Legislature(2007 - 2008)SENATE FINANCE 532
02/09/2007 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| Alaska Public School Funding Formula Overview | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
MINUTES
SENATE FINANCE COMMITTEE
February 9, 2007
9:01 a.m.
CALL TO ORDER
Co-Chair Lyman Hoffman convened the meeting at approximately
9:01:18 AM.
PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Kim Elton
Senator Joe Thomas
Senator Fred Dyson
Senator Charlie Huggins
Senator Donny Olson
Also Attending: SENATOR GARY STEVENS; SENATOR GARY WILKEN; EDDY
JEANS, Director, Division of School Finance, Department of
Education and Early Development;
Attending via Teleconference: There were no teleconference
participants.
SUMMARY INFORMATION
Presentation by the Department of Education and Early
Development.
Public School Funding Formula.
9:01:46 AM
^Alaska Public School Funding Formula Overview
Co-Chair Hoffman identified two handouts provided for the
presentation.
9:03:55 AM/ 9:04:39 AM AT EASE
9:04:44 AM
EDDY JEANS, Director, Division of School Finance, Department of
Education and Early Development communicated he would provide an
overview of the public school funding program, and directed
members' attention to the handout titled "Alaska Public School
Funding Formula Overview, Presented by Eddy Jeans, Director."
9:06:20 AM
Page 1B
Senate Bill 36
The current state public school funding formula was
adopted under SB 36 in 1998. And was implemented in
1999.
The public school funding formula is defined in Alaska
Statute 14.17
Mr. Jeans read the slide.
Page 1C
This presentation provides an overview of:
1. Calculation of Adjusted Average Daily Membership
(ADM)
2. Calculations of Basic Need ~ (Entitlement)
3. Components of Basic Need ~ (Who pays)
4. Additional Funds above Basic Need
5. Components of State Aid
Mr. Jeans reviewed the information on the slide.
9:06:45 AM
Page 2A
Average Daily Membership
ADM Reporting Requirements
™Average Daily Membership - is the number of enrolled
students during the first 20-school-day count period
ending on the fourth Friday of October.
™Reports are due within two weeks after the end of
the 20-school-day count period.
™Projected student count reports are due November 5.
Mr. Jeans reviewed the slide, and added that a student who
enrolled half-way through the 20-school-day count period would
be counted as one half of a full time student. The projected
student count data is used to make projections for the following
year.
9:07:31 AM
Senator Huggins asked the implications if a district's
enrollment varied from the initial November 5 projection for the
subsequent year.
9:07:44 AM
Mr. Jeans informed that the Department relies on the initial
projections, as continual updates to student counts would be
unreasonably cumbersome.
9:07:53 AM
Page 2B
Who Qualifies as a Student?
Eligibility for State Foundation Funding
™A child who is 6 years of age before September
1st, and under the age of 20, and has not
completed the 12th grade. (AS 14.03.070)
™A child who is 5 years of age before September
1st, following the beginning of the school year,
may enter kindergarten. (AS 14.30.180 (d))
™A child with a disability and an active
Individualized Education Program (IEP) may enter
school at the age of 3 and under the age of 22.
(AS 14.30.180(1))
Mr. Jeans clarified that the school year begins July 1 and ends
June 30, mirroring the fiscal year, but schools are only
required to operate 180 days of the year.
9:08:50 AM
Page 2C
5 Steps to District Adjusted ADM
Used to Calculate Entitlement
Step 1. Adjust: ADM for School Size
Step 2. Apply: District Cost Factor
Step 3. Apply: Special Needs Factor
Step 4. Add: Intensive Services Counts
Step 5. Add: Correspondence Student Counts
= District Adjusted ADM
Mr. Jeans overviewed the steps listed on the slide.
9:09:38 AM
Page 3A
Step 1. Adjust the ADM for School Size
ADM under 10: Added to the smallest school with an ADM
greater than 10
A Community with an ADM of 10 through 100: Grades K-12
ADM is combined and adjusted once; adjusted as one
school.
