Legislature(2003 - 2004)

03/09/2004 11:01 AM House EDU

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                                                                                                                                
HB 425-BOARDING SCHOOL FUNDING                                                                                                
                                                                                                                                
Number 1295                                                                                                                   
                                                                                                                                
CHAIR GATTO  announced that the  next order of business  would be                                                               
HOUSE  BILL NO.  425,  "An  Act relating  to  funding for  school                                                               
districts  operating  secondary   school  boarding  programs,  to                                                               
funding for  school districts from which  boarding students come,                                                               
and  to  inoperative  school  districts;  and  providing  for  an                                                               
effective date."                                                                                                                
                                                                                                                                
Number 1314                                                                                                                     
                                                                                                                                
REPRESENTATIVE JOHN COGHILL,  Alaska State Legislature, testified                                                               
as sponsor  of HB 425.   He told the members  that several issues                                                               
have  come to  his  attention which  he will  address.   He  said                                                               
Section  1 does  not need  to  be in  this  bill, so  he will  be                                                               
requesting that  it be  amended out either  in this  committee or                                                               
the  next   committee  of   referral.     Representative  Coghill                                                               
explained that  Eddie Jeans [Finance Manager,  School Finance and                                                               
Facilities   Section,   Department   of   Education   and   Early                                                               
Development] confirmed  that Section 1 refers  to the ten-student                                                               
count provision which is not addressed in this legislation.                                                                     
                                                                                                                                
Number 1414                                                                                                                     
                                                                                                                                
REPRESENTATIVE COGHILL  clarified that HB  425 does not  apply to                                                               
the Nome-Beltz  High School  where students  are brought  in from                                                               
villages for two-week classes.  He  commented that it was not his                                                               
intention to  provide airfare for students  to fly in and  out of                                                               
Nome for these classes.   Representative Coghill told the members                                                               
that he intends to suggest that  language be inserted in the bill                                                               
to limit this pilot program to 170-day schools.                                                                                 
                                                                                                                                
REPRESENTATIVE COGHILL  commented that  another problem  has come                                                               
to his attention  that some boarding schools  are getting federal                                                               
grant money  and it is  not his intention  for the funding  in HB
425 to  be added to federal  funding.  He explained  that he only                                                               
recently discovered this problem when  he was reviewing a list of                                                               
federal grants  to Alaska and  noticed that Galena  received some                                                               
funds for  its boarding school.   He  noted that Nenana  did not.                                                               
Representative Coghill told  the members that he  is hopeful that                                                               
Mr. Jeans will help him address this issue.                                                                                     
                                                                                                                                
REPRESENTATIVE COGHILL  referred to  a list  of the  schools that                                                               
show  savings to  the state  of Alaska.   Nenana  saves close  to                                                               
$319,000, he  said.  If  this bill  passes that savings  would be                                                               
used  for the  stipends for  students.   He told  the members  he                                                               
believes the cost to  the state would be an even  draw for a very                                                               
worthwhile educational  opportunity.   He added that  he believes                                                               
the Galena,  Nenana, and  Bethel schools  are doing  an excellent                                                               
job and are  so different in their operations that  he is looking                                                               
for the  broadest language  possible to  ensure inclusion  in the                                                               
pilot program.                                                                                                                  
                                                                                                                                
Number 1610                                                                                                                     
                                                                                                                                
REPRESENTATIVE  COGHILL emphasized  that  these boarding  schools                                                               
are  open  to any  student  who  cannot  obtain an  education  in                                                               
his/her  home community;  however, this  bill would  also provide                                                               
the  opportunity  for  students  who  wish  to  apply  for  other                                                               
reasons.   He  reminded the  member that  each of  these boarding                                                               
schools has a waiting list for  entry.  He asked the committee to                                                               
move the bill to the next committee of referral.                                                                                
                                                                                                                                
Number 1637                                                                                                                     
                                                                                                                                
CHAIR  GATTO  commented  that  Representative  Coghill  wants  to                                                               
delete Section 1 and do a rewrite  of some of the language in the                                                               
bill.                                                                                                                           
                                                                                                                                
REPRESENTATIVE COGHILL replied  that he has a  question that just                                                               
came to him  that he is exploring.   He told the  members that he                                                               
would commit to correcting these  points in the next committee of                                                               
referral  which  is  the  House   Health,  Education  and  Social                                                               
Services Standing Committee.                                                                                                    
                                                                                                                                
Number 1666                                                                                                                     
                                                                                                                                
REPRESENTATIVE WILSON commented that  she does not understand how                                                               
money is  saved.   She said  that as chair  of the  House Health,                                                               
Education  and Social  Services Standing  Committee she  would be                                                               
willing  to work  with  the  sponsor of  the  bill  to develop  a                                                               
committee substitute.                                                                                                           
                                                                                                                                
REPRESENTATIVE  COGHILL  replied that  he  would  prefer to  have                                                               
someone  in the  Department  of Education  and Early  Development                                                               
explain the savings component that was mentioned.                                                                               
                                                                                                                                
