Legislature(1993 - 1994)
03/25/1993 03:00 PM HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE March 25, 1993 3:00 p.m. MEMBERS PRESENT Rep. Cynthia Toohey, Co-Chair Rep. Con Bunde, Co-Chair Rep. Gary Davis, Vice Chair Rep. Al Vezey Rep. Pete Kott Rep. Harley Olberg Rep. Bettye Davis Rep. Irene Nicholia Rep. Tom Brice MEMBERS ABSENT None COMMITTEE CALENDAR HCR 10: Relating to certification of the Alaska State Legislature's opposition to requiring suspension of a driver's license for drug offenses. PASSED WITH INDIVIDUAL RECOMMENDATIONS *HB 244: "An Act making a special appropriation for additional district support for kindergarten, primary and secondary education programs; and providing for an effective date." PASSED WITH INDIVIDUAL RECOMMENDATIONS HB 85: "An Act relating to the public school foundation program; and providing for an effective date." HEARD AND HELD TO TIME CERTAIN (* First public hearing.) WITNESS REGISTER JEANNE SMITH Aide to Rep. Richard Foster Alaska State Legislature Courthouse Room 611 Juneau, Alaska 99801-1182 Phone: (907) 465-3789 Position Statement: Represented sponsor of HCR 10 REP. BILL WILLIAMS Alaska State Legislature State Capitol, Room 128 Juneau, Alaska 99801 Phone: (907) 465-3424 Position Statement: Sponsor of HB 244 BILL THOMAS Indian Education Director Ketchikan School District President, Southeast Native Education Commission 2610 Fourth Ave. Ketchikan, Alaska 99901 Phone: (907) 225-1408 Position Statement: Testified in support of HB 244 REVA SHIRCEL, Education Director Tanana Chiefs Conference 122 First St. Fairbanks, Alaska 99701 Phone: (907) 452-8251 Position Statement: Testified in support of HB 244 JUDY JENKINSON Ketchikan Education Association 1900 First Ave. Ketchikan, Alaska 99901 Phone: (907) 225-4741 work Phone: (907) 225-5839 home Position Statement: Testified in support of HB 244 KENT DURAND Association of Alaska School Boards 316 W. 11th St. Juneau, Alaska 99801 Phone: (907) 586-1083 Position Statement: Testified in support of HB 244, HB 85 BOB ANDERSON, Chairman Klawock City School Board P.O. Box 9 Klawock, Alaska 99925 Phone: (907) 755-2228 work Phone: (907) 755-2930 home Position Statement: Testified in support of HB 244 CLAUDIA DOUGLAS, President National Education Association-Alaska 114 Second St. Juneau, Alaska 99801 Phone: (907) 586-3090 Position Statement: Testified in support of HB 244 DUANE GUILEY, Director Division of Education Finance and Support Services Department of Education 801 W. 10th St., Suite 200 Juneau, Alaska 99801-1894 Phone: (907) 465-2891 Position Statement: RICHARD M. SWARNER Executive Director, Business Management Kenai Peninsula Borough School District 44955 Ptarmigan Place Soldotna, Alaska 99699 Phone: (907) 262-4056 Position Statement: Testified in support of HB 85 MARY RUBADEAU Assistant Superintendent for Instruction Kenai Peninsula Borough School District 148 N. Binkley Soldotna, Alaska 99669 Phone: (907) 262-5846 Position Statement: Testified in support of HB 85 MARILYN DIMMICK Kenai Peninsula Borough School District 148 N. Binkley Soldotna, Alaska 99669 Phone: (907) 262-5846 Position Statement: Testified in support of HB 85 BRUCE STANTON, Teacher 177 Shoup St. Ketchikan, Alaska 99901 Phone: (907) 225-5137 work Phone: (907) 225-4436 Position Statement: Testified in support of HB 85 MORRIS VERVERS, Superintendent Klawock City School District P.O. Box 9 Klawock, Alaska 99925 Phone: (907) 755-2917 work Phone: (907) 755-2363 home Position Statement: Testified in support of HB 85 STEVE GIBSON 1622 Highland Dr. Homer, Alaska 99603 Phone: (907) 235-6487 Position Statement: Parent; testified in support of HB 85 DEB GERMANO P.O. Box 1511 Homer, Alaska 99603 Phone: (907) 235-2583 Position Statement: Parent; testified in support of HB 85 JACK CADIGAN Centralized Correspondence School Education Association 3199 Pioneer Ave. Juneau, Alaska 99801 Phone: (907) 586-2778 work Phone: (907) 586-8332 home Position Statement: GREG MIDDAG, Member Ketchikan Education Association 643 Sunset Drive Ketchikan, Alaska 99901 Phone: (907) 225-9815 work Phone: (907) 225-2290 home Position Statement: Testified in support of HB 85 KATHI MCCORD Communications Vice President Anchorage Education Association Board Member, NEA-Alaska 1601 Hidden Lane Anchorage, Alaska 99501 Phone: (907) 345-8100 work Phone: (907) 272-8018 home Position Statement: Favored accountability for TAG program funding DENNIS WETHERELL, President Mat-Su Talented and Gifted Association P.O. Box 876862 Wasilla, Alaska 99687 Phone: (907) 745-2007 Position Statement: Testified in opposition to changing TAG funding LARRY WIGET Legislative Liaison Anchorage School District 4600 DeBarr Road Anchorage, Alaska 99508-3195 Phone: (907) 269-2255 Position Statement: Testified in opposition to HB 85 DIANA GREELY P.O. Box 8684 Ketchikan, Alaska 99901 Phone: (907) 247-8348 Position Statement: Parent; testified in opposition to changing TAG funding CATHERINE PLASENCIA P.O. Box 5294 Ketchikan, Alaska 99901 Phone: (907) 225-5294 Position Statement: Parent; testified in opposition to changing TAG funding MARYSIA OCHEJ, Business Manager Southeast Islands School District P.O. Box 8351 Ketchikan, Alaska 99901 Phone: (907) 225-5949 Position Statement: BETT JAKUBEK P.O. Box 8194 Ketchikan, Alaska 99901 Phone: (907) 247-8716 Position Statement: Parent; testified in opposition to changing TAG funding MALCOLM FLEMING, Principal Seward Junior-High School P.O. Box 302 Seward, Alaska 99664 Position Statement: Testified in support of HB 85 MIKE SMITH P.O. Box 302 Seward, Alaska 99664 Phone: (907) 224-3862 Position Statement: Parent; testified in support of HB 85 SUSAN WALLIN Trapper Creek, Alaska Phone: (907) 733-2298 Position Statement: Parent; testified in support of HB 85 PREVIOUS ACTION BILL: HCR 10 SHORT TITLE: FEDERAL-AID HY FUNDING/DRUG ENFORCEMENT BILL VERSION: CSHCR 10(HES) AM SPONSOR(S): TRANSPORTATION BY REQUEST TITLE: Relating to allowing the state the right to determine and impose