A Community with an ADM of 101 through 425: ADM for
grades K-6 and 7-12 are adjusted separately; adjusted
as two schools.
A Community with an ADM greater than 425: The ADM of
each facility administered separately as one school is
adjusted.
*Alternative schools with an ADM of less than 200
shall be counted as a part of the school in the
district with the highest ADM.
*If the ADM is greater than 200 and administered
as a separate facility the ADM will be adjusted
separately.
*Charter school with an ADM of 150 or greater is
adjusted as a separate facility.
Mr. Jeans reviewed the slide.
9:11:23 AM
Page 3B
Step 1. Example: Nome City Schools
Projected FY08 ADM by School
™Nome Elementary School: 400.00
™Nome-Beltz Jr/Sr High School: 340.00
™Anvil City Science Academy: 44.00
™Nome Youth Facility: 14.00
™Total ADM: 798.00
Mr. Jeans informed that Nome City Schools would be used as an
example to illustrate the application of the funding formula
throughout the presentation. He added that there are
approximately ten Youth Facilities in the State funded as
autonomous schools using the Formula.
9:12:36 AM
Page 3C
Example: Nome City Schools
Adding ADM's to the appropriate School in the District
School Size Adjustment
™The alternative schools ADM are added to the
highest ADM school in the district before
adjusting for size
™A school with a population under 10 should be
added to the smallest school in the district.
Nome Elementary + Anvil
400 + 44 = 444.00
Mr. Jeans noted that because the ADM was less than 100 at the
Anvil City Science Academy, those students were included in the
ADM for the Nome Elementary School
9:12:47 AM
Page 4A
Step 1. Example: Nome City Schools
[Table depicting:
Reference: 1.
School Size: 10-19.99
Formula: 39.60
Reference: 2.
School Size: 20-29.99
Formula: 39.60+(1.62*(ADM-20))
Reference: 3.
School Size: 30-74.99
Formula: 55.80+(1.49*(ADM-30))
Reference: 4.
School Size: 75-149.99
Formula: 122.85+(1.27*(ADM-75))
Reference: 5.
School Size: 150-249.99
Formula: 218.10+(1.08*(ADM-150))
Reference: 6.
School Size: 250-399.99
Formula: 326.10+(.97*(ADM-250))
Reference: 7.
School Size: 400-749.99
Formula: 471.60+(.92*(ADM-400))
Reference: 8.
School Size: Over 750
Formula: 793.60+(.84*(ADM-750))]
K-6 Adjusted ADM's
(Ref. 7) 471.60+{.92*(444.00-400)} 512.08
7-12 Adjusted ADM's
(Ref. 6) 326.10+{.97*(340.00-250)} 413.40
(Ref. 1) Youth facility's ADM 14 +39.60
School Size Adjusted ADM 965.08]
Mr. Jeans summarized the information provided in the table.
9:15:47 AM
Page 4B
Step 2. District Cost Factors
The Department monitors District Cost Factors and submits a
report to the Legislature on January 15th every other
fiscal year, beginning January 2001.
™Cost factors are specific to each school district.
™Lowest District Cost Factor is 1.000 and the highest
is 1.736
Multiply the School Size Adjusted ADM by the District Cost
Factor for Nome:
965.08 x 1.139 = 1,272.94
Mr. Jeans reviewed the slide.
9:16:17 AM
Page 4C
Step 3: Special Needs Funding
™All categorical programs; special education (except
intensive), vocational education, gifted/talented and
bilingual/bicultural are block funded at 20%.
™To qualify for funding under this section school
districts must file a plan with the department
indicating special needs services that will be
provided.
AS 14.17.420(b)
Mr. Jeans read the information on the slide.
9:16:48 AM
Page 5A
Step 3. Example: Nome City Schools
Multiply the adjusted ADM (from Step 2) by the Special
Needs Factor
1,272.94 x 1.20 = 1,527.53
(Shown on column R, page 8)
Mr. Jeans overviewed the slide.
