Legislature(1999 - 2000)

01/31/2000 01:48 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
HOUSE FINANCE COMMITTEE                                                                                                         
January 31, 2000                                                                                                                
1:48 P.M.                                                                                                                       
                                                                                                                                
TAPE HFC 00 - 20, Side 1                                                                                                        
TAPE HFC 00 - 20, Side 2                                                                                                        
TAPE HFC 00 - 21, Side 1                                                                                                        
TAPE HFC 00 - 21, Side 2                                                                                                        
                                                                                                                                
CALL TO ORDER                                                                                                                   
                                                                                                                                
Co-Chair Therriault called the House Finance Committee                                                                          
meeting to order at 1:48 p.m.                                                                                                   
                                                                                                                                
PRESENT                                                                                                                         
                                                                                                                                
                                                                                                                                
Co-Chair Mulder                                                                                                                 
Co-Chair Therriault    Representative Foster                                                                                    
Vice Chair Bunde   Representative Grussendorf                                                                                   
Representative Austerman   Representative Williams                                                                              
Representative J. Davies                                                                                                        
Representative G. Davis   Representative Williams                                                                               
                                                                                                                                
Representative Phillips and Representative Moses were absent                                                                    
from the meeting.                                                                                                               
                                                                                                                                
ALSO PRESENT                                                                                                                    
                                                                                                                                
Catherine Reardon, Director, Division of Occupational                                                                           
Licensing, Department of Community and Economic Development;                                                                    
Sean Strauss, Juneau.                                                                                                           
                                                                                                                                
TESTIFIED VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Susan Bunting, President, Alaska Speech and Hearing                                                                             
Association, Homer; Nick Stayrook, Fairbanks North Star                                                                         
Borough School District, Fairbanks; Mike Fisher, Fairbanks                                                                      
North Star Borough School District, Fairbanks; Linda                                                                            
Anderson, Fairbanks; Greg Miller, Aquarian Charter School,                                                                      
Anchorage; Cynthia Henry, President, Fairbanks North Star                                                                       
Borough School District, Fairbanks; Carol Comeau, Assistant                                                                     
Superintendent, Anchorage School District, Anchorage; Janet                                                                     
Stokes, Chief Financial Officer, Anchorage School District,                                                                     
Anchorage; Mike Fisher, Assistant Superintendent on Business                                                                    
Finances, Fairbanks North Star Borough School District;                                                                         
Larry Semmens, Aurora Borealis Charter School, Kenai; Sean                                                                      
Strauss, Juneau; Eddy Jeans, School Finance Manager,                                                                            
Department of Education and Early Development; Wes Keller,                                                                      
Staff, Representative Fred Dyson; Barbara Thompson, Deputy                                                                      
Director, Teachers and Learning Support, Department of                                                                          
Education and Early Development; Dr. Nick Stayrook,                                                                             
Fairbanks North Star Borough School District, Fairbanks.                                                                        
                                                                                                                                
SUMMARY                                                                                                                         
                                                                                                                                
HB 105 "An Act providing for the licensing of speech-                                                                           
language pathologists; and providing for an                                                                                     
effective date."                                                                                                                
                                                                                                                                
CSHB 105 (FIN) was REPORTED out of Committee with                                                                               
"no recommendation" and a new fiscal note by the                                                                                
Community and Economic Development.                                                                                             
                                                                                                                                
HB 191 "An Act relating to charter schools; and providing                                                                       
for an effective date."                                                                                                         
                                                                                                                                
HB 191 was heard and HELD in Committee for further                                                                              
consideration.                                                                                                                  
                                                                                                                                
HOUSE BILL NO 105                                                                                                               
                                                                                                                                
"An Act providing for the licensing of speech-language                                                                          
pathologists; and providing for an effective date."                                                                             
                                                                                                                                
Vice Chair Bunde spoke in support of HB 105. The legislation                                                                    
was introduced at the request of speech-language therapists.                                                                    
He disclosed that he has practiced as a speech therapist,                                                                       
but is not currently practicing and would not be affected by                                                                    
the legislation. The legislation would require speech-                                                                          
language pathologists to obtain a license to practice in                                                                        
Alaska. Licensure would be dependent on certification by the                                                                    
American Speech-Language Hearing Association. He explained                                                                      
that there are about 25 private practitioners in Alaska that                                                                    
would be affected by the legislation. Alaska is one of only                                                                     
6 states that do not require this protection. Vice Chair                                                                        
Bunde provided members with Amendment 1:                                                                                        
                                                                                                                                
 Page 1, following line 6:                                                                                                      
                                                                                                                                
Insert new bill sections to read:                                                                                               
Sec. 2. AS 08.01.065(c) is amended to read:                                                                                     
                                                                                                                                
 (c)  Except as provided in (1) and (g) of this                                                                                 
section, the department shall establish fee levels                                                                              
under (a) of this section so that the total amount of                                                                           
fees collected for an occupation approximately equals                                                                           
the actual regulatory costs for the occupation. The                                                                             
department shall annually review each fee level to                                                                              
determine whether the regulatory costs of each                                                                                  
occupation are approximately equal to fee collections                                                                           
related to that occupation. If the review indicates                                                                             
that an occupation's fee collections and regulatory                                                                             
costs are not approximately equal, the department shall                                                                         
calculate fee adjustments and adopt regulations under                                                                           
(a) of this section to implement the revisions for the                                                                          
previous year under this subsection to the office of                                                                            
management and budget. If a board regulates an                                                                                  
occupation covered by this chapter, the department                                                                              
shall consider the board's recommendations concerning                                                                           
the occupation's fee levels and regulatory costs before                                                                         
revising fee schedules to comply with this subsection.                                                                          
In this subsection, "regulatory costs" means costs of                                                                           
the department that are attributable to regulation of                                                                           
an occupation plus (1) all expenses of the board that                                                                           
regulates the occupation if the board regulates only                                                                            
one occupation;                                                                                                                 
                                                                                                                                
