Legislature(1997 - 1998)
04/08/1997 03:05 PM House HES
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE HEALTH, EDUCATION AND SOCIAL
SERVICES STANDING COMMITTEE
April 8, 1997
3:05 p.m.
MEMBERS PRESENT
Representative Con Bunde, Chairman
Representative Joe Green, Vice Chairman
Representative Al Vezey
Representative Brian Porter
Representative Fred Dyson
Representative J. Allen Kemplen
Representative Tom Brice
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
* SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 148
"An Act relating to the public school funding program; relating to
the definition of a school district, to the transportation of
students, to school district layoff plans, to the special education
service agency, to the child care grant program, and to compulsory
attendance in public schools; and providing for an effective date."
- HEARD AND HELD
(* First public hearing)
PREVIOUS ACTION
BILL: HB 148
SHORT TITLE: SCHOOL FUNDING ETC./ CHILD CARE GRANTS
SPONSOR(S): HEALTH, EDUCATION & SOCIAL SERVICES
JRN-DATE JRN-DATE ACTION
02/18/97 382 (H) READ THE FIRST TIME - REFERRAL(S)
02/18/97 382 (H) HES, FINANCE
04/04/97 988 (H) SPONSOR SUBSTITUTE INTRODUCED-
REFERRALS
04/04/97 988 (H) READ THE FIRST TIME - REFERRAL(S)
04/04/97 989 (H) HES, FINANCE
04/08/97 (H) HES AT 3:00 PM CAPITOL 106
WITNESS REGISTER
DR. JOHN G. AUGENBLICK, President
Augenblick & Myers
621 17th Street, Suite 730
Denver, Colorado 80293
Telephone: (303) 293-2175
POSITION STATEMENT: Testified on HB 148
EDDY JEANS, Manager
School Finance Section
Department of Education
801 West 10th Street, Suite 200
Juneau, Alaska 99801-1894
Telephone: (907) 465-2891
POSITION STATEMENT: Testified on CSSSHB 148(HES)
SUSAN HOPE
P.O. Box 842
Barrow, Alaska 99723
Telephone: (907) 852-4734
POSITION STATEMENT: Testified on CSSSHB 148(HES)
NANCY NICOLOS
P.O. Box 385
Barrow, Alaska 99723
Telephone: (907) 852-2162
POSITION STATEMENT: Testified on CSSSHB 148(HES)
WALTER COOK, President
Barrow School Advisory Council
P.O. Box 1057
Barrow, Alaska 99723
Telephone: (907) 852-4778
POSITION STATEMENT: Testified on CSSSHB 148(HES)
ROSEMARY REEDER, Coordinator
Soldotna Community School
Lead Coordinator, Kenai Peninsula Borough School District
426 West Redoubt Avenue
Soldotna, Alaska 99669
Telephone: (907) 262-6768
POSITION STATEMENT: Testified on CSSSHB 148(HES)
CARL ROSE, Lobbyist
Association of Alaska School Boards
316 West 11th Street
Juneau, Alaska 99801
Telephone: (907) 586-1083
POSITION STATEMENT: Testified on CSSSHB 148(HES)
JOHN CYR, President
National Education Association of Alaska, (NEA-Alaska)
114 Second Street
Juneau, Alaska 99801
Telephone: (907) 586-3090
POSITION STATEMENT: Testified on CSSSHB 148(HES)
LELAND DISHMAN
North Slope Borough School District
P.O. Box 169
Barrow, Alaska 99723
Telephone: (907) 852-5311
POSITION STATEMENT: Testified on CSSSHB 148(HES)
JOHN HOLST, Superintendent
Sitka School District
P.O. Box 179
Sitka, Alaska 99835
Telephone: (907) 747-8622
POSITION STATEMENT: Testified on CSSSHB 148(HES)
ACTION NARRATIVE
TAPE 97-26, SIDE A
Number 0000
CHAIRMAN CON BUNDE called the House Health, Education and Social
Services Standing Committee meeting to order at 3:05 p.m. Members
present at the call to order were Representatives Bunde, Porter,
Dyson, Kemplen and Brice. Representative Vezey arrived at 3:10
p.m. and Representative Green arrived at 3:32 p.m. This meeting
was teleconferenced to Barrow, Kenai, Valdez and an offnet site.
SSHB 148 SCHOOL FUNDING ETC./ CHILD CARE GRANTS
Number 0020
CHAIRMAN BUNDE announced the first item on the agenda was SSHB 148,
"An Act relating to the public school funding program; relating to
the definition of a school district, to the transportation of
students, to school district layoff plans, to the special education
service agency, to the child care grant program, and to compulsory
attendance in public schools; and providing for an effective date."
He said Dr. John Augenblick would join the committee via
teleconference. Dr. Augenblick assisted the Alaska Board of
Education when they put together the foundation formula rewrite.
He is a nationally known consultant, based in Denver, who has
assisted state Departments of Education in Alabama, Alaska, Maine,
Minnesota and Ohio. Eddy Jeans, Manager of School Finance,
Department of Education, was also scheduled to testify. The chair
wanted to walk the committee and the audience through the bill and
then have Dr. Augenblick and Mr. Jeans address any questions. He
referred to a committee substitute, version O-LSO605\B.
Number 0233
REPRESENTATIVE BRIAN PORTER made a motion to adopt the committee
substitute, version O-LSO605\B. There being no objection, proposed
CSSSHB 148(HES) was before the committee.
Number 0246
DR. JOHN G. AUGENBLICK, President, Augenblick & Myers, testified
next via teleconference from an offnet site.
Number 0293
CHAIRMAN BUNDE explained that a number of people have been
concerned about a rewrite of the foundation formula. The
committee's goal is to try to simplify the formula so that the
general public has a bit more ownership; so that they can see the
connection between students and dollars as well as making sure that
state funding supporting education is distributed fairly. He asked
Dr. Augenblick to begin with Section 1 and walk the committee
through the bill.
Number 0367
DR. AUGENBLICK stated that this bill does what many other states
are also trying to do; providing an adequate and equitable amount
of money for education. This goal is tricky and there is a lot of
disagreement about how best to achieve it. He supported this bill
because its approach takes advantage of the best knowledge, based
on experiences around the country, of how this ought to work.
Section 1 says funding will be provided to the school districts
based on the number of pupils that they enroll. These students are
enrolled in the district to be served as opposed to alternative
ways of counting those students. In addition, language suggests
that these pupils will be counted in a variety of different ways to
reflect the various costs that we expect the school districts will
face in serving them. These costs involve things found in other
states, plus some unique costs related to Alaska.
DR. AUGENBLICK explained that the language defines what extra money
will be available to students who participate in special education.
Additional money is provided to those students participating in the
gifted and talented programs. Additional money is also provided
based on characteristics of individual communities based on the
knowledge of what costs are likely to be incurred. The need for an
additional study is expressed in the bill. This study would help
set more accurate numbers, which might be used in future years.
Number 0543
CHAIRMAN BUNDE confirmed that Dr. Augenblick was referring to the
area cost differential. All the iterations of the foundation
rewrites - the Senate versions, the Governor's bill and CSSSHB
148(HES) - address updating the area cost differential. Senator
Wilken announced this morning that this study is a crap shoot. The
state will commission a study and then the state will have to live
by the results; there might be winners and losers, but there are no
preconceived notions going into the study.