sanctions on motor vehicle drivers. JRN-DATE JRN-PG ACTION 02/24/93 433 (H) READ THE FIRST TIME/REFERRAL(S) 02/24/93 433 (H) STATE AFFAIRS,HES,JUDICIARY 03/23/93 (H) STA AT 08:00 AM CAPITOL 102 03/23/93 (H) MINUTE(STA) 03/24/93 750 (H) STA RPT 6DP 1DNP 03/24/93 750 (H) DP: VEZEY, ULMER, B.DAVIS, OLBERG 03/24/93 750 (H) DP: G.DAVIS, KOTT 03/24/93 750 (H) DNP: SANDERS 03/24/93 750 (H) -FISCAL NOTE (DOT) 3/24/93 03/24/93 750 (H) -ZERO FISCAL NOTE (DPS) 3/24/93 03/25/93 (H) HES AT 03:00 PM CAPITOL 106 BILL: HB 244 SHORT TITLE: APPROP: SINGLE/DUAL SITE SCHOOLS BILL VERSION: SPONSOR(S): REPRESENTATIVE(S) WILLIAMS,Hudson,Olberg, Kott,James,Mulder,Sanders,B.Davis,Foster,Porter,MacLean, Menard TITLE: "An Act making a special appropriation for additional district support for kindergarten, primary, and secondary education programs; and providing for an effective date." JRN-DATE JRN-PG ACTION 03/19/93 709 (H) READ THE FIRST TIME/REFERRAL(S) 03/19/93 709 (H) HES, FINANCE 03/25/93 (H) HES AT 03:00 PM CAPITOL 106 BILL: HB 85 SHORT TITLE: PUBLIC SCHOOL FOUNDATION PROGRAM BILL VERSION: SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR TITLE: "An Act relating to the public school foundation program; and providing for an effective date." JRN-DATE JRN-PG ACTION 01/22/93 138 (H) READ THE FIRST TIME/REFERRAL(S) 01/22/93 138 (H) HES, FINANCE 01/22/93 138 (H) -FISCAL NOTE (DOE) 1/22/93 01/22/93 138 (H) GOVERNOR'S TRANSMITTAL LETTER 02/18/93 (H) HES AT 03:00 PM CAPITOL 106 02/18/93 (H) MINUTE(HES) 02/23/93 (H) HES AT 03:00 PM CAPITOL 106 02/23/93 (H) MINUTE(HES) 03/22/93 (H) MINUTE(HES) 03/25/93 (H) HES AT 03:00 PM CAPITOL 106 ACTION NARRATIVE TAPE 93-46, SIDE A Number 000 CHAIR BUNDE called the meeting to order at 3:07 p.m. and noted members present. He announced the calendar and noted that the meeting was being teleconferenced to Anchorage, Dillingham, Fairbanks, Galena, Homer, Hoonah, Ketchikan, Yakutat, Kenai/Soldotna, Seward, Sitka, Tanana, Tok, Trapper Creek and Valdez. He brought HCR 10 to the table. He stated that testimony would be limited to two minutes. He announced his intention to move HB 244 out of committee that day. HCR 10: FEDERAL AID-HIGHWAY FUNDING/DRUG ENFORCEMENT Number 061 JEANNE SMITH, AIDE TO REP. RICHARD FOSTER, PRIME SPONSOR OF HCR 10, testified on his behalf. She read a sponsor statement, which is on file in the committee room. In summary, the statement said that the federal government would begin withholding federal highway funds if the state did not by April 1, 1993, either adopt laws requiring a six month driver's license revocation for persons convicted of drug offenses, or have both the governor and legislature certify and resolve to be opposed to the federal requirement for such state laws. The amount at risk was $9.6 million for FY94 and FY95, which would increase to $19.2 million in each year thereafter. She said the Alaska House and Senate had several pieces of comprehensive legislation to address local problems. She noted a committee substitute (CS) had the approval of both bodies. Number 110 REP. BUNDE stated that it was the first time the House Health, Education and Social Services (HESS) Committee had seen the CS version of the resolution. He invited Ms. Smith to begin a section-by-section discussion of a CSHCR 10. Number 115 MS. SMITH said the title had been changed to reflect the state's right to determine and impose sanctions on drivers, but to delete elements of the title dealing with certification of the legislature's opposition to the federal requirement. Number 123 CHAIR TOOHEY asked if the bill required the state to impose sanctions. Number 125 MS. SMITH answered no, but it allowed the state to retain that option. She proceeded with the discussion of the changes, saying that the second change deleted a section indicating that revocation of driver's licenses has not shown to be a successful deterrent. She said the deletion was acceptable to the federal government. She said the third difference was in language to indicate that the state opposed the federal requirement to revoke driver's licenses and not necessarily such laws themselves. Number 149 REP. BUNDE invited further public testimony and, hearing none, closed public testimony. He invited comments and discussion from the committee. REP. BRICE moved passage of HCR 10 with individual recommendations. REP. KOTT objected. REP. OLBERG asked whether it would not be better to adopt the CS version of the bill first. REP. KOTT withdrew his objection. REP. BRICE moved passage of CSHCR 10 with individual recommendations. Number 174 CHAIR TOOHEY said the committee would be remiss in forgoing $20 million in federal highway funds, as long as the state cold protect its rights. Number 180 REP. BUNDE said the state wanted both to encourage people to face their drug problems and to allow the state to maintain its ability to function. MS. SMITH said the legislature was not against considering a license suspension law, but it would be in its own best interest to do that at the state level so that the federal government could not later say the state was not in compliance. Number 195 REP. BUNDE asked for objections to the motion and, hearing none, declared CSHCR 10 passed with individual recommendations. REP. BUNDE brought HB 244 to the table. HB 244: APPROP:SINGLE-DUAL SCHOOL SITES REP. BILL WILLIAMS testified as PRIME SPONSOR of HB 244. He read a sponsor statement (which is on file in the committee room) which said, in summary, that the bill was an effort to restore funding to nine single-site school districts which had seen their supplemental funding cut from the FY94 budget earlier in the 1993 legislative session. He said the goal of HB 244 was to ensure that all single-site school districts would be dealt with in the same manner. Number 237 REP. BUNDE observed that there were no fiscal notes in the bill packets, but then commented that the special appropriations were included in the bill and that there would be no fiscal