(2) the expenses of a board that are attributable to                                                                            
the occupation if the board regulates more than one                                                                             
occupation.                                                                                                                     
                                                                                                                                
Sec. 3. As 08.01.065 is amended by adding a new                                                                                 
subsection to read:                                                                                                             
                                                                                                                                
 (g) Notwithstanding (c) of this section, the department                                                                        
shall establish fee levels under (a) of this section so                                                                         
that the total amount of fees collected by the                                                                                  
department for all occupations regulated under AS 08.11                                                                         
approximately equals the total regulatory costs of the                                                                          
department for all occupations regulated by the                                                                                 
department under AS 08.11. The department shall set the                                                                         
fee levels for the issuance and renewal of licenses                                                                             
issued under AS 08.11 so that the fee levels are the                                                                            
same for all occupations regulated by the department                                                                            
under AS 08.11 .                                                                                                                
                                                                                                                                
Renumber the following bill sections accordingly.                                                                               
                                                                                                                                
Vice Chair Bunde noted that the fiscal note would be changed                                                                    
with the adoption of the amendment.                                                                                             
                                                                                                                                
Representative Grussendorf questioned why the profession                                                                        
should be regulated. Vice Chair Bunde responded that the                                                                        
level of competency is in question. He pointed out that                                                                         
individuals recovering from strokes could suffer from                                                                           
inappropriate services.                                                                                                         
                                                                                                                                
Co-Chair Therriault asked if the legislation is proactive or                                                                    
reactive. Vice Chair Bunde noted that the providers                                                                             
requested the legislation. He referred to an instance where                                                                     
an individual was practicing without any experience or                                                                          
training in the field. The legislation is both proactive and                                                                    
reactive. People who need the services need assurance that                                                                      
quality service will be provided.                                                                                               
                                                                                                                                
Co-Chair Therriault asked how the legislation would impact                                                                      
current practitioners. Vice Chair Bunde observed that all of                                                                    
the 25 private practitioners would met the requirements.                                                                        
                                                                                                                                
CATHERINE REARDON, DIRECTOR, DIVISION OF OCCUPATIONAL                                                                           
LICENSING, DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT                                                                     
provided information regarding the legislation. The Division                                                                    
of Occupational Licensing would administer the program                                                                          
without a licensing board. She thought that there might be                                                                      
one person in Homer practicing with a bachelor's degree that                                                                    
would be affected by the legislation.                                                                                           
                                                                                                                                
Representative Austerman asked if the legislation provided                                                                      
sufficient guidelines to administer the program. Ms. Reardon                                                                    
stated that the legislation is similar to the Audiology                                                                         
Licensing Program, administered by the Division. The                                                                            
Division would not have general regulation authority. The                                                                       
Division would have to administer the program from the                                                                          
direct language of the bill, except for in the temporary                                                                        
licensing sections.                                                                                                             
                                                                                                                                
Representative Grussendorf asked if there have been problems                                                                    
with patients or clients.                                                                                                       
                                                                                                                                
Ms. Reardon replied that she had not been approached by any                                                                     
clients or patients. She noted that other states license                                                                        
speech pathologists. The Division has received inquiries                                                                        
regarding licensing requirements from people entering the                                                                       
state.                                                                                                                          
                                                                                                                                
Co-Chair Therriault noted that the 25 practicing speech-                                                                        
language pathologists make a small pool. He noted that the                                                                      
amendment would broaden the field by adding 45 audiologists.                                                                    
Ms. Reardon spoke in support of merging the two groups. She                                                                     
noted that there is still a danger of volatile fees.                                                                            
                                                                                                                                
Co-Chair Therriault questioned if the audiologists were                                                                         
aware that one legal action could drive the fees up                                                                             
substantially. Ms. Reardon stated that the fee structure was                                                                    
explained to Ms. Bunting. She acknowledged that increased                                                                       
fee costs could be difficult in the case of a serious legal                                                                     
action.                                                                                                                         
                                                                                                                                
Vices Chair Bunde stressed that the more people in the pool                                                                     
the lower the cost but the higher the risk.                                                                                     
                                                                                                                                
Ms. Reardon noted that the Division separated audiologists                                                                      
from hearing aide dealers due to their liability.                                                                               
Audiologists have not been difficult to regulate. She felt                                                                      
that a license denial appeal would be the most serious legal                                                                    
challenge.                                                                                                                      
                                                                                                                                
Co-Chair Therriault noted that speech pathologists working                                                                      
for school districts were exempted. Ms. Reardon clarified                                                                       
that employees of school districts are exempt. The majority                                                                     
of pathologists work for school districts.                                                                                      
                                                                                                                                
Co-Chair Therriault questioned if employees under contract                                                                      
would need to be licensed. Ms. Reardon affirmed that                                                                            
contract pathologists would need temporary or full licenses                                                                     
under the law. A temporary license would allow them to work                                                                     
for 60 days.                                                                                                                    
                                                                                                                                
Representative Austerman noted that the Division does not                                                                       
have the authority to do regulation. Their authority would                                                                      
come from statute. Ms. Reardon pointed out that "has not                                                                        
engaged in conduct that is a ground for imposing                                                                                
disciplinary sanctions under AS 08.11.085" would allow the                                                                      
Division to make a subjective decision. The Division could                                                                      
accuse a pathologist of performing incompetently in                                                                             
violation of one of the activities listed on page 5 of the                                                                      
legislation. The accused would have a due process right to a                                                                    
hearing. Any costs would be charged against the fee. She                                                                        
detailed costs that could incur.                                                                                                
                                                                                                                                
In response to a question by Representative Austerman, Ms.                                                                      
Reardon clarified that the 25 individuals that would be                                                                         
affected by the legislation are not practicing in school                                                                        
districts.                                                                                                                      
                                                                                                                                
