Legislature(2013 - 2014)SENATE FINANCE 532

02/25/2013 09:00 AM Senate FINANCE

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09:10:02 AM Start
09:10:10 AM SB17
10:37:50 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Bills Previously Heard/Scheduled TELECONFERENCED
Heard & Held
                 SENATE FINANCE COMMITTEE                                                                                       
                     February 25, 2013                                                                                          
                         9:10 a.m.                                                                                              
9:10:02 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Meyer  called the Senate Finance  Committee meeting                                                                    
to order at 9:10 a.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Senator Pete Kelly, Co-Chair                                                                                                    
Senator Kevin Meyer, Co-Chair                                                                                                   
Senator Anna Fairclough, Vice-Chair                                                                                             
Senator Mike Dunleavy                                                                                                           
Senator Donny Olson                                                                                                             
MEMBERS ABSENT                                                                                                                
Senator Click Bishop                                                                                                            
Senator Lyman Hoffman                                                                                                           
ALSO PRESENT                                                                                                                  
Tim   Lamkin,   Staff,   Senator   Stevens;   Kris   Curtis,                                                                    
Legislative Auditor,  Legislative Budget and  Audit; Patrick                                                                    
Pillai,  Executive   Director,  Special   Education  Service                                                                    
Agency (SESA); Millie Ryan,  Executive Director, REACH Inc.;                                                                    
Les Morse, Deputy Commissioner,  Department of Education and                                                                    
Early Development.                                                                                                              
PRESENT VIA TELECONFERENCE                                                                                                    
Genevieve   Hollins,   Finance  Director,   SESA;   Margaret                                                                    
Kavanaugh,  Teacher,   Kodiak;  Jennifer   Eubank,  Teacher,                                                                    
SB  17    EXTEND SPECIAL EDUCATION SERVICE AGENCY                                                                               
          SB 17 was HEARD and HELD in committee for further                                                                     
SENATE BILL NO. 17                                                                                                            
     "An Act extending the special education service                                                                            
     agency; and providing for an effective date."                                                                              
9:10:10 AM                                                                                                                    
TIM  LAMKIN, STAFF,  SENATOR  STEVENS,  discussed the  bill,                                                                    
which  would extend  the  Special  Education Service  Agency                                                                    
(SESA).  He presented  the bill  with a  summary of  actions                                                                    
taken in  the Senate Education Committee.  The bill extended                                                                    
SESA with  three separate issues.  One issue was  whether or                                                                    
not to  extend the sunset date  of the agency, which  set to                                                                    
expire  on  June  30,  2013.   The  second  issue  addressed                                                                    
considerations  pointed  out  in  the  audit  including  the                                                                    
structure  of   SESA's  governance.  The  third   issue  was                                                                    
funding.  He  mentioned   recommendations  to  increase  the                                                                    
funding  for  SESA. A  fourth  issue  presented itself  upon                                                                    
consideration  of   the  bill,  which   included  extraneous                                                                    
language regarding the Division  of Retirement and Benefits.                                                                    
The recommendation from Legislative  Budget and Audit (LB&A)                                                                    
was  to   extend  the  sunset   date.  The   LB&A  committee                                                                    
determined  that the  program  was  worthy without  services                                                                    
duplicated elsewhere.                                                                                                           
Mr. Lamkin explained that SESA  was governed as a non-profit                                                                    
agency  with   its  own  board  of   directors  through  the                                                                    
Governor's  Council on  Disabilities and  Special Education.                                                                    
The majority of SESA's board  sat on the governor's council.                                                                    
The members  had a vested  interest in the  issues addressed                                                                    
by  SESA.  He added  that  the  non-profit organization  was                                                                    
funded by the Department  of Education and Early Development                                                                    
(DEED). The structure, while  unorthodox, functions well. No                                                                    
recommendations were  made to change the  methods of funding                                                                    
and governing SESA. The  LB&A audit recommendations included                                                                    
suggestions  that the  legislature review  its funding.  The                                                                    
Senate Education Committee chose not  to review the issue of                                                                    
funding. He agreed  that SESA had been  flat and underfunded                                                                    
for 15  years. Due to  inflation, a 36 percent  decrease was                                                                    
suffered  in  operating  funds.  He  encouraged  the  Senate                                                                    
Finance Committee to consider funding increased for SESA.                                                                       
9:13:39 AM                                                                                                                    
Mr.  Lamkin discussed  the  Senate  Education Committee  CS,                                                                    
which  removed  language  that  indicated  that  the  amount                                                                    
allocated to the  agency should be reduced  each fiscal year                                                                    
by the amount  contributed by DEED to  the Public Employees'                                                                    
Retirement System (PERS) and  the Teachers Retirement System                                                                    
(TRS).  However, DEED  allocated the  full appropriation  to                                                                    
SESA annually and then SESA  paid directly to the retirement                                                                    
system.  He provided  a statement  from the  department that                                                                    
the language was  extraneous and that all  parties agreed to                                                                    
remove  it  from  the  books.  He  offered  to  provide  the                                                                    
statement to committee members.                                                                                                 
9:14:42 AM                                                                                                                    
Co-Chair  Meyer   asked  for   further  details   about  the                                                                    
Mr.  Lamkin  replied  that  the   statement  from  Mr.  Neil                                                                    
Slotnick from the Department of  Law (LAW) and Ms. Elizabeth                                                                    
Nudelman from DEED was available in the committee's packet.                                                                     
Senator Olson agreed that SESA  was an important program. He                                                                    
asked about  services that would  be omitted if  the funding                                                                    
was not increased.                                                                                                              
Mr.  Lamkin  replied  that   school  districts  had  varying                                                                    
resources for  special education  that depended on  the size                                                                    
of  the  district.  Most  school  districts  had  their  own                                                                    
special  education teachers.  He  noted that  SESA served  a                                                                    