Number 1723                                                                                                                     
                                                                                                                                
EDDIE  JEANS,  Finance  Manager, School  Finance  and  Facilities                                                               
Section,   Department  of   Education   and  Early   Development,                                                               
testified on HB 425 and answered  questions from the members.  He                                                               
pointed to a handout in the  members' packet from the Nenana City                                                               
School [District] which  provides an analysis of  the per student                                                               
dollar amount  generated through  the foundation program  for the                                                               
students based  upon the  community that  each student  lives in.                                                               
That  figure  is then  compared  with  the dollars  generated  by                                                               
attending public  school in  Nenana.  Mr.  Jeans said  in looking                                                               
down  the list  it shows  that many  of these  schools have  very                                                               
small student  populations and therefore  the dollar amount  on a                                                               
per student basis is high.   When students come to Nenana the per                                                               
student  amount decreases  because  of economies  of  scale.   He                                                               
summarized that is  the process used in  determining the savings.                                                               
Mr.  Jeans told  the members  that the  state has  been realizing                                                               
this savings for  a number years due to  these students attending                                                               
school in Nenana.                                                                                                               
                                                                                                                                
Number 1795                                                                                                                     
                                                                                                                                
REPRESENTATIVE  WOLF asked  Mr. Jeans  how much  the Galena  home                                                               
school program supports the boarding school program.                                                                            
                                                                                                                                
MR.  JEANS  responded  that  based  upon  the  audited  financial                                                               
statements  the  department  got   for  the  Galena  City  School                                                               
District last year,  the amount of money recorded  as its expense                                                               
for the correspondence program was  close to $2 million less than                                                               
what  was actually  generated from  the foundation  program.   He                                                               
clarified  that  there  are  caveats  to  this  statement.    The                                                               
correspondence  expenditure  recorded  is for  the  instructional                                                               
program  for  correspondence only.    The  program also  provides                                                               
services  for special  education which  would be  allocated to  a                                                               
different  part of  the  audit.   There  are also  administrative                                                               
expenses  that are  associated  with  the correspondence  program                                                               
that would be the school  administration component of the budget.                                                               
He summarized  that he could  not say that  Galena correspondence                                                               
program made $2 million.   It is not that simple.   Based on that                                                               
difference, he said, it is safe  to say Galena made some money on                                                               
the program  and it  is being used  to subsidize  other programs,                                                               
but to what degree he could not say.                                                                                            
                                                                                                                                
Number 1928                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA asked  if the bill provides that  each of the                                                               
students who  attends these schools  would get $6,000  outside of                                                               
the foundation formula.                                                                                                         
                                                                                                                                
MR. JEANS replied no.                                                                                                           
                                                                                                                                
Number 1967                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA asked if he  understands correctly that if it                                                               
is  found   that  adequate  educational  opportunities   are  not                                                               
available in  a student's home  district, then the  student could                                                               
attend one of these boarding schools.                                                                                           
                                                                                                                                
MR. JEANS  explained that the  current program which  is outlined                                                               
in regulation says  if a student does not have  daily access to a                                                               
secondary program, then the student  would qualify for a boarding                                                               
home stipend.   It  is not  necessary to  attend a  boarding home                                                               
school; the  student could  opt to  go to  a community  where the                                                               
student would  be housed  with a  family and  a stipend  would be                                                               
paid  to  that  family  through the  school  district,  he  said.                                                               
Regulations also provide  for one round trip airfare  to and from                                                               
the student's  residence.  In  response to  Representative Gara's                                                               
question,  he clarified  that all  this bill  does is  remove the                                                               
criteria  that there  has  to be  a  lack of  daily  access to  a                                                               
secondary  program in  order for  a student  to qualify  for this                                                               
program [stipend].   This  pilot program  would be  offered until                                                               
2009, Mr. Jeans added.                                                                                                          
                                                                                                                                
REPRESENTATIVE  GARA commented  that  the compensation  mechanism                                                               
would be exactly the same.   This pilot program just provides the                                                               
opportunities  for children  who  have  the adequate  opportunity                                                               
locally, but who chooses to attend a boarding school.                                                                           
                                                                                                                                
MR. JEANS replied that is correct.                                                                                              
                                                                                                                                
REPRESENTATIVE GARA asked how the funding works.                                                                                
                                                                                                                                
MR.  JEANS responded  that  the  stipend is  paid  to the  school                                                               
district to cover the residential cost.                                                                                         
                                                                                                                                
REPRESENTATIVE  GARA asked  how  the base  student allocation  is                                                               
paid for.                                                                                                                       
                                                                                                                                
MR. JEANS  replied that  the students are  counted in  the school                                                               
they  attended  for  which  there is  foundation  funding.    For                                                               
example, in  the case  of the  Galena school  where there  are 83                                                               
students being  served, the state  pays foundation aid  for those                                                               
students.  He  commented that only school age  students [grades 9                                                               
through 12] qualify for the  base student allocation, so if there                                                               
are  13-year or  14-year students  there would  not be  any funds                                                               
provided for them.                                                                                                              
                                                                                                                                
Number 2125                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA concluded  that  the only  fiscal impact  is                                                               
that students leave an area where  there is a higher base student                                                               
allocation and go to an area of a lower base student allocation.                                                                
                                                                                                                                
