
                                                                                                                                
     It's not  so much the time  it takes, I get  paid to do                                                                    
     that, but  it goes  more to the  core of  local control                                                                    
     and  who is  in  the best  situation  to determine  how                                                                    
     money is  to be allocated;  whether it is  an arbitrary                                                                    
     number set  in statute,  or whether  it is  people that                                                                    
     serve the  school district -  school board  members and                                                                    
     community members.  I would  argue that it's the people                                                                    
     closer to  the school  district who  would be  the more                                                                    
     appropriate people to make that decision.                                                                                  
                                                                                                                                
     At the Klawock  City School District we  have a mission                                                                    
     statement that  highly values providing a  well rounded                                                                    
     educational  program and  educating the  whole student.                                                                    
     In  our  mission  statement there  is  an  emphasis  on                                                                    
     developing  leadership skills,  team work,  strong work                                                                    
     ethics, and responsibility.  Those  are sorts of things                                                                    
     that are learned  in and outside of  the classroom, and                                                                    
     consequently, outside of the 70 percent criteria.                                                                          
                                                                                                                                
     We  believe  that  we  are in  the  best  situation  to                                                                    
     determine  what  is  in  the   best  interest  for  our                                                                    
     children, not some arbitrary number set in statute.                                                                        
                                                                                                                                
     On  a more  practical level,  increasing energy  costs,                                                                    
     the  cost of  facilities,  and the  cost  of state  and                                                                    
     federal   unfunded   mandates  make   it   increasingly                                                                    
     difficult to reach the [70] percent.                                                                                       
                                                                                                                                
     Clearly we  agree that accountability is  critical, but                                                                    
     we  feel  that there  are  many,  many better  ways  to                                                                    
     determine  the success  of a  school  district than  to                                                                    
     place an arbitrary number in statute.                                                                                      
                                                                                                                                
     Therefore, we very  much support HB 147  and the repeal                                                                    
     of the 70 percent rule.                                                                                                    
                                                                                                                                
8:16:03 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WILSON pointed out that some districts provide                                                                   
pay/benefits to school board members, and asked what the policy                                                                 
is in Klawock.                                                                                                                  
                                                                                                                                
MR. CARLSON reported  that the members receive  $75.00 per month,                                                               
which many of  them donate back to the district.   To a follow-up                                                               
question he stated that spouses do not receive travel benefits.                                                                 
                                                                                                                                
8:17:03 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER  queried how  heating cost for  a classroom                                                               
is considered under the 70:30  rule, and whether those guidelines                                                               
are in statute.                                                                                                                 
                                                                                                                                
MR. CARLSON answered that the  guidelines are not in statute, and                                                               
that fuel counts against the 70  percent criteria.  When the fuel                                                               
prices skyrocketed the situation became untenable.                                                                              
                                                                                                                                
REPRESENTATIVE KELLER  suggested that  a regulation  change could                                                               
be made  to allow a portion  of the heating costs  to be included                                                               
as  a  cost  of  education;  arguing that  a  warm  classroom  is                                                               
necessary for instruction.                                                                                                      
                                                                                                                                
MR.  CARLSON  maintained  that  the issue  comes  back  to  local                                                               
control and who is making appropriate determinations.                                                                           
                                                                                                                                
8:18:42 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MUNOZ noted  the  districts declining  enrollment                                                               
and asked the superintendent to address the topic.                                                                              
                                                                                                                                
MR.  CARLSON  stated  his  belief   that  southeast  Alaska,  and                                                               
certainly  Prince  of  Wales Island,  is  experiencing  declining                                                               
enrollment  in  general.    The exiting  senior  class,  and  the                                                               
incoming  kindergarten numbers,  indicates a  loss of  about five                                                               
percent.   The fixed costs  of operating remain  static, however,                                                               
and  it  becomes increasing  difficult  to  meet the  70  percent                                                               
requirement.   To a  further question,  he reported  that Klawock                                                               
has  a  staff comprised  of  3  administrators and  14  certified                                                               
teachers.                                                                                                                       
                                                                                                                                
8:21:02 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON directed  attention to the committee  packet and the                                                               
waiver requests  from the various  school districts.   He pointed                                                               
out  that these  forms  contain  pertinent information  regarding                                                               
each schools budget.                                                                                                            
                                                                                                                                
