02/22/1996 03:12 PM House HES

 HB 471 - REPAY GRADUATE EDUCATION AID                                       
                                                                               
 Number 075                                                                    
                                                                               
 CO-CHAIR BUNDE presented the sponsor statement.  He said Alaska has           
 two graduate education programs in the medical field that are very            
 expensive and obviously useful education because they deal with the           
 medical community.  There have been varying levels of success with            
 Alaskans who are subsidized by these programs returning to practice           
 medicine in Alaska.  It has been an ongoing quest of Co-Chair                 
 Bunde's to maximize the return on the state's investment in their             
 students.  He remarked there are a number of ways that can be                 
 accomplished.  One way would be to spread the approximate $1.6                
 million cost of the programs per year for 40 students through the             
 entire university community.  The University of Alaska Fairbanks,             
 University of Alaska Anchorage and University of Alaska Southeast             
 could each be asked what they could do with an additional $500,000            
 and if it would be a good investment having that money impact                 
 20,000 or 30,000 students.  The existing programs which take $1.6             
 million a year to finance the education of only 40 students could             
 be continued.  His frustration is that only a small number of those           
 students return and practice medicine in Alaska.  Co-Chair Bunde              
 said last year the Western Interstate Commission on Higher                    
 Education (WICHE) program was not funded.  He has been contacted by           
 parents and members of the medical community who are willing to pay           
 the cost if the program is continued.  They want students to have             
 access to the program.  On the other hand, there are students in              
 the WAMI (Washington, Alaska, Montana and Idaho) program who have             
 indicated they won't have anything to do with it if it is changed             
 to a loan program.  Co-Chair Bunde said he had some problems with             
 these students asking for a great deal of money from the state and            
 not willing to be at least partially responsible for it.  In                  
 conclusion, he said these two programs could continue and the                 
 amount of money he is addressing is the subsidy paid by the state             
 that is the difference between the resident tuition in the state              
 the student attends and the nonresident tuition.  The                         
 administrative costs which are very high are not being addressed.             
 The loan would be forgiven for the student who partakes of this               
 program and then returns to the state to practice in their field in           
 Alaska for a minimum of five years.  If, however, that student                
 chooses to work in the Lower 48, then the student would repay                 
 Alaska for the subsidy he/she received.                                       
                                                                               
 CO-CHAIR TOOHEY added that the WAMI program has been in effect                
 since 1971 and 134 Alaskans have taken part in it.  To date, 23 of            
 those are doctors practicing in Alaska.                                       
                                                                               
 WENDY REDMAN, Vice President, Statewide University System,                    
 University of Alaska, interjected it was 46 not 23 doctors.                   
                                                                               
 CO-CHAIR BUNDE commented there seems to be some confusion on the              
 numbers.  The agencies that support the program count everybody who           
 has ever been in the WAMI program who come to Alaska and work as a            
 benefit from the program.  He pointed out there are students from             
 Washington and Oregon who come to Alaska to do an internship and              
 return to Alaska to practice, but they are not the people Alaska              
 has invested money in.  The rates for qualified Alaskans who go               
 into the program and return to Alaska vary, but are as low as a 2             
 percent return.                                                               
                                                                               
 Number 422                                                                    
                                                                               
 REPRESENTATIVE TOM BRICE asked if Co-Chair Bunde had had any                  
 discussions with bond counsel relating to the insertion of a                  
 forgiveness provision into the student loan program.                          
                                                                               
 CO-CHAIR BUNDE replied that only general fund monies were involved.           
                                                                               
 Number 454                                                                    
                                                                               
 MS. REDMAN said there are currently 46 Alaskan students who went              
 through the WAMI program practicing in the state of Alaska.  That             
 is not the equivalent rate, and she thinks the equivalent rate is             
 what Co-Chair Bunde was referring to.  She added that in addition             
 to the 46 students, there is a total of 107 out of 134 WAMI                   
 educated doctors practicing in the state of Alaska.  Of the 107               
 doctors, 46 are Alaskan students which is about a 43 percent return           
 rate.                                                                         
                                                                               
 CO-CHAIR BUNDE said he wouldn't argue with those figures, but                 
 pointed out that some classes have 2 out of 10 students who return            
 while other classes may have more.  He is of the opinion that when            
 the state has invested in excess of $160,000 in a student's                   
 education, the return should be 100 percent.                                  
                                                                               
 CO-CHAIR BUNDE asked if there were further questions or testimony.            
 Hearing none, he closed public testimony.                                     
                                                                               
 Number 592                                                                    
                                                                               
 REPRESENTATIVE BRICE moved to pass HB 471 out of committee with               
 individual recommendations.                                                   
                                                                               
 CO-CHAIR BUNDE explained that a technical amendment was needed                
 because there was some conflicting language; the original bill                
 indicated repayment would begin within one year and other student             
 loans are  paid (indisc.).                                                    
                                                                               
 REPRESENTATIVE BRICE withdrew the motion.                                     
                                                                               
 Number 634                                                                    
                                                                               
 REPRESENTATIVE BRICE made a motion to adopt Amendment 1.  Hearing             
 no objection, Amendment 1 was adopted.                                        
                                                                               
 Number 642                                                                    
                                                                               
 REPRESENTATIVE BRICE moved to pass CSHB 471(HES) out of committee             
 with individual recommendations and zero fiscal note.  Hearing no             
 objection, it was so ordered.