MR. JEANS replied that is correct.                                                                                              
                                                                                                                                
REPRESENTATIVE  GARA pointed  out  that one  or  two students  in                                                               
small school  districts may  opt for  this choice.   The  cost in                                                               
that  smaller  district is  still  the  same; however,  the  base                                                               
student  allocation for  those two  students has  gone elsewhere.                                                               
Representative Gara  said that  while the cost  to the  state may                                                               
not  have  changed, there  is  a  loss  in  funds to  the  school                                                               
district the student has left.                                                                                                  
                                                                                                                                
MR. JEANS responded that Representative  Gara analysis that fewer                                                               
students equates to fewer dollars is correct.                                                                                   
                                                                                                                                
CHAIR GATTO commented  that conversely if a  couple of additional                                                               
students enroll the district receives more funds.                                                                               
                                                                                                                                
MR. JEANS  pointed out that there  is a hold harmless  clause for                                                               
those school that  may fall below the threshold  of ten students.                                                               
For example,  if a school  originally had 12 students,  but three                                                               
elected to  go to a  boarding school,  that school would  be held                                                               
harmless  and still  be funded  for the  ten-student minimum,  he                                                               
said.   He  reminded  the  members that  the  way the  foundation                                                               
program provides funding  is by group.  The first  grouping is 10                                                               
to  20  students.     The  funding  is  the   same  within  those                                                               
parameters.  Mr.  Jeans said that for example if  a school had 15                                                               
student  and  four left  then  the  school  would not  loose  any                                                               
funding.  The school's funding is still the same, he emphasized.                                                                
                                                                                                                                
MR.  JEANS said  in response  to Chair  Gatto's question  about a                                                               
minimum number of  students to consider, he  suggested that there                                                               
probably is a  minimum.  He commented that  the legislature would                                                               
probably not  want to maintain a  school in a community  if there                                                               
are only  three or  five students.   Mr.  Jeans told  the members                                                               
that the current foundation program says  that there has to be at                                                               
least ten  students to  maintain a  school for  funding purposes.                                                               
The hold  harmless provision in this  bill says that if  a school                                                               
falls  below ten  students, the  school  will not  be closed  and                                                               
would still be funded for ten  students.  He reiterated that in a                                                               
school of  10 to 20 students,  there could be students  that come                                                               
or go and the school still gets the same funding.                                                                               
                                                                                                                                
Number 2297                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA  said  he understands  that  in  the  school                                                               
districts  where there  are  ten  or less  students,  it is  held                                                               
harmless.   However, in a  small school district where  there are                                                               
60 students in  grades Kindergarten through 12th  (K-12), that is                                                               
five students per  grade, if one or two students  leave, the same                                                               
number  of  teachers  are  still   required.    So  those  school                                                               
districts  are left  with the  same  costs, but  with $12,000  to                                                               
$20,000  less compensation  from the  state.   That is  where his                                                               
concern lies, he  said.  Representative Gara commented  that is a                                                               
significant loss that cannot be absorbed.                                                                                       
                                                                                                                                
MR. JEANS  responded that  schools that have  60 students  do not                                                               
generate $10,000  to [$20,000] per  student.  The cost  per child                                                               
goes down  substantially.  He  explained that the size  of school                                                               
Representative  Gara  discussed  will  normally  have  a  student                                                               
enrollment variation of two to three kids each year.                                                                            
                                                                                                                                
CHAIR GATTO  commented that  just because  there are  60 students                                                               
and 12  grades, that does  not mean  the school has  12 teachers.                                                               
Perhaps there would be three or four teachers, he offered.                                                                      
                                                                                                                                
Number 2374                                                                                                                     
                                                                                                                                
REPRESENTATIVE COGHILL said that  for those presently enrolled in                                                               
these schools there would probably  not be more than 220 students                                                               
out of  133,000 students in Alaska.   The impact would  be small,                                                               
he commented.                                                                                                                   
                                                                                                                                
CHAIR  GATTO asked  if Representative  Coghill believes  this may                                                               
become a trend where there would be regional boarding schools.                                                                  
                                                                                                                                
REPRESENTATIVE COGHILL replied  that the bill is  a pilot program                                                               
with a  set time period  and limited  only to those  schools that                                                               
are currently operating.  He  commented that the program needs to                                                               
demonstrate   that  it   works   before  there   should  be   any                                                               
proliferation of boarding schools.                                                                                              
                                                                                                                                
Number 2462                                                                                                                     
                                                                                                                                
REPRESENTATIVE WILSON explained that  in the community of Pelican                                                               
there  are  five   high  school  students.     The  community  is                                                               
considering not retaining the one  high school teacher next year.                                                               
She  explained that  three of  the students  graduate this  year,                                                               
which leaves  only two students next  year.  She asked  Mr. Jeans                                                               
if a school could send students to another school.                                                                              
                                                                                                                                
Number 2517                                                                                                                     
                                                                                                                                
MR. JEANS  replied that according to  current regulations neither                                                               
a  school  district or  the  Department  of Education  and  Early                                                               
Development  can  send a  child  outside  of their  community  of                                                               
residence.      The  school   district   will   still  have   the                                                               
responsibility of providing educational  services although it may                                                               
not be the method preferred.   It may be through a correspondence                                                               
program and  the district may  contract with another  district to                                                               
provide that correspondence program.                                                                                            
                                                                                                                                