8:22:19 AM                                                                                                                    
                                                                                                                                
EUGENE S.  AVEY, Superintendent, Annette Island  School District,                                                               
stated support for  HB 147, and opined that  the existing statute                                                               
has become  a burden on  small school districts.   Annette Island                                                               
School represents  the southern most  district of the state.   He                                                               
credited  the dedicated  teaching staff  as the  reason that  the                                                               
school has  met AYP.   The 70  percent regulation  was originally                                                               
placed in statute to raise  the level of instruction, however, it                                                               
has become overshadowed by the  requirements of the No Child Left                                                               
Behind Act (NCLB).  It is  now an unnecessary mandate that places                                                               
undue burdens  on school  districts that  cannot possibly  be met                                                               
given  the rising  costs for  energy, maintenance,  shipping, and                                                               
other operational  expenses.  Creative  ideas are  cultivated, by                                                               
small school  districts, in an  attempt to meet  this unrealistic                                                               
requirement.   At  the Annette  Island  School District,  outside                                                               
assistance  is employed  to ensure  that the  minimum expenditure                                                               
requirement is  being met.   As a past superintendent  of another                                                               
rural district,  he reported  that similar  difficulties occurred                                                               
and  the  requirement could  not  be  met.   The  one-site  Rural                                                               
Education Attendance  Area (REAA) and  high impact AYP  have been                                                               
instrumental for  Annette Island  School District to  achieve the                                                               
mandate.    He added  that  many  schools  cannot send  teams  to                                                               
competitions,  due to  these expenditure  requirements.   At  the                                                               
recent  Academic   Decathlon  competition   a  low   turnout  was                                                               
experienced.    This  may  possibly   be  schools  cutting  these                                                               
activities  to meet  the minimum  expenditure requirement  and he                                                               
posed the question,  "But at what cost?"  Students  miss out when                                                               
they  are  unable to  benefit  from  participating in  intramural                                                               
events.   The  NCLB requirement  has raised  the bar  and imposes                                                               
standards that parallel  the state statute under  repeal.  Reduce                                                               
government   bureaucracy,  allow   local  officials   to  provide                                                               
oversight, and trust  that the schools have the  best interest of                                                               
the students in mind, he finished, and urged passage of HB 147.                                                                 
                                                                                                                                
8:28:34 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WILSON reiterated  her previous question regarding                                                               
payment/benefits for members of the Annette Island school board.                                                                
                                                                                                                                
MR. AVEY  said he believes it  is a monthly stipend  of $109, the                                                               
spouses are not allowed travel  privileges.  Given the hours they                                                               
work, and the activities that  they contribute personal money to,                                                               
he  opined, "I  don't think  they're  really paid  .... ...  Most                                                               
likely it's  a wash."   To a question from  Representative Munoz,                                                               
he said that  Annette Island is a single site  district, with 275                                                               
students.    The  staff  includes 30  certified  teachers  and  3                                                               
administrators.   The high school  has been recognized as  a blue                                                               
ribbon school,  which applies efforts  to not only meet  AYP, but                                                               
to focus on each child and their needs.                                                                                         
                                                                                                                                
8:30:54 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER  inquired if  school board  members receive                                                               
health coverage or other benefits, including travel.                                                                            
                                                                                                                                
MR.  AVEY   reported  that  the   members  attend   one  national                                                               
conference per  year, and  participate in  state fly-ins  once or                                                               
twice per year.   He opined that the travel  money is not lavish,                                                               
but  well  spent.    Further, health  coverage  benefits  can  be                                                               
purchased, however,  none of the  members take advantage  of that                                                               
option.                                                                                                                         
                                                                                                                                
REPRESENTATIVE  WILSON qualified  her  line of  questioning as  a                                                               
means to  locate the districts  which reportedly pay  their board                                                               
members several thousand dollars.                                                                                               
                                                                                                                                
MR. AVEY noted that higher pay could be an attractive incentive.                                                                
                                                                                                                                
8:33:38 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON pointed  out that the retirement  system rewrite has                                                               
been  changed  to  exclude   from  Public  Employees'  Retirement                                                               
System/Teacher's  Retirement  System  (PERS/TRS) a  school  board                                                               
member who  makes less than  $24,000 per year; rectifying  a loop                                                               
hole that has existed to  the detriment of some school districts.                                                               
However, there  are school  districts that  pay board  members as                                                               
much as  $2,100 per month, but  it does not count  towards the 70                                                               
percent requirement.                                                                                                            
                                                                                                                                
