HB 75-INTERNET FOR SCHOOLS; FUNDING    8:20:24 AM CO-CHAIR DRUMMOND announced that the final order of business would be HOUSE BILL NO. 75, "An Act relating to funding for Internet services for school districts; and relating to the Alaska higher education investment fund." 8:20:45 AM REPRESENTATIVE SARA RASMUSSEN, Alaska State Legislature, as prime sponsor of HB 75, paraphrased a portion of the sponsor statement, which read in its entirety as follows [original punctuation provided]: Alaska's constitution clearly establishes a requirement for the state to provide an education to all its children, regardless of where that student resides. However, Alaska's test scores and graduation rates are consistently below national averages. Our students deserve better outcomes. House Bill 75 aims to improve education outcomes across the state by improving access to broadband in schools, including those in our most remote communities. Improved internet access means students and teachers will be able to tap into additional educational resources that they would otherwise be unable to access at slower speeds. In 2014, the Alaska State Legislature passed a bill to create the Broadband Assistance Grant program to assist school districts with the cost of Internet services and ensure that all schools achieved a download speed of 10 Megabits per second (Mbps). By raising the floor from 10 Mbps to 25 Mbps, House Bill 75 will more than double the number of students who can access distance learning content at any given time, without any additional infrastructure. It is time to update the minimum Internet speed in statute to align with the increased bandwidth needs of today's students. 8:21:51 AM KRYSTEN WALKER, Staff, Representative Sara Rasmussen, Alaska State Legislature, on behalf of Representative Rasmussen, prime sponsor of HB 75, reviewed the sectional summary, which read as follows [original punctuation provided]: Section 1: AS 14.03.127 (a) Amends AS 14.03.127(a) to provide that schools qualifying for discounted Internet services under the federal universal services program are eligible to receive an amount of funding necessary to provide a minimum of 25 megabits of download per second. Section 2: AS 37.14.750(a) Amends AS 37.14.750(a) to provide that money in the Alaska higher education fund may be appropriated to fund school Internet services under AS 14.30.127. Section 3: AS 37.14.750 Adds a new subsection to AS 37.14.750, providing that the legislature may appropriate any amount from the Alaska higher education fund for school Internet services under AS 14.03.127 in addition to the amount of the fund available for grants and scholarships under AS 37.14.750(c). 8:22:33 AM REPRESENTATIVE STORY asked the bill sponsor whether she is committed to using the higher education funds as the source of revenue. She expressed concern that the fund also covers Alaska proponent scholarships and education grants. She said she wonders if the bill provisions could be funded from the general fund. REPRESENTATIVE RASMUSSEN answered that she would be willing to look at other funding sources. 8:23:24 AM REPRESENTATIVE HOPKINS noted there were $2 million left over in "e-rate funding," and he wondered if that money could be used toward HB 75. REPRESENTATIVE RASMUSSEN responded that she would need to speak with the Division of Legislative Finance to determine an answer. She noted another funding option may be a grant from the Bill Gates Foundation. She indicated that a grant could be applied for through a partnership with a local nonprofit organization. REPRESENTATIVE HOPKINS asked whether the bill sponsor had spoken with any school districts regarding HB 75. REPRESENTATIVE RASMUSSEN deferred to her staff. 8:24:37 AM MS. WALKER said the sponsor's staff met with the Bristol Bay School District, which was supportive [of increased access to Internet], and she surmised that other school districts would express the same support. 8:25:04 AM REPRESENTATIVE STORY observed that many e-rate funds come from user fees, particularly from cellular user services, and she said a significant amount of money would be coming into school districts under HB 75. She wondered whether the sponsor had spoken with the Department of Education & Early Development (DEED) and whether the department is confident that an increase of e-rate funds going to school districts will not affect "the disparity test." MS. WALKER offered her understanding that "the department's working on crunching those numbers." REPRESENTATIVE STORY posited that those numbers need to be seen to avoid using funds that result in the disparity test not being met. 8:26:00 AM REPRESENTATIVE JOHNSON asked how many students the additional funding would serve. REPRESENTATIVE RASMUSSEN answered that that number is not available; however, she proffered that [the school Internet services funded under HB 75] would reach districts across the state. MS. WALKER pointed out that included in the committee packet is a list of schools with fewer than 25 Mbps, and those are the schools that would qualify under HB 75. 