Co-Chair Therriault reiterated questions for Ms. Bunting.                                                                       
                                                                                                                                
SUSAN BUNTING, PRESIDENT, ALASKA SPEECH AND HEARING                                                                             
ASSOCIATION, HOMER testified via teleconference in support                                                                      
of HB 105. She stated that the Association is aware that                                                                        
fees will be charged and that there is a risk that                                                                              
additional costs could be incurred through litigation. She                                                                      
explained that the procedure for licensure of audiologists                                                                      
was started in 1986. Speech-language was not added at that                                                                      
time due to other concerns. There are only two other states                                                                     
that do not have requirements for speech-language                                                                               
pathologists in private practice. The legislation would be                                                                      
proactive.                                                                                                                      
                                                                                                                                
Representative G. Davis clarified that state regulations                                                                        
will not be drawn up because standards of the American                                                                          
Speech-Language Association would be adopted. He noted that                                                                     
adherence to the American Speech-Language Association                                                                           
standards is voluntary. Vice Chair Bunde clarified that                                                                         
certification in the American Speech-Language Association                                                                       
voluntary. Once an individual is certified they must comply                                                                     
with the standards. The legislation would make compliance                                                                       
mandatory.                                                                                                                      
                                                                                                                                
Vice Chair Bunde MOVED to ADOPT Amendment 1. Representative                                                                     
G. Davis OBJECTED for the purpose of discussion.  Vice Chair                                                                    
Bunde explained that the amendment allows the Division of                                                                       
Occupational Licensing to combine audiologists and speech-                                                                      
language pathologists in their calculations for financial                                                                       
purposes.                                                                                                                       
                                                                                                                                
Ms. Reardon noted that "the department may impose by                                                                            
regulation additional limitations that it determines                                                                            
appropriate on a temporary license issued under this                                                                            
section." The Division only has regulation writing authority                                                                    
to govern temporary licenses. She explained that the                                                                            
Division could not write regulation to define grounds for                                                                       
sanctions under page 5. She added that fee setting is a                                                                         
regulation process. The Division has the general authority                                                                      
to set fees through regulation under other statutes.                                                                            
                                                                                                                                
In response to a question by Representative Foster, Vice                                                                        
Chair Bunde noted that fees would be approximately $200                                                                         
hundred dollars for the first year.                                                                                             
                                                                                                                                
In response to a question by Representative Austerman, Ms.                                                                      
Reardon interpreted the Division's regulation authority                                                                         
under the legislation to address only the contents of the                                                                       
bill and the fees that go with the bill. Representative                                                                         
Austerman expressed concern that there could be a broader                                                                       
interpretation. Co-Chair Therriault agreed with a narrow                                                                        
interpretation. Ms. Reardon recalled that the intent of the                                                                     
House Labor and Commerce Committee was to allow the Division                                                                    
to provide public notice fee regulations before the                                                                             
legislation takes effect. Vice Chair Bunde maintained that                                                                      
the regulation writing authority only applies to HB 105.                                                                        
                                                                                                                                
Representative G. Davis WITHREW his objection.                                                                                  
                                                                                                                                
In response to a question by Representative Foster, Ms.                                                                         
Reardon explained that licenses would have to be renewed                                                                        
every two years. National certification would have to be                                                                        
demonstrated. Ms. Bunting discussed certification                                                                               
requirements. Continuing education is needed to maintain                                                                        
certification. Alaska does not require continuing education.                                                                    
She noted that classes are not available in Alaska.                                                                             
                                                                                                                                
In response to a question by Representative Foster, Ms.                                                                         
Reardon stated that the state is not involved in maintaining                                                                    
standards. Ms. Bunting explained that examinations are                                                                          
offered two times a year in various places in the                                                                               
continental United States. Conference attendance is                                                                             
voluntary and is generated by the interests of the                                                                              
membership.                                                                                                                     
                                                                                                                                
Representative Foster questioned why the legislation does                                                                       
not cover speech-language practitioners working in school                                                                       
districts. Ms. Bunting noted that most individuals working                                                                      
in schools have masters' degree. Master degrees have on                                                                         
going education requirements. Ms. Reardon added that since                                                                      
the Department of Education and Early Development has master                                                                    
level requirements their addition to the legislation would                                                                      
amount to double regulation.                                                                                                    
                                                                                                                                
In response to a question by Representative Foster, Ms.                                                                         
Bunting noted that private hospitals and Native Corporations                                                                    
generally pay the fee for their employees. Some of the 25 in                                                                    
question would fall into this category.                                                                                         
                                                                                                                                
Representative Austerman questioned if Amendment 1 was                                                                          
discussed with audiologists. Vice Chair Bunde noted that Ms.                                                                    
Bunting has carried the message to the audiologists.                                                                            
                                                                                                                                
There being NO OBJECTION, Amendment 1 was adopted.                                                                              
                                                                                                                                
Ms. Reardon discussed the fiscal note. She observed that the                                                                    
fiscal cost would be $7.5 hundred dollars for the first year                                                                    
and $3.7 hundred dollars for each additional year. She                                                                          
explained that the fiscal note was based on actual costs of                                                                     
the audiology program in FY99. More money is needed in the                                                                      
first year to cover attorney fees to review regulations and                                                                     
postage related to advertising.                                                                                                 
                                                                                                                                
Representative J. Davies questioned if steps have been taken                                                                    
to look at lumping adjudication costs into one category. Ms.                                                                    
Reardon stated that discussions have occurred but that there                                                                    
is dissention among the groups.                                                                                                 
                                                                                                                                
(Tape Change, HFC 00-20, Side 2)                                                                                                
                                                                                                                                
Ms. Reardon continued to discuss the possibility of merging                                                                     
licensing groups.                                                                                                               
                                                                                                                                
