Legislature(2021 - 2022)DAVIS 106
04/06/2022 08:00 AM House EDUCATION
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| Audio | Topic |
|---|---|
| Start | |
| HB413 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 413 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 413-FACILITIES CONSTITUTING A SCHOOL
8:01:22 AM
CO-CHAIR DRUMMOND announced that the only order of business
would be HOUSE BILL NO. 413, "An Act relating to facilities
constituting a school; and providing for an effective date."
8:01:56 AM
GEORGE ASCOTT, Staff, Representative Harriett Drummond, Alaska
State Legislature, presented HB 413 on behalf of the House
Education Standing Committee. He presented that HB 413 seeks to
remedy a funding formula that negatively effects the Lower Yukon
School District. He said HB 413 would add three words to
existing law [AS 14.17.905]: "excluding charter schools." He
explained that the district recently opened a charter school in
Hooper Bay. The community is now seen as having two schools
instead of one. Through the current formula, the addition of
the charter school reduces the district's funding by about $1
million [per funding year]. He suggested while the school
district tried to provide a wider variety of services for
students without increasing costs, it was inadvertently
punished. He stated the proposed bill has an effective date of
July 1, 2022.
8:03:52 AM
GENE STONE, Chief School Administrator, Lower Yukon School
District, related that he had worked in Lower Yukon School
District (LYSD) for five years, three of those years as chief of
operations and the past two years as the chief school
administrator. He continued by reading from his written
testimony [available in the committee packet], as follows:
On behalf of the Lower Yukon School District, allow me
to express our appreciation for the introduction of HB
413. The district is in full support of HB 413. HB
413 will remedy a funding issue that unfairly
penalizes the Lower Yukon School District for opening
a charter school in Hooper Bay. The penalty within
the statute for adding a charter school in Hooper Bay
resulted in an annual reduction in funding of
$1,033,000 for fiscal year 2021 and $1,021,000 for
fiscal year 2022. Until this funding penalty is
remedied, LYSD will lose approximately $1 million
annually. The district operates two separate
educational programs in the Hooper Bay School: the
conventional K-12 school [and] a fourth- to eighth-
grade charter school that features a culturally
relevant, place-based learning curriculum for its
students. Additionally, the school has a K-3 Yupik
immersion program but is not part of the charter
school and functions as part of the conventional
school as a special program. Some may argue that HB
413 has a fiscal note to the State of Alaska of $1
million annually. LYSD sees the opposite; to date our
loss of foundation funding has resulted in fiscal
surplus to the state of $2 million dollars for fiscal
year 21 and fiscal year 22. As a result of the Hooper
Bay Charter School, our district has the same number
of students - the exact same students - inside the
same school building, and yet we realize a funding
penalty of over $1 million per year. By adding the
three words "excluding charter schools" to AS
14.17.905, the annual funding penalty is remedied, and
it becomes feasible to fund Hooper Bay's charter
school. As it stands now, the statute is punitive and
this unintended $1 million annual funding penalty
impacts our entire school district and effectively
jeopardizes rural Alaskans' access to school choice.
HB 413 would remedy this funding problem and support
charter school equity for rural Alaska schools.
8:07:22 AM
REPRESENTATIVE PRAX asked why a separate charter school is
needed.
MR. STONE offered his understanding that the Department of
Education and Early Development (DEED) responds favorably to
school districts that offer school choice. He described Hooper
Bay as a "community that has been, in many ways, underserved and
has underperformed." He said the district should not "be
blamed" for operating with autonomy and trying something
different. The charter school conversation had been ongoing for
several years in LYSD, but once approved, timing with
formulating language, the COVID-19 pandemic, and a change in
statute [AS 14.17.905] created a more complicated process. He
surmised the district shouldn't be treated any differently in
offering school choice.
8:10:04 AM
CO-CHAIR DRUMMOND asked Mr. Stone to explain the difference
between the amount of funding in the fiscal note versus the
amount in his opening statement and to describe when the penalty
amounts would occur.
MR. STONE responded that the difference is because of the
average daily membership (ADM), stating these numbers change
slightly every year. Due to the ADM formula, the funds waiver
from $20,000 to $50,000 [per student] each year. He said the
amount of funding will be somewhere between $1 million and $1.1
million annually. In response to a follow-up question, he
explained that the district has already incurred a penalty with
a loss of approximately $2 million.
CO-CHAIR DRUMMOND followed that she understood a "relief period"
exists, allowing the penalty to be gradually applied.
Considering the charter school opened in the 2020 to 2021 school
year, she said it seemed the district should have had some
fiscal relief prior to this point.
MR. STONE said there had been a two-year period before the
charter school opened when waivers were provided to the
district. But the timing of a new [provision in] the
aforementioned statute addressing the 425 ADM threshold, along
with the opening of the charter school, created a "the perfect
storm." At this time Mr. Stone deferred to the chief business
officer of the school district.