9:17:04 AM
Page 5B
Step 4. Intensive Services Funding
A school district will receive funding for intensive
services students that:
1. Are receiving intensive services and are;
2. Enrolled on the last day of the 20 school-day count
period and who have;
3. Established Individual Education Plan (IEP) for each
intensive services student.
An Intensive Services Student generates $26,900.
(Intensive Student Count) x 5 = Intensive Student Funding
Mr. Jeans summarized the slide, and added that students
requiring intensive services funding are also included in the
school's total ADM count and base funding.
9:18:01 AM
Senator Elton asked if the intensive services funding issue had
recently been in the news.
Mr. Jeans affirmed. He explained that a legislative
appropriation made two years ago funded a state-wide audit of
all intensive claims. Before the audit, random sampling was
conducted to determine the appropriateness of the intensive
claims. If a portion of the sample was determined to not meet
the requirements for intensive services funding, the school was
held liable for only the number of students in the sample
determined to be ineligible for funding, rather than the
percentage of the total funds received. Upon completion of the
full audit, the Department now holds districts accountable for
the full amount of their intensive services claims. The new
monitoring techniques revealed that many of the funding claims
were not eligible for intensive services monies.
Senator Elton requested additional information on the
Department's monitoring practices and the financial impact on
the districts that had been audited.
9:20:05 AM
Mr. Jeans informed that the Department hired a contractor to
assist in the monitoring effort. The contractor spent time with
Department staff in order to be fully informed as to the
Department's methods and criteria, and then went into the
schools with Department staff. Mr. Jeans characterized the
initial audit as an "educational review" to inform districts how
the regulations would be applied, hence school districts were
not asked to return intensive services funds for students who
were determined ineligible that year. Mr. Jeans suggested that
school districts may have a different understanding of
"intensive" than the Department, as defined by SB 36.
9:21:38 AM
Senator Olson asked if schools were penalized for applying a
more liberal definition of "intensive".
9:21:54 AM
Mr. Jeans responded that Senator Elton had alluded to that
issue. He repeated that school districts were not asked to
return funds upon completion of the initial audit, but the
Department was "very clear" in defining to the districts what
would constitute a valid claim. The Department was currently
conducting subsequent audits, holding districts accountable for
invalid claims, and that had lead to the situation in Anchorage
that appeared in the media.
Senator Olson interjected that the withholding of funds is
different from a penalty.
Mr. Jeans clarified that no interest was levied based on invalid
claims.
9:23:08 AM
Page 5C
Step 4. Example: Nome City Schools
Multiply the Intensive Student Count by 5 and add to the
adjusted ADM (from Step 3)
~Nome City Schools has 4 Intensive Student~
4 x 5 = 20
1,527.53 + 20 = 1,547.53
(Shown on Column U, page 8)
Mr. Jeans summarized the slide.
9:23:29 AM
Page 6A
Step 5. Correspondence Programs
Districts offering correspondence programs receive funding
based on 80% of correspondence ADM.
Each correspondence student generates $4,304.
(Correspondence ADM) x .80 = Level of Correspondence
Funding
Mr. Jeans remarked that all correspondences students were funded
at 80 percent, regardless of whether the program was "in-
district" or "statewide".
9:23:51 AM
Page 6B
Step 5. Example: Nome City Schools
Multiply the Correspondence Student ADM by 80% and add to
the Adjusted ADM to get Final District Adjusted ADM. (from
Step 4)
~Nome City Schools has 6 Correspondence Students~
6 x .80 = 4.80
1,547.53 + 4.80 = 1,552.33
(Shown on Column V, page 8)
Mr. Jeans reviewed the slide.
9:24:08 AM
Page 6C
BASIC NEED Entitlement
Multiply the district adjusted ADM by the base student
allocation = BASIC NEED
1,552.33 x $5,380 = $8,351,535
(Shown on Column W, page 9)
Mr. Jeans read the information on the slide.