Number 2540                                                                                                                     
                                                                                                                                
REPRESENTATIVE  SEATON asked  Mr. Jeans  what number  of students                                                               
[are required in] secondary schools where teachers are provided.                                                                
                                                                                                                                
MR. JEANS  replied that he  is not  sure that he  understands his                                                               
question.    The  state  funds  K-12  schools  as  small  as  ten                                                               
students.  If a school  has a secondary school student attending,                                                               
the school must provide secondary services.                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON asked  if he understands that  if there are                                                               
two  to five  students in  the  secondary level  the school  must                                                               
provide services.  He asked if  the important point is that there                                                               
be at least ten students in the entire school.                                                                                  
                                                                                                                                
MR. JEANS  agreed that  the school  must have  ten students.   He                                                               
reminded  the members  of  the case  of St.  George  that runs  a                                                               
Kindergarten  through 8th  grade  school.   St.  George is  still                                                               
required to provide  educational services to the kids  in the 9th                                                               
through  12th grades  if  the  students elect  to  remain in  the                                                               
community, he said.   He added that it is  his understanding that                                                               
the students from St. George are electing to go to Galena.                                                                      
                                                                                                                                
Number 2620                                                                                                                     
                                                                                                                                
REPRESENTATIVE  KAPSNER asked  for further  clarification on  the                                                               
deletion of Section 1.                                                                                                          
                                                                                                                                
MR. JEANS explained that Section  1 relates to inoperative school                                                               
districts.   It  has  no  bearing on  this  piece of  legislation                                                               
whatsoever,  he  said.    He  told  the  members  that  initially                                                               
Representative Coghill believed that Section  1 was tied into the                                                               
minimum of ten  students for funding purposes.  It  is not, so it                                                               
is unnecessary.                                                                                                                 
                                                                                                                                
Number 2654                                                                                                                     
                                                                                                                                
REPRESENTATIVE WILSON asked if Nenana offers education beyond K-                                                                
12.                                                                                                                             
                                                                                                                                
MR.  JEANS responded  that Galena  offers education  beyond grade                                                               
12.                                                                                                                             
                                                                                                                                
REPRESENTATIVE  WILSON  asked who  pays  for  a student  who  has                                                               
completed 12th grade  and wishes to continue through  the 13th or                                                               
14th year for vocational training such as beauty school.                                                                        
                                                                                                                                
MR. JEANS replied that it would not be paid by K-12 education.                                                                  
                                                                                                                                
REPRESENTATIVE SEATON asked if the full school year is 170 days.                                                                
                                                                                                                                
MR. JEANS told the members that it  is 180 days, ten of which can                                                               
be in-service days.                                                                                                             
                                                                                                                                
REPRESENTATIVE  GARA posed  a  hypothetical  situation where  the                                                               
Municipality of  Anchorage lost one student  and the municipality                                                               
lost one percent  of its funding.  It gets  about $300 million of                                                               
foundation formula money.   If a student leaves [and  there was a                                                               
one percent  loss in  funding], the  municipality would  loose $3                                                               
million.  He commented that is  not going to happen in Anchorage,                                                               
but in a school district that  has 100 students, when one student                                                               
leaves then  the district  has lost one  percent of  its funding.                                                               
He  suggested a  hold  harmless provision  for  the base  student                                                               
allocation for schools with 100 or  less students when there is a                                                               
loss of  students to  boarding schools.   He  asked if  Mr. Jeans                                                               
believes this would have a significant fiscal impact.                                                                           
                                                                                                                                
Number 2777                                                                                                                     
                                                                                                                                
MR. JEANS replied that he really  does not know.  He reminded the                                                               
members that the  discussion is really about  Galena, Nenana, and                                                               
Lower  Kuskokwim  to  Bethel  boarding   home  programs.    These                                                               
programs  are  currently  operating   at  capacity  or  close  to                                                               
capacity  and  these kids  are  already  coming from  communities                                                               
around  the state.   If  school districts  were really  concerned                                                               
about the loss in enrollment, he  said he is sure those districts                                                               
would  be testifying  today about  the need  for a  hold harmless                                                               
provision.   He  added  that he  has  not heard  that  this is  a                                                               
problem from school districts.                                                                                                  
                                                                                                                                
Number 2808                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA  said that the way  he reads Section 1  is if                                                               
it  is deleted  a  school  district with  ten  students looses  a                                                               
student, then the  school district closes down.   Why isn't there                                                               
hold harmless  language that says  a school district will  not be                                                               
closed if the last marginal student goes to a boarding school.                                                                  
                                                                                                                                
MR. JEANS  told the  members that the  only school  district that                                                               
could  fall  into  that  category  is  the  Pelican  City  School                                                               
District.    He commented  that  he  really  cannot see  why  the                                                               
legislature would want to keep  a school district operating if it                                                               
had fewer than ten students.                                                                                                    
                                                                                                                                
CHAIR GATTO  commented that there  may be  a desire to  raise the                                                               
number of students to a level higher than ten students.                                                                         
                                                                                                                                
