Legislature(2003 - 2004)
04/09/2003 01:31 PM Senate HES
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 84-TEACHER LOAN REPAYMENT PROGRAM
CHAIR FRED DYSON announced SB 84 to be up for consideration.
SENATOR GARY STEVENS, sponsor, said the teacher shortage will be
even more of a problem with passage of the federal No Child Left
Behind laws. SB 84 will set up the Alaska teacher recruitment
loan repayment program, which is designed to help school
districts recruit and retain teachers. It includes repayment of
education loans when the teachers are hired by Alaskan public
elementary or secondary schools. It limits the lifetime
financial award to $10,000 for an individual teacher. The
funding would come from the dividend, which would normally be
returned to the state through the Commission on Postsecondary
Education. The intent is that the program would operate when the
funds are available and if no funding is appropriated by the
Legislature, then no money would be spent. If an individual
leaves a teaching position, they would not receive the loan
repayment that would be made at the end of the school year.
SENATOR STEVENS explained that the proposed amendment is from
the Alaska Postsecondary Commission and clarifies some of the
language and expands the scope of funding sources to include
federal funds and other receipts. He said he didn't know of
anyone who was against this bill.
SENATOR GRETCHEN GUESS asked if this program could be used by
professionals in other shortage areas, like speech pathologists
who don't have teaching certificates.
SENATOR STEVENS replied that it's meant for certificated
teachers in elementary or high school.
SENATOR GUESS asked if they are only going to repay loans in
areas of shortage or is this for all teachers.
SENATOR STEVENS replied that the specifics would be developed by
the Postsecondary Commission. His intent is that it's for any
position.
SENATOR GARY WILKEN said he had some reservations with this
bill, as well as SB 154. He understands the financial burden of
going to school, but he was concerned that this is slippery
slope legislation. He came to the Legislature just as the
student loan program was starting to dig itself out of the
problems of the 80s and 90s when it was a give-away program. The
program is now robust and has brought money back to the state.
They have brought back about $5 million for the fourth year in a
row.
SENATOR STEVENS shared his concerns, but said this would not
make the fund any less healthy than it is now, but it would
simply reduce the dividend that the state receives. Every year
the Legislature would have to fund the program.
MS. DIANE BARRANS, Executive Director, Alaska Commission on
Postsecondary Education, explained the amendments and noted that
the sponsor was very proactive on getting the commission's input
on this bill. One of the amendments insures that the criteria is
efficient to administer and does not require costly activity.
The second amendment is on page 3, line 14, after "AS 14.42.295"
to insert "or any federal or other funds", the objective being
to capture any funding that is available for a program of this
kind. The others are technical changes.
SENATOR WILKEN moved to adopt Amendment 1. There were no
objections and it was so ordered.
MS. BARRANS responded to Senator Wilken's concerns saying that
this bill, rather than requiring additional funds to be expended
from the Student Loan Corporation to pay benefits under this
program, it would simply be an earmarking in statute that when
the dividend is calculated and goes back to the state, the
Legislature would use those funds to endow the fund from which
benefits are paid.
SENATOR WILKEN said that the fiscal note shows 807 new hires
would participate in the program each year.
MS. BARRAN responded that was correct and added that a recent
study of openings each year showed about 1,600 teacher vacancies
and about half of those are estimated to be new teachers who
would still have educational debt. They did not build in any
growth estimate and the details of the payments would have to be
worked out in regulation.
How I would recommend that it be structured is that
when someone agrees to participate in this program, we
identify what their total debt is at that time. We
actually set aside the amount of funds that we would
need to pay to meet its obligation to this participant
so we would essentially encumber funds on their
behalf. What I don't want to be in the position of
doing is telling someone there is going to be a
benefit for them and then not have the funds
available. I don't' want to come back to the
legislature...One of the things I see the commission
being charged with is to monitor the amount in the
fund and to monitor the amount that's been obligated
to current participants and only enroll new
participants when funding is available.
SENATOR WILKEN said that was where his concern lay - if one year
they needed all of the $5 million of the dividend, they would
not fund that particular year. There would be a clamor to
continue the funding over and above the $5 million. He asked if
they were funding at the $500,000 level, would she prorate that
through the debt or through the number of participants.
MS. BARRANS replied that she could see either scenario occurring
depending on a number of variables. The amount of controls put
in place will affect whether or not that can occur. Her
objective would be for it not to occur. Since the board is given
some latitude to set the criteria for the program, they might
define critical shortage areas and target the money to those
areas.
SENATOR WILKEN asked her if she saw any problems with trying
this for five years.
MS. BARRANS answered that was more of a political question than
a financial question and, if it was structured correctly at the
outset, they would not be in a financial hole in terms of being
obligated to pay benefits.
SENATOR WILKEN complimented Ms. Barrans on running a great show.
MS. MARY FRANCIS, Executive Director, Alaska Association of
School Administrators, supported SB 84.
TAPE 03-19, SIDE A
MS. FRANCIS said that last year only about 300 educators came in
to look for Alaskan jobs.
MR. JOHN ALCANTRA, Government Relations Director, National
Education Association, supported SB 84 for all the reasons
stated previously.
SENATOR WILKEN moved to report SB 84 from committee with
individual recommendations and attached fiscal note. There were
no objections and it was so ordered.
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