niche   of  people   with  low-incident   disabilities  that                                                                    
standard  special education  teachers  were  not trained  to                                                                    
9:16:59 AM                                                                                                                    
KRIS  CURTIS, LEGISLATIVE  AUDITOR,  LEGISLATIVE BUDGET  AND                                                                    
AUDIT,  explained  that the  purpose  of  the audit  was  to                                                                    
determine  that  SESA  provided an  essential  service.  She                                                                    
stated that LB&A conducted a  sunset audit of SESA, with the                                                                    
goal  of determining  if  the agency  was  operating in  the                                                                    
public's interest  and whether  its termination  date should                                                                    
be extended.  The conclusion was  that SESA served  a public                                                                    
need and was essential in  meeting the federal law requiring                                                                    
the state to insure that  all children with disabilities had                                                                    
a  free  and appropriate  public  education  that met  their                                                                    
unique needs. She  added that SESA served  over 200 students                                                                    
located mostly  in non-urban locations. She  recommended the                                                                    
extension of  SESA's termination  date until June  30, 2021,                                                                    
which was the maximum 8 year extension.                                                                                         
Ms. Curtis  noted that the recommendation  for extension was                                                                    
accompanied by  the recommendation to  improve collaboration                                                                    
and oversight.  The largest issue  facing SESA was  the flat                                                                    
funding  of  its  low-incidence  disabilities  program.  The                                                                    
funding level was set in  statute and had not been increased                                                                    
in  14  years, thereby  decreasing  the  real value  of  its                                                                    
budget by  36 percent. The  funding issue made  it difficult                                                                    
to  hire   qualified  staff.  The   funding  for   SESA  was                                                                    
identified  in  the  public   school  funding  statutes  and                                                                    
administered by DEED.  She added that DEED  could request an                                                                    
increase as part of its  annual budgetary process, but chose                                                                    
not   to  since   SESA  organizationally   reports  to   the                                                                    
Governor's  Council on  Disabilities and  Special Education,                                                                    
which  is located  in the  Department of  Health and  Social                                                                    
Services (DHSS).                                                                                                                
Ms.  Curtis  continued  that   the  governor's  council  did                                                                    
support unsuccessful legislation during  the past session to                                                                    
increase SESA's budget.  Since DEED was the  entity that was                                                                    
obligated  to  meet  the   federal  requirement,  the  audit                                                                    
determined  that DEED  should  take a  more  active role  in                                                                    
monitoring SESA.  The audit recommended  that both  DEED and                                                                    
SESA  management   collaborate  to  ensure  that   SESA  was                                                                    
operated  and funded  as intended  by  the legislature.  She                                                                    
stated that DEED did not  agree with the recommendation. The                                                                    
funding for SESA was historically  a legislative process and                                                                    
DEED opined  that there  was no need  to change  the method.                                                                    
She understood  the viewpoint of  DEED, since  the oversight                                                                    
responsibility for  SESA was  fragmented and  confusing. She                                                                    
pointed out a section of  the audit report addressing SESA's                                                                    
organizational  structure  and  highlighting  the  need  for                                                                    
legislative  clarification  regarding monitoring  SESA.  The                                                                    
audit contained a second  recommendation addressed to SESA's                                                                    
board  president  to  revise the  board  policy  to  improve                                                                    
oversight. She  stated that the  board initiated  changes to                                                                    
improve oversight.                                                                                                              
9:20:47 AM                                                                                                                    
Vice-Chair  Fairclough  asked  about  page 18  of  the  LB&A                                                                    
audit. She  asked if  the board  president was  the previous                                                                    
board president overseeing the executive director.                                                                              
Ms.  Curtis pointed  out a  recent change  in the  executive                                                                    
director position, but was unsure about the board.                                                                              
Vice-Chair  Fairclough   clarified  that  SESA  had   a  new                                                                    
executive director.                                                                                                             
Ms. Curtis replied in the affirmative.                                                                                          
Vice-chair  Fairclough asked  about the  board's history  of                                                                    
difficulty reaching a quorum.                                                                                                   
Ms. Curtis replied  that the issue of reaching  a quorum was                                                                    
not a problem for the SESA board.                                                                                               
9:22:16 AM                                                                                                                    
Senator Dunleavy  asked about  recommendation number  two of                                                                    
the audit. He  believed that a certified  teacher fell under                                                                    
the professional  teaching ethics  code. He asked  if SESA's                                                                    
teachers were certified.                                                                                                        
Ms.  Curtis replied  that  the audit  cited  that "SESA  has                                                                    
procedures for potential ethics  violations of teachers, but                                                                    
does  not have  procedures for  addressing potential  ethics                                                                    
violations involving administration and management."                                                                            
Senator Dunleavy stated that if "they  have a type A or type                                                                    
B  they would  still  fall under  the professional  teaching                                                                    
practices commission."                                                                                                          
Ms. Curtis  replied that  question was  best suited  for the                                                                    
executive director.                                                                                                             
Vice-Chair  Fairclough  asked  about  different  boards  and                                                                    
commissions and their maximum extensions.                                                                                       
Ms. Curtis replied  that the statute provided  for a maximum                                                                    
extension  of  eight years.  An  audit  usually contained  a                                                                    
recommendation not to exceed eight years.                                                                                       
Vice-Chair  Fairclough   compared  the   suicide  prevention                                                                    
council's  six year  extension, which  she believed  was the                                                                    
maximum  allowable. She  opined  that the  extension of  the                                                                    
Suicide Prevention  Council when  audited had  less concerns                                                                    
than  SESA's audit.  She  asked how  the  extension for  the                                                                    