Number 0590
DR. AUGENBLICK expressed that he likes to think this creates place
holders for factors that are yet to be developed. The place
holders have numbers assigned to them based on prior history. He
expected that the numbers produced, in the future, will be somewhat
different but probably not terribly different. He didn't feel the
risk to be so terrible that it should stop the legislature from
moving ahead with legislation. A big shift is being made in
education, a shift that most other states have made. This shift
goes from a unit based funding system, units of children, to one
that is student based. This shift represents a trend that almost
every state has followed. Certainly no state has gone the opposite
way; from a per student approach to a unit approach.
DR. AUGENBLICK stated that Wyoming was found to be unconstitutional
a year or so ago in their funding mechanism. In June, the Wyoming
legislature will meet and talk about making the shift to per
student funding. Other states have made this kind of change in the
past few years. Nebraska, Louisiana, Mississippi have made this
shift. Most states have found it to be productive. Provided that
Alaska does what is included in this bill; to recognize that on one
hand you want to treat every student as if they are the same, but
to also recognize those students have different needs based on
their own characteristics. Some students participate in programs
which are more expensive than the regular programs such as live-in
programs where the cost is higher. This bill tends to address all
of those things, it does it appropriately.
DR. AUGENBLICK said, like legislation in other states, this bill
defines the foundation program. The bill has an expectation that
school districts should have a certain amount of revenue based on
the numbers of students they serve and on the characteristics of
those students. The bill also expects local school districts to
make a contribution. He added that other states have also included
this provision. Education is not a fully funded state system,
there is an expectation that local school districts will make a
contribution. The contribution by the local school districts is
defined in the bill, with a little change over time.
Number 0771
DR. AUGENBLICK stated the other thing that this bill does is to
protect the school districts during the transition. If the school
found they would get less money under this formula than they might
have received under the current formula, then the bill says that
the school will be protected in the short term. After five years
of this protection that money will not be provided, the school
districts will be on the formula as defined in the bill. This is
a procedure which other states have used, they recognized that it
is unfair to expect the school district to be able to respond
immediately to the kind of change this bill creates. However, the
expectation is that the school district will be able to make this
change in just a few years. From his perspective, this is a well
designed bill. This bill is consistent with the best practices of
other states, philosophically it is strong. One way in which to
evaluate the bill is by its impact on individual school districts
and communities. The legislature will have to determine its impact
in order to feel comfortable with the results. Every other state
has gone through the same process.
Number 0872
DR. AUGENBLICK said a bill like this needs to have a strong
philosophical underpinning, there has to be a reason why it does
what it does. He felt this bill had this strong philosophical
underpinning. Secondly, this bill had to be supported by technical
work of the sort that the Department of Education (DOE) has done so
that the numbers which drive the formula are based on the best
knowledge that we have of what works in Alaska. Finally, the bill
has to pass a political test which is based on the legislative
judgement. The legislature has to decide whether or not the
philosophy is good and the technical work is strong so that the
political work can be done to see that it happens.
Number 0920
DR. AUGENBLICK felt it was a well designed bill. Other states do
many pieces of this bill. The bill is unique in that it considers
factors specific to Alaska.
Number 0943
EDDY JEANS, Manager, School Finance Section, Department of
Education, addressed the issue of area cost differentials. He said
CSSSHB 148(HES) assigns area cost differentials at a funding
community level. When area cost differentials are studied, the DOE
will consider the cost of operating a school. Currently the
foundation area cost differentials are assigned to a school
district and reflect the cost of operating in a district. He
explained that CSSSHB 148(HES) takes the 23 differentials in
statute and recommends that they be reduced down to seven.
Number 0993
CHAIRMAN BUNDE addressed the past concept of funding communities
and the proposed concept of funding schools. He thought that if
the state is going to have area cost differentials based on each
school, there would be more area cost differentials.
Number 1015
MR. JEANS answered that there are fewer variables. Currently there
are 23 variables and CSSSHB 148(HES) would reduce it down to seven
variables.
Number 1027
CHAIRMAN BUNDE referred to page 5, line 30, this language suggests
that students be counted on October 15, every year. He asked if
there was an advantage or disadvantage to counting more than once
a year.
Number 1049
DR. AUGENBLICK stated that this issue needs to be addressed by the
legislature. More and more states have moved away from a system of
counting students every day. People found this task burdensome and
did not create a significantly more accurate number than just
counting students once a year. Some states have a system where
they do a student count two or three times during the year. Over
the course of a year, the student count changes enough that it is
appropriate to do it more than once. Typically the second semester
has a lower number. Counting one time in the fall might result in
more students being counted then actually are being served
throughout the school year. The only adjustment he suggested would
be to do a student count two, three or maybe four times. He
certainly would not suggest counting more than four times.
Number 1121
MR. JEANS referred to that section of the statute dealing with
student count estimates. These estimates are used by the DOE to
prepare the foundation budget, they are not the numbers on which
the actual foundation payments are based. The foundation payments
are based on an actual student count occurring on the fourth Friday
in October.
Number 1146
CHAIRMAN BUNDE commented that in his experience, in the urban
settings where people are more transient, the student population is
lower in the spring than it is in the fall. He didn't intend to
suggest that the students should be counted every day. He proposed
a count in the fall and a count in the spring.
Number 1167
MR. JEANS directed the members' attention to page 8, which requires
a count on the 20th day in October and an optional count on the
second Friday in February which is also a 20 day count. These
counts are consistent with the current statute. He referred back
to the projections and said that districts have indicated that the
October 15th date is difficult to meet. The schools would prefer
to wait until they completed the current year count to provide DOE
with estimates for the next year.
MR. JEANS continued that delaying the count would be a problem for
DOE because of budgeting time constraints, but the department could
work with this issue. He reiterated that there is a required count
in October and an optional count in February if it provides the
school with additional revenue.
Number 1201
CHAIRMAN BUNDE clarified that the schools count twice, but if it is
to the school's advantage they only list their count once.
Number 1231
MR. JEANS verified that the schools count twice if it is to their
advantage.
Number 1239
CHAIRMAN BUNDE asked why there was an option of only counting once.
Number 1242
MR. JEANS answered that some school districts will see an increase
in enrollment and this second count provides them with an
opportunity to receive additional funding.
Number 1253
CHAIRMAN BUNDE referred to page 7, starting at line 8, the
percentage of a school's operating budget which should be invested
in the instructional component. Another way to express this
language is that it keeps the administrative overhead low.
Number 1286
DR. AUGENBLICK said this is an unusual component. A few states,
including Louisiana, have this language on the books. The language
attempts to ensure that the majority of the money is focused on
instruction and a minimal amount is spent on administration. Most
places suggest that there isn't a large variation among school
districts. The schools tend to spend most of their money in
instruction. This section of the bill isn't a problem if it
doesn't create a burden for DOE or anyone else to collect and
verify the data. An additional area of concern would be the
smallest school district or school community which typically spends
a higher amount on fixed costs; administration, lighting and
building maintenance. He could not answer whether or not 60
percent was enough for them to maintain those costs. He reiterated
that this language is not typical in regards to what other states
are doing, but it was not a problem if the legislature felt it
needed to be included in order to ensure that districts spent most
of their money on instruction.
Number 1370
CHAIRMAN BUNDE clarified that Dr. Augenblick was aware of the
single site situation in Alaska.