8:35:33 AM                                                                                                                    
                                                                                                                                
JACK WALSH, Superintendent, Bristol  Bay Borough School District,                                                               
stated support  for HB  147.   Bristol Bay  is a  small district,                                                               
serving   Naknek,  South   Naknek,  and   King  Salmon,   with  a                                                               
significantly declining  enrollment; currently 144 students.   In                                                               
the  history of  Bristol Bay  the population  trend is  cyclical,                                                               
thus the  decline may  take an  upward turn  in the  near future.                                                               
The  70:30 issue  has been  a  challenge for  many districts,  he                                                               
opined.  The Bristol Bay  schools have met their AYP requirements                                                               
under NCLB;  however, with the  NCLB bar rising,  and enrollments                                                               
declining, the  margin of error  is reduced, and meeting  AYP may                                                               
become more difficult in the future.   He said it is important to                                                               
understand   that  AYP   does  not   directly   relate  to   this                                                               
legislation,  and may  or  may not  be impacted  as  a result  of                                                               
repealing the 70:30  statute.  Student success and  progress is a                                                               
greater indicator  of a  district's accountability  than anything                                                               
else,  he opined.   Every  year  Bristol Bay  requests a  waiver,                                                               
although  the  budget  is  above  the  $3  million  dollar  mark;                                                               
approximately  $3.5  million.     The  district  employs  fifteen                                                               
teachers,   four  support   staff,  along   with  one   full-time                                                               
administrator and  one part-time administrator, both  of whom are                                                               
certified teachers.  Operational costs  consume 10 percent of the                                                               
budget;  despite the  decline in  enrollment,  the 90,000  square                                                               
foot  building must  be maintained.   Neither  the transportation                                                               
costs  [nor  maintenance  costs]   are  reduced  when  enrollment                                                               
declines.  He opined that passage of  HB 147 may be the best step                                                               
towards helping the rural school scenario.                                                                                      
                                                                                                                                
8:41:20 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON asked  whether a new school would  reflect a savings                                                               
in operating costs.                                                                                                             
                                                                                                                                
MR.  WALSH  responded  that,  although the  school  is  an  older                                                               
building, it  is well maintained.   Some costs may be  saved, but                                                               
measures have been  taken to minimize heating  costs by utilizing                                                               
recovered  waste heat  from the  electric company;  no diesel  is                                                               
used and  the building  has no furnace/boiler.   However,  as the                                                               
utility company upgrades to more  efficient equipment, waste heat                                                               
is being  minimized, and he  acknowledged that he may  be looking                                                               
for  capital  improvement  money  in   the  future  to  secure  a                                                               
different heat source.                                                                                                          
                                                                                                                                
CHAIR SEATON  indicated interest regarding how  operational costs                                                               
at  new  schools compare  with  older  facilities and  how  these                                                               
expenditures effect the 70:30 requirements.                                                                                     
                                                                                                                                
8:43:45 AM                                                                                                                    
                                                                                                                                
MR. WALSH  responded to the question  from Representative Wilson,                                                               
stating that  Bristol Bay has  a five member school  board, which                                                               
meets locally on  a regular basis and participates  in state fly-                                                               
ins once  or twice per year.   Each member is  allowed $50.00 per                                                               
meeting, including  per diem.   A policy  allows them  to qualify                                                               
for health insurance,  although none of them subscribe.   He said                                                               
that  there  is no  indication  that  board privileges  are  ever                                                               
abused.                                                                                                                         
                                                                                                                                
8:45:21 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MUNOZ asked  if the  administrative office  is in                                                               
Naknek.                                                                                                                         
                                                                                                                                
MR. WALSH  said, yes.   The nearest  administrative office  is 12                                                               
miles down the road, however.                                                                                                   
                                                                                                                                
REPRESENTATIVE  MUNOZ inquired  about  the  districts ability  to                                                               
attract and retain teaching staff.                                                                                              
                                                                                                                                
MR.  WALSH indicated  that, despite  the  lack of  infrastructure                                                               
amenities, the  staff continues to  be stable, and  locating good                                                               
teachers has  not been  an issue.   The  district does  provide a                                                               
$1,500 moving allowance  for teachers, and the  new hire starting                                                               
wage is $40,000 per year, he  reported.  The turnover is about 20                                                               
percent,  but  is  primarily experienced  in  the  administrative                                                               
staff.                                                                                                                          
                                                                                                                                
