Legislature(1999 - 2000)
03/03/2000 09:01 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
March 3, 2000
9:01 AM
TAPES
SFC-00 # 45, Side A & B
SFC-00 # 46, Side A
CALL TO ORDER
Co-Chair John Torgerson convened the meeting at
approximately 9:01 AM
PRESENT Co-Chair John Torgerson, Co-Chair Sean Parnell,
Senator Pete Kelly, Senator Loren Leman, Senator Randy,
Senator Green Phillips,
Also Attending: EDDY JEANS, Manager, School Finance and
Facilities Section, Department of Education and Early
Development; CARL ROSE, Executive Director, Association of
Alaska School Boards; VERNON MARSHALL, Executive Director,
NEA Alaska; RICK CROSS, Commissioner, Department of
Education and Early Development.
Attending via Teleconference: From Eagle River: DEBBIE
OSSIANDER, Anchorage School Board; NANCY DAVIS, Eagle River
PTA; From Greely: DAN BECK, Greely School Board; ART
GRISWOLD, Borough Incorporation Committee; From Nome: KAREN
LIGON; From Fairbanks: DEBBIE COOK, Chinook Charter School;
MIKA MACH, Chinook Charter School; ROYCE CHAPMAN, Fairbanks
School Board; CYNTHIA HENRY, President, Fairbanks School
Board; CARTER CRAWFORD; From Homer: SCOTT WHEAT and RICK
HARNESS; From Kenai: PATRICK HICKEY, Kenai School District;
CATHERINE DELACEE, President, Soldotna Elementary Sight
Council; From Petersburg: ELIZABETH BACOM, President,
Petersburg School Board; From Seward: MALCOLM FLEMING,
Principal, Seward High School.
SUMMARY INFORMATION
SB 95-SCHOOL GRADE LEVELS
The Department of Education and Early Development, along
with members from the public testified. The bill was held
in committee.
SB 105-PUBLIC SCHOOL FUNDING
The Sponsor, along with members from the public testified.
A committee substitute was adopted. The bill was held in
committee.
SB 198-INCREASE BASE ALLOCATION FOR EDUCATION
The Sponsor, along with members from the public testified.
The bill was held in committee.
SB 244-QUALITY SCHOOL GRANT FUND INCREASE
The Commissioner of Department of Education and Early
Development, along with members from the public testified.
The bill was held in committee.
SENATE BILL NO. 95
"An Act relating to the combination of grades that
constitute junior high, middle, or secondary school."
Senator Phillips explained that this legislation would
provide a mechanism to alleviate an overcrowding situation
in an Anchorage high school.
DEBBIE OSSIANDER, Anchorage School Board testified via
teleconference from Eagle River. She stated that this
legislation addresses a specific problem in the Anchorage
school district. She noted that those schools, which are
more geographically isolated than the ones in the Anchorage
bowl, are being unfairly impacted by current regulations.
She explained that Chugiak High School is the most
overcrowded in the Anchorage School District, but under
current regulations it is impossible to qualify for state
reimbursement to address the problem. She pointed out that
this current legislation would make less stringent the
requirements to qualify for relief. She then gave specific
characteristics of Chugiak High School's overcrowding
situation.
EDDY JEANS, Manager, School Finance and Facilities Section,
Department of Education and Early Development stated that
this legislation's related fiscal note reflects the
increased eligibility for districts to qualify for
additional monies for major maintenance or construction.
He added that this legislation allows the allocation of
secondary square footage for six graders who are located in
middle schools. He noted that overall the system
implemented by this legislation would allow reimbursement
under the debt retirement program or the school
construction grant program as appropriated by the
legislature. He then outlined the fiscal note figures more
specifically. He explained that these figures would not be
retroactive.
Senator Phillips explained that the figures referenced in
the fiscal note would be the maximum potential of monies
necessary to rectify this overcrowding problem. He then
gave a general overview of other school districts statewide
that are also nearing saturation.
Mr. Jeans outlined the reasons behind a reduction of funds
from $26 million to $18 million related to this
legislation's fiscal note. He explained that the fiscal
note was originally prepared under the assumption that all
six-grade students would move to a middle school concept,
reflecting the maximum possible increase in eligibility if
this concept was initiated.
Senator Wilken referred to page three, lines 15 - 23, and
asked for an explanation for the proposed language
addition. This section reads:
(A) projected long-term student enrollment that
indicates the district has inadequate facilities to
meet present or projected enrollment or has unhoused
students; for purposes of this subparagraph,
(i) students are considered unhoused if the
students attend school in temporary facilities;
and
(ii) sixth grade students shall receive the
space allocation given to secondary students when
the sixth grade students are housed in a middle
school, junior high school, or high school that
includes the sixth grade;
Mr. Jeans explained that this language would give districts
secondary space allocation if the students are housed in a
middle school. He noted that students are considered
unhoused under section (i) if the students are in portable
or temporary facilities. He then explained the square foot
ramifications of this language.