Number 1376
MR. JEANS said there used to be a similar statute, a 55 percent
instruction requirement, which he believed was repealed in 1987.
The DOE collected information to compute this measurement to ensure
that districts met this requirement. He pointed out that one
school district, on a annual basis, could not meet the 55 percent
and through DOE sought waivers before the state Board of Education.
Number 1402
CHAIRMAN BUNDE asked what would have happened if the waivers had
not been granted.
Number 1405
MR. JEANS could not respond to the question as waivers were always
granted.
Number 1416
REPRESENTATIVE TOM BRICE asked if there were any provision for
waivers in CSSSHB 148(HES).
Number 1427
MR. JEANS answered yes, in Section 14.17.520 (c), where it says the
commissioner shall review the annual audits and then the state
Board of Education could provide a waiver. This language continues
down into subsection (d), line 24.
Number 1464
CHAIRMAN BUNDE said Section 3 of CSSSHB 148(HES) dealt with
definitions. He asked Mr. Jeans if he wanted to make any comments
on Section 8, dealing with the transportation of students.
Number 1483
MR. JEANS explained that CSSSHB 148(HES) moves the current method
of reimbursing schools for pupil transportation services into the
foundation program. The DOE has developed place holder adjustment
factors for transportation costs. These factors were developed on
district pupil transportation costs, based on a percentage of their
total budget. The intent is to direct those monies to districts
providing those services, as opposed to just distributing money
statewide. The DOE will continue to do bus safety inspections and
pass drug and alcohol tests for bus drivers.
Number 1545
MR. JEANS explained that the remaining sections of CSSSHB 148(HES)
are clean-up sections. The language addresses statutory references
to the foundation aid, average daily membership and other terms.
The language is cleaned-up to be consistent in the legislation.
Number 1580
REPRESENTATIVE BRICE asked, to what degree, other states'
foundation formulas require a strict accounting of funds spent at
the local level on special education and gifted and talented
programs.
Number 1597
MR. JEANS answered that other states have categorical expenditure
requirements for special education. Currently the state of Alaska
does not have that requirement, although the state provides
categorical revenue for those services. Under CSSSHB 148(HES),
there would be a flat 20 percent allocation to cover all
categorical needs; special education, bilingual, vocational
education and gifted and talented.
Number 1617
REPRESENTATIVE BRICE asked how the transportation component of
CSSSHB 148(HES) would affect the Fairbanks district which buses
private students.
Number 1651
MR. JEANS answered that when transportation adjustments were
developed, the total cost of providing transportation was taken
into the percentage of the total budget. Currently, Fairbanks is
being reimbursed for routes that have some private school students
on them and this situation would have been included in that factor.
Number 1667
REPRESENTATIVE PORTER suggested that, in future committee meetings,
someone take a blackboard and take this formula from point A to
point B.
Number 1693
REPRESENTATIVE FRED DYSON discussed the difficulties of addressing
a bill which only lists the paragraphs of the foundation formula
being addressed in CSSSHB 148(HES). He asked if someone could say
how the philosophy and the general approach was being changed. He
understood that the formula moves from units to actual students.
Number 1733
CHAIRMAN BUNDE said the committee has not had a side by side
comparison of the existing formula and this proposed formula.
Number 1743
REPRESENTATIVE DYSON asked that if someone could summarize what
CSSSHB 148(HES) aims at changing, then these details would make
more sense.
Number 1760
CHAIRMAN BUNDE referred to a chart which states the differences
between the current formula, SB 36, the Governor's bills, SB 146
and CSSSHB 148(HES). Currently there is no spread sheet which will
state what will happen to individual districts.
Number 1802
MR. JEANS referred to the chart, under SB 146, second block down
which lists "categorical revenues" as 120 percent and clarified
that it is a 20 percent allocation above the base as is the
previous two columns. He suggested that this is a typographical
error, it was down in the next block as well.
Number 1825
REPRESENTATIVE BRICE clarified that SB 146 is the same as CSSSHB
148(HES), SB 85 and HB 126 in those situations.
Number 1837
MR. JEANS then reiterated that Section 9 is clean-up language. It
refers to AS 14.11.008(b), the school construction statute. On
page 12, the bill lists the district's participating share based on
the full value per average daily membership (ADM). This language
spells out average daily membership as opposed to listing it as
ADM, cleans up the references to assessed value, when it is
referenced in this bill.
Number 1888
REPRESENTATIVE BRICE asked if Dr. Augenblick could explain the
background behind providing or not providing sideboards in
legislation to ensure that school districts across the state spend
their special needs money in those areas.
Number 1945
DR. AUGENBLICK said there are two philosophies concerning
categorical or special needs programs. Some believe that these
things ought to be done as a block grant type of program; where
somebody determines how much more money a particular program might
cost through a formula procedure, making sure that money is
provided and then let the school districts or the recipients of
that money spend it in whatever way they feel is most appropriate.
Those recipients may decide that they don't need to spend as much
money as they receive from the formula or they may decide that they
need to spend more. This philosophy is to let the school districts
make those decisions because they are the ones closest to the
services being provided. This philosophy is appropriate as long as
the legislature can hold the school districts accountable, not so
much for how they spend their money, but for what is produced by
that spending. Those districts should be accountable for the
performance or the improvement in the performance of the students
who are supposed to benefit from that money.
DR. AUGENBLICK stated that the other philosophical view is that it
might be difficult to hold the school districts accountable in that
way. It is important for the state to direct the districts to
spend some portion of that money for a specific purpose. Some
states, when they give an extra amount of money to provide a
particular kind of service, monitor the school district to make
sure that they are spending 85 to 90 percent of it in that way.
Typically the people who have children in those programs are
interested in making sure that money is available and is spent for
those purposes. It is a matter of how you hold the recipients
accountable; for what is produced or how they spend the money.
Number 2033
REPRESENTATIVE BRICE asked the philosophy of CSSSHB 148(HES)
regarding those questions.
Number 2057
DR. AUGENBLICK understood that this bill would provide the block
grant funding. The state is providing additional money, in several
different categories, for programs or characteristics which make
the cost of providing those services different. The bill does not
require that this money be spent in any particular way.
Number 2080
MR. JEANS clarified that this interpretation of CSSSHB 148(HES) was
correct. This bill provides a 20 percent allocation for special
needs; special education, bilingual, vocational education and
gifted and talented. The bill pulls the intensive needs category
of special education out of this allocation. Students in this
category require services which have a high cost attached to them.
There are approximately 1,200 of these intensive students
statewide. The bill calls for an allocation of $22,500 per
intensive needs student.
Number 2103
DR. AUGENBLICK said it is also true that, in some cases, those
children and programs are protected by a variety of laws and
regulations. The school district can't chose whether or not to
provide the service, they are mandated to provide them.
Number 2117
MR. JEANS verified that there are federal laws which govern the
special education process through the individual educational plan
(IEP) and the services provided.
Number 2125
CHAIRMAN BUNDE commented that CSSSHB 148(HES) tries to remove some
of the past incentives for creative student categories such as
listing the entire band as gifted.
Number 2133
REPRESENTATIVE BRICE asked who was going to determine intensive
needs versus special needs and how does the legislature ensure that
there is a consistent applicability across the state.