Representative Foster questioned the cost of the fee. Ms.                                                                       
Reardon emphasized that the fee would be $315 dollars in                                                                        
combination with audiologists. There would be an initial                                                                        
application fee of $150 dollars. She observed that this is a                                                                    
medium level fee. She noted that fees could be increased in                                                                     
the future.                                                                                                                     
                                                                                                                                
Representative Grussendorf questioned the need for                                                                              
regulation. He indicated that he has additional questions                                                                       
regarding the legislation.                                                                                                      
                                                                                                                                
Vice Chair Bunde noted that under the current law a person                                                                      
with no training could call themselves a speech and hearing                                                                     
pathologist.                                                                                                                    
                                                                                                                                
Vice Chair Bunde MOVED to report CSHB 105 (FIN) out of                                                                          
Committee with the accompanying amended fiscal note.                                                                            
                                                                                                                                
Representative J. Davies did not object, but voiced concern                                                                     
with the legislation. Representative G. Davis pointed out                                                                       
that the public did not request the legislation.                                                                                
Representative Foster asked for clarification regarding                                                                         
individuals practicing with Native nonprofit groups. Ms.                                                                        
Reardon stated that they would need a license. He questioned                                                                    
if there was support for the legislation in rural areas.                                                                        
                                                                                                                                
Vice Chair Bunde clarified that those working in public                                                                         
schools would be required to have a master degree. Those in                                                                     
private practice would have to have certification at the                                                                        
national level. He thought that those currently practicing                                                                      
in Alaska already have their certification.                                                                                     
                                                                                                                                
There being NO OBJECTION, CSHB 105 (FIN) was Moved from                                                                         
Committee.                                                                                                                      
                                                                                                                                
CSHB 105 (FIN) was REPORTED out of Committee with "no                                                                           
recommendation" and a new fiscal note by the Community and                                                                      
Economic Development.                                                                                                           
HOUSE BILL NO. 191                                                                                                              
                                                                                                                                
"An Act relating to charter schools; and providing for                                                                          
an effective date."                                                                                                             
                                                                                                                                
Members were provided with a proposed committee substitute                                                                      
on May 17, 1999 (copy on file).                                                                                                 
                                                                                                                                
REPRESENTATIVE FRED DYSON, SPONSOR, noted that the proposed                                                                     
committee substitute had not been adopted.                                                                                      
                                                                                                                                
Co-Chair Mulder MOVED to ADOPT proposed committee substitute                                                                    
1-LS0598\N, 12/17/99. There being NO OBJECTION, it was so                                                                       
ordered.                                                                                                                        
                                                                                                                                
Representative Dyson noted that the committee substitute                                                                        
removed items from the original legislation that reduced the                                                                    
fiscal cost. He maintained that the committee substitute now                                                                    
contains 3 or 4 essential items. Section 1 would increase                                                                       
the number of charter schools to 60, double the current                                                                         
number. He observed that charter schools have had difficulty                                                                    
obtaining leases and financing due to the five-year contract                                                                    
limit. The committee substitute would extend the contract                                                                       
period from 5 to 10 years. All of the charter schools have                                                                      
struggled financially. Charter schools receive approximately                                                                    
half of the per pupil funding available to school districts.                                                                    
The legislation would require school districts to                                                                               
demonstrate to charter schools where the funding is being                                                                       
used. Charter schools would be allowed to negotiate with                                                                        
school districts for services. For instance, the charter                                                                        
school could negotiate with the school district to provide                                                                      
its own library services or use other available library                                                                         
services in order to reduce their cost of services. He                                                                          
recounted a situation in which a charter school located next                                                                    
to a public library opted to use the public library instead                                                                     
of a school district library. The charter school also                                                                           
contracted with a health club for the use of its gymnasium.                                                                     
                                                                                                                                
Co-Chair Mulder asked the primary mission of charter                                                                            
schools. Representative Dyson stated that the mission is to                                                                     
allow parents to set the primary direction for their                                                                            
children's education. The faculty and parents decide the                                                                        
emphasis, which surrounds the core information required by                                                                      
state law.                                                                                                                      
                                                                                                                                
Co-Chair Mulder questioned if operation of charter schools                                                                      
would be enhanced by the amendments, which would assure a                                                                       
fair share of the allocation of funds. Representative Dyson                                                                     
stated that he could not demonstrate that charter schools                                                                       
have not received a fair portion of pupil costs. He                                                                             
acknowledged concerns by charter school members that they                                                                       
have not received a fair share.                                                                                                 
                                                                                                                                
Representative Austerman questioned if charter schools would                                                                    
have to follow standards such as exit exams.                                                                                    
                                                                                                                                
WES KELLER, STAFF, REPRESENTATIVE FRED DYSON clarified that                                                                     
charter schools are public schools and are subject to the                                                                       
same requirements as other schools. Charter schools would be                                                                    
required to meet exit exam qualifications.                                                                                      
                                                                                                                                
Vice Chair Bunde questioned if current charter schools are                                                                      
nearing the end of their 5-year contracts.                                                                                      
                                                                                                                                
Representative Dyson responded that he did not know of any                                                                      
charter schools that had more than a 2-year (leasing)                                                                           
contract.                                                                                                                       
                                                                                                                                
Vice Chair Bunde asked if there is a minimal requirement for                                                                    
operation of charter schools. Representative Dyson noted                                                                        
that there is no requirement for continuation of a charter                                                                      
school. He did not think that much effort was needed to                                                                         
protect leaseholders. The most difficult issue for charter                                                                      
schools is the start up cost.                                                                                                   
                                                                                                                                
In response to a question by Representative Williams,                                                                           
Representative Dyson noted that the legislation would be                                                                        
permissive and allow school districts and charter schools to                                                                    
work out arrangements regarding services, such as library or                                                                    
gymnasiums services.                                                                                                            
                                                                                                                                