notes. Number 244 BILL THOMAS, INDIAN EDUCATION DIRECTOR, KETCHIKAN SCHOOL DISTRICT and PRESIDENT, SOUTHEAST NATIVE EDUCATION COMMISSION, testified via teleconference from Ketchikan in support of HB 244. He said he was distressed with the state Senate for making arbitrary cuts in single-site school districts' budgets. He said investing in education for youth was cheaper than trying to repair them later in life. He encouraged legislators to put politics aside and support HB 244. Number 285 REVA SHIRCEL, EDUCATION DIRECTOR, TANANA CHIEFS CONFERENCE, testified via teleconference from in support of HB 244. She said the bill would provide needed supplementary funding for the nine rural single-site school districts. Number 314 JUDY JENKINSON, KETCHIKAN EDUCATION ASSOCIATION, testified in Juneau in support of HB 244. She said it was criminal to balance the budget on the backs of children. She said children are at the mercy of their parents and cannot choose where they attend school. Number 330 REP. BUNDE stated his opposition to the idea of single-site school districts because he favors children and believes money spent on small single-site districts is poorly spent. Number 338 KENT DURAND, ASSOCIATION OF ALASKA SCHOOL BOARDS, testified in Juneau in support of HB 244. He said the state legislature has since 1986 provided supplemental funding for small single-site school districts. At its 1992 conference, the association resolved to support adjusting the foundation formula to eliminate the disparities in single-site school district funding. He said cuts in supplementary funding before such adjustment was made were unfair. REP. BUNDE asked if the association supported single-site schools. MR. DURAND responded that the association supported HB 244. Number 345 REP. BUNDE repeated his question. MR. DURAND stated, "At this time, yes we do, unless there's another alt...(unintelligible)." REP. BUNDE said, "Even if they have an enrollment of three?" MR. DURAND responded, "Yes, that's correct." Number 357 CHAIR TOOHEY noted that Mr. Durand had qualified his answer, saying that the association supported single-site school districts "at this time," pending a better solution. REP. BUNDE noted that Anchorage had 40 percent of the state's school children, but nowhere near 40 percent of the state's educational operating budget. Number 369 BOB ANDERSON, CHAIRMAN, KLAWOCK CITY SCHOOL BOARD, testified in Juneau in support of HB 244. He said Klawock, a single- site school district, saw $147,010 cut from its budget through HB 45, representing a catastrophic cut of 10.67 percent of the district's FY94 budget. He said the district did not have a highly paid superintendent, or a private plane, but was devoted to teaching 207 students from kindergarten through 12th grade. He urged the committee to rectify the state Senate's error in making the cuts by passing HB 244. Number 379 CLAUDIA DOUGLAS, PRESIDENT, NATIONAL EDUCATION ASSOCIATION- ALASKA (NEA), testified in Juneau in support of HB 244. She said children should not be punished through politics, and while HB 244 addressed the issue of equity, children were injured by discrimination in supplemental funding. REP. BUNDE asked if the NEA supported single-site schools. MS. DOUGLAS asked if he meant single-site schools or single- site school districts. REP. BUNDE answered single-site school districts. Number 385 MS. DOUGLAS said that NEA supported supplemental funding for single-site school sites needing extra money, at least until the issue of equity had been addressed. She said NEA also supported changes in policy if necessary. REP. BUNDE asked if NEA had a position on school district consolidation. MS. DOUGLAS answered that she would prepare a position, but she did not want to comment at that time. Number 410 REP. BUNDE called for more public testimony on HB 244 and, hearing none, closed public testimony. Number 412 REP. BETTYE DAVIS, a CO-SPONSOR of the bill, stated her support for the bill, saying it was better to provide funding for single-site school districts later than never, and if any of such districts were funded, all should be. She asked Rep. Williams why he thought the legislature would approve funding for districts which had been removed from HB 45. Number 420 REP. WILLIAMS answered that he did not know what happened in the Senate, but he hoped his bill would pass the House. He said HB 244 provided a vehicle for the nine single-site school districts that had seen their supplementary budgets cut to discover the reason why. Number 428 REP. B. DAVIS asked if Chair Bunde planned to pass the bill out of committee that day. REP. BUNDE answered that he did intend to do so. Number 433 REP. NICHOLIA stated her support for HB 244. She said single-site school districts deserved financial support, and they allowed local control. She said the existing foundation funding formula did not address their budget problems and there should be no cuts in supplemental funding until the inequities had been addressed. Number 445 REP. VEZEY moved for passage of HB 244 with individual recommendations. Hearing no objections, REP. BUNDE declared HB 244 passed with individual recommendations. He also commented that the vote should not be taken as encouragement or endorsement of single-site school districts. He encouraged people to work for different solutions to their financial problems, and to look toward consolidation, as the issue would probably be before the committee again in 1994. CHAIR BUNDE then brought HB 85 to the table. HB 85: PUBLIC SCHOOL FOUNDATION PROGRAM REP. BUNDE noted that there had been much communication and concern from the public concerning the bill. He said he would like to address those questions. Number 455 DUANE GUILEY, DIRECTOR, DIVISION OF EDUCATION FINANCE AND SUPPORT SERVICES, DEPARTMENT OF EDUCATION (DOE), testified in Juneau in support of HB 85. He briefly described the five major portions of the bill: 1) Creation of an Alaska School Price Index, which would use information from FY89 and FY92 to update and replace the Area Cost Differential established in 1985. 