REPRESENTATIVE  MUNOZ  asked  if   the  local  young  people  are                                                               
encouraged to become teachers.                                                                                                  
                                                                                                                                
MR. WALSH  responded that  many of the  students have  taken that                                                               
path,  and  the  staff  includes  several  lifelong  Alaskans  as                                                               
teachers.  A  Future Teacher's of America (FTA)  program is being                                                               
developed to encourage interest in the teaching profession.                                                                     
                                                                                                                                
8:48:45 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER queried  if the 70 percent  law has changed                                                               
how district funds are distributed.                                                                                             
                                                                                                                                
MR. WALSH answered  that fund distribution is  effected, in order                                                               
to  maintain   compliance.    Whenever   a  new  program   and  a                                                               
maintenance project are  considered, the 70 percent  rule must be                                                               
weighed  against the  need.   Also, budget  line items  are often                                                               
amended.                                                                                                                        
                                                                                                                                
8:49:53 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON asked what adjustments are made.                                                                                   
                                                                                                                                
MR. WALSH  said that  primarily maintenance  has been  set aside.                                                               
The  reading and  writing performance  for  students, along  with                                                               
math,  could use  some  academic specialists,  however,  it is  a                                                               
struggle to accomplish this goal.                                                                                               
                                                                                                                                
8:50:56 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  WILSON  noted  that  transportation  for  student                                                               
activities  appears  to  be  an  issue, and  asked  how  that  is                                                               
accomplished.                                                                                                                   
                                                                                                                                
MR. WALSH indicated that $40,000  is included for student travel,                                                               
and funds  are raised  in the community  to help  students attend                                                               
activities.                                                                                                                     
                                                                                                                                
8:52:22 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   KELLER  suggested   that  employing   a  reading                                                               
specialist would  improve the schools instructional  component to                                                               
meet the 70:30.                                                                                                                 
                                                                                                                                
MR. WALSH agreed,  and also concurred with Chair  Seaton that the                                                               
stimulus for such  action is consideration for  the students, but                                                               
the measurement tool is AYP.                                                                                                    
                                                                                                                                
8:53:42 AM                                                                                                                    
                                                                                                                                
MR. WALSH, prior to his departure,  stated support for HB 58 that                                                               
will be subsequently addressed by the committee today.                                                                          
                                                                                                                                
8:54:04 AM                                                                                                                    
                                                                                                                                
DAVID HERBERT,  Superintendent, St. Mary's City  School District,                                                               
stated support  for HB  147, and reported  that his  district has                                                               
met the  optimal zero  level for  AYP.   St. Mary's  services 185                                                               
students, employing  14 certified teachers, and  3 administrative                                                               
staff; two full-time  and one half-time.  Fuel costs  are a major                                                               
factor  for meeting  the  70:30 requirement,  as  the fuel  barge                                                               
makes delivery  once per year, and  whatever the cost is  at that                                                               
time will effect  the year's budget, including  the allotment for                                                               
transportation.    Additionally, this  is  a  single site  school                                                               
district,  serving a  first class  city,  and has  a budget  just                                                               
under $3,000.000.   During  the four  years he  has served  as an                                                               
administrator,  he  said  that  each   year  a  waiver  has  been                                                               
requested.   The  school board  reviews all  budget expenditures,                                                               
along with an outside financial  auditing firm.  Each year effort                                                               
must  be expended  on generating  the documentation  to submit  a                                                               
waiver.    Students  are  being  well  educated,  but  the  70:30                                                               
requirement  cannot  be  met,  despite  frugal  practices.    The                                                               
department  does not  tend to  deny waivers,  although this  year                                                               
there were  additional questions to  be considered.   He stressed                                                               
that the  funds are well spent  and this regulation is  no longer                                                               
necessary.  Finally, he said  the board members attend the Alaska                                                               
Association of  School Board fly-ins  and on occasion  attend job                                                               
fairs to hire teachers.                                                                                                         
                                                                                                                                
8:59:34 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KELLER  asked  whether the  superintendent  would                                                               
consider  the additional  questions indicative  of harassment  on                                                               
the part of the department.                                                                                                     
                                                                                                                                
MR. HERBERT explained that the  waiver request format was changed                                                               
this year,  and upon approval, EED  required additional questions                                                               
regarding expenditure  activity.   He declined to  conjecture why                                                               
these questions were put forward by the department.                                                                             
                                                                                                                                
9:01:06 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON closed  public testimony and set the  bill aside for                                                               
further consideration following the subsequent agenda item.                                                                     
                                                                                                                                