Senator Wilken asked if this section would change the
global definition of "unhoused" students in Alaska.
Mr. Jeans responded that he would do additional research to
answer this question.
Ms. Ossiander confirmed that students in portable
facilities in Anchorage have been considered "unhoused."
Senator Phillips advised that the Anchorage School
District, along the Department of Education and Early
Development will work with demographers in order to further
refine this fiscal note. He then gave examples of
overcrowding and growth of community sectors, both of which
reflect a need for this legislation.
Mr. Jeans clarified that the numbers outlined in the fiscal
note reflected the additional amount of money allowed for
eligible reimbursement. He continued that the level of
reimbursement would depend on the funding mechanism that
the legislature passes. He added that this legislation
would change entitlement for school districts, affecting
the related project priority process.
NANCY DAVIS, Eagle River PTA (Parent Teacher Association)
spoke to the fiscal note and noted that this district's
highest priority was to secure funding for a second high
school in North Anchorage. She noted that the district
currently has nine portable facilities at this high school.
Co-Chair Torgerson ordered the bill HELD in committee.
CS FOR SENATE BILL NO. 105(HES)
"An Act determining the facilities constituting a
school for purposes of public school funding; and
providing for an effective date."
Senator Taylor stated that this legislation corrects
problems with SB 36, legislation passed in a previous
session changing the foundation funding formula for public
schools. He pointed out that Petersburg barely qualified
for the enrollment requirement set out in SB 36. He
continued that in the community of Wrangell there were
three funding units for elementary, middle and high
schools. He noted that because of this, Wrangell would not
receive any significant funding, but rather were required
to institute special taxation programs to make up for the
shortfall. He added that Petersburg or Wrangell have never
taken advantage of the previous school basic funding
formula. He explained the characteristics of a new
committee substitute not presently before the committee,
which would provide for a decline on the present funding
mechanism at 75 percent, then to 50 percent, and finally to
25 percent. He asserted that these funding percents were
created for the purposes of bringing Petersburg and
Wrangell to current levels of necessary allotted monies.
Senator Phillips affirmed that this legislation would only
affect three communities, these being Petersburg, Wrangell
and Delta Greely. He wondered how much each community paid
for their schools.
Senator Taylor responded that these communities pay up to
the cap and above, some of which; is paid out of the city
coffers. He continued that Wrangell increased its real
property taxes by 20 percent, all of which was spent on
education. A discussion ensued between Senator Taylor and
Senator Phillips regarding the non-tax paying status of
Delta Greely.
Senator Wilken gave a historical overview of school funding
for Petersburg and Wrangell, as well as Delta Greely as
illustration of the inequities between tax based and non-
tax based communities, which progressed into a general
discussion about how school expenses are funded statewide
per established formulas. Senator Taylor, Senator
Phillips, Senator Green and Senator Leman participated in
this discussion.
Senator Green referred to discussions from last session
regarding the Department of Education and Early
Development's hesitancy to amend SB 36, until the overall
effects of this legislation could be weighed on a statewide
basis.
Mr. Jeans responded that this is still the department's
position. He noted that the department does recognize the
effects to a school system that falls below the established
formula number. He noted that when a community has more
than 750 students in their system, this community has the
benefit of counting three schools, if three schools
presently exist. He continued that with a drop of
students, this community can only count on funding for two
schools, which can be a substantial cut. He remarked that
a three-year transition formula as proposed in this current
legislation might be inappropriate, but rather a one-year
transition might be in order.
Senator Green asked if the department could foresee any
other community falling into this similar situation.
Mr. Jeans responded that the two communities closest to
this cut-off figure are Petersburg and Delta Junction. He
then responded to various questions about a proposed study
regarding cost differentials, which this study is slated to
be completed next year.
Senator Wilken referred to the efforts of two Accountants,
who are presently trying to align the state's chart of
accounts.
Mr. Jeans responded that in addition to SB 36, the
legislature appropriated additional resources for the hire
of two internal auditors who are compiling comparable data
between school districts. He added that different school
districts were accounting for certain types of expenditures
inconsistently with other school districts. He summarized
that these efforts were an attempt to make these accounts
more uniform.
DAN BECK, Greely School Board testified via teleconference
from Greely. He stated that his community was in the
process of creating a borough. He noted that Greely would
need help with funding their schools once this transition
takes place. He outlined the funds that Greely has lost in
this past year because their student enrollment fell below
the cut-off formula. He stressed that unless Greely can
get some relief, the community will have to lay off 19
teachers and one administrator. He spoke to additional
shortfalls.