Number 2159
MR. JEANS said there are definitions of the different categories of
special education in regulation and these are possibly located in
statute as well. The DOE has special education specialists that go
to individual school districts to determine that those students are
properly classified. This bill would reduce their scope so that
the specialists would have to focus on intensive services as
opposed to the entire program. Currently there are four different
categories in special education which DOE provides funding for;
gifted and talented, resource, self contained and intensive. He
understood that there was a very fine line between resource and
self contained. The field reviews provide opportunities for the
DOE specialists and members from the school districts to discuss
the classifications.
Number 2198
REPRESENTATIVE PORTER asked, through the DOE assessment of these
classifications of students, if they would allocate to a specific
school or district, based on the volume of kids that they had, an
additional 20 percent.
Number 2228
MR. JEANS responded that the allocation would be a 20 percent
addition above the district average daily membership; schools would
receive an allocation based on that percentage. Currently schools
have to label children in order to generate revenue. This bill, by
providing a block allocation, would allow districts to provide some
early intervention as opposed to waiting until the child actually
needs services.
TAPE 97-26, SIDE B
Number 0000
REPRESENTATIVE JOE GREEN presented a situation where student A is
a special education student at school one and moves to school two.
He asked if the money would move with that student or has that
money been allocated by a block grant to school one.
Number 0041
MR. JEANS said the allocation is still to the school district. The
responsibility of allocating revenues to individual schools lies
with the school district.
Number 0057
REPRESENTATIVE BRICE asked how the legislature could be sure that
state dollars, dedicated to special education needs, are making it
into classrooms. He also asked how the legislature could be sure
that students in an inclusion program would have an aide with them
throughout the day.
Number 0125
MR. JEANS said the school districts have federal requirements.
Currently, state requirements mirror the federal laws which govern
special education and those services. This bill provides districts
with a revenue source to address the four categories of need.
Number 0135
CHAIRMAN BUNDE commented that as an educator he felt that some days
the weight of paper equaled the child's weight.
Number 0149
REPRESENTATIVE J. ALLEN KEMPLEN asked if the 20 percent allocation
is the upper limit, in terms of what could be provided with the
proposed change.
Number 0162
MR. JEANS answered that it is a flat allocation.
Number 0169
REPRESENTATIVE KEMPLEN asked him to provide an example using a
particular school district.
Number 0178
MR. JEANS said that, through the current foundation program, there
are school districts that are generating revenue through
categorical needs; special education, bilingual, vocational
education and gifted and talented. Some schools only receive 9
percent of their total foundation funding through these categories
and some districts receive 27 percent. This bill attempts to
provide everyone with the same level of resources for the special
needs category and allow flexibility, in the district, to address
the needs the way they see fit.
Number 0219
CHAIRMAN BUNDE explained that this funding excludes intensive
needs.
Number 0225
REPRESENTATIVE KEMPLEN questioned why certain districts only had 9
percent in this category.
Number 0239
MR. JEANS answered that in those school districts only 9 percent of
their funding came from identifying students for special needs.
This situation could be interpreted that either the schools
received sufficient funding through their kindergarten through
twelfth grade allocation or the schools didn't have the specialists
on staff to aggressively identify those students with needs.
Number 0273
REPRESENTATIVE KEMPLEN wondered if the school districts with
specialists, who were good at identifying the students for
particular categories, had a number closer to 27 percent. He
suggested that the fewer specialists on staff, then the fewer
students who would be identified as having categorical needs.
Number 0310
MR. JEANS said this is not necessarily true. He did not mean to
imply this situation. He meant to say that there is a variance in
revenue which is being allocated for special needs; the three
categories of special education, bilingual categories and
vocational education. This CSSSHB 148(HES) proposes to level the
playing field for all districts.
Number 0339
CHAIRMAN BUNDE continued, CSSSHB 148(HES) attempts to simplify the
formula, creating a block fund for special needs with the exception
of the intensive needs category. This funding situation would
allow the schools to put all their money into bilingual education
if they wanted, as long as they were in the federal parameters.
Number 0358
REPRESENTATIVE PORTER clarified that the state is going to give
every school district an additional 20 percent to cover these kind
of things.
Number 0386
REPRESENTATIVE GREEN referred to the category of special education
which can range from capable to less capable learning styles. He
asked if this block grant would allow each of the school districts
to determine how much goes to each particular student.
Number 0408
MR. JEANS answered that the school districts have to provide the
services called for in the student's IEP. He presented a situation
where one student might only cost the district a couple of thousand
dollars to fulfill the resource requirement and the other student
might cost you $3,000. The allocation of funding, through the
current foundation program, is the same. The districts have to
address the needs of the students, as it's identified in the IEP,
regardless of how much revenue they generate.
Number 0454
REPRESENTATIVE GREEN asked if a block grant is given asking the
school district to service all of the listed categories, yet there
is a mandatory requirement to service students who have an IEP.
Number 0515
MR. JEANS answered that currently there are variances in the levels
of services provided within the categories. The school districts
are required to provide services identified in the IEP, regardless
of the costs. The current funding formula will provide a certain
level of funding without making an adjustment for variances within
that special needs category. The school districts are already
providing those services, as needed, in order to allocate resources
and will continue to do so under CSSSHB 148(HES).
Number 0556
REPRESENTATIVE GREEN asked if each group would have a set amount,
even if there are more students in one area and less in another.
Number 0563
MR. JEANS said this was correct.
Number 0568
REPRESENTATIVE KEMPLEN clarified that those school districts who
have presented a 27 percent need will now face a reduction of 7
percent to bring them to the 20 percent level.
Number 0586
MR. JEANS said yes, but it does not translate straight across to a
7 percent reduction.
Number 0604
DR. AUGENBLICK made some comments before he went off line. He felt
the questions being asked were good ones. He said there are a
variety of ways of addressing the questions. If the legislature
felt that pieces of this system might not do exactly what they want
them to do or they know that there are problems which might be
better addressed, then there are alternatives for those pieces. He
urged the legislature to try to stay within the overall framework
provided in CSSSHB 148(HES). This bill provides a base amount for
every student to ensure that all students are treated equally. The
amount is adjusted to account for the various student
characteristics. If one piece of this legislation doesn't work
particularly well, then he assured the legislature that it could be
change and still fit within the overall context of CSSSHB 148(HES).
He did not feel that the questions being asked indicated that the
bill was wrongheaded. He assured the committee that the questions
could be addressed within the context of the bill. The committee
should not proceed with the bill if there is a piece of it that
needs to be changed.
DR. AUGENBLICK supported the concept of CSSSHB 148(HES). He said
it was a difficult change, but he hoped the legislature would make
it. The legislature and the people providing these services will
be a lot happier once it is done.
Number 0721
CHAIRMAN BUNDE asked about PL-874 money.
Number 0735
DR. AUGENBLICK answered that this is an important question. He
stated that the chair was referring to federal money which is
sometimes referred to as impact aid. This money has caused
problems because of the federal government restrictions. These
restrictions are put on the money despite the fact that it is a
deteriorating amount. The federal government puts restrictions on
the way you can count that money. He understood that this
situation is no longer a problem. The Alaska DOE and other states
have spent a ridiculous amount of time trying to appease the
federal government so that the state can spend the money. He
understood that the formula simply doesn't require this any longer.