8:26:51 AM CO-CHAIR DRUMMOND offered her understanding that there was "a significant funding that lapsed" because of the 10 Mbps maximum, and she said she knows school districts are "looking forward to being able to apply for this." She inquired about a fiscal note for HB 75. 8:27:19 AM The committee took a brief at-ease at 8:27 a.m. 8:27:36 AM CO-CHAIR DRUMMOND announced that a fiscal note was "not quite ready." 8:27:47 AM REPRESENTATIVE TUCK, regarding Co-Chair Drummond's previous mention of the lapse in funding, offered his understanding that it was $1 million that lapsed" and he said he thinks there would be "at least a million dollars available for the fund" at 25 Mbps. CO-CHAIR DRUMMOND offered correction in terminology and expressed her desire to form a special committee on technology within the legislature. 8:28:37 AM CO-CHAIR DRUMMOND initiated invited testimony. 8:28:46 AM CHRISTINE O'CONNER, Executive Director, Alaska Telecom Association (ATA), said ATA represents telecommunications providers and is "the landline, long distance, wireless, and broadband provider serving Alaska." She stated that ATA supports HB 75, which will help schools to increase broadband speed, thus providing access for teachers and students to a wide array of content and educational tools. She said ATA has reviewed the list of schools that would benefit under HB 75, and confirmed that each school can be upgraded to 25 Mbps. She indicated that any necessary upgrades, which would be specific to each site, would not be expected to increase to the magnitude as would placing a "middle mile section" of fiber optic infrastructure or launching new satellite. She expressed appreciation for the effort being made [under HB 75] to provide schools with increased access to broadband, and she said ATA is committed to continually improving its network and welcomes the opportunity to collaborate with teachers and students toward accessing the tools needed. 8:30:22 AM MS. O'CONNOR, in response to Representative Johnson, recapped her comments regarding upgrades. 8:31:43 AM REPRESENTATIVE TUCK questioned why the upgrades haven't been done already if it doesn't require "a higher rate." MS. O'CONNOR answered that in terms of not rising to the level of middle mile construction, her understanding is that "the real support coming in the bill is for the ongoing operational costs - the recurring costs - of the support for the increased fees, most cases 90 percent of which is covered through the federal e- rate program." She clarified that she thinks the reason the upgrades have not happened previously is because of that recurring cost. In response to a follow-up question, she said she does not know what the cost will end up being, but it will vary from school to school and based on area per provider. She said through the e-rate process, the school will put out a request for proposal (RFP), asking for bids from each provider, and then choose the provider and rate. 8:33:36 AM REPRESENTATIVE JOHNSON directed attention to the document included in the committee packet, labeled "2017-2018 School Year School District Bandwidth Counts less than 25 Mbps." She observed that there were no schools in the Matanuska-Susitna (Mat-Su) area listed. She then asked whether the schools in Anchorage that were on the list were charter schools. MS. O'CONNOR responded that Representative Johnson's observations were correct. She added that the Mat-Su School District has a robust fiber infrastructure. 8:34:43 AM REPRESENTATIVE HOPKINS asked whether private citizens, private businesses, or other state buildings would be able to "tap into" the broadband increase that would take affect under HB 75. MS. O'CONNOR answered that it would be possible to extend the network to other locations; however, if the fiber is constructed using e-rate funds, there are specific rules on how that can be used for other entities. She added, "But generally, when you have an anchor institution that allows you to construct fiber, that will help bringing availability to the surrounding area." 8:35:59 AM REPRESENTATIVE STORY expressed she thinks [the increase in broadband width] would be valuable for rural school districts; it would enable them to incorporate desired innovations and help with student learning. She said it will be interesting to see "how these questions are answered and how we can go forward." 