Representative Dyson acknowledged that the Anchorage School                                                                     
District is supportive of the contract extension and the                                                                        
increase in the number of allowable charter schools. They                                                                       
are not supportive of accounting requirements to identify                                                                       
costs. The Department of Education and Early Development is                                                                     
supportive of the cost accounting requirement.                                                                                  
                                                                                                                                
Mr. Keller explained that one purpose of charter schools is                                                                     
to provide a vehicle for reform of public schools and                                                                           
innovation. Each charter school can work with the school                                                                        
board of their area. Involved parents are passionate and                                                                        
active.                                                                                                                         
                                                                                                                                
Representative Dyson further explained that the intent of                                                                       
(section 4) the legislation is to allow negotiations with                                                                       
school districts to transfer funds from the school district                                                                     
to the charter school for services not provided by the                                                                          
school district.                                                                                                                
                                                                                                                                
Co-Chair Therriault observed that no fees are charged at                                                                        
municipal libraries. He noted that some of the funding used                                                                     
to operate schools comes from the local government                                                                              
contribution.                                                                                                                   
                                                                                                                                
Representative Dyson concluded that the amount of money                                                                         
received from the school board would go up because they are                                                                     
not utilizing the service.                                                                                                      
                                                                                                                                
Representative J. Davies observed that there would be a                                                                         
problem if the majority of students utilized the municipal                                                                      
library. He pointed out that there is an equity issue. He                                                                       
referred to page 2. He noted that the name of the teacher is                                                                    
required. He questioned why the teacher's name is part of                                                                       
the contract.                                                                                                                   
                                                                                                                                
Mr. Keller noted that name of the teacher is required under                                                                     
existing law. Representative Dyson added that charter school                                                                    
teachers are required to be members of the teachers'                                                                            
bargaining unit and are considered employees of the school                                                                      
district. He noted that Kansas City has merged its municipal                                                                    
and public school libraries. He stressed that few charter                                                                       
schools would have access to public libraries.                                                                                  
                                                                                                                                
GREG MILLR, AQUARIAN CHARTER SCHOOL, ANCHORAGE testified via                                                                    
teleconference in support of the legislation. He noted that                                                                     
the Aquarian school supports 210 students in grades K-6.                                                                        
This is the third attempt to improve the charter school law.                                                                    
He emphasized that charter schools are still required to                                                                        
meet academic and fiscal standards. He clarified that the                                                                       
name of the teacher is only included on the start up                                                                            
application.                                                                                                                    
                                                                                                                                
Mr. Miller spoke in support of amending section five to                                                                         
extend contracts to 10 years. He observed that it is                                                                            
difficult to negotiate leasing contracts because many                                                                           
landlords will not consider contracts of short duration. He                                                                     
spoke in favor or deleting the sunset clause. He noted that                                                                     
every charter contract comes up every year. Contracts can be                                                                    
terminated for good cause. He maintained that checks and                                                                        
balances are in place. He emphasized that charter schools                                                                       
favor provisions to allow the use of other public buildings                                                                     
as long as they meet code requirements.                                                                                         
                                                                                                                                
Mr. Miller spoke in favor of other provisions in the bill.                                                                      
He referred to section 4, which would require accounting of                                                                     
services by school districts. The indirect cost is                                                                              
established by the Department of Education and Early                                                                            
Development. The Anchorage School District's indirect cost                                                                      
is 4.39 percent. He stated that the indirect cost for school                                                                    
administration services is reasonable. The use of this                                                                          
amount would not require an increase of work by the school                                                                      
district. The indirect cost could be higher in rural areas.                                                                     
He acknowledged that it would cost school districts to do                                                                       
the accounting, but emphasized that charter schools should                                                                      
know what they are getting for their money. He stressed that                                                                    
charter schools should not be assessed more than the                                                                            
indirect cost of 4.39 percent and recommended that the                                                                          
administrative costs be capped at the indirect cost. He                                                                         
noted that their school has been successful at opting out of                                                                    
services.                                                                                                                       
                                                                                                                                
Mr. Miller noted that the Family Partnership Charter School                                                                     
also supports the legislation.                                                                                                  
                                                                                                                                
(Tape Change, HFC 00 - 21 Side 1)                                                                                               
                                                                                                                                
Vice Chair Bunde felt that it could adversely affect                                                                            
students to be in a charter school that did not continue and                                                                    
questioned if Mr. Miller would support a minimum requirement                                                                    
for operation of charter schools. Mr. Miller responded that                                                                     
administrative difficulties would be the only reason a                                                                          
charter school would not succeed. He stressed that charter                                                                      
schools are created to teach children. He suggested that the                                                                    
only difficulty a charter school child would have if they                                                                       
had to return to a regular classroom, would be that they                                                                        
could be beyond the level of other students in their class.                                                                     
                                                                                                                                
Co-Chair Mulder noted that statutes do not contain a clear                                                                      
definition of the mission or objective of charter schools.                                                                      
He felt that charter schools have labored under the effort                                                                      
to be everything to everybody. He spoke in support of                                                                           
creating a concise mission statement for charter schools in                                                                     
order to answer many of the questions being asked and                                                                           
provide the answers that would help more clearly identify                                                                       
hindrances to success.                                                                                                          
                                                                                                                                
Mr. Miller disagreed that current charter schools have tried                                                                    
to be all things to all people. He noted that each charter                                                                      
school has a different emphasis. He pointed out that the                                                                        
mission statement could be found in the charter school's                                                                        
application.                                                                                                                    
                                                                                                                                
Co-Chair Mulder noted that everyone did not want charter                                                                        
schools to succeed. He expressed support for more                                                                               
educational opportunities or choice.                                                                                            
                                                                                                                                