Number 0794
MR. JEANS verified that Dr. Augenblick was correct. The formula,
presented in CSSSHB 148(HES), does not consider impact aid funds in
determining the state's allocation to school districts. Under the
current formula, the DOE considers how much impact aid funds the
school districts receives in order to determine the amount of the
state allocation. The DOE has to meet the federal disparity test
when they do this. The federal disparity test says that the DOE
cannot have more than a 25 percent disparity between our fifth and
ninety-fifth richest to poorest districts. Legislation in 1994,
changed that disparity standard to 20 percent, which the state of
Alaska was going to have problems meeting. Legislation, SB 244,
was pursued to address that requirement last year. This October,
Congress amended the impact aid statute and put it back at 25
percent. This percentage is good for a two year period, after that
the program will be reauthorized. At that point, he anticipated
that Congress would attempt to lower the amount again. The DOE
felt this was a step in the right direction to remove impact aid
from the equation.
Number 0873
CHAIRMAN BUNDE stated that the local contribution, using Anchorage
as an example, was limited. More money could not be given, even if
you wanted to do it. He said that Anchorage never met their limit,
but he believed that both Fairbanks and Kenai did. This
requirement was put in place as a result of the richest district
giving more money to their school which created a disparity between
schools.
CHAIRMAN BUNDE explained that, in this bill, the PL-874 goes
directly to the district. In the old bill, the PL-874 came
directly to the state and then was redistributed which created
certain restrictions.
Number 0925
REPRESENTATIVE BRICE asked for an explanation of the Ohio situation
where they rewrote their foundation formula to get out from the
federal disparity test. This rewrite was taken to court and the
court ruled that the state had to meet a certain level of
disparity.
Number 0954
DR. AUGENBLICK said the Ohio system was found to be
unconstitutional by a lower court a couple of years ago. There
were two issues involved; the disparity between the school
districts and the adequacy issue of whether or not there was
sufficient money to do what they wanted to do. The lower court
decision was appealed to a mid-level court which ruled that the
system was constitutional about a year ago. This decision was then
appealed to the supreme court of Ohio, who ruled a couple of weeks
ago. The supreme court again ruled the system to be
unconstitutional. These decisions were not based on federal money,
but on state and local money. The essence of that decision is that
there was insufficient money in the system to accomplish the goals
that the state constitution established. The language of the Ohio
constitution reads, "a thorough and efficient education". In
addition, the Ohio State Board of Education adopted certain
objectives which were unable to be met by the allocated money. The
court has stayed this order for one year, giving the legislature
until the end of March 1998, to come up with a new system and to
assure the court, which will retain jurisdiction over that case,
that sufficient money is provided.
DR. AUGENBLICK stated that the Ohio court case also spoke to the
issue of capital and building. It identified the difference
between estimated needs, which the state itself determined to be
$10 billion for facilities, versus the $1 or $2 billion dollars
that were actually being put into the system. The court ruled that
the procedure was fine, but the amount of money was insufficient.
Ohio is going to have to figure out how they are going to come up
with a sufficient amount of money to meet the court's requirements.
Number 1101
SUSAN HOPE testified next via teleconference from Barrow. She is
a parent who has two children enrolled in the Barrow schools. She
opposed any bill which would reduce state foundation formula
funding of the North Slope Borough District. The funding helps the
schools pay for staff, teachers, programs, utility operations so
that her children can receive a complete education to compete with
students on a statewide and worldwide level. State funds provide
one-third of the education funding in the North Slope. If any one
of these foundation formula funding bills were passed by the
legislature, then her school district would be forced to eliminate
programs.
MS. HOPE said the school is the center of the community and that
healthy living opportunities would not be supported or provided
without state funding. Bare bones education would be the only goal
the school district would be able to accomplish. The school
district would be forced to deny school access. With less
operating dollars from the state to provide basic education, the
North Slope community would be without alternatives for healthy
living and community assemblage. She stated how important it was
for a child to learn community responsibility and ownership.
Community meetings are held in schools, this is the main link a
child, in rural Alaska, has to learn and develop social skills and
community responsibility. The schools in Barrow are truly dual
purpose, carrying both social and academic responsibilities. She
urged the committee to help all students by not approving,
considering or supporting this bill as it will cut $2.5 million to
$4 million from the North Slope Borough school district. She
believed that the solution was not with tampering with the formula
funding, but in addressing the lack of statewide funding for
education.
Number 1312
NANCY NICOLOS testified next via teleconference from Barrow. She
is a parent and has three children enrolled in school. She
commended the committee and Representative Bunde for their work on
the foundation formula funding issue. However, she did not feel
that CSSSHB 148(HES) was the issue. The North Slope Borough and
its school district are already paying their fair share. For every
dollar in state money, the borough supplies approximately $3.00 in
order to provide the North Slope students with adequate funding for
education. The North Slope Borough and municipality are facing
decreasing municipal revenue sharing which further increases the
burden upon the taxpayers.
MS. NICOLOS spoke with the business director at the school district
who estimated that the amount of lost funding for the North Slope
Borough, should HB 148(HES) pass, is between $2.5 million to $4
million. She did not feel the North Slope should be penalized
substantially by such a dramatic cut in funding, nor did she
understand the justification in taking this money from their
students to give to other students. She thought the legislature
might be overlooking the basic fact that education is not
adequately funded. She said the problem is not solved by shuffling
the same deck and redistributing it. She asked the committee to
address the issue of why their constituent's children were more
important than her children.
Number 1380
CHAIRMAN BUNDE did not feel that CSSSHB 148(HES) would be depriving
the North Slope Borough. The committee would be getting some
spread sheets to work out the amounts. He suggested that the
witnesses might be using earlier versions of the bill which did not
contain the current information.
Number 1412
WALTER COOK, President, Barrow School Advisory Council, testified
next via teleconference from Barrow. He has heard people mention
how impressive the North Slope Borough's facilities are. He
believed the facilities are what they are because the North Slope
voters have consistently taken a stand for education. The North
Slope Borough school district facilities are community centers,
providing activities for rural villages and Barrow. The schools
were not built to attract people, they are impressive because of
the commitment to education and to lessen the harsh environment.
The school district delivery system, computer network and
telecommunications system were not derived from the operating
budget, but from capital project improvement ballot issues. This
technology is needed to provide instruction to students across vast
distances, saving money in the school district's operating budget.
This bill proposes to take funding from the operating budget
because the North Slope voters strongly believe in education. He
asked if it was justified to discriminate against rural
communities.
MR. COOK said the foundation formula issue is a funding problem,
not a disbursement problem. It is not morally right to take
funding from the North Slope Borough district. He felt it was
important for the legislature to uphold the constitution which
clearly supports maintaining education. He did not understand how
the legislature thinks the North Slope can maintain a reasonable
education system with reduced state funding. Taking millions of
dollars a year away from the budget is unwarranted, especially in
a year when citizens can identify excessive state funds. As a
father of children in the schools and a voter who understands the
importance of education, he resented the notion of redistributing
education dollars. He mentioned the state resources received from
the North Slope.
Number 1570
CHAIRMAN BUNDE asked the witnesses not to confuse CSSSHB 148(HES)
with the Senate version requiring a significant contribution from
the North Slope Borough. He added that the constitution mandates
that the state provide a basic education and what constitutes this
definition is debatable. He did not think that community centers
entered into basic education.
