Legislature(1993 - 1994)
05/04/1994 09:15 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CSSSSB 301(HES): An Act relating to the calculation of instructional units used in determining state aid for education; and providing for an effective date. Joe Ambrose, aide to Senator Robin Taylor, sponsor of SB 301, spoke in support of the bill. Senator Kerttula proposed amendment 1. Wanda Cooksey, lobbyist for Single Site School District Consortium, and Senator Fred Zharoff testified in support of amendment 1. Amendment 1 FAILED to be adopted. Amendment 2 by Senator Kelly would tighten the title of SB 301. Amendment 2 was ADOPTED. CSSSSB 301(FIN) was REPORTED out of committee with a "no recommendation," and a fiscal note for the Department of Education for $96.4. SB 381: An Act relating to the construction of the Alaska Orbital Launch Complex by the Alaska Aerospace Development Corporation. Bill Paulick, Business Development Information Network, Division of Economic Development, Commerce & Economic Development, and member of the Board of Directors, Aerospace Development Corporation, testified in support of SB 381. SB 381 was REPORTED out of committee with a "do pass," and a zero fiscal note for the Department of Commerce & Economic Development. CS FOR SPONSOR SUBSTITUTE FOR SENATE BILL NO. 301(HES): An Act relating to the calculation of instructional units used in determining state aid for education; and providing for an effective date. Co-chair Pearce announced CSSSSB 301(HES) was before the committee and invited Joe Ambrose, aide to Senator Taylor, sponsor of SB 301, to speak to the bill. JOE AMBROSE said the bill originally introduced by Senator Taylor encompassed a permanent fix on the single site school issue but that provision had been removed from the bill. He wanted the committee to know that Senator Taylor was in support of CSSSSB 301(HES) which drastically reduced the fiscal note. Mr. Ambrose outlined section 1 which reduced the percentage at which the hold harmless provision was triggered from the current 10 percent to 5 percent. It would bring Sitka into the hold harmless cycle which allowed their loss to be spread over three years. In answer to Co-chair Pearce, Mr. Ambrose ask Senator Rieger to speak to Section 2. Senator Rieger said Section 2 would effect Adak's hold harmless if, in fact, the Adak shutdown occurred as proposed. What the new hold harmless provisions did as a package was to create three tiers of hold harmless. He went on to explain if a reduction in entitlement of instructional units exceeded 5 percent in a year, it triggered the hold harmless similar to what was in existing law. There were two other brackets for more dramatic changes in the entitlement to instructional units. Existing law said there was a three-step process. First, a four-year phase-down where the school would receive 75 percent of what they would have been entitled to, then 50 percent, then 25 percent, then zero. The next, a three-year phase-down, two-thirds, one-third and then zero, as a hold harmless. Then a more extreme, two-year phase-down bracket, 50 percent and then zero. The more rapid phase-downs occurred in cases where there was a more dramatic drop in entitlement to instructional units. If a community suffered a complete shutdown, it was reasoned that it should not take three years of gradual phasing out of the harmless. There was recognition of some need for hold harmless because some employment contracts needed to be honored and contractual obligations and funding were required to carry those out. Mr. Ambrose said that the Department of Education had advised them that a reduction of the 5 percent trigger would add only Sitka to the hold harmless provision. There were three other districts in one step or the other at the present time. In answer to Co-chair Frank, Mr. Ambrose did not know which communities those were. Senator Kerttula MOVED amendment 1. Co-chair Pearce OBJECTED for discussion purposes. Senator Fred Zharoff explained that amendment 1 would hopefully take care of funding for the single/dual site schools. Since the funding formula had been revised 5-6 years ago, a shortfall had happened each year. Wanda Cooksey, lobbyist for Single Site School District Consortium, spoke in support of amendment 1. She said the formula provided in amendment 1 was the exact formula that was being used now. She felt this was a good time to add this formula so when the foundation formula was worked on in the future, this issue would be included instead of being outside the formula. In answer to Senator Kelly, Ms. Cooksey answered that the fiscal impact for the coming year, $3.1M would be funded in HB 505. In answer to Senator Sharp, Ms. Cooksey said it effected 21 school districts that range in size from 50 to 800 students ADM. Again in answer to Senator Sharp, Ms. Cooksey answered that there were 3 REAAs in the group and the rest were small municipal schools. In answer to Senator Kerttula, she said each REAA had only one funding community. Co-chair Pearce called for a show of hands on the motion to ADOPT amendment 1 and the motion FAILED on a vote of 6 to 1 (Co-chairs Frank and Pearce, Senators Sharp, Kelly, Rieger and Jacko were opposed, Senator Kerttula was in favor). Senator Rieger MOVED for passage of CSSSSB 301(HES) from committee with individual recommendations. Co-chair Pearce noted that SB 301 had not received a "do pass." Senator Kelly noted that he was not comfortable with the title. No further objection having been heard, the bill was REPORTED out. Senator Kelly MOVED that CSSSSB 301(HES) be brought back before the committee for the purpose of an amendment to "tighten" the title. No objection being heard, the motion to RESCIND the committee's action CARRIED. Senator Kelly MOVED conceptual amendment 2 that would revise the title to conform with the contents of the bill. No objection being heard, amendment 2 was ADOPTED for incorporation within a Finance Committee Substitute for the bill. Senator Kelly MOVED for passage of CSSSSB 301(FIN) from committee with individual recommendations. No objection being heard, the bill was REPORTED out as amended with a "no recommendation", and a fiscal note for the Department of Education for $96.4. Co-chair Pearce, Senator Kelly, Rieger, Kerttula and Sharp signed "no recommendation".
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