9:24:31 AM
Page 7A
NOME: Summarized District Adjusted ADM & Basic Need
Projected ADM for Nome:
798.00 + 6 corresp. = 804.00
Step 1. Adjusted ADM for School Size:
965.08
Step 2. Apply the District Cost Factor:
x 1.319
= 1,272.94
Step 3. Apply the Special Needs Factor:
X 1.20
= 1,527.53
Step 4. Add Intensive Service Counts:
(4.00 x 5 = 20)
+ 20.00
= 1,547.53
Step 5. Add Correspondence Student Counts:
(6 x .80 = 4.80)
+ 4.80
= 1,552.33 District Adjusted ADM
X $5,380 base student allocation
= $8,351,535 BASIC NEED
Mr. Jeans overviewed the information on the table.
9:25:20 AM
Page 7B
Components of Basic Need
(Who Pays?)
™Required Local Contribution
™Federal Impact Aid
™State Aid
Mr. Jeans reviewed the slide.
9:25:36 AM
Page 7C
SB 174 Full & True Value/Local Effort Calculation
As a result of SB 174: (enacted in 2001)
Beginning FY2002, half of the increased full & true
value over 1999 (base year), is added to 199 base year
to determine the full & true value for the purposes of
calculating Required Local Effort for education.
(If the full & true value did not increase over the
1999 base year, then the current full & true value
stands and is multiplied by .004 mills to reach local
effort.)
Mr. Jeans summarized the slide.
9:26:08 AM
Page 8A
Calculating Nome's True and Full Value
Nome's 2006 Full Value 252,725,500
Nome's 1999 Full Value 191,926,100
Full Value Increase Difference 60,799,400
Divided in Half 30,399,700
Half of the Increase is Added to 1999 Value
191,926,100 + 30,399,700 = 222,325,800
Mr. Jeans referred to the total of $222,325,800 as the
"education full value", and told that the 4 mills are applied to
that number. The fiscal impact to the State was $3.6 million
when the provision implementing this calculation was first
passed in 2001, but has now risen to $50.5 million in FY 08, and
would continue to grow.
9:27:20 AM
Co-Chair Hoffman categorized this as a reduction communities are
allowed to take in their contribution due to provisions of SB
174. He asked how the State would justify this action in a
disparity test.
9:28:09 AM
Mr. Jeans responded that this provision does not have an impact
on the federal disparity test, as the local contribution
requirements are applied uniformly throughout the State. He
acknowledged there may be opposition, however, from taxpayers.
Mr. Jeans exampled a $100,000 home that would generate $100 if
it were levied a 1 mill tax. Property values in Bristol Bay and
other areas that are "struggling economically" are set by the
State assessor and have been decreasing over the years, yet
those areas are still required to pay 4 mills, or the equivalent
of $400 on a $100,000 home. Areas that are growing, such as
Anchorage and the Matanuska-Susitna Valley, also pay based on
the State assessor's set values, but those properties are
increasing in value. Required local contribution rates in those
economically healthy areas amount to approximately 2.8 mills, or
$280 for a $100,000 property.
9:30:15 AM
Senator Elton asked why legislation has not been introduced to
address the "growing disparity".
9:30:52 AM
Mr. Jeans replied that the State Board hasn't taken a firm stand
on the issue.
Senator Elton realized that he may be "speaking against" the
best fiscal interest of the community he represents, but opined
that the Governor's goal of reducing the budget ought to lead to
a revisit of the provision.
9:32:50 AM
Mr. Jeans explained that his intent in addressing the issue of
required local contribution was to bring awareness to the
disparity. He was not urging the Committee to enforce the 4 mill
rate, and opined that a 3 mill rate may be more appropriate.
However, that was a policy decision the legislature must make.
9:33:29 AM
Co-Chair Stedman identified two areas of concern within the
funding formula. First was the computation of the operating
costs, which he considered "a little off". His other concern was
the millage rate. He listed the millage rates paid by
Southeastern Alaska school districts as: Juneau, 3.2; Sitka,
3.3; Petersburg, 3.7; Wrangell, 4.0. He informed that while
Wrangell was contributing at a rate of 4 mills, that community
was the least "financially healthy" within his Senate district.
He continued that the disparities will continue to increase,
with the financially stagnant areas of the State required to
contribute a disproportionate amount based on the current
required local contribution schedule.