2) Changes in the vocational and gifted education programs to provide a flat rate of funding per student. The talented and gifted (TAG) educational programming would be based on 4.5 percent of the school population, multiplied by a weighting factor. 3) Inclusion of a hold-harmless clause so that for three years no district would receive less money under the proposed new formula than it did under the existing formula. 4) Amendments in the school enrollment projection process to allow the count to come after the current year count to improve districts' projecting and budgeting processes. 5) Inclusion of a forward-funding mechanism to allow districts to use current or previous year student enrollment data for funding, whichever would bring it more money, thus allowing districts to phase out expenses as they lost students. Number 499 REP. VEZEY asked when the DOE would produce its final plan for the Alaska School Price Index (ASPI). MR. GUILEY said the department was currently building up that index, had sent out and was receiving back completed data confirmation worksheets from districts, and was trying to resolve discrepancies to produce another list. He said the department had a draft of the index, but not a final index. Number 505 REP. VEZEY asked why medical (insurance) premiums were one of the factors considered in the ASPI. Number 506 MR. GUILEY said the index was an attempt to measure the differing costs of providing education at schools across the state, and insurance premiums were among the varying factors. Number 509 REP. VEZEY interrupted, saying that medical insurance premiums were the same across the state. Number 512 MR. GUILEY disagreed, saying that school employees were not covered by a uniform health plan; each school district provided its own medical plan and costs differed significantly. He said the index did not assess TRS (Teachers Retirement System), which is assessed uniformly across all 54 school districts. Number 525 REP. BRICE asked how money from the mental health trust fund was used under the current foundation formula and how it would be used under the ASPI. Number 529 MR. GUILEY said that the use of revenue in funding the foundation formula was not anticipated to change under ASPI. Any use of mental health trust fund money in funding the foundation formula would not change under the ASPI, he said. Number 534 REP. BRICE asked whether it was true that the mental health trust fund paid for TAG programs because the TAG programs could not be broken out of other special needs programs. Number 538 MR. GUILEY responded, "Not exactly. The gifted and talented program does generate separate educational units now. They are lumped together with special education and they're reported to the state, but they do have a separate weight factor and do generate revenue separately. The mental health trust fund severely under-funds the special education program in total, and we more than utilize the mental health trust fund within the handicapped student component, and do not have to assess any to the gifted and talented component." Number 543 REP. BRICE said he believed that all children deserved educations, whether or not they are beneficiaries of the mental health trust fund; and using the fund for educational proposes undermines the ideas upon which the trust was established. He encouraged removing the mental health fund from educational funding entirely and to use general funds instead. Number 550 REP. B. DAVIS asked Mr. Guiley to go through the rest of the bill's features and outline the changes. MR. GUILEY said the DOE had provided a sectional analysis at earlier meetings. He described the ASPI, which would replace the Area Cost Differential for state educational funding. He said the DOE had an amendment that would allow the state to use the secondary school funding formula, instead of the elementary school formula, to fund the secondary school elements of the centralized correspondence school. He said the bill updates the sections that apply to the Mt. Edgecumbe school in relation to the ASPI. He said the bill updates the TAG program by establishing separate units for calculating both the TAG program and the vocational education programs in section 5 and section 6. Number 565 REP. B. DAVIS asked for a more detailed explanation of sections 5 and section 6. She asked how much money the talented and gifted programs, once separated from vocational education, would receive under the ASPI. She also asked what the funding cap would be for TAG programs. Number 567 MR. GUILEY said that the current practice saw special education units include TAG as a type of special education unit. The proposal was to remove TAG from special education units, and create new separate educational units for them. As TAG students were included in the current law, they generated 0.025 units per student identified as gifted. Districts are required to write service plans and Individualized Education Plans (IEP) for each TAG child, he said. The students are figured into the minimum level of funding by each funding community and for the minimum funding levels for special education by each district. The proposal would create separate educational units, based upon a revenue weight factor defined by regulation. So far, the DOE had approved a weight factor of 0.012 units, multiplied by 4.5 percent of the student population, without requiring an IEP or plan of service. The hope was to eliminate the administrative burden of the program and to provide a flat rate of funding, 4.5 percent of the student population. Number 588 REP. B. DAVIS said that, if each gifted student earned a school district 0.025 educational units, then it would take 40 students to generate one instructional unit, or $61,000. She said that under the new formula it would take 80 students to generate one instructional unit. She commented that