CAROL COMEAU, ASSISTANT SUPERINTENDENT FOR INSTRUCTION,                                                                         
ANCHORAGE SCHOOL DISTRICT, ANCHORAGE testified that the                                                                         
Anchorage School District supports section 1, which would                                                                       
allow more charter schools. She noted that section 4 is the                                                                     
most problematic to school districts. School districts are                                                                      
concerned about the implementation of section 4. She agreed                                                                     
with the elimination of the sunset clause. The space issue                                                                      
is a major concern in Anchorage. She supported extending the                                                                    
contract length to 10 years. She added that the biggest                                                                         
challenge is meeting occupancy codes for facilities in the                                                                      
city of Anchorage                                                                                                               
                                                                                                                                
Representative J. Davies asked if language in subsection (f)                                                                    
would affect section 4. He asked if the charter schools                                                                         
would receive more than their basic need.                                                                                       
                                                                                                                                
JANET STOKES, CHIEF FINANCIAL OFFICER, ANCHORAGE SCHOOL                                                                         
DISTRICT, ANCHORAGE responded to questions by Representative                                                                    
J. Davies. She interpreted the reference to AS 14.17.410(c)                                                                     
as additional local revenues above the 4-mil contribution.                                                                      
Anchorage has implemented activity fees in lieu of reducing                                                                     
programs. According to this section, charter schools                                                                            
electing not to participate in these programs would receive                                                                     
funds that would have gone to the program. She felt that                                                                        
this would be problematic.                                                                                                      
                                                                                                                                
CYNTHIA HENRY, PRESIDENT, FAIRBANKS NORTH STAR BOROUGH                                                                          
SCHOOL DISTRICT, FAIRBANKS testified via teleconference. She                                                                    
stated that HB 191 would be problematic, especially in                                                                          
regards to section 4. She expressed concern that section 4                                                                      
could result in an adversarial relationship between the                                                                         
school district and its charter schools. The district's open                                                                    
policy includes charter schools. She cautioned that the                                                                         
provision to account for services could create a                                                                                
bureaucratic nightmare and increase costs and personnel.                                                                        
                                                                                                                                
Ms. Henry stated that the Fairbanks North Star School                                                                           
District does not oppose the elimination of the sunset date.                                                                    
Fairbanks received five charter school charters. Only two                                                                       
have been awarded.                                                                                                              
                                                                                                                                
Co-Chair Therriault noted that it would not be difficult to                                                                     
account for snow removal or rent. Ms. Henry agreed, but                                                                         
emphasized that other services would be more difficult.                                                                         
                                                                                                                                
MIKE FISHER, ASSISTANT SUPERINTENDENT, BUSINESS AND FINANCE,                                                                    
FAIRBANKS NORTH STAR BOROUGH SCHOOL DISTRICT acknowledged                                                                       
that the school district has mechanisms in place to account                                                                     
for services such as snow removal and rent. They do not                                                                         
currently charge the indirect rate to their charter schools.                                                                    
It would be difficult to generate a true intergovernmental                                                                      
cost allocation.                                                                                                                
                                                                                                                                
Representative J. Davies referred to subsection (f). Mr.                                                                        
Fisher explained that their local contribution is                                                                               
approximately $30 million dollars, $18 million dollars of                                                                       
this comes from the required contribution. The additional                                                                       
$12 million dollars would be prorated to the charter schools                                                                    
based on their adjusted Average Daily Membership (ADM).                                                                         
                                                                                                                                
Ms. Henry felt that the School District's current                                                                               
contribution would meet this level of contribution but                                                                          
reiterated that accounting would be problematic.                                                                                
                                                                                                                                
Co-Chair Therriault acknowledged that the Fairbanks North                                                                       
Star Borough School District is probably providing                                                                              
assistance beyond the required contribution level, but                                                                          
emphasized that the intent of the legislation is to address                                                                     
districts that are not providing a fair allocation                                                                              
                                                                                                                                
DR. NICK STAYROOK, FAIRBANKS NORTH STAR BOROUGH SCHOOL                                                                          
DISTRICT, FAIRBANKS testified via teleconference. He echoed                                                                     
comments by Ms. Henry and Mr. Fisher. He stated that he did                                                                     
not know if allocation of the addition local contribution                                                                       
would be considered as part of the basic need for charter                                                                       
schools. He noted that additional sources of funds are                                                                          
provided to charter schools in Fairbanks. He referred to a                                                                      
proposed amendment regarding the use of public facilities by                                                                    
charter schools (copy on file.) He pointed out that AS                                                                          
14.03.255(d) states that the chief school administrator must                                                                    
determine that the facility meets requirements for health                                                                       
and safety applicable to other public schools in the                                                                            
district.                                                                                                                       
                                                                                                                                
Representative J. Davies asked if the school district would                                                                     
retain liability if a charter school did not complete their                                                                     
contract. Mr. Stayrook explained that the charter schools                                                                       
operate on a 5-year term, however their contract is                                                                             
negotiated annually. He anticipated that existing charter                                                                       
schools would receive a new 5-year contract at the end of                                                                       
their current term. He did not think that an increase in the                                                                    
number of charter schools would have a negative impact.                                                                         
                                                                                                                                
LARRY SEMMENS, ACADEMIC POLICY COMMITTEE, AURORA BORELIS                                                                        
CHARTER SCHOOL, KENAI testified via teleconference in                                                                           
support of HB 191. He pointed out that basic need is the                                                                        
minimum amount that a school district provides. He stressed                                                                     
that their charter school could not function at the level of                                                                    
basic need. He noted that their school has 90 students.                                                                         
There are openings for 20 students in the next year with a                                                                      
waiting list of 109 students. He did not want to see charter                                                                    
schools receive less than they are currently receiving.                                                                         
                                                                                                                                