Tape: SFC - 00 #45, Side B, 9:49 AM
Mr. Beck responded to a question posed by Senator Leman
regarding the district's ADM (Average Daily Membership)
number at 1022 students, putting them over the threshold.
Mr. Beck noted this number was closer to 891 students.
Senator Phillips asked what the timeline was related to
Greely becoming a borough.
Mr. Beck responded that the charter would be submitted
within six weeks.
ART GRISWOLD, Borough Incorporation Committee testified via
teleconference from Greely reiterated this six-week
estimate. He continued that after the necessary signatures
were collected, it would be up to the Boundary Commission
to set a date for a hearing, and it would probably be
within 90 to 120 days after this hearing that a final vote
would take place.
KAREN LIGON, Nome Public Schools, testified via
teleconference from Nome. She stated that in Nome they
absorb the Nome Youth Facility, which is a youth
correctional institution. She added that educational
services are provided here for a capacity of 6 to 12
students. She spoke about an alternative high school with
a student population that fluctuates from 25 to 35 students
there as well. She stressed that it is hard to provide
adequate services to these small schools when it is a
requirement to count them as part of a larger school, which
has the highest ADM.
DEBBIE COOK, Chinook Charter School testified via
teleconference from Fairbanks. She stated the school's
concern with SB 105 dealt specifically with section 1.3,
which states:
(3) in a community with an ADM of greater
than 450 [750], each facility that is administered as
a separate school shall be counted as one school,
except that each alternative school with an ADM of
less than 200 shall be counted as a part of the school
in the district with the highest ADM.
She stated that this section continues to treat charter
schools with less than 200 students for funding purposes,
as if the students are enrolled in the school with the
largest ADM in the district. She asserted that this
creates an inequity with smaller schools. She gave various
examples of how the Chinook Charter School lacks many of
the programs of these larger schools and along with the
established funding formulas, this charter school has a
harder time meeting their costs.
SCOTT WHEAT testified via teleconference from Homer and
stated that he supports this legislation, especially from a
rural perspective.
RICK HARNESS testified via teleconference from Homer to
support this bill. He spoke to the possibility of cutting
staff in Homer schools because of funding shortfalls,
something, which affects the whole community. He also
stressed that funding charter schools takes away monies
that could be used in the public school system.
PATRICK HICKEY, Kenai School District, testified via
teleconference from Kenai. He addressed the issue of how
schools are categorized by this legislation. He suggested
that having a charter school with 26 students, while
funding it along with a community of 600 students in a
larger high school creates an inequitable situation. He
concluded that charter schools should be treated like any
other.
Senator Green responded to Co-Chair Torgerson's concern
that the testimony was turning into a charter school
debate. She pointed out that this legislation in earlier
versions did make reference to charter schools and inferred
that some of the testifiers were referring to this older
version.
ELIZABETH BACOM, Petersburg School Board testified via
teleconference from Petersburg. She highlighted the
negative fiscal impacts created by declining enrollment,
while using the two-school formula as versus the three-
school calculations as was testified to previously. She
listed all those programs that the district stands to
loose, as a result and those that they have already lost.
She also outlined how Petersburg has had to shore up their
resources to save existing funding.
MIKA MACH, Chinook Charter School, testified via
teleconference from Fairbanks regarding the inclusion of
charter schools into this legislation. She requested that
a benchmark be included in section 3 to cover the Chinook
Charter School.
CARL ROSE, Executive Director, Association of Alaska School
Boards stated that the association supports this
legislation, although they are concerned that a present
state funding policy exists under a foundation formula. He
noted the benchmark change from 750 to 450 ADM, his main
point being that whatever the benchmark, it needs to be
consistent from one school district to the next.
Senator Phillips asked Mr. Rose to address the inequity
created by two tax paying jurisdictions that are presently
requesting relief, along with another community, Delta
Greely, a non-paying tax community.
Mr. Rose responded that he does agree that an inequity
exists, but suggested that this issue be addressed through
another avenue. A lengthy discussion ensued between Mr.
Rose, Art Griswold and Senator Phillips regarding this
issue.
Senator Wilken made a motion to adopt SB 105, 1-LS06AA\T as
the committee substitute. Hearing no objection, it was so
moved.
Co-Chair Torgerson ordered the bill HELD in committee.
SENATE BILL NO. 198
"An Act increasing the base student allocation
component of the public school funding formula; and
providing for an effective date."