HB 147-EDUCATION FUNDING FOR INSTRUCTION                                                                                      
                                                                                                                                
9:38:30 AM                                                                                                                    
                                                                                                                                
CHAIR SEATON announced  that the next order of  business would be                                                               
HOUSE BILL  NO. 147,  "An Act  repealing the  minimum expenditure                                                               
for instruction requirements for public schools."                                                                               
                                                                                                                                
9:38:57 AM                                                                                                                    
                                                                                                                                
EDDY  JEANS, Director,  School  Finance  and Facilities  Section,                                                               
Department  of  Education  and Early  Development  (EED),  stated                                                               
official support  for HB 147.   He explained that the  70 percent                                                               
requirement  rule  was  passed  in 1978,  when  the  state  first                                                               
implemented  an  accountability system.    At  the same  time  an                                                               
assessment system  was also implemented.   With the  enactment of                                                               
the No Child  Left Behind Act (NCLB), new  assessment levels have                                                               
been established, which is proving  to be a better measurement of                                                               
student achievement  than the original effort  established by the                                                               
state.   To expect that  every district  can meet the  70 percent                                                               
requirement  is now  unreasonable.   He  identified two  specific                                                               
areas  that are  primarily affected:   schools  with a  budget of                                                               
$3,000,000  or  less,  and districts  with  operation/maintenance                                                               
costs that require 20 percent of their budgeted funds.                                                                          
                                                                                                                                
9:41:33 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER  inquired how the 30  percent instructional                                                               
component is defined and reviewed.                                                                                              
                                                                                                                                
MR. JEANS  responded that  the definition is  in regulation.   It                                                               
specifies   the    categories   of    expenditure   requirements:                                                               
instruction,  special  education,  support services,  and  school                                                               
operations.    These  are  the  areas  that  the  department  has                                                               
understood as instructional expenditures.                                                                                       
                                                                                                                                
REPRESENTATIVE KELLER  asked if  it would  be possible  to review                                                               
the  inclusive  elements  and  add  fuel  costs;  could  that  be                                                               
considered a valid waiver item.                                                                                                 
                                                                                                                                
MR. JEANS  said fuel  costs are  a reason  that a  district would                                                               
make a request, however, the  department has already identified a                                                               
pattern, via  the economy of  scale, and know which  schools will                                                               
routinely be requesting a waiver.                                                                                               
                                                                                                                                
9:44:08 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KELLER referred  to  today's previous  testimony,                                                               
which indicates that a significant  amount of work is involved in                                                               
attaining  a waiver.    He  asked whether  the  zero fiscal  note                                                               
implies  that the  department's  workload to  process waivers  is                                                               
insignificant.                                                                                                                  
                                                                                                                                
MR.  JEANS  affirmed that  the  department  is providing  a  zero                                                               
fiscal  note, however,  the scrutiny  of district  budget reviews                                                               
will  continue to  be of  a high  level, and  require substantial                                                               
amounts of  time.  The  overall reduction of  departmental effort                                                               
surrounding the waiver request is  minimal.  However, he allowed,                                                               
the  districts  do  expend   considerable  effort  preparing  the                                                               
requests.    Mr. Jeans  cited  the  St.  Mary's district,  as  an                                                               
example.  The  districts students perform at a  high level, which                                                               
should  be  the  performance   measure  rather  than  identifying                                                               
whether  an  appropriate  percentage   of  funds  were  used  for                                                               
instruction.     Following  a  comment  from   Chair  Seaton,  he                                                               
confirmed  that  the   2008  passage  of  SB   285  provided  the                                                               
department the  authority, as well  as a directive, to  work with                                                               
low performing schools/districts.                                                                                               
                                                                                                                                
9:47:06 AM                                                                                                                    
                                                                                                                                
CHAIR  SEATON  referred  to the  previous  questions  of  funding                                                               
school board member  travel and spousal privileges.   He asked if                                                               
this  bill   preserves  the   department's  ability   to  provide                                                               
oversight and  appropriate determination  of activities  that may                                                               
not promote student achievement.                                                                                                
                                                                                                                                