Suicide Prevention Council was determined.                                                                                      
Mr.  Curtis responded  that the  main issue  that drove  the                                                                    
Suicide Prevention Council's extension  date was the lack of                                                                    
agreement ensuring  that effective oversight  would continue                                                                    
in the  future. The  importance of the  recommendation drove                                                                    
the six year extension.                                                                                                         
9:24:38 AM                                                                                                                    
Co-Chair  Meyer asked  about  concerns  regarding a  shorter                                                                    
extension for SESA.                                                                                                             
Ms. Curtis  responded that the  recommendation was  based on                                                                    
audit  findings   and  the   different  criterion   used  to                                                                    
determine the  extension recommendations. She  admitted that                                                                    
the  audit recommendations  were an  "inexact science."  She                                                                    
explained  that considerations  such as  types of  findings,                                                                    
controversies, and  the nature  of work accomplished  by the                                                                    
board  were reviewed  when determining  extensions. Workload                                                                    
for  the auditors  and the  legislators was  also considered                                                                    
when  determining  potential extensions,  although  workload                                                                    
did   not  impact   this  year's   recommendations.  Current                                                                    
recommendations were based on the findings in LB&A's audit.                                                                     
9:25:51 AM                                                                                                                    
PATRICK  PILLAI,   EXECUTIVE  DIRECTOR,   SPECIAL  EDUCATION                                                                    
SERVICE  AGENCY  (SESA),  showed  a brief  video  about  the                                                                    
9:32:36 AM                                                                                                                    
Senator  Dunleavy  asked if  Mr.  Pillai  was the  executive                                                                    
director in FY 10.                                                                                                              
Mr. Pillai responded that changes  occurred in the executive                                                                    
director  position,  the  board president,  and  the  entire                                                                    
board. He  stated the board  president was PJ Ford  Slack, a                                                                    
principal in Sitka.                                                                                                             
9:34:17 AM                                                                                                                    
Mr.  Pillai  responded to  an  earlier  question by  Senator                                                                    
Dunleavy regarding  the "type  A" teaching  certificates. He                                                                    
stated  that  all   specialists  for  SESA  had   a  type  a                                                                    
certificate  and administrators  had "type  B" certificates.                                                                    
He stated that  SESA reviewed the entire  board policy under                                                                    
the leadership of Joseph Reeves  with the Alaska Association                                                                    
of School Boards to address issues brought up by the audit.                                                                     
Senator  Dunleavy responded  that  teachers with  type A  or                                                                    
"type  B"  certificates  fell  under  Professional  Teaching                                                                    
Practices Commission (PTPC) and  were subject to sanction in                                                                    
the event of an ethics violation.                                                                                               
9:35:32 AM                                                                                                                    
Mr.   Pillai   introduced   slide  1   of   his   PowerPoint                                                                    
presentation (copy on file): "Special Education Service."                                                                       
     SESA provides consultation and training to support the                                                                     
     unique educational needs of individuals and the                                                                            
     Alaskan communities that serve them.                                                                                       
Mr. Pillai discussed slide 2: "Background."                                                                                     
   · Created   in   1986;   formed   as   a   not-for-profit                                                                    
   · Governed by the Alaska Governor's Council on                                                                               
     Disabilities and Special Education;                                                                                        
   · Receive Low Incidence Disabilities funding through                                                                         
     DOEED based on prior years statewide total enrollment;                                                                     
   · Receives grant funding from State and Federal sources,                                                                     
     (DHHS and DOEED)                                                                                                           
9:37:03 AM                                                                                                                    
Mr. Pillai discussed  slide 3 depicting a  picture of SESA's                                                                    
vision specialist  working with  a student in  rural Alaska.                                                                    
The  specialist had  been  working with  the  agency for  15                                                                    
Mr.  Pillai   detailed  slide  4:  "A.S.   14.30.630(b)  (1)                                                                    
requires  SESA to  provide the  following special  education                                                                    
   A. Itinerant outreach services to students who are deaf,                                                                     
     deaf-blind, mentally retarded,  hearing impaired, blind                                                                    
     and   visually   impaired,   orthopedically   disabled,                                                                    
     health-impaired in other  ways, and severely disturbed,                                                                    
     and to students with multiple disabilities;                                                                                
   B. Special education instructional support and training                                                                      
     of local school district special education personnel;                                                                      
   C. Other services appropriate to special education needs.                                                                    
9:38:40 AM                                                                                                                    
Mr.  Pillai  discussed  slide  5,  a  map  depicting  SESA's                                                                    
presence in rural areas across  Alaska along with the number                                                                    
of  students served  in each  of  the areas.  The number  of                                                                    
students  depended  on the  size  of  the village,  how  far                                                                    
villages  were  from  urban  areas, and  the  need  for  the                                                                    
different disabilities. Many of  the areas were inhabited by                                                                    
Coast Guard and  cannery workers leading to  years with more                                                                    
or less students.                                                                                                               
Mr.  Pillai  detailed  slide  6, a  picture  of  a  multiple                                                                    
disabilities  specialist  working  with  a  child  in  rural                                                                    
Alaska. The specialist  had worked with the  agency for over                                                                    
one and one half years.                                                                                                         
9:39:38 AM                                                                                                                    
Mr. Pillai explained slide 7: "SESA Services."                                                                                  
   · On-side consultation - Observation/Modeling/Evidence                                                                       
     Based Strategies                                                                                                           
   · In-service training (professional development)                                                                             
   · Alaska State Special Education Conference (ASSEC)                                                                          