MR.  JEANS said  in  response to  Representative Gara's  question                                                               
that the hold  harmless provision for the  foundation count would                                                               
apply in  the example  he put  forth.   If the  school district's                                                               
count fell  below ten students  because a student(s) went  to the                                                               
boarding school then the district would be held harmless.                                                                       
                                                                                                                                
REPRESENTATIVE GARA asked how the hold harmless provision reads.                                                                
                                                                                                                                
MR. JEANS  replied that it is  Section 3 of the  bill which reads                                                               
as follows:                                                                                                                     
                                                                                                                                
     Sec.3.  AS.14.17.905   is  amended  by  adding   a  new                                                                  
     subsection to read:                                                                                                        
          (c) Notwithstanding (a)(1) of this section, a                                                                         
     community with an ADM of  less than 10 shall be counted                                                                    
     as a  school if the  ADM would be  at least 10  if each                                                                    
     student  from  the  community  who  is  enrolled  in  a                                                                    
     district secondary  school boarding program  outside of                                                                    
     the   student's  community   and   operated  under   AS                                                                    
     14.16.200 were counted as a student in the community.                                                                      
                                                                                                                                
MR. JEANS  told the members that  what this section says  is if a                                                               
school district or community falls  below ten students and it can                                                               
be  demonstrated  to  the   department  that  enrollment  dropped                                                               
because students  went to  a boarding  school, then  the district                                                               
would be  held harmless  for foundation  funding purposes  at the                                                               
minimum of ten students.                                                                                                        
                                                                                                                                
Number 2910                                                                                                                     
                                                                                                                                
CHAIR GATTO pointed  out that this has already  been discussed in                                                               
an earlier meeting.   He said for example that  a whole family of                                                               
kids could leave  bringing the student count down to  five.  Even                                                               
though a  school of five  is not what  is wanted, with  this hold                                                               
harmless  provision that  is  exactly what  would  happen if  the                                                               
students  went to  a  boarding  school, he  said.    He told  the                                                               
members  that  it  is  not   a  provision  that  he  is  entirely                                                               
comfortable with.                                                                                                               
                                                                                                                                
Number 2933                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA pointed out that  there could be two students                                                               
who decide  to spend their last  year in a boarding  school, then                                                               
the school would  close.  The next year two  more students enroll                                                               
and the  school district would  have open  the school again.   He                                                               
commented that this is the kind  of instability that could cost a                                                               
fair amount of money.                                                                                                           
                                                                                                                                
MR.   JEANS  responded   to  Representative   Gara  request   for                                                               
clarification between  the differences  in language in  Section 1                                                               
and Section 3 with respect to  the number of students which would                                                               
trigger the  closure of a school  district.  He told  the members                                                               
that of the districts that serve  10 to 15 students, the majority                                                               
of those  students are elementary  school age.   There are  not a                                                               
great number of secondary school age students.                                                                                  
                                                                                                                                
TAPE 04-14, SIDE B                                                                                                            
                                                                                                                                
Number 2966                                                                                                                     
                                                                                                                                
MR. JEANS  said it would be  highly unlikely that there  would be                                                               
five  secondary  students  who  would   leave  a  district.    He                                                               
explained that the  first section of statute is  statute that has                                                               
been on  the books  a long time  and it says  that if  a district                                                               
falls below  eight students the  school board may  declare itself                                                               
inoperative.   The foundation formula  was rewritten under  SB 36                                                               
which said  to qualify for  funding as a separate  community, not                                                               
district,  there must  be at  least ten  students.   He clarified                                                               
that  one section  is  dealing  with the  operation  of a  school                                                               
district as a  whole and the other is dealing  with the number of                                                               
students for funding purposes within a community.                                                                               
                                                                                                                                
Number 2848                                                                                                                     
                                                                                                                                
REPRESENTATIVE  KAPSNER  expressed  her  concern  about  removing                                                               
Section  1.   She told  the  members that  she attended  boarding                                                               
school for one year and  for extenuating circumstances it did not                                                               
work  out.    She  said  she  had two  sister  who  went  to  Mt.                                                               
Edgecumbe.  It worked out for  one sister, but not for the other,                                                               
so she moved back to the village.                                                                                               
                                                                                                                                
REPRESENTATIVE  KAPSNER  told  the  members that  at  the  Bethel                                                               
Alternative  Boarding  School  (BABS)  students have  to  take  a                                                               
sobriety  pledge.   She said  that is  wonderful, but  because of                                                               
zero tolerance  some of the  students are  asked to leave  if the                                                               
pledge is broken.  She said  she believes it would be terrible if                                                               
a student who went to that  school messed up once, was sent home,                                                               
and then dropped out because there were no options at home.                                                                     
                                                                                                                                
Number 2842                                                                                                                     
                                                                                                                                
MR. JEANS  replied that the example  Representative Kapsner posed                                                               
to the committee  is happening at BABS today.   He explained that                                                               
all this bill does is  provide some financial assistance with the                                                               
residential component for a five year  period and then it will be                                                               
decided if it is effective or not.                                                                                              
                                                                                                                                