this was a drastic change, resulting in immediate funding cuts. MR. GUILEY stated, "The section above that generated the vocational education instruction units again, a revenue weight factor as defined by the board. The board has currently approved .006 units for vocational education weight factor. The fiscal note, if you will, on that separate section was slightly in excess of $4 million. The fiscal savings on section 6 was approximately $4 million, so the two tend to wash themselves out with no fiscal impact on the state." Number 595 REP. B. DAVIS said, "So you're saying $4 million would have been saved from gifted and then added into this, the voc-ed. What is the cap on the voc-ed, I mean, on the special ed? At this time, every school district identified their children, they're turning that in, then you take that. Under the new plan that wouldn't be true." MR. GUILEY stated, "Under the new plan there would be no requirement to identify the children and turn them in. There would be simply a revenue weight factor that would assign a weight to 4.5 percent of the current average daily membership." Number 600 REP. B. DAVIS asked if it were not true that some districts had identified up to 12 percent or 14 percent of their students as gifted. MR. GUILEY said yes, and one district had identified 18 percent of its student population as gifted, while other districts claimed no gifted students. Since 1981, the state has never identified more than 4.3 percent of the entire student population as gifted. He said the national standard ranges between 4.5 percent and 5 percent, most years averaging 4.6 percent. TAPE 93-46, SIDE B Number 000 REP. BUNDE said he understood that some school districts identified their entire bands as gifted in an attempt to get more state funding. He suggested that the state might want to examine the definition of gifted student. He noted that the suggested separation of TAG from the special education program had generated large amounts of constituent action from an active lobby. He asked Mr. Guiley if he believed gifted students would not be as well served under HB 85. Number 020 MR. GUILEY said the state Board of Education intended that TAG students would continue to be served, and that more money targeted at them would go directly to the classroom programs addressing their needs. He said comparisons between expenditures compared to revenue generation by the program showed that 39 of 54 districts short-fund their TAG programs, some school districts short-fund by more than 30 percent, and some short-fund by from 50 percent to 60 percent. He said the DOE hoped there would be no changes in the delivery model for gifted students, and that the standards being developed would raise the standards for all students, such that some students now identified as gifted would be arriving at the normal outcomes and standards the DOE was developing. Number 054 REP. BUNDE said that the element of hopefulness Mr. Guiley had expressed, and not certainty, would be a concern. REP. B. DAVIS asked if there was not a national trend to include TAG programs under special education programs. Number 060 MR. GUILEY said he could not say. He did say, however, that the Governor's Council on the Handicapped and Gifted said 38 states do not fund TAG as part of special education programs, that there is no federal mandate to fund TAG programs, and that more than half the states do not do so. He said Alaska's $760 annual per-student funding for TAG showed state concern for the programs. He said some school districts charge the entire cost of TAG programs to TAG funds, whereas the Board of Education believed it was providing enough money to fund just the incremental additional cost of such programs. Number 084 REP. B. DAVIS asked if the new foundation funding formula would not address the issue of equitable funding for single- site school districts. MR. GUILEY said the ASPI included a table for additional resources for certificated and classified school staffers as a district got smaller. He said that does address and resolve the single-site school district issue. Number 101 REP. B. DAVIS recalled that a representative of the Alaska School Board Association had testified at a previous meeting that he had provided some suggested changes to HB 85 to Mr. Guiley. She asked if the state Board of Education had adopted those changes. MR. GUILEY answered that the school board did adopt those changes, but he had not brought them to the HESS Committee for its review. Number 110 REP. OLBERG asked if the state would lose any federal revenue if it ceased to fund TAG programs. MR. GUILEY answered no. Number 115 REP. NICHOLIA asked if the changes that the state Board of Education had adopted would be included into HB 85 by amendment in the House Finance Committee. She asked why the changes had not been provided to the HESS Committee. Number 120 MR. GUILEY said he thought HB 85 was scheduled for another hearing in the HESS Committee the following week next, and he hoped to have final numbers, with all changes to the bill, ready for the committee at that time. Number 127 REP. BUNDE said he wanted to hear the bill again the following Thursday, April 1, 1993. He invited public testimony via teleconference. Number 130 RICHARD M. SWARNER, EXECUTIVE DIRECTOR, BUSINESS MANAGEMENT, KENAI PENINSULA BOROUGH SCHOOL DISTRICT, testified via teleconference from Kenai in support of HB 85. He referred to a letter he had sent to the committee stating his position on the bill. He noted that his district's 9,700 students represented 8 percent of Alaska's student population. He said something was wrong with the funding system when such a major district had reached its funding cap and had the lowest administrative cost in the state, but still faced severe financial problems, including high pupil- teacher ratios, low salaries and no raises, no equipment money and an inability to buy books. He said HB 85 would go a long way toward fixing state