   · Specific courses designed and offered for university                                                                       
   · Alaska Deaf Education Advisory Board                                                                                       
   · Governor's Council/Education/Rural Education                                                                               
   · DEED-Specific Grants- AARC/BTKH/DSI                                                                                        
   · Other Non-profits-Stone Soup/Center for Human                                                                              
9:42:26 AM                                                                                                                    
Mr.  Pillai  discussed  slide  8,  a  picture  of  the  SESA                                                                    
website.   He  pointed   out   the  different   disabilities                                                                    
highlighted by the options presented  on the homepage of the                                                                    
website.  He   added  that  district   administrators  could                                                                    
download paperwork to make referrals  for services needed by                                                                    
the  agency. The  website  was a  resource  for parents  and                                                                    
school districts.                                                                                                               
Mr.   Pillai  detailed   slide  9:   "SESA  FY   12  Student                                                                    
Consultation by District." The  graph detailed the districts                                                                    
served. He  stated that the  data compiled  included on-site                                                                    
visitation,  calls from  teachers  seeking information  from                                                                    
the SESA  library. He added  that SESA allowed  districts to                                                                    
borrow materials that they  considered purchasing. The slide                                                                    
detailed 39 different districts when  SESA worked with 45 in                                                                    
Mr. Pillai discussed slide 10,  a picture of Andrea Story, a                                                                    
vision specialist, who worked  for SESA for approximately 23                                                                    
years.  Ms. Story  was pictured  working with  a child  with                                                                    
vision loss in rural Alaska.                                                                                                    
9:44:01 AM                                                                                                                    
Mr.  Pillai  discussed slide  11:  "Impact  on Students  and                                                                    
Teachers." He provided an example  of a syndrome that caused                                                                    
a person to  sleep all day and stay awake  at night. After a                                                                    
SESA  specialist  spent eight  months  of  working with  the                                                                    
family,  the  child  displayed significant  improvement.  He                                                                    
added  that he  himself was  the  deaf and  hard of  hearing                                                                    
teacher with the  agency for 19 years, so  he understood the                                                                    
challenges faced by the teachers.                                                                                               
 1. Reduced ability to promote evidenced based practices.                                                                       
   2. Fewer   on-site    visits    to    provide    targeted                                                                    
   3. Shorter visits to maximize travel dollars to include                                                                      
     more sites.                                                                                                                
   4. Less time for classroom observation and program                                                                           
   5. Loss of guidance to new special education teachers and                                                                    
     to     classroom    teachers     encountering    unique                                                                    
   6. Loss of child specific educational intervention                                                                           
     strategies modeled on-site to teachers.                                                                                    
   7. Reduced ability to recruit quality specialists to                                                                         
9:45:48 AM                                                                                                                    
Mr.  Pillai  detailed  slide   12:  "2004  Individuals  with                                                                    
Disabilities Education Act (IDEA)."                                                                                             
     The State is required to  meet the 2004 IDEA to "ensure                                                                    
     that all  children with disabilities have  available to                                                                    
     them   a  free   appropriate   public  education   that                                                                    
     emphasizes  special  education   and  related  services                                                                    
     designated to meet their unique needs."                                                                                    
     The Legislature intended for SESA  to help DEED fulfill                                                                    
     this  requirement by  assisting schools  with providing                                                                    
     special education children affected by LID.                                                                                
9:46:19 AM                                                                                                                    
Mr. Pillai discussed slide 13: "Legislative Audit Report                                                                        
June 2, 2012."                                                                                                                  
     Recommendation  1: Reiterating  from  the prior  report                                                                    
     that the Legislature should review SESA funding; and                                                                       
     "Over  the   past  14  years,  school   districts  have                                                                    
     received  increases  in   their  funding  formula,  yet                                                                    
     SESA's   funding  formula   has  not   increased.  …the                                                                    
     historical process  for evaluating and  increasing SESA                                                                    
     funding has been a legislative process…"                                                                                   
9:46:47 AM                                                                                                                    
Mr. Pillai detailed slide 14: "Legislative Audit Report,                                                                        
June 22, 2012."                                                                                                                 
     "Due  to  inflation,  the  real  value  of  SESA's  LID                                                                    
     budget, as  established 14 years ago,  has decreased 36                                                                    
     percent.  Accounting for  inflation since  1998, SESA's                                                                    
     funding   formula   in   today's   dollars   would   be                                                                    
     approximately  $21.50  per   student  rather  than  the                                                                    
     current funding formula amount of  $15.75. As a result,                                                                    
     SESA  is experiencing  challenges  with recruiting  and                                                                    
     retaining   education   specialists  with   specialized                                                                    
     disability endorsements  and meeting schools'  need for                                                                    
     itinerant outreach services."                                                                                              
9:47:31 AM                                                                                                                    
Mr. Pillai detailed slide 15: "Senate Bill 17 Conclusion."                                                                      
   1. Alaska Statute Funding Calculation for SESA should be                                                                     
     changed to $21.50.                                                                                                         
   2. SESA needs these funds to:                                                                                                
        a. fulfill the intent of the Legislature, and the                                                                       
          mandate of the 2004 IDEA;                                                                                             
        b. provide competitive salaries to attract and                                                                          
          retain qualified specialists;                                                                                         
        c. continue providing quality services for LID                                                                          
        d. maintain consistent infrastructure despite short                                                                     
          term or discontinued grant funding cycles.                                                                            