Number 1587
ROSEMARY REEDER, Coordinator, Soldotna Community School, Lead
Coordinator for the Kenai Peninsula Borough School District,
testified next via teleconference from Kenai. She said small
cities such as Soldotna, Homer and Seward have a special need for
community education programs. Lay cultural, academic as well as
recreational activities take place in the early morning, evening
and weekend hours. The community school budget is based on a
portion of the foundation formula. She asked the legislature to
serve the students and the communities in which they live.
Number 1628
CHAIRMAN BUNDE stated that the committee intends to do what they
can for the good of the students. The committee is not out to
penalize any students in the state of Alaska.
Number 1642
MR. JEANS explained that under CSSSHB 148(HES), the required local
effort is 35 percent of the district's need as it is in the current
foundation program. Preliminary runs indicate that it would reduce
the state allocation to the North Slope Borough, in the first year,
by approximately $1.5 million out of a total budget of $11 million.
Number 1677
CARL ROSE, Executive Director, Association of Alaska School Boards,
presented an equation. He said the formula takes the average daily
membership (ADM) multiplied by the adjusted student allocation.
The adjusted student allocation takes into consideration the 1.20
factor for special needs, transportation, bilingual, bicultural and
can also be adjusted for the $22,500 dedicated to intensive need
students. The equation is then multiplied by the area cost
differential plus local contribution and this equals the aid to
schools.
MR. ROSE presented a second equation of the ADM multiplied by the
stated base allocation multiplied by the 1.20 factor for special
needs plus the intensive needs students at $22,500 multiplied by
the area cost differential plus the local contribution.
MR. ROSE said CSSSHB 148(HES) deals with change, it is the
magnitude of the change which must be examined. Back in 1987, when
the foundation formula was last revisited, some of the same basic
principles were kept; the unit value, area cost differentials, the
"categoricals" were handled in a categorical manner. In 1987,
there was one different principle, the addition of an equation for
single site schools. Since 1987, the state has been mitigating
this issue on an annual basis, with the exception of one year.
This bill, CSSSHB 148(HES), proposes a unit to a per student ADM.
Using the unit as a factor provided what is known as a front-end
load. Small schools first qualified as a funding community for two
instructional units and then calculated the amount the students
generated in terms of instructional units. Small schools around
Alaska will lose a front-end load when the funding is calculated
per student. If we take a look at the ADM, then we need to look at
those schools because their funding could be reduced by at least
one-half. He felt the numbers would show a tremendous decline.
Number 1815
MR. ROSE explained that some school districts in the state are
going to be devastated by this formula. Alaska is diverse. He
referred to the Lower Kuskokwim which identifies and serves
children who require special education, bilingual and bicultural.
This populace, to a great degree, speaks Yupik. A large portion of
their pupils speak Yupik as a first language and in their early
years they are identified as needing special education, this number
decreases as they are mainstreamed into the system. Going to a 20
percent figure for special education needs will impact the Lower
Kuskokwim. There are other areas of the state which also face
this same issue.
Number 1862
MR.ROSE did not feel that $22,500 would be enough to mitigate the
costs for intensive needs students. He understood the desire to
not identify too many students. He felt that if the state were
more congruent, then it would be a good policy. The area cost
differentials will be changed from measuring school districts to a
per site unit method. He raised these issues to show how CSSSHB
148(HES) will provide more money to some school districts at a
tremendous cost to others.
MR. ROSE said the 53 school districts have suffered under the
weight of a 30 percent loss in buying power. The foundation
formula that was implemented in 1987 was never designed to absorb
that kind of pressure. The Ohio issue of adequacy is the same type
of problem which the state of Alaska has, but is not acknowledging.
We are moving that part of the problem off the table and are
reshuffling the deck. The committee needs to address the hold
harmless portion of this bill which will hold everyone harmless in
the first year, but will discontinue in five years.
Number 1950
MR. ROSE raised the issue of the 60 percent requirement. There are
districts in the state which operate in the extreme arctic regions
or are in isolation; they have high transportation costs and
probably will not be able to meet the 60 percent figure. Many of
those schools could not meet the 55 percent figure. The
association has not taken a formal position on CSSSHB 148(HES)
because they are trying to think outside of the box. If the
formula is going to change, then the issue which needs to be
addressed is adequacy.
MR. ROSE mentioned Dr. Augenblick's testimony. He agreed that
there is a strong philosophical underpinning for this change and he
agreed that a high level of technical support will be needed. He
expressed some concern over the political will to do this if the
effort is going to be inconsistent with the past. The transition
and change are going to be dramatic, but if the state can work to
make this change for the right reason which is to improve the
quality of education then it will be worth it. He said the issue
has to revolve around adequacy and equity in distribution.
Number 2016
CHAIRMAN BUNDE mentioned that adequacy is a discussion which could
continue for a long time. In the Alaska Senate it was suggested
that the verbiage be changed from school need to school support.
He did not feel that there was any amount of money in this state
that could exceed school needs, but there is a rational level of
school support which can be arrived at financially.
Number 2032
REPRESENTATIVE DYSON appreciated his explanation. He asked how his
association felt about the quality schools initiative.
Number 2050
MR. ROSE answered that his association supported the quality
schools initiative as it is contained in the Governor's bill. He
stated that budgets are built on a cut scenario. Many of the
things listed in the quality schools initiative are things which
the school districts are struggling to do right now. The issue
comes down to quality, how do schools operate and provide a quality
opportunity. There is also the added pressure from the numerous
mandates which the school district has to meet. He referred to a
school administrator who handed him a grant application which last
year was about a quarter of an inch thick, this year it is almost
an inch thick. Administrators are asked to meet a lot of mandates.
The quality initiative is seen as a way to focus the dollars onto
specific things which aren't diverted away as a result of mandates.
Number 2150
CHAIRMAN BUNDE mentioned that the quality school initiative
incorporates an additional $24 million into the budget.
Number 2111
REPRESENTATIVE PORTER asked if the resulting redistribution
resulted in an inequity and in a redistribution of school funding,
does his comment presuppose that it is now equitably distributed.
TAPE 97-27, SIDE A
Number 0000
MR. ROSE answered that CSSSHB 148(HES) redistributes additional
money for some at the expense of everyone else. If you look at the
harmless clause of this bill, there will be some 42 school
districts being held harmless which is the first indication that
money has been redistributed and the issue of adequacy has not been
addressed.
Number 0059
REPRESENTATIVE PORTER asked if the only bill he could support would
be one that increased funding.
MR. ROSE answered yes, they do look to increase funding for the
purpose of cushioning some of the loss which has occurred over the
last ten years.
CHAIRMAN BUNDE suggested that ten years ago, far too much money was
invested and that we are finally getting down to normal now.
MR. ROSE disagreed with that comment.
Number 0127
JOHN CYR, President, National Education Association of Alaska,
(NEA-Alaska), said it was important to look at the history of
educational funding in order to put it into some type of
perspective. The purpose of education and, ultimately, the
education funding bill is about children. If we forget that, if we
look at it as just some kind of mathematical formula that moves
money from A to B and we forget that we are dealing with children,
then we've done the state a disservice.