REPRESENTATIVE  KAPSNER commented  that she  was speaking  to her                                                               
concern of the removal of Section 1.                                                                                            
                                                                                                                                
MR. JEANS said that Section 1 can  stay in the bill.  He told the                                                               
members that Section 1  has no impact one way or  the other.  The                                                               
hold harmless provision in Section  3 will cover the provision in                                                               
Section 1, he reiterated.                                                                                                       
                                                                                                                                
REPRESENTATIVE GARA asked  Mr. Jeans to again  explain the fiscal                                                               
impact in terms of saving general fund money.                                                                                   
                                                                                                                                
Number 2800                                                                                                                     
                                                                                                                                
MR.  JEANS told  the members  that the  department had  estimated                                                               
that the fiscal  impact would be approximately $1.4  million.  He                                                               
said he  believes that fiscal  note could be reduced  downward by                                                               
$227,000  now that  Representative Coghill  clarified that  it is                                                               
not  his intention  to provide  round trip  airfare and  boarding                                                               
expenses for the two-week classes such as those in Nome.                                                                        
                                                                                                                                
MR. JEANS  commented that  the savings  that was  discussed early                                                               
was based on  the analysis that Nenana provided  on students that                                                               
are currently attending Nenana.   He explained that what is being                                                               
said is  that if these students  went to school in  the student's                                                               
home  communities of  residence,  the state  would  be paying  an                                                               
additional  $318,000  in  state  foundation aid  to  those  other                                                               
school districts.                                                                                                               
                                                                                                                                
Number 2728                                                                                                                     
                                                                                                                                
RICH  BAUYMFALK testified  in support  of HB  425.   He told  the                                                               
members that  the students  elect to go  to the  boarding schools                                                               
for  many  reasons including  sports  and  are getting  a  better                                                               
education.  Mr.  Bauymfalk said the students and  parents are not                                                               
looking at  the dollar  amount, it  is the  education that  is of                                                               
concern.  He urged support of HB 425.                                                                                           
                                                                                                                                
Number 2641                                                                                                                     
                                                                                                                                
JIM SMITH,  Superintendent, Galena School District,  testified in                                                               
support  of HB  425.   He  told the  members that  Galena has  85                                                               
students  that  come from  35  different  communities in  Alaska.                                                               
Galena has  three different programs  including the  local school                                                               
district, the residential school,  and the correspondence school.                                                               
The effect is  that it provides a larger population  base just as                                                               
a larger community  has that advantage, he said.   Mr. Smith said                                                               
if  the amount  of money  received for  average daily  membership                                                               
(ADM)  for Galena  was divided  by the  total number  of students                                                               
served in the three programs,  the amount received would be about                                                               
$3,800 per student.  By using  that model it means that Galena is                                                               
serving  those  85 students  attending  the  boarding school  for                                                               
roughly $300,000, he  explained.  If these 85  students were sent                                                               
home to  their home districts  the cost  to the state  to educate                                                               
these  student would  be $680,000.   Mr.  Smith pointed  out that                                                               
even with  the proposed  pilot program  which provides  funds for                                                               
residential services,  it would still  be cheaper to  educate the                                                               
students at Galena than to send them all home.                                                                                  
                                                                                                                                
MR.  SMITH  said that  Galena  has  been aggressive  in  securing                                                               
federal grants to operate a  resiliency program.  These funds are                                                               
shared by  Nenana and Mt.  Edgecumbe.   There is also  the Alaska                                                               
Natives grant which  will come to the school next  year.  It will                                                               
support five  dorm positions in  Galena, three in  Mt. Edgecumbe,                                                               
and one  in Nenana.   This grant has  been shared with  the other                                                               
schools for the last four years, he commented.                                                                                  
                                                                                                                                
Number 2436                                                                                                                     
                                                                                                                                
MR.  SMITH  told  the  members   that  the  Alaska  congressional                                                               
delegation  supports the  process of  saving lives  and providing                                                               
education  for  those  students  who  do  not  have  a  secondary                                                               
program.  He said that Galena  is trying to improve the lifestyle                                                               
and the  residential life of  the students.  The  school district                                                               
has  the kids  six hours  per day,  five days  per week,  but the                                                               
residential halls have  the kids the rest of the  week, he added.                                                               
He cautioned  that the federal  funds are  not funds that  can be                                                               
planned on  and hopes  the state will  support the  program which                                                               
will give  them additional funds  that can  be planned for.   Mr.                                                               
Smith explained that he currently  issues teachers contracts with                                                               
some  risk because  he often  has to  get the  funding for  those                                                               
positions as  the year progresses.   He told the members  that HB
425  would be  a  godsend  to Galena  and  urged the  committee's                                                               
support.                                                                                                                        
                                                                                                                                
Number 2302                                                                                                                     
                                                                                                                                
ROBERT RYCHNOVSKI  testified in  support of  HB 425  and answered                                                               
questions from the  members.  He urged the support  of the Nenana                                                               
boarding school  program.   He told the  members that  the school                                                               
provides a very good alternative  for students who need to attend                                                               
the boarding  school for a  variety of reasons.   He said  he has                                                               
visited  the  school  several  times   and  was  very  impressed.                                                               
Parents worry  that their kids are  safe when they are  away from                                                               
home, and the school's living center  is very well run and it has                                                               
outstanding employees.   It  is clear the  staff cares  about the                                                               
students.   The  place is  well setup,  well maintained  and very                                                               
clean.   He  said  he believes  his daughter  is  getting a  good                                                               
education there.                                                                                                                
                                                                                                                                