9:49:20 AM                                                                                                                    
Mr.  Pillai  detailed the  graph  on  slide 16:  "ADM  (i.e.                                                                    
SESA's  Funding) vs.  SESA LID  Student Count  FY 2001  - FY                                                                    
2013."  The graph  illustrated the  declining Average  Daily                                                                    
Membership  (ADM) in  red and  the increasing  Low-Incidence                                                                    
Disabilities (LID) during the  same time frame. Between 2004                                                                    
and 2013, SESA  lost over $200 thousand in  revenue based on                                                                    
declining  ADM. During  the same  period,  the LID  students                                                                    
served by  SESA increased. The graph  depicted 260 students,                                                                    
but SESA served 270 students at the time of the hearing.                                                                        
Mr.  Pillai discussed  slide  17: "A  Review  of SESA's  Low                                                                    
Incidence Disabilities Funding Over the Past 10 Years."                                                                         
Mr. Pillai  discussed slide  18: "CPI  and BSA  Increase vs.                                                                    
SESA Funding."                                                                                                                  
     This chart shows the increase in the Consumer Price                                                                        
     Index and Base Student Allocation, with SESA's funding                                                                     
     remaining flat.                                                                                                            
9:50:18 AM                                                                                                                    
Mr.  Pillai detailed  slide 19:  "SESA's Actual  Funding vs.                                                                    
Funding if Equivalent to BSA vs. Student Count."                                                                                
     This graph shows how LID student count has increased                                                                       
     while SESA's overall funding has decreased due to                                                                          
     decreased ADM.                                                                                                             
9:50:39 AM                                                                                                                    
Mr.  Pillai discussed  slide 20:  "LID  Cost of  Operations,                                                                    
Fund Balances  and Grant Expenditures  FY 2005 - FY  2013 (9                                                                    
9:51:52 AM                                                                                                                    
Mr. Pillai  discussed slide 21:  "How SESA's  Funding Should                                                                    
be  Structured VERSUS  How it  is Currently  Structured." He                                                                    
explained that the graph on  the right exhibited the current                                                                    
structure.  The  resources  were  shared by  LID  and  grant                                                                    
funding. He stated that grant  funding fluctuated. The graph                                                                    
on the  left illustrated  a solid infrastructure  that could                                                                    
be used  to assist  the state  with grant-writing.  He noted                                                                    
the difficulty  in recruiting with  one or  two-year grants.                                                                    
The sunset clause  coupled with the limits  of grant funding                                                                    
added to the complications.                                                                                                     
9:53:20 AM                                                                                                                    
Mr. Pillai  detailed slide 22:  "Impact of  Continued Under-                                                                    
 1. Reduced ability to promote evidenced based practices.                                                                       
   2. Fewer   on-site    visits    to    provide    targeted                                                                    
   3. Shorter visits to maximize travel dollars to include                                                                      
     more sites.                                                                                                                
   4. Less time for classroom observation and program                                                                           
   5. Loss of guidance to new special education teachers and                                                                    
     to     classroom    teachers     encountering    unique                                                                    
   6. Loss of child specific educational intervention                                                                           
     strategies modeled on-site to teachers.                                                                                    
   7. Reduced ability to recruit and retain quality                                                                             
9:54:03 AM                                                                                                                    
Co-Chair  Meyer asked  about  slide 9.  He  asked about  the                                                                    
acronym BSSD listed on the school districts served.                                                                             
Mr.  Pillai  responded  Bering Strait  School  District  was                                                                    
shortened to BSSD.                                                                                                              
Co-Chair Meyer asked if school  districts contributed to the                                                                    
funding for SESA.                                                                                                               
Mr. Pillai replied  that SESA was a free  service for school                                                                    
districts. He  shared a  letter of  support from  one school                                                                    
district testifying  that the free services  helped meet the                                                                    
district's  needs  to  provide assistance  in  remote  rural                                                                    
Co-Chair  Meyer  asked about  how  long  a specialist  would                                                                    
remain in the rural schools.                                                                                                    
Mr. Pillai  responded that  the typical  length of  stay was                                                                    
one week.                                                                                                                       
9:56:09 AM                                                                                                                    
Co-Chair  Meyer  asked  about  specialist  worked  with  the                                                                    
school's special education teachers.                                                                                            
Mr.  Pillai responded  that  the  challenges determined  the                                                                    
strategy regarding the child and  the inclusion of the staff                                                                    
in the  classroom. He mentioned  that some children  were in                                                                    
mainstream classrooms,  so the specialist worked  with those                                                                    
teachers too.                                                                                                                   
Co-Chair Meyer pointed out that  very few specialists worked                                                                    
in the Anchorage area. He asked why that was the case.                                                                          
9:57:13 AM                                                                                                                    
Mr.  Pillai responded  that the  Anchorage school  districts                                                                    
had their  own specialists as  well as trainings  offered to                                                                    
the  communities.  He  credited  the small  number  of  SESA                                                                    
specialists  in Anchorage  to the  needs of  deaf and  blind                                                                    
students,   which  were   deemed   high-need  and   required                                                                    
additional  support. He  mentioned  examples  of other  high                                                                    
need disabilities  that benefit  from the support  of SESA's                                                                    
9:58:25 AM                                                                                                                    
Co-Chair Kelly  asked if Alaska met  the federal requirement                                                                    
to provide supported education without SESA.                                                                                    
Mr. Pillai  replied that the federal  requirements would not                                                                    
be met  without SESA.  He added  that SESA  was listed  as a                                                                    
resource  on  the  department's website  and  in  the  state                                                                    