MR. CYR stated that in Alaska; 15 children every year commit
suicide, 85 children die of homicides and unintentional injuries,
125 newborns die before their first birthday, 160 are born with
Fetal Alcohol Syndrome (FAS), 580 are born with low birth weigh,
600 children are admitted for in-patient psychiatric care, over
1,200 babies are born to teenage mothers, almost 1,500 children
will be arrested for felony offenses, 2,200 kids drop out of
school, 3,500 are registered runaways or reported to the police as
runaways, almost 4,000 kids are abused and neglected through
verified reports, 10,500 preschoolers live below the federal
poverty level, 21,000 children have no health insurance, 25,000
children receive Aid to Dependent Families and Children, over
30,000 children live in households with single parents and these
are the children that attend Alaskan schools.
MR. CYR explained that in the first year of the foundation formula,
44 percent of the state's operating budget was included in the
education foundation formula. In 1970 and 1971 that figure dropped
to 35 percent, in 1990 the figure dropped to 17 percent, in 1987
the current formula was developed setting the foundation formula at
$60,000 and increased in 1992 to $61,000. In 1996, Alaska ranks
last, of all 50 states, in resource allocation to education. After
the rate is adjusted for inflation, Alaska ranks 50th in average
salaries for education employees. This translates into larger
class sizes and fewer class offerings. Alaska ranks 49th in
advanced placement classes. The fact remains that a lot of money
flows through the till and only a small percentage of it goes to
the children. There is less attention spent on marginal students
and there is inadequate technology in almost all of the schools.
There is nearly a complete absence of academic and vocational
counseling, an absence of drug and alcohol counseling, and an
absence of counseling done for violent and aggressive children. He
guaranteed that Alaska is paying a lot more for this later. It
costs a lot more to house those children when they become adults
and enter the penal institutions, than it does to work with them in
our schools.
Number 0483
MR. CYR addressed this bill and other bills addressing funding, his
organization did not believe that funding could be based on moving
dollars from rural children for the short term benefit of urban
districts. They believe that funding must be based on the
equalization of programs, not the equalization of dollars. A
dollar does not do the same thing in Tuntutuliak as it does in
Anchorage. They absolutely agree with every other education group
that the foundation formula must be inflation-proof. Schools have
suffered a 30 percent loss in the last few years regarding their
buying power. Schools must be fully funded for student growth.
Alaska is the fifth state in the nation when it comes to student
growth. He referred to the growth of the Mat-Su district and
concluded that their funding is eaten up by the cost of that
growth.
MR. CYR said his organization believes in the quality schools
initiative. They believe that it is incumbent to fund for
innovation. Research, incentive grants, new programs for violent
students, parental involvement, technology, and other programs need
to be funded in our schools and this cannot be done with the
dollars provided.
Number 0595
MR. CYR explained that the special education funding is a real
problem. He appreciated the fact that CSSSHB 148(HES) provides a
20 percent increase. The problem with that amount is that there
are mandates for special education and how it's funded. The
mandate used to be called public law 94-142, but it is now called
the individual disabilities education act. The federal government
sits there and says; these kinds of kids must be served, an IEP
must be put together, these kinds of things must be done to meet
the needs of these children. The federal government throws a
couple hundred dollars towards each child, but those programs are
expensive. If the state is funding at 20 percent, it means that
the other programs; vocational education, bilingual, regular
education, will pay for the lack of state dollars put into special
education. The foundation formula will rip money out of an already
hard pressed classroom.
Number 0680
MR. CYR stated that we must fully fund pupil transportation;
whether it is done in the formula or done somewhere else. There
has to be some long term study of the area cost differential. We
need a clear picture of what it costs to deliver services around
the state, not so that we can equalize dollars but so that the
state can equalize programs to give kids the same kind of
education.
Number 0730
MR. CYR explained that an oversight and auditing provision is
missing from all of these bills. The state must ensure that the
money is used the way they want it to spent. He asked that the DOE
be given the authority to audit the program.
Number 0760
CHAIRMAN BUNDE felt the auditing and oversight suggestion was
useful. He mentioned the situation of the administrator in the
Aleutians. He agreed that CSSSHB 148(HES) doesn't increase the
amount of dollars, it moves dollars around. There are 21 schools,
12 with fewer than 10 students and asked him if that was
educationally sound.
Number 0801
MR. CYR believed that, as a parent, you ought to have the right to
send your child to a school in your community. He referred to a
time when children were sent out-of-state to school. He argued
that this education system worked, for a very limited number of
children who went outside, got an education and came back. This
system was a disservice to the vast number of kids who lived in
rural Alaska. He felt there was an obligation to provide education
to every child. He did not think that it was morally permissible
for the state to identify small communities and rip the heart out
of those communities.
Number 0856
CHAIRMAN BUNDE commented that there have been consolidated schools
throughout the United States for the last fifty years.
Number 0867
CHAIRMAN BUNDE referred to the quality schools initiative where the
Governor has identified $12 million to reward schools that were
doing a good job. He asked why shouldn't the state take $12
million away from schools that are doing a lousy job.
Number 0881
MR. CYR responded that this would suppose that you can quantify in
some way a list of schools that are doing a lousy job and those
that are doing a good job. He suggested that the state should look
at those lousy schools to see why they are not doing well and see
what needs to be changed, added or subtracted to those schools.
This evaluation needs to be done on a school by school basis to
establish some real criteria. If the state set a list of criteria,
then he felt you could take away money.
CHAIRMAN BUNDE asked if he could support closing a really bad
school.
Number 0937
MR. CYR would support making that school better. He did not know
if accomplishing this would necessarily take more money.
Number 0945
REPRESENTATIVE DYSON referred to his comment that Alaska was dead
last in allocation as a portion of our total resources towards
education, not dead last in per student expenditures.
Number 0960
MR. CYR said he would be happy to run the numbers for him. The
charts come out of the federal Department of Education which looks
at the numbers in different ways. The percentage of state
resources compared to the percentage of total dollars is what he
was referring to in his testimony.
Number 0987
REPRESENTATIVE DYSON clarified that he said Alaska was the poorest
of the 50 states in what is paid to teachers.
MR. CYR said yes, according to the average salary adjusted for
inflation.
REPRESENTATIVE DYSON clarified that this did not address regional
cost of living figures.
Number 1010
CHAIRMAN BUNDE asked if this figure dealt with teachers or all
school workers.
MR. CYR believed this was for teachers' salaries. In real dollars
Alaska ranks fourth or fifth. He said the figures and how the
percentages were calculated could be argued.
REPRESENTATIVE PORTER asked if typically people would really judge
the amount spent on education by the total resource potential of
the state.
Number 1092
MR. CYR felt there was a valuable comparison to be made using this
figure.
Number 1128
LELAND DISHMAN, North Slope Borough School District, referred to
the 20 percent funding for special education. He did not feel that
his district would be able to maintain programs, in many of the
schools, based upon needs with this amount. His philosophy is that
you cannot homogenize children. It does not work when you try to
throw 27 percent in from one school district and 9 percent in from
another school district. One school district can have a child with
severe needs who will cost $100,000 a year to educate. This is a
moveable number where we will need to have a cushion somewhere at
the state level to assist any of the school districts.
MR. DISHMAN commented that the 60 percent requirement on
instruction will not be able to be met in many of the districts.
In some districts, including his, they cannot do it because of the
tremendous cost of maintenance and operation due to distances, fuel
and electricity. He joined the ranks of people who say that the
state has not adequately funded education. Basically, the state
has decreased educational spending over the last ten years. The
last time an adjustment was made to state foundation money, in
1988, the North Slope took a 42 percent loss in state money. In
some of the bills being addressed, the North Slope would take an
additional 100 percent. He said the figures listed in CSSSHB
148(HES) are more palatable.