8:13:20 AM
ANDREW LEAVITT, Chief Business Officer, Lower Yukon School
District, said Co-Chair Drummond's understanding of a "relief
period" is called a "hold harmless provision." This provision
addresses decreased funding due to a drop in a school's ADM
level. He said in this case the provision was not "triggered,"
and the district did not qualify for a gradual reduction in
funding. In response to a follow-up comment, he affirmed Co-
Chair Drummond's suggestion the provision did not apply because
student population did not change.
8:14:30 AM
CO-CHAIR STORY made two points. First, she suggested the school
could reconfigure to a "school within a school" so the district
could retain its funding. Second, she suggested the proposed
legislation could affect the funding of other charter schools
statewide. She referenced the Alaska Association of School
Business Officials (ALASBO) on this issue.
8:16:22 AM
MR. STONE responded that a "charter school" designation allows
for choice in programs. He gave the example of a unique model
of a culturally relevant, place-based program for fourth through
eighth grades. He said that research shows this age group
responds better to activities that have "local flavor." He
added that the local and state schoolboards back the initiative.
He also asserted that the proposed legislation would not impact
any other school in the state.
CO-CHAIR STORY stated her support of school choice but wondered
if the schoolboard had considered solutions to the LYSD's
problem with other optional programs. She cited the Montessori
program in the Juneau School District that offers choice with
their curriculum, but it is not called a "charter school."
Summarizing, she said if the school were in the original school
model and called "an optional school," the district could
receive the $1 million lost in funding.
MR. STONE responded that could be done, but it skirts the real
issue and denies the school the opportunity to have an
independent school and administration. He said if the Hooper
Bay school became a "special mission school," it would remedy
the funding, but disallow choice.
CO-CHAIR STORY, seeking verification that other schools would
not be affected, suggested the proposed legislation could read
"excluding Hooper Bay Charter School" versus "excluding charter
schools."
8:23:12 AM
ELWIN BLACKWELL, School Finance Manager, Department of Education
and Early Development, stated with the proposed legislation only
LYSD would be affected at this time, as there are no other
schools "anywhere near 425 ADM" in rural Alaska. He continued
that in 2018 the Hooper Bay Charter School first exceeded 425
ADM, changing funding for the school from two adjustments to
one. He said, as a remedy, the statute was changed; but, when
the charter school was approved in 2020, the district was seen
as having two schools and "that knocked them out of that fix."
The proposed change in the statute, "excluding charter schools,"
would again qualify the K-12 facility for the two adjustments.
8:24:55 AM
MR. LEAVITT, in response to a question from Co-Chair Story,
clarified the number of students in the charter school as 47 and
the number in K-12 as 421.
8:27:18 AM
MR. BLACKWELL responded to Co-Chair Story that urban areas will
not be affected because the ADM in these schools is far above
the 425 threshold, and urban areas already have multiple school
facilities.
8:28:28 AM
REPRESENTATIVE CRONK inquired about the plans to take the
charter school out of the K-12 facility.
8:28:50 AM
MR. STONE responded that the charter school is currently housed
in Hooper Bay's conventional school. The intention is for the
charter school to have its own facility through grants and
budget surpluses.
8:29:56 AM
CO-CHAIR DRUMMOND opened public testimony on HB 413. After
ascertaining there was no one who wished to testify, she closed
public testimony.
8:30:22 AM
CO-CHAIR DRUMMOND would like to know the specifics of the
charter school's contract, stating that once a charter school is
opened, it is difficult to close.
8:30:43 AM
MR. LEAVITT responded that the charter school started officially
July 1, 2020, initially with a five-year contract. To a follow-
up question, he said he believed the contract would be up for a
review and renewal in five years, and then after that it is a
10-year contract.
8:31:32 AM
CHAIR DRUMMOND announced that HB 413 was held over.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 413 and SB 236 Fiscal Note (FP).pdf |
HEDC 4/6/2022 8:00:00 AM |
HB 413 SB 236 |
| HB 413 and SB 236 Fiscal Note (PEF).pdf |
HEDC 4/6/2022 8:00:00 AM |
HB 413 SB 236 |
| HB 413 Committee Packet 4.6.2022.pdf |
HEDC 4/6/2022 8:00:00 AM |
HB 413 |
| HB 413 SB 236 LYSD Letter.pdf |
HEDC 4/6/2022 8:00:00 AM |
HB 413 SB 236 |
| HB 413 Sponsor Statement.pdf |
HEDC 4/6/2022 8:00:00 AM |
HB 413 |
| Supporting Testimony for HB 413 LYSD.pdf |
HEDC 4/6/2022 8:00:00 AM |
HB 413 |
| HB0413A.PDF |
HEDC 4/6/2022 8:00:00 AM |
HB 413 |