handbook as a  resource for the various needs  of the staff.                                                                    
If there was a teacher in  a school district that lacked the                                                                    
expertise needed to help with  a certain child, a parent may                                                                    
choose to take the school  district to court. Many potential                                                                    
situations   of   litigation   were  prevented   by   SESA's                                                                    
intervention as a neutral party.                                                                                                
Senator  Olson commented  on slide  9. He  pointed out  that                                                                    
BSSD documented  an abundance of SESA  student consultations                                                                    
as compared with  other districts on the  chart. He wondered                                                                    
why the consultations in his district were so numerous.                                                                         
Mr. Pillai responded  that the villages were  spread out and                                                                    
crisis  intervention   calls  were  received   from  various                                                                    
communities in the district. He  stated that SESA co-wrote a                                                                    
grant  with  BSSA  called   "Mesh  Alaska,"  which  included                                                                    
organizing  a  training led  by  a  national presenter.  The                                                                    
training led  to a heightened  awareness about  the services                                                                    
provided  and   as  a   result,  individual   villages  were                                                                    
requesting more services.                                                                                                       
Senator Olson asked  about the fiscal note. He  asked if the                                                                    
note increased or maintained current funding.                                                                                   
Mr.  Pillai  responded that  the  fiscal  note retained  the                                                                    
current  operation's  funding.  An increase  of  36  percent                                                                    
would  yield an  extra $700  thousand to  the agency,  which                                                                    
would be necessary to sustain operations.                                                                                       
Senator Olson wondered which services  would not be provided                                                                    
without the increase.                                                                                                           
Mr.  Pillai  responded that  the  outreach  model would  not                                                                    
provide services  in individual areas without  SESA. Without                                                                    
funding, the  specialized evaluations  on-sight professional                                                                    
development  for teachers  would not  exist. He  provided an                                                                    
example of  SESA's value. The commissioner  had a specialist                                                                    
in Hoonah after the  shooting that addressed multiple issues                                                                    
for students  and staff.  The lack  of funding  would impact                                                                    
students' achievement because teachers  would not be able to                                                                    
implement plans for high-need students.                                                                                         
10:02:09 AM                                                                                                                   
Co-Chair Kelly  asked about the grants  for non-profits that                                                                    
were  carrying  out  the mission  directed  by  the  federal                                                                    
government. He spoke about the  difference in operations for                                                                    
the non-profit  organizations and the state.  He pointed out                                                                    
that grant  restrictions limited the hiring  capabilities of                                                                    
non-profit  organizations. With  state government,  employee                                                                    
compensation grew within  statutory structure and contracts.                                                                    
He  added that  SESA could  find difficulty  obtaining money                                                                    
from  the  state to  increase  or  even continue  operations                                                                    
because of restricted budgets.  He wanted organizations like                                                                    
SESA to  do a job  that the state was  not suited to  do. He                                                                    
hoped  to look  carefully at  the possibility  of increasing                                                                    
SESA's budget.                                                                                                                  
10:04:20 AM                                                                                                                   
Senator  Dunleavy opined  that  the program  was needed  and                                                                    
ought  to be  funded by  the  legislature. He  noted that  a                                                                    
school  district  could  make  a  choice  to  appeal  to  an                                                                    
organization like  SESA for help with  an exceptional child,                                                                    
or  the district  could hire  the help  directly with  their                                                                    
resources. He  opined that  SESA saved  the state  money, by                                                                    
providing  options   for  assistance  with  some   rare  and                                                                    
exceptional children's  educational needs.  He spoke  to the                                                                    
expertise  of SESA's  staff. He  agreed with  Co-Chair Kelly                                                                    
and would vote to increase SESA's funding.                                                                                      
Co-Chair  Meyer wondered  how the  state  would address  the                                                                    
federal  mandate for  the education  of those  children with                                                                    
special needs without SESA.                                                                                                     
10:06:47 AM                                                                                                                   
Vice-Chair Fairclough  discussed the fiscal note.  She asked                                                                    
about  the  positions and  wondered  if  all employees  were                                                                    
Mr. Pillai responded that SESA employed 11 specialists.                                                                         
10:07:25 AM                                                                                                                   
Vice-Chair  Fairclough  requested  a corrected  fiscal  note                                                                    
illustrating the full time personnel working for SESA.                                                                          
Mr. Pillai responded that the  all of the specialists worked                                                                    
full-time with yearly contracts.                                                                                                
Vice-Chair  Fairclough  asked  how many  members  served  on                                                                    
SESA's board of directors.                                                                                                      
Mr. Pillai responded ten.                                                                                                       
10:08:25 AM                                                                                                                   
Vice-Chair Fairclough asked if  the board meeting attendance                                                                    
was good.                                                                                                                       
Mr. Pillai responded that attendance  was good. He commented                                                                    
on the representation's diversity.                                                                                              
Vice-Chair  Fairclough  asked  if the  board  travelled  for                                                                    
Mr.  Pillai responded  that the  board members  travelled to                                                                    
Anchorage for the four annual meetings.                                                                                         
Vice-Chair  Fairclough   asked  if  all  meetings   were  in                                                                    
Mr. Pillai responded in the affirmative.                                                                                        
10:08:51 AM                                                                                                                   
Senator  Dunleavy  asked about  the  staff.  He wondered  if                                                                    
services were contracted.                                                                                                       
Mr. Pillai  responded that the agreement  was negotiated and                                                                    