Senator Wilken as sponsor gave an overview of this
legislation. He noted that this bill simply provided that
an additional fifty dollars be added to the student dollar
for K-12 foundation formula. He pointed out that the
foundation formula puts a demand on state resources in the
amount of $19.96 million dollars less than the year before.
He noted that this legislation recognizes that part of this
money, if not all of it, is education. He continued that
this $19.96 million is generated by three things: the
first, Alaska has fewer students, federal monies have
increased since last year, and through the efforts in the
last decade of this legislature and others, the assessed
value of Alaska continues to grow. He summarized that
these three aspects contributed to a $20 million dollar
reduction to the state's resources. He felt as though the
increase in funding outlined in SB 198 would provide relief
to various communities.
MALCOLM FLEMING, Principal Seward High School testified via
teleconference from Seward. He pointed out how this
district is slated to loose three regular teachers and one
special education teacher due to falling enrollments, along
with the effects of budget cuts. He added that if they had
been able to use the funding formula from 1996 - 1997, the
district would presently have four more teachers on staff.
He outlined the additional effects budget cuts would have
on the Seward school district.
ROYCE CHAPMAN, Fairbanks School Board testified via
teleconference from Fairbanks. He noted that the Fairbanks
district is faced with a $4 million-dollar gap in funding.
He declared that the district made up $3 million of this
deficit through cuts to administrative areas, which did not
have a direct affect on student programs. He gave an
overview of other such efforts, including shortfalls
anticipated in the future.
CYNTHIA HENRY, President, Fairbanks School Board testified
via teleconference from Fairbanks. She stated that the
board recently held two public hearings and heard from 80
citizens regarding the Fairbanks school budget. She noted
that every participant requested the reinstatement of those
programs already cut because of budget shortages. She
explained that the district would eventually ease subsidies
to their charter school contingents. She spoke to loosing
children from the district due to program cuts.
Tape: SFC - 00 #46, Side A, 10:36 AM
CARTER CRAWFORD, testified via teleconference from
Fairbanks. She stated her support for SB 198 and education
generally as a high priority. She added that education
should not be considered an expense just because it is a
budget item. She countered that drops in enrollment should
be an opportunity for districts to increase Alaska's
commitment to existing students.
PATRICK HICKEY testified via teleconference from Kenai.
He noted that Kenai's property taxes have increased to the
point where the state should realize a reduction of revenue
at $781,000 next year. He stated his support for this
legislation.
Catherine DeLacee, President, Soldotna Elementary Sight
Council, testified via teleconference from Kenai. She
stated that the Council unanimously supports this
legislation. She stated that the local school there had to
"pink slip" four teachers recently and she noted that
teachers have had to pay for supplies out of their pockets
for the last three years.
SCOT WHEAT testified via teleconference from Homer and
voiced his support for this legislation.
RICK HARNESS testified via teleconference from Homer. He
stated his support of the previous testimony.
DEBBIE COOK testified via teleconference from Fairbanks.
She stated wholeheartedly her support for this legislation
in face of budget shortfalls. She felt as though education
of Alaskan children should be its highest priority.
CARL ROSE, Executive Director, Association of Alaska School
Boards stated that the state has been on the move to
improve the quality of education in Alaska. He noted that
the intent of previous legislation namely, SB 36 was to
inject $26 million into the education system. He asserted
that this legislation was to offset enrollment declines and
increased property values as a local contribution to
education. He stated that his organization supports this
legislation because the weight of money generated by it
will go towards the children directly.
VERNON MARSHALL, Executive Director, NEA (National
Education Association) Alaska stated that his organization
supports the $50 increase as allowed for by this
legislation. He added that the NEA would gladly support an
amendment to raise the basic student allocation to $4,040
in an effort to restore the $19.17 million as recommended
by the governor. He noted that this money would go a long
way to preparing students for the 2002 exit exams. He also
stated a concern with the quality schools initiative as
presented in SB 244. He pointed out that this effort would
require additional personnel, materials and training. He
outlined the specific related cost ramifications of this
initiative as well.
SENATE BILL NO. 244
"An Act increasing the eligible maximum amount for
quality school grant funding for school districts; and
providing for an effective date."
RICK CROSS, Commissioner, Department of Education and Early
Development stated that this legislation provides an
increase from $16 to $52 of the quality school grant in the
public school foundation formula. He noted that the
ultimate impact of this increase would total $7,552,000.
He asserted that this legislation provides money to school
districts using a different mechanism than SB 198, which
the department also supports. He continued that this
legislation provides quality school grant increases that
targets money for specific purposes, meaning to improve
student performance. He cited that this money was for
districts to provide necessary programs ensuring a high
level of student success for exit exams.
ADJOURNED
Senator Torgerson adjourned the meeting at 11:00 AM.
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