Representative G. Davis questioned if their charter school                                                                      
is successful economically. Mr. Semmens noted that they have                                                                    
had difficulty procuring a facility to house their charter                                                                      
school. The school started in a church and paid $75 thousand                                                                    
dollars a year in rent. They are now in a vacant elementary                                                                     
school, which has been provided by the city and school                                                                          
district without a fee. He noted that their teachers are new                                                                    
to the district and at the lower end of the salary scale.                                                                       
When teachers move to upper levels, funding will be more                                                                        
difficult.                                                                                                                      
                                                                                                                                
Representative J. Davies asked if they have had problems                                                                        
with the issues that the provisions in section 4 are                                                                            
intended to address. Mr. Semmens explained that the charter                                                                     
school has been charged for services that they did not                                                                          
receive, but that they had received sufficient funding. He                                                                      
did not want to quibble over every item.                                                                                        
                                                                                                                                
SEAN STRAUSS, PARENT, JUNEAU testified in support of HB 105.                                                                    
He noted that there is only one remaining charter available                                                                     
in Juneau. There are two applications for charter schools                                                                       
pending in Juneau, a Montessori charter school and a Native                                                                     
language charter school. He spoke in support of section 1                                                                       
with no geographic restrictions.                                                                                                
                                                                                                                                
Vice Chair Bunde noted without geographical restrictions                                                                        
that the majority of schools could go to Anchorage. He                                                                          
questioned if there should be geographic considerations. Mr.                                                                    
Strauss emphasized that the increase in schools would allow                                                                     
schools to be considered based on their merit.                                                                                  
                                                                                                                                
EDDY JEANS, SCHOOL FINANCE MANAGER, DEPARTMENT OF EDUCATION                                                                     
AND EARLY DEVELOPMENT provided information regarding the                                                                        
legislation. He discussed the additional local contribution                                                                     
contained on page 2, line 22. This section refers to the                                                                        
additional local contributions that municipalities are                                                                          
allowed to make to school districts under the foundation                                                                        
program. This is limited to two revenue sources, the value                                                                      
of in kind services performed by the city or borough and the                                                                    
tax appropriation.                                                                                                              
                                                                                                                                
Mr. Jeans referred to page 2, line 31:  "A local school                                                                         
board shall provide an approved charter school with an                                                                          
annual budget. The budget shall be not less than the basic                                                                      
need for the charter school as determined under AS                                                                              
14.17.410(b)(1)(A) and (B) and must reflect the itemization                                                                     
and per student value required under (e) of this section".                                                                      
He noted that there is a proposed amendment to delete the                                                                       
reference to (A) and (B). These are two of the four                                                                             
components that make up basic need. He noted that schools                                                                       
are given and adjusted ADM. This is multiplied by the                                                                           
district cost factor and then multiplied by the special                                                                         
needs factor of 1.20. There are other adjustments for                                                                           
intensive student services and correspondence students. This                                                                    
results in the school's adjusted ADM. This is multiplied by                                                                     
the base student allocation of 3,940 to calculate basic                                                                         
need. Basic need is divided into three components: state                                                                        
funding, federal impact aid dollars and the four mil local                                                                      
share. The basic need can be easily calculated for all                                                                          
charter schools. The legislation lists the type of services                                                                     
that can be provided by the school district. School district                                                                    
and the charter school can negotiate for special needs and                                                                      
intensive services.                                                                                                             
                                                                                                                                
Co-Chair Therriault clarified that charter schools would not                                                                    
automatically receive the 20 percent for special needs. Mr.                                                                     
Jeans noted that some charter schools are retaining the 20                                                                      
percent and providing special needs services and some are                                                                       
having their needs provided by the school district.                                                                             
                                                                                                                                
Co-Chair Therriault expressed concern that schools that do                                                                      
not have special needs students do not receive part of this                                                                     
funding.                                                                                                                        
                                                                                                                                
Mr. Jeans pointed out that the calculation for special needs                                                                    
is an adjustment to all the students across the district.                                                                       
The charter school students will generate 20 percent for                                                                        
special needs regardless of whether they special needs                                                                          
students or get to keep the money.                                                                                              
                                                                                                                                
Co-Chair Mulder concluded that the calculation for basic                                                                        
needs is simple to make. Mr. Jeans agreed. Co-Chair Mulder                                                                      
asked the Department of Education and Early Development's                                                                       
role in relationship to charter schools.                                                                                        
                                                                                                                                
(Tape Change, HFC 00 - 21, Side 2)                                                                                              
                                                                                                                                
Mr. Jeans agreed that the legislation would diminish the                                                                        
department's involvement in financial mediation. He                                                                             
emphasized that the department's obligation in the                                                                              
application process would remain. He thought that the                                                                           
department would remain involved in some of the negotiations                                                                    
for itemized services.                                                                                                          
                                                                                                                                
Co-Chair Mulder questioned if the department viewed its role                                                                    
as an arbiter. Mr. Jeans responded that the department would                                                                    
be a sounding board, not necessarily an arbiter. Co-Chair                                                                       
Mulder questioned who would make the final decision. Mr.                                                                        
Jeans concluded that the final decision would have to be                                                                        
negotiated between the charter school and the school board.                                                                     
                                                                                                                                
In response to a question by Co-Chair Therriault, Mr. Jeans                                                                     
clarified that impasses would not be "kicked back" to the                                                                       
department. He added that the charter school community                                                                          
relies on the department to look at some of the issues that                                                                     
they do not understand. The department provides advice and                                                                      
direction.                                                                                                                      
                                                                                                                                
Representative J. Davies observed that the Board of                                                                             
Education is involved by statute. Co-Chair Mulder questioned                                                                    
if the Board "rubber stamps" decisions made by local school                                                                     
districts. Mr. Jeans did not know if the Board had ever                                                                         
turned down an application approved by a local school                                                                           
district.                                                                                                                       
                                                                                                                                