school financing. Number 164 REP. G. DAVIS cited the DOE's efforts to finalize the ASPI, and asked whether the Kenai Peninsula Borough School District had submitted its final numbers in response to DOE queries for the ASPI. Number 170 MR. SWARNER answered that the district had, and he believed the district's funding rate would not change under the new funding formula. Number 175 MARY RUBADEAU, ASSISTANT SUPERINTENDENT FOR INSTRUCTION, KENAI PENINSULA BOROUGH SCHOOL DISTRICT, testified via teleconference from Kenai in support of HB 85. She said the district had good community support, but in the last five years, when the district had been at the funding cap, she had seen erosion in the instructional programs, even though the district had been thrifty with raises, hiring, benefits, and equipment purchases. She said the cost differential for Kenai needed to be addressed. Regarding the elements of HB 85 dealing with the TAG program, she said the district puts more money into its TAG programs than does the state. She said she wanted HB 85 to maintain a steady formula funding mechanism for TAG funding. She said 5 percent of the district's students were gifted, and the current funding level was proper. REP. BUNDE asked a clarifying question whether Ms. Rubadeau supported HB 85's provisions for TAG programs. Number 212 MS. RUBADEAU stated, "We support the bill in its entirety. I was just speaking in terms of that one section that we do put in the current amount of money that we generate from state in terms of gifted programs and probably would continue even if this bill went through as written. Thank you." Number 218 MARILYN DIMMICK, KENAI PENINSULA BOROUGH SCHOOL DISTRICT, testified briefly via teleconference from Kenai in support of HB 85. Number 277 BRUCE STANTON, A TEACHER and VICE PRESIDENT, KETCHIKAN EDUCATION ASSOCIATION, testified via teleconference from Ketchikan, representing himself, in support of HB 85. He referred to a letter he had written to the committee, which is on file in the committee room. In summary, he said that Ketchikan, like Kenai, had long been at its funding cap and it could only seek funding solutions from the state. He suggested raising the local contribution cap from the current 4 mill rate to six mills, which could save the state $40 million and fund $64,000 instructional units at no cost to the state. He noted that Alaska is third in the nation in percentage of education funds coming from the federal government, but the state ranks 46th in percentage of local contribution to education funding. He said it might be the time in Alaska to turn to local governments for more education funding. REP. BUNDE observed that Mr. Stanton might find resistance to his ideas in Ketchikan, but not in Juneau. He asked if Mr. Stanton was speaking for the Ketchikan Education Association (KEA), and if so, whether the KEA supported breaking the TAG program away from special education. Number 290 MR. STANTON said KEA did not object to splitting the two programs. He said there was a very small TAG program in Ketchikan, with possibly one class each in the elementary and high school levels and none in the middle school. REP. VEZEY said he admired Mr. Stanton's bravery in advocating a local tax increase for education. He asked why people would want to raise their taxes to increase school funding when other areas of the state did not pay taxes for their schools. Number 305 MR. STANTON said that was part of the complication of the issue. He said there was a need to consider what REAAs (Rural Education Attendance Areas) actually could do contribute to state educational funding and how much they might be asked to contribute. He repeated that the Ketchikan school district, facing a state funding cap, faced the need to continue cutting expenses or imposing more local taxes. REP. NICHOLIA asked who Mr. Stanton represented. MR. STANTON answered that he represented the KEA. Number 320 REP. NICHOLIA asked if the KEA had given him a letter identifying him as the association's representative. MR. STANTON answered no, and said the KEA had not taken a vote to support HB 85. He said the KEA was interested in $474,000 that would go to the district. REP. NICHOLIA observed that, in the absence of any authorizing vote, Mr. Stanton did not really officially represent the KEA. MR. STANTON said, "You could say it that way, yes." Number 334 REP. NICHOLIA noted Mr. Staton's comment that REAAs should contribute to their educational funding and asked how, in the absence of any funding base or property of value, they could be expected to do so. MR. STANTON said that was a good question. He said he had not said they should have to contribute the same way other districts did. Number 345 REP. NICHOLIA said anyone who asserted that the REAAs should contribute to educational funding should also offer suggestions as to how they could do that. CHAIR TOOHEY applauded Mr. Stanton's heroism in taking an unpopular position, but said he probably had more leeway to do so as he was representing himself and not the KEA. Number 363 REP. B. DAVIS noted that the state general fund received money from the federal government on behalf of REAAs and single-site school districts. She said the committee would be surprised at the amount of money that came in from the federal government, which she said showed the REAAs and single-site school districts did not have a free ride. REP. BUNDE asked Mr. Stanton to ask the KEA to formulate a position on school consolidation and the single-site issue for later submission. Number 380 MORRIS VERVERS, SUPERINTENDENT, KLAWOCK CITY SCHOOL DISTRICT, testified in Juneau in support of HB 85. He said the new formula had gone through a year and a half of intense work, including input from many people, which was a highly credible process. He added that the bill would end the practice of holding school children hostage in political budget battles each legislative session. Number 395 REP. G. DAVIS asked if the state