8:36:34 AM LISA PARADY, Ph.D., Executive Director, Alaska Council of School Administrators (ACSA), testified in support of HB 75. She said she is also speaking on behalf of Norm Wooten, the executive director of the Association of Alaska School Boards, who was unable to testify today. She said there was a similar bill last year that did not make it all the way through the process. She expressed appreciation for HB 75 and the previous discussion regarding the previous lapse of funding. She indicated her hope that the language in HB 75 stating the minimum of 25 Mbps would prevent that from happening again. She emphasized her involvement in 2015 bringing forward a grant when she was working in the North Slope School District, and in the district, there were villages with 1 or 2 Mbps. A next step was to connect the villages that could not use [the Internet] for instruction. She mentioned effort to bring all villages up to a base of 10 Mbps. She said she recognizes that today it is unlikely that there will be funding to "connect the state all at once." She said that "the last time" she understood the cost would have been in the range of $2 billion. She said the grant is critical in raising the broadband levels, in this case to a minimum of 25 Mbps. DR. PARADY read a statement underlining the highest priority of the council as being the increase of bandwidth in outlying areas, as follows: Alaska students need and deserve the full transformative power of technology and equitable access to online resources. ... Teachers and school leaders of Alaska, some of whom live in some of the most remote areas of the world, require access to modern technology in order to transform learning, create efficiencies, provide online ... health services, and keep pace with their peers globally. ACSA supports continuing the broadband systems grant and increasing the level of state-funded bandwidth for schools for a minimum of 25 ... [Mbps]. This funding leverages federal e-rate funds, at approximately [a] 9:1 ratio, to provide Alaska students and educators their access to the digital world. DR. PARADY stated that as of 2017, there were an estimated 51,000 students across the state that still lacked access to the bandwidth needed to support the integration of technology in classroom instruction, and HB 75 would address this statistic. She said reliable access to the Internet is a critical component to learning, and many students cannot access the Internet. She emphasized the importance of passing HB 75 to provide equity in connectivity. She said rural schools are the anchor centers and often provide the opportunity for the community to utilize the school; therefore, providing broader bandwidth would benefit the communities. 8:43:50 AM PATRICK MAYER, Superintendent, Yakutat School District; President, Alaska Superintendents Association; President, Alaska Council of School Administrators, stated, "Alaska's students need and deserve the full transformative power of technology and fair access to online resources." He said digital content makes up a great portion of the district's curriculum, and the schools increasingly use digital content for supplemental materials and intervention programs. He related that the Yakutat School District is limited to 10 MB per second, which severely limits the ability to stream higher-end digital content, and as a result, the district must make choices in which content it will be able to utilize. He said this hampers students' ability to enroll and participate in "dual credit opportunities." He stated that this is an equity issue, because "there simply are 'have' and 'have-not' districts in this [state]." While some districts can purchase as much bandwidth as necessary, others cannot. He referred to the 2019 joint position statement previously quoted by Ms. Parady, and echoed that ACSA stands in support of continuing the broadband assistance grant and increasing the level of state-funded bandwidth for schools, to a minimum of 25 Mbps of download. 8:46:09 AM PATIENCE FREDERIKSEN, Director, Division of Libraries, Archives and Museums, stated that the school guide program, at 10 Mbps, has been administered by the state library for the past five years; therefore, she said she could speak to the issue from the point of view of an administrator. She said the program was easy to administer once regulations were in place in the first year. There were many questions from school districts about the program. She said schools approached her to question whether they could have more than 10 MB per second; therefore, she expressed concern regarding the language in HB 75 that would establish "a minimum" of 25 MB per second. She said she fully expects school districts will be calling to ask for more, because "'a minimum of' implies that we can go beyond 25." She said she recommends the committee amend the bill to delete "a minimum of". In terms of funding, she said the division would manage the fund with whichever method of funding the legislature designates. MS. FREDERIKSEN said the division compiled a list last month of 245 