Co-Chair Therriault recalled that, during debate on the                                                                         
charter legislation, the involvement of the state Board of                                                                      
Education gave comfort to concerns that things might not                                                                        
work out at the local level.                                                                                                    
                                                                                                                                
Representative J. Davies recounted that the charter school                                                                      
legislation was a pilot program that allowed federal funds                                                                      
for charter schools and that those funds are about to run                                                                       
out. Mr. Jeans agreed that the charter school legislation                                                                       
was a pilot program. He noted that the legislation would                                                                        
institutionalize the program.  There is a fiscal note for a                                                                     
position to administer the program. He reiterated that the                                                                      
department assists charter schools in the application                                                                           
process.                                                                                                                        
                                                                                                                                
Representative Dyson observed that many states have charter                                                                     
school boards. He noted that there are people in the public                                                                     
school movement that do not like charter schools, but are                                                                       
willing to support them as an alternative to vouchers.                                                                          
                                                                                                                                
Representative Grussendorf referred to page 3, line 24,                                                                         
allocation of local revenues. Mr. Jeans explained that the                                                                      
local revenues cited are revenues made available by                                                                             
municipalities under AS 14.17. There is a cap on the amount                                                                     
municipalities can contribute. The legislation would take                                                                       
the amount that is contributed above the required 4 mil                                                                         
local effort and divide this by the total student population                                                                    
and multiply this per student figure by the amount of                                                                           
students in the charter school. This is the additional                                                                          
revenue that would have to be appropriated to charter                                                                           
schools above local need. Representative Grussendorf pointed                                                                    
out that some school districts are already providing these                                                                      
funds. Mr. Jeans noted that some districts provide                                                                              
additional local revenues and others do not. Representative                                                                     
Grussendorf noted that the legislature's desire to support                                                                      
charter schools has put (financial) pressures on school                                                                         
districts.                                                                                                                      
                                                                                                                                
Representative Austerman questioned if the additional local                                                                     
contribution would be tied to a specific need. Mr. Jeans                                                                        
explained that under the funding is discretionary under the                                                                     
current structure. The school board adopts a budget with a                                                                      
requested local contribution. Then assemblies make their                                                                        
appropriation to the overall operation. The funding is                                                                          
discretionary.                                                                                                                  
                                                                                                                                
BARBARA THOMPSON, DEPUTY DIRECTOR, DIVISION OF TEACHERS AND                                                                     
LEARNING SUPPORT, DEPARTMENT OF EDUCATION AND EARLY                                                                             
DEVELOPMENT provided information regarding the fiscal note.                                                                     
She noted that the state of Alaska has received federal                                                                         
funding to support charter schools for the past four years.                                                                     
These funds are ceasing.                                                                                                        
                                                                                                                                
Co-Chair Therriault noted that the fiscal note requests $100                                                                    
thousand dollars for Department of Education and Early                                                                          
Development personnel. She explained that the legislation                                                                       
would increase charter schools around the state. The                                                                            
department anticipates an increase in workload. The                                                                             
department currently has a part-time person that is paid                                                                        
with 5 percent of the federal funds.                                                                                            
                                                                                                                                
In response to a question by Representative Williams, Ms.                                                                       
Thompson acknowledged that the department is requesting                                                                         
funds for personal services, supplies, travel and                                                                               
contractual costs. She emphasized that it is a state                                                                            
program. She stressed that staff is needed to keep the                                                                          
program running and help schools to get established.                                                                            
                                                                                                                                
Representative J. Davies asked if the disappearance of                                                                          
federal funds would increase the demand on the department to                                                                    
help prepare grants and implement programs. Ms. Thompson                                                                        
indicated that the workload would shift, but did not                                                                            
anticipate that it would lessen. The department would not                                                                       
put out requests for grant proposals since they would not                                                                       
have money to put out a grant program. However, the workload                                                                    
in other areas could increase with additional charter                                                                           
schools if the cap were eliminated.                                                                                             
                                                                                                                                
Co-Chair Therriault observed that the fiscal note requests                                                                      
one position, but that additional percentages of FTE (full                                                                      
time equivalent) positions are included. Ms. Thompson                                                                           
explained that the department would be losing some federal                                                                      
grants. This will free one grant administrator to take on                                                                       
the work of this program. She explained that only one                                                                           
additional position is needed due to the ability to shift                                                                       
personnel.                                                                                                                      
                                                                                                                                
In response to a question by Representative Williams, Ms.                                                                       
Thompson explained that charter schools are reviewed as a                                                                       
real option for students' needs to be met.                                                                                      
                                                                                                                                
Representative Dyson anticipated that there is interest in                                                                      
charter schools that would be specific to professions or                                                                        
language. He anticipated that poor exit exam results would                                                                      
increase demand for alternatives.                                                                                               
                                                                                                                                
Representative Austerman questioned if additional charter                                                                       
schools would result in an increase in the cost of education                                                                    
in Alaska. Mr. Jeans responded that there is not a fiscal                                                                       
note for the foundation program. The anticipation is that                                                                       
charter schools would draw off of the existing student                                                                          
population. There would only be a shift from the formula.                                                                       
Representative Austerman questioned if it would weaken the                                                                      
existing system. Mr. Jeans emphasized that it would provide                                                                     
additional education opportunities for the general public.                                                                      
New programs would be incorporated within the existing                                                                          
system. Co-Chair Therriault observed that it would challenge                                                                    
the existing system to provide a new level of excellence.                                                                       
                                                                                                                                
Representative Dyson emphasized that students from private                                                                      
schools or home schooling may opt into the system.                                                                              
                                                                                                                                
HB 191 was heard and HELD in Committee for further                                                                              
consideration.                                                                                                                  
ADJOURNMENT                                                                                                                     
                                                                                                                                
The meeting adjourned at 4:38 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
DRAFT HFC 18 1/31/00                                                                                                            

Document Name Date/Time Subjects