the employees were classified as full-time.                                                                                     
Senator Dunleavy  asked if members belonged  to the National                                                                    
Education Association (NEA).                                                                                                    
Mr.  Pillai  responded in  the  affirmative.  He added  that                                                                    
employees contributed to TRS.                                                                                                   
Vice-Chair Fairclough  reported to  the committee  that DEED                                                                    
confirmed  that since  the SESA's  employees were  not state                                                                    
employees, thus the Full-Time Employee  (FTE) portion of the                                                                    
fiscal note was irrelevant. She  imagined that the fact that                                                                    
employees  paid  into  the TRS  would  somehow  violate  the                                                                    
definition of FTE.  She believed that SESA  was incorrect in                                                                    
their method of classifying employees.                                                                                          
Mr.  Pillai responded  that even  though  employees sign  an                                                                    
annual  contract, they  were  in-fact  considered full  time                                                                    
Vice-Chair Fairclough  stated that DEED was  classifying the                                                                    
employees differently.  She emphasized the need  for clarity                                                                    
regarding the state's classification of employees.                                                                              
Co-Chair  Meyer stated  that the  administration would  help                                                                    
the committee to better understand the fiscal note.                                                                             
10:10:55 AM                                                                                                                   
MILLIE RYAN, EXECUTIVE DIRECTOR,  REACH INC., explained that                                                                    
REACH provided  services to  approximately 400  children and                                                                    
adults with disabilities. She stated  that prior to her work                                                                    
with  REACH;   she  was  the   executive  director   of  the                                                                    
Governor's  Council on  Disabilities and  Special Education.                                                                    
She  then  served as  an  ex  officio  member of  SESA.  She                                                                    
addressed common  questions, such as why  the council served                                                                    
as the governing  board for SESA. She was  instructed by her                                                                    
predecessor  at the  council  that  the arrangement  existed                                                                    
because  the   council  served  as  the   special  education                                                                    
advisory  panel and  SESA was  a special  education program.                                                                    
The  council,  located  in  DHSS ended  up  as  the  special                                                                    
education advisory  panel because  the legislature  and DEED                                                                    
did not want  another small board with a  narrow purpose, so                                                                    
instead sought a board with a common interest.                                                                                  
Ms. Ryan pointed out another  common question regarding SESA                                                                    
regarding the duplication of funding  for intensive needs or                                                                    
for  students with  severe disabilities.  She stressed  that                                                                    
having  a  low-incidence  disability  did not  mean  that  a                                                                    
student  was  eligible  for  intensive  needs  funding.  She                                                                    
mentioned that  DEED required that seven  specific criterion                                                                    
be  met   to  determine  eligibility  for   intensive  needs                                                                    
funding. She added that  school districts utilized intensive                                                                    
needs  funding to  provide the  full-time aide,  to purchase                                                                    
specialized  materials  and   technology  required  for  the                                                                    
intensive  needs  student.  She  stated  that  if  SESA  was                                                                    
involved, the specialist worked  with the district to assess                                                                    
the  students  and  identify which  instructional  materials                                                                    
were best  suited for the  needs, and would teach  staff how                                                                    
to use the materials  and technology. She strongly supported                                                                    
the passage of SB 17.                                                                                                           
10:13:52 AM                                                                                                                   
GENEVIEVE    HOLLINS,    FINANCE   DIRECTOR,    SESA    (via                                                                    
teleconference), addressed  the question about  employees of                                                                    
SESA  being   state  employees.  She  clarified   that  SESA                                                                    
employees  were not  state employees,  but employees  of the                                                                    
political subdivision of the state.                                                                                             
Co-Chair Meyer requested further clarification.                                                                                 
Ms. Hollins  replied that  the fiscal  note did  not reflect                                                                    
FTEs  for  SESA because  its  employees  were those  of  the                                                                    
political subdivision of the state.                                                                                             
Co-Chair   Meyer   relayed   that    he   would   have   the                                                                    
administration further explain  the classification of SESA's                                                                    
employees as documented in the fiscal note.                                                                                     
10:15:29 AM                                                                                                                   
Co-Chair  Kelly thought  that the  full time  employees were                                                                    
not listed  on the  fiscal note because  the budget  was not                                                                    
increased and a request for new positions was not active.                                                                       
10:15:54 AM                                                                                                                   
MARGARET  KAVANAUGH, TEACHER,  KODIAK (via  teleconference),                                                                    
testified in support of SB 17.  She worked as both a regular                                                                    
and special  education teacher and with  the infant learning                                                                    
program.  She  stated  that  SESA   was  the  most  valuable                                                                    
resource  she  had encountered  because  of  its support  of                                                                    
teachers.  Without   the  support  of   SESA's  specialists,                                                                    
teachers often felt unable to  meet all students' needs. She                                                                    
discussed  the  burn-out  that resulted  from  the  lack  of                                                                    
support. The support of a  SESA specialist with their unique                                                                    
knowledge  and  training  with  low  incidence  disabilities                                                                    
enabled success  for students and  teachers. She  added that                                                                    
parents also  benefitted from SESA's services.  She shared a                                                                    
story  about  her  own  son   who  was  diagnosed  with  low                                                                    
incidence   disabilities.  She   concluded  that   SESA  had                                                                    
benefitted her life personally and professionally.                                                                              
10:20:46 AM                                                                                                                   
JENNIFER  EUBANK,  TEACHER,   KODIAK  (via  teleconference),                                                                    
testified in support of the  legislation. She announced that                                                                    
she  was a  certified special  education teacher  in Kodiak.                                                                    
She taught in the life-skills  program for grades 6-8. Prior                                                                    