should establish a regular time frame in which to review and adjust school funding numbers every few years. MR. VERVERS observed that equity in school funding was a goal aimed for but not usually attained. He repeated that the 18 months of work on the new funding formula lent it credibility. Number 404 STEVE GIBSON, A PARENT, testified via teleconference from Homer in support of the ASPI in HB 85. He asked for a more precise definition of what constituted a TAG student. He said some TAG students are liable to become bored in school and to drop out, wasting their abilities. He said that the TAG programs also enrich students not enrolled in the programs. He encouraged the legislature not to diminish the TAG program. Number 422 DEB GERMANO, A PARENT, testified via teleconference from Homer in support of HB 85. She expressed concern that the TAG program might be damaged by efforts to address problems in other programs. She said money spent on TAG programs was well spent. REP. BUNDE invited those testifying to submit written testimony as well. Number 449 JACK CADIGAN, a TEACHER and MEMBER of the CENTRALIZED CORRESPONDENCE SCHOOL EDUCATION ASSOCIATION (CCSEA), testified in Juneau on behalf of the CCSEA in support of HB 85. He said the 23-member association was concerned with section 2, which changes the funding formula for the Centralized Correspondence School (CCS) from that applied to elementary schools to 65 percent of that applied to regular schools. He said it was in one sense a question of equity for the CCS, a fully accredited school which about 1,200 students in both urban and rural areas, and both elementary and secondary students. He said the school had been adequately funded for years when the state paid all costs for it, and when summer school was added, other funding sources were found to pay. He said the FY94 budget left the CCS short by between $100,000 to $300,000. Number 477 CHAIR TOOHEY asked what percentage of the 1,200 students attended summer school. MR. CADIGAN said the CCS actually made money from the summer school, as all of the services necessary for summer school were already available from the regular school year, including some staff, the warehouses, books and equipment. Therefore, being funded under the elementary school formula would not have much negative impact, as funding was sufficient, he said. But when summer school was taken away, as it was last year, the issue of what formula CCS is funded under became critical, he said. He noted CCS was originally just for elementary grades, but 12 or 14 years ago expanded to a full K-12 school. Number 490 GREG MIDDAG, MEMBER, KETCHIKAN EDUCATION ASSOCIATION'S EXECUTIVE BOARD, testified in Juneau in support of HB 85. He said some in his district were concerned about TAG students, though there was not much of a TAG program in Ketchikan. He said Ketchikan had been at its funding cap for the past five or six years and there were no other sources of funding for education. He expressed the hope that Ketchikan could maintain some of its programs. He said the district has cut school nurses, daytime janitors and special needs aides, and the district has had to raise money from the community for special needs students. He voiced support for the district administration and its efforts to maintain funding, but said the district needed someplace else to go for funding. He encouraged passage of HB 85 and asked the committee to help local governments find some more money. Number 521 REP. BUNDE asked if White Cliff School were still operating in Ketchikan and commented that his wife had attended the school in the past. MR. MIDDAG said that the school would probably have to keep operating for the next 20 years, if it stood. Number 521 KATHI MCCORD, VICE PRESIDENT, COMMUNICATIONS, ANCHORAGE EDUCATION ASSOCIATION and MEMBER of the BOARD OF NEA-ALASKA, testified in Juneau on HB 85. She expressed concerns that HB 85, by separating the TAG programs from special education, would remove accountability from the TAG programs. She said she had been told that schools could spend money allocated for TAG programs on other unrelated programs. Number 533 CHAIR TOOHEY stated she needed to have someone from the school district present to answer such questions. She said that issue had been addressed the previous day and such diversion of funds was not possible under HB 85. Number 538 REP. BUNDE corrected Chair Toohey, saying that the committee had dealt the previous day with HB 235, which required IEPs, but not the three-year evaluation. Number 545 DENNIS WETHERELL, PRESIDENT, MAT-SU TALENTED AND GIFTED ASSOCIATION, testified via teleconference from Anchorage in opposition to HB 85. He addressed what he perceived to be the committee's misunderstandings that TAG education had been coupled with special education in the first place because TAG students were at risk of dropping out of school and of life. He listed problems TAG students had in succeeding in school and in life. He said HB 85 cut funding in four ways. He stated the bill would result in the Mat-Su district receiving $4 million less than it would have under the existing foundation formula in effect. He said HB 85 did not mandate funding for TAG education, while special and voc-ed programs had guaranteed or minimum funding levels. He stated that independent analysis by the district showed that HB 85 would cut TAG funding for the district by 40 percent. He commented that districts were not bound to spend TAG money on TAG programs. Number 573 LARRY WIGET, LEGISLATIVE LIAISON, ANCHORAGE SCHOOL DISTRICT (ASD), testified via teleconference from Anchorage in opposition to HB 85. He repeated the district's position that HB 85 would cost the district money. According to Mr. Wiget, Anchorage has 37.73 percent of the state's school population, and while it receives 30.27 percent of the state educational funding under the existing system, it would receive 29.69 percent under the proposed formula. He favored