Number 1230
MR. DISHMAN said many of the school districts are doing the quality
school initiative suggestions. If there is an opportunity to do
those things in our schools, we should be morally obligated to do
the very best that we can do with what is available. He said the
North Slope schools are growing at a rate of 5 percent per year,
over 100 new children show up every fall which equates to about
four classrooms and four teachers. He said Ipalook is now
recognized as being one of the largest elementary schools in the
state of Alaska with about 810 students and anticipates having 840
or 850 students in 1997.
Number 1288
MR. DISHMAN explained that he is here to show that the North Slope
Borough School District is here in opposition to any type of
funding program which will take away the opportunity for children
in his district or anyone else's district to receive a quality
education. He said redistributing dollars is not going to satisfy
the need of the school district. As the amount of money is taken
from other districts to solve the problems in the larger, urban
districts it would have little impact on the urban settings, but
would devastate smaller districts.
MR. DISHMAN commented that some of the bills have looked at the
North Slope in the context that they have more, so let's take it.
He stated that rural schools have a high number of students at
risk. Those students can be identified as those scoring in the
bottom quarter of standardized testing. The North Slope has 25
percent in this category and many other districts have that many or
more. Those children could be identified as going to a poor
school, because the school is unable to educate them to the level
of the bright students.
MR. DISHMAN said that one of the indicators, of children who do not
do well in schools, is students who grow up in poverty. In one
village 62 percent of the entire student population lives below the
poverty level, 48 percent in another, 44 percent in another, 35
percent in another, all the way down to Barrow which has 10 percent
of the population living below the poverty level. These numbers
were derived from the national school lunch program, numbers which
are submitted to the federal government.
Number 1440
REPRESENTATIVE DYSON asked how many homes below the poverty level
had televisions.
MR. DISHMAN answered that he did not know.
REPRESENTATIVE DYSON asked the correlation in his district between
the homes having books and parents that read to their children and
their performance.
MR. DISHMAN answered that there is a universal correlation
regarding that situation. He could say that books are put into the
schools. Programs have been set up, using federal grant money, to
put books into homes. He could not, however, answer his question
precisely.
Number 1486
CHAIRMAN BUNDE said the greatest predictor of student success over
all other socio-economic things is that parents read to their kids.
MR. DISHMAN commented that, in the North Slope, the day a child
arrives home they receive a book on how important it is to read to
your child, a letter of congratulations to the parents and a t-
shirt saying, "North Slope Borough School District Class of 2013 or
2014 Please Read to Me, Please Care for Me, Please Love Me".
Number 1526
JOHN HOLST, Superintendent, Sitka School District, explained that
his comments are going to be reflective of the board and the
citizens of Sitka. When the new foundation formula was put into
effect in 1987, Sitka lost about $1 million in funding on a $10
million budget. With the cap that keeps the district from spending
any more, Sitka is the lowest per pupil expenditure district in the
state. Sitka has been sitting in a position of having the lowest
per pupil expenditure without having the advantages of size that
Anchorage or Fairbanks has and not being allowed to increase their
spending. When people say that they don't want to see change
because it will create winners and losers, citizens in Sitka take
exception to that because many schools in Southeast Alaska were
made losers ten years ago. They were made losers with a promise
that next year if there was a problem with the area cost
differential, it will be revisited. A study was done and, had it
been implemented, values would have been adjusted 5 to 8 percent in
Southeast Alaska as well as in Kenai and Mat-Su.
MR. HOLST said it is difficult for citizens in Sitka. He said
Sitka has lost 11 percent of their population, in the last four
years, with the closing of the mill. He explained the difficulties
of having fewer students and eliminating positions. The first year
school nurses were eliminated. Currently there is one contract
nurse for 15,000 students. In the late 1980s, Sitka contracted for
food service, custodial services and pays 60 percent of what any
other district in the state pays for those services. The food
service actually takes in revenue that allows Sitka to supply
equipment and machinery. He explained that Sitka has not done
these things because they are extraordinarily economical, they have
been done because it has had to be done. A school was closed last
year to save $125,000, but there are no more rabbits to pull out of
the hat.
Number 1701
MR. HOLST stated that the area cost differential must be adjusted.
He referred to page 5, the size of schools, the community size
factor and the ADM going from 10 to 20. This number goes up to
1,000 and then everyone who has over 1,000 students is treated the
same way. This says to him that the economies of scale in Sitka,
with 1,769 students, are identical to the operational costs in
Anchorage. He challenged the committee to show the statistics
which prove this. It is not possible to have economies of scale
with 1,769 that you have with 46,000. He suggested that the
committee look at the reduction when the student numbers hit 8,000
or 10,000 students. At that level, the number ought to be 1.0.
There are only three or four spots in the state which would fit
into that category. An adjustment should be made for Girdwood He
suggested breaking it down to 1,000 to 2,000, 2,000 to 5,000 and
5,000 to 8,000, making above 8,000 the 1.0 and then take this 1.10
and ration it down to 1.08, 1.06, 1.04 et cetera. He felt this
suggestion made sense and was defensible.
MR. HOLST quoted Walter Hickel, "There is no vision, no hope, no
future, no agenda for Alaska, if your only idealogy, if your only
philosophy, if your only cause is to cut the budget." He said
there may be more money in places than the legislature thinks ought
to be there, but that is not the overall problem. A lid on
spending has been in place for ten years. Maybe ten years ago
there was more money than necessary in some places, but there
aren't very many of those places left. He said, speaking from a
place that started out with not enough, it has gotten really tough.
Adjusting funding for new students and saying that it is a full
funded education is not true. The school district has been forced
to accept any cost of living adjustments for the past ten years.
MR. HOLST stated that their bus contract was recently rebid. This
five year bus contract had a cost of living adjustment of 3 to 5
percent every year during those five years. The Sitka experience
has been the same as almost every other district in the state,
there has been about a 30 or 40 percent increase in the cost of
that new contract. The open market determines what those costs
are. If the committee includes transportation in CSSSHB 148(HES),
then transportation, over time, is going take more money out of the
classrooms. The school districts can control spending because the
legislature has made them, but it doesn't make it right. He felt
the legislature had to loosen up a little bit and realize that the
schools cannot continue what they are doing for the same amount of
dollars.
Number 1899
REPRESENTATIVE PORTER asked if the formula proposed in CSSSHB
148(HES) had been run against his school district's information.
Number 1901
MR. HOLST had not seen a spread sheet, so he had no idea. He asked
the committee to look at the area cost differentials in terms of
Sitka and the size of schools issue because it won't stand up in
court. This issue involves funding every community over 1,000
students the same way because it assumes operational efficiency.
Number 1941
CHAIRMAN BUNDE commented that the role model that Sitka achieved in
efficiency, in some of the ancillary services for education, should
be looked at as a role model.
MR. HOLST commented that Sitka has no more of those ancillary
services which they can reduce, other than contracting out teaching
services.
CHAIRMAN BUNDE announced that the committee meeting was closed, but
he asked the committee members to remain in order to discuss what
they would need to understand the complexities of the foundation
formula.
ADJOURNMENT
There being no further business to conduct, CHAIRMAN BUNDE
adjourned the meeting of the House Health, Education and Social
Services Standing Committee at 5:17 p.m.
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