MR. RYCHNOVSKI  told the  members that he  was surprised  when he                                                               
heard of the funding situation  and is concerned that this school                                                               
remain open.                                                                                                                    
                                                                                                                                
Number 2216                                                                                                                     
                                                                                                                                
CHAIR GATTO asked how many children he has enrolled at Nenana.                                                                  
                                                                                                                                
MR. RYCHNOVSKI replied he has one daughter attending there.                                                                     
                                                                                                                                
CHAIR  GATTO asked  what kind  of an  education was  available in                                                               
Iliamna.   Specifically, how large  was it and how  many teachers                                                               
were there, he asked.                                                                                                           
                                                                                                                                
MR.  RYCHNOVSKI replied  that  there were  about  80 students  in                                                               
Iliamna and  it has about  seven teachers.   He offered  that the                                                               
reason his daughter  went to Nenana was due to  the limited class                                                               
offerings in  rural districts.   Nenana  offered classes  that he                                                               
wanted her to have.                                                                                                             
                                                                                                                                
Number 2171                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON moved Amendment 1 as follows:                                                                             
                                                                                                                                
     On Page 1, delete lines 5 through 10                                                                                       
     Renumber the sections accordingly                                                                                          
                                                                                                                                
                                                                                                                                
Number 2152                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA said that he  does not have an objection, but                                                               
wondered  if  he  could  ask  Mr. Jeans  another  question.    He                                                               
commented  that  he know  Representative  Kapsner  has a  concern                                                               
about  removing  Section  1  from  the  bill  and  asked  if  the                                                               
committee  could  wait  until  her  return  to  committee  before                                                               
proceeding with Amendment 1.                                                                                                    
                                                                                                                                
RYNNIEVA  MOSS, Staff  to  Representative  Coghill, Alaska  State                                                               
Legislature,  testified  on  behalf  of  Representative  Coghill,                                                               
sponsor of HB 425.   Since a lot of the members  that sit on this                                                               
committee  also  sit  on  the next  committee  of  referral,  she                                                               
suggested that  Representatives Coghill and Kapsner  get together                                                               
to discuss  her concerns.   If a  change is necessary  the change                                                               
could be made in the next committee of referral, she commented.                                                                 
                                                                                                                                
Number 2081                                                                                                                     
                                                                                                                                
There being  no objection, Amendment  1 was adopted by  the House                                                               
Special Committee on Education.                                                                                                 
                                                                                                                                
Number 2029                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON moved Amendment 2 as follows:                                                                             
                                                                                                                                
     On Page 1, Line 14                                                                                                         
     Between the words "a" and "secondary"                                                                                      
     Insert "full school year"                                                                                                  
                                                                                                                                
CHAIR GATTO asked  Representative Seaton to read  the sentence as                                                               
it would be with the amendment.                                                                                                 
                                                                                                                                
REPRESENTATIVE  SEATON  replied  that  with  this  amendment  the                                                               
sentence would read as follows:                                                                                                 
                                                                                                                                
         boarding programs.  (a) A district that began                                                                        
     operating a full school year secondary boarding ...                                                                        
                                                                                                                                
Number 2014                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA objected  for  purposes of  discussion.   He                                                               
asked if the term "full school year" is defined somewhere.                                                                      
                                                                                                                                
REPRESENTATIVE SEATON  replied that  the Department  of Education                                                               
and Early Development told the  committee that a full school year                                                               
is 180 days of which 10  days could be used for school in-service                                                               
training.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  GARA  withdrew his  objection.    There being  no                                                               
objection,  Amendment   2  was  adopted  by   the  House  Special                                                               
Committee on Education.                                                                                                         
                                                                                                                                
REPRESENTATIVE GARA  commented that the analysis  from Galena and                                                               
Nenana  reflects that  HB 425  would save  the state  money.   He                                                               
asked if  the department has a  position as to whether  this bill                                                               
would save the state money.                                                                                                     
                                                                                                                                
MR.  JEANS replied  that the  analysis  that was  done by  Nenana                                                               
seems reasonable; however,  he has not verified the  numbers.  He                                                               
pointed out that when Nenana told  the members it would be saving                                                               
the state  of Alaska, what is  really being said is  that this is                                                               
the  money that  is currently  being saved.   He  reiterated that                                                               
this bill  will cost the state  about $1.2 million each  year for                                                               
the five  year pilot  program.   Mr. Jeans  pointed out  that the                                                               
fiscal note needs to be corrected.                                                                                              
                                                                                                                                
Number 1901                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA acknowledged  that it  would cost  the state                                                               
$1.2  million each  year, but  asked if  the analysis  is correct                                                               
will it actually save the state money.                                                                                          
                                                                                                                                
CHAIR GATTO  replied that it  would only  cost more money  if the                                                               
students were placed  in a regular classroom.   He commented that                                                               
it is almost an impossible question for Mr. Jeans to answer.                                                                    
                                                                                                                                