schools that fall below the 25 Mbps mark. She indicated there is a fiscal note, but she surmised it had not made it through a final review. The fiscal note would show that "this is going to be about $9.8 million of state funds per year." She said the current program at 10 Mbps is at a cost of approximately $1.2 million. She explained the math that led to the fiscal note amount. She said currently there are 80 schools receiving support in order to get to the 10 Mbps; HB 75 would considerably broaden that number to get schools to the 25 Mbps mark. 8:49:15 AM REPRESENTATIVE ZULKOSKY asked Ms. Frederiksen if she thinks 25 Mbps should be the maximum. MS. FREDERIKSEN answered the proposed legislation seems to propose "a step up," and she opined that "25 is fine." She said when the 10 Mbps law was instated, approximately 140 schools joined the program. Over the past five years, schools have found they can go beyond the 10 Mbps without state support, so they have dropped out of the program. She said she does not know who chose the number 25. She said there is a national recommendation for 100 Mbps for schools, so "this would at least get us closer to the 100 MB." She remarked, "Internet is always a moving target." She outlined the increases over the years. She stated, "It's always going to increase. No library and no school has enough Internet at any one given time." REPRESENTATIVE ZULKOSKY asked if Ms. Frederiksen is suggesting that "a minimum of" might result in ambiguity in statute. MS. FREDERIKSEN answered, "Exactly, it would be ambiguous." 8:51:25 AM REPRESENTATIVE HOPKINS asked whether the $9.1 million would be for operations and maintenance of the fiber optics or for capital expenditure. MS. FREDERIKSEN answered that a school applies for an e-rate at a certain level, for example 25 Mbps, and then it starts getting bids from providers. She said prior to e-rate, which began in 1995, [schools] paid for their own Internet. From 1995 to 2014, schools paid for their Internet in combination with federal e- rate funds, which cover 86 percent. Then the School Bag program started, which made a third funding stream, such that e-rate funds pay 86 percent, and the schools and the School Bag program split the remaining 14 percent. She said this does not pay for infrastructure at the schools or with the providers; the funding goes directly toward payment of Internet bills. REPRESENTATIVE HOPKINS asked how HB 75 would affect the Online With Libraries (OWL) program. MS. FREDERIKSEN answered that these are separate programs. 8:53:58 AM CO-CHAIR DRUMMOND opened public testimony on HB 75. After ascertaining no one wished to testify, she closed public testimony. 8:54:04 AM REPRESENTATIVE STORY asked whether, if "a minimum of" remains in the bill language, districts with more than 25 Mbps would be able to access funds. MS. FREDERIKSEN said the division's understanding of the 10 Mbps in statute is that it helps school districts "get up to 10." She said some of the districts have asked if they can get the help to get to the 10 Mbps and then "go as far as we want to go." She said the way the division interprets the law, the answer to that question is no, "this was to get to school to 10 Mbps straight forward." She added that if the school had the money to go beyond that, then it did not need the state's support and would be "on their own." She explained the reason some schools have dropped out of the program is because the cost of Internet has dropped. REPRESENTATIVE ZULKOSKY asked if the aforementioned fiscal note was drafted based on "up to 25" Mbps. MS. FREDERIKSEN answered that the division looked at the exact number of schools that were under 25, and that was the basis for the 245 sites needing to get up to 25. 8:56:41 AM REPRESENTATIVE TUCK offered his understanding that the $9.8 million fiscal note would get the districts up to 25 Mbps; however, if the ["a minimum of"] language is left in HB 75, that will not necessarily increase the fiscal note. MS. FREDERIKSEN clarified that administering the program with the "a minimum of" phrase left in the bill would be difficult, because school districts have a desire to go beyond 25 Mbps. That is why the division recommends the language be changed to reflect a limit of 25 Mbps. REPRESENTATIVE TUCK concluded that the desire is to bring [school districts] up to the 25 Mbps mark, but suggested a question for the committee to answer is whether it wants to "simultaneously hold people back from going any further." 8:58:22 AM CO-CHAIR DRUMMOND said she agrees. She said she does not want to limit [school districts], especially in light of hearing that the recommendation for the minimum nationally is 100 Mbps. She opined that the committee needs to discuss the matter to figure out "now that would work." 8:58:57 AM CO-CHAIR DRUMMOND announced that HB 75 was held over.