leaving TAG under special education funding and opposed changing the funding weight factor for TAG. REP. BUNDE asked a clarifying question whether the ASD opposed separating TAG and special education program funding. MR. WIGET answered yes. TAPE 93-47, SIDE A Number 000 KENT DURAND, ASSOCIATION OF ALASKA SCHOOL BOARDS (AASB), testified in Juneau in support of HB 85. He said the ASPI would level the playing field for almost all state school districts, and with a few minor adjustments to the ASPI, it will provide equity in funding. He said rural districts had higher non-personnel costs, often due to extremes in weather and geography. He said some school districts were also concerned about how inflation would affect school funding. He said the AASB asked for a statutory inflation-proofing mechanism to be added to the ASPI, and language directing the DOE to submit an annual recommended unit value adjustment. The association hoped the ASPI would address single-sites and recommended the state consider district size and enrollment in making funding adjustments for school funding. He also encouraged de-politicizing funding of single-site school districts. REP. BUNDE encouraged the AASB to consider the capital budget, showing that some school districts had 22 schools with fewer than 12 students. He encouraged the association to prepare to provide testimony to the committee on that topic. (Rep. Brice left at 4:39 p.m.) Number 062 DIANA GREELY, PARENT OF A CHILD IN KETCHIKAN SCHOOLS, testified via teleconference from Ketchikan in opposition to HB 85. She spoke against changes in the TAG program funding plan and in favor of maintaining the program in Ketchikan, where 62 elementary schools had been identified as TAG. She said that, as a parent of a sixth grader, she would work to help establish a TAG program in Ketchikan's middle school. Number 080 CATHERINE PLASENCIA, PARENT OF A CHILD IN KETCHIKAN SCHOOLS, testified via teleconference from Ketchikan in opposition to HB 85. She spoke against changing funding for TAG programs in the absence of other legislative mandates concerning TAG funding. She wanted TAG funding left under mandated special education funding. Number 090 MARYSIA OCHEJ, BUSINESS MANAGER, SOUTHEAST ISLANDS SCHOOL DISTRICT, testified via teleconference from in Ketchikan support of HB 85. She agreed with the price differential, saying she had worked around the state and had experienced the inequities of the existing price differential system. As a parent, however, she said it was important not to reduce services to TAG children. She said the DOE needed to address funding of TAG programs as part of its mission to address all students' learning needs. Number 125 REP. G. DAVIS asked what was the differential with which Ms. Ochej had expressed satisfaction. MS. OCHEJ replied, "One point two-two (1.22). It's currently one point 0-four(1.04)." Number 133 REP. VEZEY asked her where she got her figures. MS. OCHEJ said the foundation formula currently assigned the Ketchikan district a price differential factor of 1.04 and the proposed new formula would increase that factor to 1.22. Number 140 REP. VEZEY said he had been trying for a month, without success, to get a copy of the ASPI, but he had heard from Ms. Ochej and others that they already had the information. Number 146 BETT JAKUBEK, PARENT OF TAG CHILDREN, testified via teleconference from Ketchikan in opposition to HB 85. She said she wanted her children to be able to enjoy the benefits of a TAG program when they advanced to middle school. She said some teachers see TAG programs as a frill, and potential targets for budget cuts. She wanted her children to get the kind of education they needed and the latitude allowed for TAG funding under HB 85 did not ensure that TAG programs would be properly funded. Ms. Jakubek acknowledged the need to eliminate paperwork and encouraged the committee to find new ways to protect the current system and not remove TAG from special education. Number 189 REP. BUNDE invited her and others to fax in written testimony. Number 210 MALCOLM FLEMING, PRINCIPAL, SEWARD JUNIOR-HIGH SCHOOL, testified via teleconference from Seward in support of HB 85. He said the Seward school budget was inadequate and student-teacher ratios were too high. He said the Kenai school district needed special adjustments and HB 85 appeared to help by replacing the Area Cost Differential with the ASPI. He said Kenai's education costs were higher than those of Anchorage; the district was at its funding cap; and school fund-raising was paying as much as the school district for some supplies and activities. REP. BUNDE asked Mr. Fleming his opinion about breaking TAG students out of special education funding. MR. FLEMING said he had no problem with the break-out as the 4.5 percent level matched his school's needs. Number 240 MIKE SMITH, A PARENT, testified via teleconference from Seward in support of HB 85. He said he agreed with the testimony from Mr. Swarner and Mr. Fleming that Kenai's educational costs were higher than those of Anchorage's district. Number 250 SUSAN WALLIN, A PARENT, testified via teleconference from Trapper Creek in support of HB 85. Her written testimony is on file in the committee room. In summary, her testimony praised the ASPI and encouraged even closer consideration of small rural districts in the Mat-Su Borough. She opposed removing TAG funding from special education, and also expressed concern about the bill's adjustment of the enrollment estimate date, saying it might slow budgeting. REP. BUNDE provided the committee's fax number, 465-6790, so that others in Trapper Creek and elsewhere could submit written testimony. He announced that the committee would hear HB 85 again the following Thursday, April 1, 1993. REP. B. DAVIS asked permission to pass out amendments to HB 85 for the committee members' examination before the members next considered the bill. REP. BUNDE assented, then ADJOURNED the meeting at 4:55 p.m.