9:36:16 AM
Co-Chair Hoffman commented that Mr. Jeans provided that "exact
testimony" in his example of Bristol Bay's required local
effort.
9:36:31 AM
Page 8B
Required Local Contribution
Example: Nome City Schools
The lesser or minimum of 4 mills of the education full &
true value, but not to exceed 45% of the school districts
prior year basic need.
.004 of Tax Base:
.004 x $222,325,800 (Education Full & True Value)
= $889,303
45% of Prior Year Basic Need:
.45 x $8,157,425
= $3,670,841
(Shown on Column C, page 9)
Mr. Jeans explained that the formula puts a "cap" on the amount
a community is required to contribute at 45 percent of the
previous year's Basic Need. The districts that fall under this
provision are the North Slope, Valdez, and Skagway. The required
local effort of these areas is less than four mills, and the
"cap" is in place to ensure that these areas receive some amount
of State funding for their public schools. The 45 percent limit
on the required local effort could be adjusted by the
legislature if it was deemed appropriate.
9:38:38 AM
Co-Chair Stedman asked for an explanation of why Skagway was
impacted by this provision, as that area seemed to differ
demographically from the other two.
Mr. Jeans told that Skagway is a "booming" community due to an
extensive tourism industry during summer months. The "boom",
however, is seasonal, and Skagway has a small year-round
population with a student population of approximately 100. The
great community wealth compared to the student population is the
cause of the anomaly.
9:39:49 AM
Page 8C
Title VIII Federal Impact Aid Payments
™Title VIII Federal Impact Aid Payments received from
March 1 through the last day of February are used for
calculations of state aid.
™The dates on the payment vouchers are used to indicate
that a school has received Title VIII Payments
Mr. Jeans informed that homes on military bases or Alaska Native
Claims Settlement Act (ANCSA) lands are not taxable, and the
Federal Impact Aid payments are akin to the federal government
paying the taxes on those lands. Alaska receives $110 to $120
million annually in Federal Impact Aid payments. Some of these
payments contain "add-ons", such as an additional 25 percent
added to the payments for people who reside on ANSCA lands.
These "add-ons" cannot be included in the State-wide funding
formula, thus Federal Impact Aid is considered at approximately
50 percent.
9:41:12 AM
Page 9A
Title VIII Federal Impact Aid Payments
Example: Nome City Schools
Payments received by the Nome City Schools from March
1 through the end of February.
$86,382
(Amount eligible for Deduction)
(Shown on Column D, page 9)
9:42:40 AM
Senator Olson asked why Federal Impact Aid is not counted as a
local contribution.
Mr. Jeans replied that the federal government does not allow
those lands to be taxed.
Senator Olson understood that the lands could not be developed
or taxed, but again asked why the payments provided by the
federal government were not considered a local contribution.
Mr. Jeans responded that he considered both local tax
contributions and Federal Impact Aid as part of the local
contribution effort for the purposes of the formula
calculations.
9:44:04 AM
Senator Olson was still under the impression that Federal Impact
Aid was not considered local contribution by the State.
Mr. Jeans allowed that whether federal aid is considered local
contribution "depends on who you talk to".
9:44:19 AM
Page 9B
Impact Aid Percentage
Required Local Contribution divided by Budgeted Local
Contribution
Budgeted Local Contribution, for the purposes of
calculating the Impact Aid percentage is found in the
Budgets submitted on July 15th of each year and may
consist of:
™Appropriations
™Investment Earnings
™In-Kind Services
™"Other Local"
Mr. Jeans summarized the slide.
9:44:48 AM
Page 9C
Title VIII Percentage
Example: Nome City Schools
Required Local: $889,303 = 46.52%
Budgeted Local: $1,911,850
(This percentage is only derived for City & Boroughs)
(Shown on Column E, page 9)
Mr. Jeans reviewed the slide.