to  teaching,  she  worked as  a  specialist  for  Assistive                                                                    
Technology  of Alaska  (ATLA), which  was a  federal program                                                                    
used  to  introduce  and support  assistive  technology  for                                                                    
students. During  her time with  ATLA, she worked  with SESA                                                                    
to help provide  materials needed in rural  villages and she                                                                    
realized  that  SESA  produced impressive  specialists.  She                                                                    
requested the  services from SESA  currently in  her special                                                                    
education class room.                                                                                                           
10:27:00 AM                                                                                                                   
Co-Chair Meyer closed public testimony.                                                                                         
10:27:22 AM                                                                                                                   
Co-Chair Meyer  intended to  hold the  bill in  committee to                                                                    
discuss the fiscal  note. He wanted to  discuss amending the                                                                    
bill to  increase the funding.  He wanted to talk  about the                                                                    
fiscal note.                                                                                                                    
10:28:11 AM                                                                                                                   
Senator Olson  asked about  line six of  the CS.  He assumed                                                                    
that the  amount should  be changed to  $21.50 to  align the                                                                    
bill with the fiscal note.                                                                                                      
10:29:07 AM                                                                                                                   
AT EASE                                                                                                                         
10:29:36 AM                                                                                                                   
LES MORSE, DEPUTY COMMISSIONER,  DEPARTMENT OF EDUCATION AND                                                                    
EARLY DEVELOPMENT  clarified that SESA's employees  were not                                                                    
considered state  servants based  on statute, but  they were                                                                    
considered employees  to the  non-profit agency.  The fiscal                                                                    
note was built as a grant  to that agency, just as the state                                                                    
granted  Base Student  Allocation  (BSA) money  to a  school                                                                    
district, without  accounting for staff. He  added that SESA                                                                    
contributed to  the retirement system  in the same  way that                                                                    
school districts and municipalities did.                                                                                        
Co-Chair  Meyer  stated  that  SB  17  renewed  the  current                                                                    
program. An  increase, as suggested  by a  committee member,                                                                    
would require a change to the fiscal note.                                                                                      
10:31:23 AM                                                                                                                   
Vice-Chair Fairclough  pointed out  that SESA  also utilized                                                                    
grant  funds. She  wished to  better understand  the funding                                                                    
structure in relation to grants and general funds.                                                                              
Mr.  Morse  responded that  SESA  did  receive grant  money,                                                                    
which was  not reflected in  the fiscal note.  He understood                                                                    
that additional state dollars were  received as grants under                                                                    
some circumstances.                                                                                                             
10:32:28 AM                                                                                                                   
Co-Chair  Meyer  asked  how the  state  would  meet  federal                                                                    
requirements without SESA.                                                                                                      
Mr. Morse replied that school  districts and the state would                                                                    
be greatly challenged by a  lack of the services provided by                                                                    
SESA.  He  added  that  if  a  district  could  not  provide                                                                    
services   required  within   an  Individualized   Education                                                                    
Program (IEP),  a family could  seek legal  recourse against                                                                    
the school  district and  the state. He  added that  if SESA                                                                    
did   not  exist,   districts   would   require  a   similar                                                                    
organization   to   provide   support  for   low   incidence                                                                    
disabilities.  He  credited  the   efficiency  of  SESA  for                                                                    
Alaskan school districts.                                                                                                       
Co-Chair  Meyer asked  if the  administration supported  the                                                                    
Mr.   Morse  stated   that  the   administration  was   very                                                                    
supportive of the sunset extension  for SESA. The department                                                                    
would allocate  the funds  appropriated by  the legislature.                                                                    
He opined that the legislature  ought to review the evidence                                                                    
and consider options like increasing funding.                                                                                   
10:35:02 AM                                                                                                                   
Senator  Dunleavy  understood  that  SESA  had  not  seen  a                                                                    
funding increase for 15 years.                                                                                                  
Mr. Morse concurred.                                                                                                            
Senator  Dunleavy asked  if the  increases  given to  school                                                                    
districts  were for  legislative intent,  although SESA  was                                                                    
not provided the same increases.                                                                                                
Mr. Morse replied  that a formula approach  was employed for                                                                    
funding SESA and  the school districts. He  stated that SESA                                                                    
did not fall  under the BSA addressed, so  their funding was                                                                    
not increased.                                                                                                                  
Senator  Dunleavy asked  if the  separation between  funding                                                                    
increases  for SESA  and other  districts was  determined by                                                                    
the department.                                                                                                                 
Mr. Morse responded that the  statutory approach employed by                                                                    
the legislature determined the structure.                                                                                       
10:36:06 AM                                                                                                                   
Senator  Olson asked  about a  comparison with  other states                                                                    
and their approach to the federal mandates.                                                                                     
Mr.  Morse  replied  that all  states  handled  the  federal                                                                    
requirements  differently.  He  explained that  some  states                                                                    
provided a  wider array of  services. He imagined  that some                                                                    
rural  states   had  created  solutions  or   programs  that                                                                    
mirrored SESA's.                                                                                                                
10:37:50 AM                                                                                                                   
SB  17  was   HEARD  and  HELD  in   committee  for  further                                                                    
The meeting was adjourned at 10:38 a.m.                                                                                         

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