MR.  JEANS  opined  that the  existing  legislation  is  straight                                                               
forward;  either a  district meets  the 70  percent rule  or not.                                                               
Flexibility is not  built in to the regulation, and  a report may                                                               
be received that a district  has misappropriated funds.  However,                                                               
he  stressed,  this  is  not  the  mechanism  to  address  school                                                               
districts  possible abuse  of funds.    When a  district has  low                                                               
student performance, the miss direction  of funding is clear, and                                                               
the department  can then  take action, as  allowed under  SB 285.                                                               
Additionally, he recalled that the  department has recommended to                                                               
the  state board  to not  grant a  waiver; perhaps  two or  three                                                               
instances.   When  this occurs  the superintendants  are able  to                                                               
appeal  before  the  board  to  have the  waiver  granted.    The                                                               
department   takes  the   waiver  responsibility   seriously,  he                                                               
stressed.                                                                                                                       
                                                                                                                                
9:50:20 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WILSON  asked what alterations would  be necessary                                                               
to make a waiver acceptable, if it is initially denied.                                                                         
                                                                                                                                
MR.  JEANS  explained  that  the   waiver  must  match  what  the                                                               
districts budget indicates.  Exchange  between the department and                                                               
district also  occurs when identical  waiver request  letters are                                                               
received, in which  only the date has been altered.   This is not                                                               
a rubber stamp process, he stressed.                                                                                            
                                                                                                                                
9:51:34 AM                                                                                                                    
                                                                                                                                
CHAIR  SEATON named  the entities  supporting  HB 147,  including                                                               
EED,   school  board   association  administrators,   and  school                                                               
superintendents.                                                                                                                
                                                                                                                                
9:52:37 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER  stated that he  is not able to  support HB
147, and  requested that it  be held  for an amendment  to refine                                                               
the instructional  definition component,  rather than  repeal the                                                               
law.                                                                                                                            
                                                                                                                                
CHAIR SEATON called  for further discussion and  suggested that a                                                               
conceptual amendment be offered.                                                                                                
                                                                                                                                
9:55:07 AM                                                                                                                    
                                                                                                                                
MR. JEANS  clarified that the previously  mentioned instructional                                                               
component categories are  listed in regulation, not  statute.  He                                                               
cited the enumerated items, under  regulation 4 AAC 09.115, which                                                               
reads:                                                                                                                          
                                                                                                                                
     4 AAC 09.115. Minimum expenditure for instruction                                                                          
                                                                                                                                
     The department will  calculate each district's required                                                                    
     minimum expenditure for  instruction under AS 14.17.520                                                                    
     based  upon   the  district's  school   operating  fund                                                                    
     expenditures  reported  under   the  uniform  chart  of                                                                    
     accounts   required   under   4  AAC   06.120.      The                                                                    
     instructional   component   of  a   district's   budget                                                                    
     consists  of expenditures  in the  following functional                                                                    
     uniform chart of accounts categories:                                                                                      
                                                                                                                                
     (1) 100 - Instruction;                                                                                                     
                                                                                                                                
     (2) 200 - Special Education Instruction;                                                                                   
                                                                                                                                
     (3) 220 - Special Education Support Services -                                                                             
               Student;                                                                                                         
                                                                                                                                
     (4) 300 - Support Services - Students;                                                                                     
                                                                                                                                
     (5) 350 - Support Services - Instruction.; and                                                                             
                                                                                                                                
     (6) 400 - School Administration.                                                                                           
                                                                                                                                
MR.  JEANS  pointed out  that  item  (6), School  Administration,                                                               
includes principals but not secretarial staff.                                                                                  
                                                                                                                                
9:55:56 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER withdrew  his request to hold  the bill for                                                               
amendment, but maintained his objection to passing the repeal.                                                                  
                                                                                                                                
9:56:05 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MUNOZ moved to report HB 147 out of committee                                                                    
with individual recommendations and the accompanying                                                                            
fiscal notes.                                                                                                                   
                                                                                                                                
REPRESENTATIVE KELLER objected.                                                                                                 
                                                                                                                                