9:45:17 AM
Page 10A
Impact Aid
Example: Nome City Schools
90% of the Impact Aid received by a school district is
multiplied by the Impact Aid Percentage
Nome's Deductible Impact Aid Calculation:
$85,947 x 46.52% x 90% = $35,984
Eligible Impact Aid x Title VIII % x 90% =
Deductible Impact Aid
(Shown on Column D, Column E, Column F, page 9)
Mr. Jeans read the slide.
9:45:53 AM
Page 10B
State Aid
Nome City Schools
Nome's State Aid:
Basic Need $8,351,535
Less Required Local (889,303)
Less Impact Aid (35,984)
State Aid $7,426,248
(Shown on Column G, page 9)
Mr. Jeans explained that this slide illustrated how Federal
Impact Aid is taken into account in the funding formula.
9:46:20 AM
Mr. Jeans returned to the previous slide to address Regional
Educational Attendance Areas (REAAs). Due to the fact that those
districts do not have a required local contribution rate, the
unorganized areas are calculated by multiplying 85,000 by 90
percent.
9:46:57 AM
Page 10C
Additional Funds Above Basic Need
™Additional Local Contribution
™Quality Schools Grant
™Supplemental Funding Floor
Mr. Jeans read the slide.
9:47:07 AM
Page 11A
Additional Local Contribution
Example: Nome City Schools
The greater of 2 mills of the tax base or 23% of the
district's current year Basic Need can be contributed
but not to exceed.
.002 of the Full & True Value Tax Base:
.002 x $252,725,500 = $505,451
23% of Basic Need:
.23 x $8,351,535 = $1,920,853
Mr. Jeans summarized the slide, adding that the districts that
fall under the 2 mill additional local contribution are North
Slope, Valdez and Skagway.
9:47:54 AM
Page 11B
Maximum Local Contribution
Example: Nome City Schools
Required Local Contribution plus Additional Local
Contribution
Required Local Contribution: $889,303
Additional Local Contribution: $1,920,853
Maximum Local Contribution: $2,810,156
Mr. Jeans reviewed the slide.
9:48:18 AM
Page 11C
Quality Schools Grant
AS 14.17.480 explains a district is eligible to
receive a quality school funding grant not to exceed
the district's Adjusted ADM multiplied by $16.
Example: Nome City Schools
1,552.33 x $16 = $24,837
(Column W, page 8 and Column 1, page 9)
Mr. Jeans overviewed the slide and added that schools must apply
for these funds, and all districts do so. The funds are
generally used for remedial programs, after school tutoring, and
other activities.
9:48:48 AM
Page 12A
Supplementary Funding Floor
™What is "The Floor"?
™How is it established?
™How is it adjusted?
Mr. Jeans read the slide.
9:48:56 AM
Page 12B
"The Floor"
By providing additional funds "The Floor" bridges the
transition between the new funding formula implemented
in 1999 and the old formula that was in place in 1998.
Mr. Jeans explained that "The Floor" was established as a
provision of SB 36 to facilitate the transition from the
previous funding scheme to the new funding formula. If a school
qualified for more funding dollars under the prior calculation,
those funds were provided as supplemental funding for the first
year.
9:49:22 AM
Page 12C
How "The Floor" was Established
"The Floor" was established in FY1999
For example:
Old Formula State Aid
= $1,100,000
New Formula State Aid
(Less)= $1,000,000
Supplementary Funding Floor
(Result)= $100,000
Mr. Jeans summarized the slide.
9:49:39 AM
Page 13A
Nome's Transition to New Formula
™Old Formula State Aid:
FY 99 = $5,206,292
™New Formula State Aid:
(Less) FY 99 = $5,095,932
™Supplementary Funding Floor:
(Results) FY 99 = $110,360
Mr. Jeans reviewed the funding floor for Nome City Schools.
9:49:52 AM
Page 13B
Adjustments to the "Floor"
All Adjustments to "The Floor" are reductions!
Decreases to "The Floor" occur because of:
1. an increase in Basic Need
OR
2. a decrease in ADM
Mr. Jeans informed that the floor was designed to "erode away",
thus all adjustments to the floor were reductions in
supplemental funding. He added that increases in basic need
occurred due to an increase in student population or an increase
in the base student allocation.