REPRESENTATIVE GARA said  that currently the analysis  is that by                                                               
allowing these  children to go  to boarding school less  is being                                                               
spent by the  state than would be spent if  the children attended                                                               
schools  in  their local  school  districts.   By  expanding  the                                                               
program a  larger number  of children  will be  allowed to  go to                                                               
boarding  school so  even though  the state  will be  paying more                                                               
stipends and round  trip airfares, the cost to the  state will be                                                               
less  in  the  long  term.   He  asked  if  he  understands  this                                                               
correctly.                                                                                                                      
                                                                                                                                
Number 1809                                                                                                                     
                                                                                                                                
MR. JEANS commented that this program  is not an expansion of the                                                               
program offering.   He said these students  are already attending                                                               
Nenana  and  Galena.     This  proposal  looks   at  funding  the                                                               
residential  component  of  approximately   the  same  number  of                                                               
students who currently  attend.  Mr. Jeans told  the members that                                                               
what  the analysis  says is  if these  schools closed  their door                                                               
tomorrow  and   all  the  students   went  back  to   their  home                                                               
communities, it  would cost the  state an additional  $300,000 in                                                               
both  cases.   It would  cost  the state  an additional  $600,000                                                               
through  the foundation  program to  put these  children back  in                                                               
their  home  communities,  he  reiterated.    That  is  what  the                                                               
analysis says.                                                                                                                  
                                                                                                                                
REPRESENTATIVE WILSON  asked what  if the  students went  back to                                                               
their home  communities and  did a  correspondence program.   The                                                               
districts would not get full funding then, she commented.                                                                       
                                                                                                                                
MR. JEANS replied that Representative  Wilson is correct.  If the                                                               
students opted for a correspondence  program its funding would be                                                               
at a different level.                                                                                                           
                                                                                                                                
CHAIR GATTO suggested  that in all likelihood  these students are                                                               
going nowhere.   The students are in the school  and plan to stay                                                               
there.                                                                                                                          
                                                                                                                                
MR.  JEANS replied  that is  the reason  the bill  is before  the                                                               
committee.  There  is no assurance that Nenana  would continue to                                                               
operate  based on  the current  funding levels.   They  need some                                                               
additional support,  he said.   It also provides  the legislature                                                               
with an  opportunity to do a  case study to see  how this program                                                               
works.                                                                                                                          
                                                                                                                                
Number 1708                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON  asked what funding mechanism  will be used                                                               
to fund this program.                                                                                                           
                                                                                                                                
MR. JEANS  replied that it  would currently go into  the boarding                                                               
home component which is already in the budget, he said.                                                                         
                                                                                                                                
REPRESENTATIVE GARA commented  that he believes he  has heard two                                                               
conflicting answers to the same question.   He asked if the state                                                               
is currently paying one round-trip  ticket per year and a monthly                                                               
stipend  for each  student.   He  asked if  the  amount paid  per                                                               
student is changing.                                                                                                            
                                                                                                                                
Number 1624                                                                                                                     
                                                                                                                                
MR. JEANS  replied that the  amount per student is  not changing,                                                               
neither is the  round trip airfare or the stipend.   For example,                                                               
in Galena there  are currently 83 students, of  those 83 students                                                               
six qualify  for the  residential stipend  and the  one roundtrip                                                               
airfare  under  the  current  program.   This  bill  expands  the                                                               
program by  allowing the other 77  students to be funded  for the                                                               
residential component.                                                                                                          
                                                                                                                                
REPRESENTATIVE  WILSON  asked  why   only  six  are  allowed  the                                                               
residential component  now and with  this bill the other  77 will                                                               
be included.                                                                                                                    
                                                                                                                                
Number 1564                                                                                                                     
                                                                                                                                
MR. JEANS  under the existing  program those six children  do not                                                               
have daily access to a secondary  program where they live.  These                                                               
children qualify  for a stipend.   The other 77 children  do have                                                               
daily  access to  a secondary  program  where they  live, so  for                                                               
those children it is a choice, he explained.                                                                                    
                                                                                                                                
CHAIR GATTO added that daily  access merely means that the school                                                               
offers classes in grades 9 through 12.                                                                                          
                                                                                                                                
MR. JEANS replied that is the correct definition.                                                                               
                                                                                                                                
Number 1500                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA withdrew his objection.                                                                                     
                                                                                                                                
Number 1492                                                                                                                     
                                                                                                                                
REPRESENTATIVE  SEATON moved  to  report HB  425,  Version D,  as                                                               
amended,  out of  committee with  individual recommendations  and                                                               
the accompanying  fiscal notes.   There being no  objection, CSHB
425(EDU)  was  reported  from the  House  Health,  Education  and                                                               
Social Services Standing Committee.                                                                                             
                                                                                                                                
MS. MOSS said in response to  Chair Gatto's request for a revised                                                               
fiscal note  that a new fiscal  note will be provided  before the                                                               
bill  is heard  in House  Health, Education  and Social  Services                                                               
Standing Committee.                                                                                                             
                                                                                                                                

Document Name Date/Time Subjects