9:56:37 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLER expounded on the  role of the public school                                                               
system   in   the   community,  particularly   rural   or   small                                                               
communities, which, although important  and good, are not aspects                                                               
of  education.   There  is  nothing  in statute  that  delineates                                                               
between these  roles.   He maintained  that the  existing statute                                                               
provides a useful  tool that has helped to  ensure the direction,                                                               
and accountability of funding use  for educational purposes.  The                                                               
school  facilities/transportation are  often  the  best and  most                                                               
vital  in  a  community;  perhaps  even  offering  a  nutritional                                                               
program, and a place to stay  overnight.  Local school boards are                                                               
under pressure to divert core  funding from classroom instruction                                                               
and have it sidelined to these  other uses and needs of adults in                                                               
the system.   Although the existing  law may be a  crude tool, he                                                               
insisted  it is  working, and  he  reviewed points  of the  day's                                                               
testimony.   The laws cannot define  what is best for  a student.                                                               
The  funding formula  does not  incentivize  proficiency, it  has                                                               
been left to the accountability system  imposed on the state.  He                                                               
recalled Mr.  Jeans's statement regarding  the dialogue  with the                                                               
districts, generated  by waiver requests  that will be  lost with                                                               
this repeal.  Finally, he argued  that SB 285 does not afford the                                                               
legislature the same control or involvement.                                                                                    
                                                                                                                                
10:01:32 AM                                                                                                                   
                                                                                                                                
CHAIR SEATON countered that better,  modern instruments now exist                                                               
to measure progress and accountability;  outdating the means that                                                               
this  original legislation  set forth.   Every  school should  be                                                               
seen for  its individual needs,  and be scrutinized by  the local                                                               
school  board,  rather than  having  a  blunt tool  with  blanket                                                               
requirements  wielded.   Maintaining  the 70  percent rule  would                                                               
require allowing some of the  categories to be re-directed, "just                                                               
to fudge the numbers," he opined.   Additionally, there is a huge                                                               
discrepancy   between  schools   and  the   maintenance  required                                                               
depending on  the age of  the building  and the funding  that has                                                               
been provided to upgrade a  communities facilities.  "I think the                                                               
tool is blunter than it should be," he finished.                                                                                
                                                                                                                                
10:04:25 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE KELLER  said that, regarding the  construction and                                                               
facilities costs, it is because  of the existing statute that the                                                               
committee is  aware of the  situation.  Further, the  zero fiscal                                                               
note  indicates   that  it  does   not  cost  to   continue  this                                                               
regulation.   He  agreed  that the  school  districts resent  the                                                               
paperwork involved,  although the  actual time spent  writing the                                                               
waiver is  not lengthy.   He pointed out  that the tough  part of                                                               
requesting a waiver  is making decisions and  scrutinizing how to                                                               
spend the  money.  That is  precisely what makes this  a valuable                                                               
tool, he opined.                                                                                                                
                                                                                                                                
10:05:39 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  WILSON  stated  her  support for  the  bill,  and                                                               
offered that  if a school is  making AYP, it is  obvious that the                                                               
funds are  being well  utilized.  The  majority of  school boards                                                               
want  the best  for  their students,  thus this  is  not a  rural                                                               
versus urban  concern.  She  voiced support for local  control in                                                               
the districts,  and opined  that the sideboards  are in  place to                                                               
deal with a school that does not perform.                                                                                       
                                                                                                                                
10:07:38 AM                                                                                                                   
                                                                                                                                
A  roll call  vote  was taken.    Representatives Munoz,  Wilson,                                                               
Buch,  and  Seaton  voted  in  favor of  reporting  HB  147  from                                                               
committee.  Representatives Keller  and Gardner voted against it.                                                               
Therefore,  HB  147  was  reported out  of  the  House  Education                                                               
Standing Committee by a vote of 4-2.                                                                                            
                                                                                                                                
10:08:20 AM                                                                                                                   
                                                                                                                                

Document Name Date/Time Subjects
HB 126 amendment.pdf HEDC 3/2/2009 8:00:00 AM
HB 126
HB 126 amendment II.pdf HEDC 3/2/2009 8:00:00 AM
HB 126
hb 126 materials.pdf HEDC 2/25/2009 8:00:00 AM
HEDC 3/2/2009 8:00:00 AM
HEDC 3/9/2009 8:00:00 AM
HB 126
workdraft HB 126.pdf HEDC 2/25/2009 8:00:00 AM
HEDC 3/2/2009 8:00:00 AM
HEDC 3/9/2009 8:00:00 AM
HB 126
HB 147 material.pdf HEDC 3/2/2009 8:00:00 AM
HB 147
HB 58 material.pdf HEDC 3/2/2009 8:00:00 AM
HB 58
new HB 126 material including new fiscal notes.pdf HEDC 3/2/2009 8:00:00 AM
HB 126
HB 58 fiscal note.pdf HEDC 3/2/2009 8:00:00 AM
HB 58
HB 58 amendment.pdf HEDC 3/2/2009 8:00:00 AM
HB 58