9:50:23 AM
Page 14B
Establishing Nome City School's Floor
FY 99 Old Formula
=$5,206,292
FY 99 New Formula
($5,095,932)
Nome's Funding Floor Established at
=$110,360
FY 00 No Deduction
=$110,360
FY 01 Floor reduced due to increase in Basic Need
($14,562)
FY 01 Floor Balance
=$95,798
FY 02 Floor No reduction floor
(0.000
FY 02 Floor Balance
=$95,798
FY 03 Floor reduced due to increase in Basic Need
(73,206)
FY03 Floor Balance
$22,592
FY 04 Floor reduced due to increase in Basic Need
(49,268)
Difference exceeds Floor ~ Balance set to zero (0.00)
Mr. Jeans walked the Committee through the calculation, adding
that in 2004 Nome had "fully transitioned" to the new funding
formula.
9:51:52 AM
Page 14C
Supplementary Funding Floor
Remember:
o The floor is reduced by 40% of the increase in
the Basic Need over the prior year.
OR
o The floor is reduced if ADM decreases by more
than 5%, initially, of the FY1999 ADM.
Mr. Jeans reviewed the slide and added that only 10 school
districts are on the supplemental funding floor in fiscal year
2008, with a total of less than $1 million committed to that
funding.
9:52:21 AM
Page 15A
Components of State Aid
A Permanent Funding Component of State Aid
Nome's Total State Aid equals:
Calculated State Aid $7,426,248
Plus the Funding Floor $0
Plus the Quality Schools Grant $24,837
Total State Entitlement $7,451,085
Mr. Jeans summarized the slide.
9:52:42 AM
Page 15B
Please Note:
Prorating the Public School Funding Formula
If insufficient funds are appropriated by the
legislature to meet the total entitlement, then all
components of the Public School Funding Formula will
be reduced by the same percentage.
AS 14.17.400(b)
Mr. Jeans concluded his presentation by reading the slide.
9:53:08 AM
Senator Olson asked how funding for home school students is
determined.
Mr. Jeans responded that home school students that enroll in a
correspondence program are funded at the correspondence rate of
0.8.
Senator Olson mentioned that Nome is first class city with a
property tax, and asked how Nome compares to other boroughs.
9:54:15 AM
Mr. Jeans replied that all first class cities in unified
municipalities are required to make a 4 mill contribution as
required under SB 174. He noted that the differing property
wealth of each area would dictate the amount of the required
contribution.
Senator Olson asked how a city such as Tanana would differ in
their required local contribution.
9:54:56 AM
Mr. Jeans informed that Tanana, as a first class city, is
required to make a 4 mill contribution. He added that Tanana has
a declining property value, but the area is required to make the
full 4 mill contribution on the value if the current year.
9:55:17 AM
Senator Dyson asked the effect of large school districts with
decreasing student population.
Mr. Jeans understood Senator Dyson was referring to Kenai and
Anchorage, districts that have experienced declining enrollment.
He reported that the funding formula currently does not have a
"hold harmless" provision to address the issue and provide
transition for those districts. He had drafted language to
address the problem, and would be willing to provide it to
interested parties.
9:56:24 AM
Senator Dyson asked if any large districts other than Anchorage
were not providing their full contribution amount.
Mr. Jeans told that Juneau was the only district he was aware of
that was providing the entire allowed contribution amount. He
understood Kenai intended to request additional funds from their
borough assembly to reach the limit placed on local
contributions.
9:57:08 AM
Senator Thomas remarked that Mr. Jeans presented "quite a
formula". He asked the effect of the school size adjustment on
charter schools, as a charter school in his area lost
approximately $500,000 in funding due to a slight decrease in
enrollment. He was interested in possible avenues to assist in
these situations.
9:58:12 AM
Mr. Jeans was familiar with the aforementioned "struggles". The
150 student threshold for charter schools was reduced from 200
after the passage of SB 36. Further assistance could be provided
through legislative action.
ADJOURNMENT
Co-Chair Lyman Hoffman adjourned the meeting at 9:59:46 AM
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