2:26:09 PM HOUSE BILL NO. 198 "An Act relating to the special education service agency." REPRESENTATIVE ALAN DICK, CHAIR, SPECIAL COMMITTEE ON EDUCATION, testified in support of HB 198. He observed that House Bill 198 would remove a sunset requirement and increase state funding for the Special Education Service Agency (SESA), which was a not-for-profit organization established in statute in 1986. The Special Education Service Agency was governed by the Governor's Council on Disabilities and Special Education and its own independent board of directors. Representative Dick noted that sometimes districts could not fully serve students that had low-incidence disabilities with existing personnel and resources. House Bill 198 would incorporate the recommendations of the most recent legislative audit, completed in 2007. The Special Education Service Agency assisted local school districts to provide needed special education services. House Bill 198 would repeal the sunset requirement and increase SESA funding. Representative Dick noted that the Special Education Service Agency received state support based on a funding formula adopted in 1998. Each year the Department of Education and Early Development allocated to SESA not less than $15.75, times the number of students statewide. Although local school districts had received increases in state funding since 1998, SESA had not. Under HB 198, the multiplier would increase as the base student allocation increases. Currently the computation (.4 percent of $5,680) equaled $22.72 which would approximate the impact of inflation from 1998 to 2011. He observed that the Committee did not change the provision. The Special Education Service Agency was set to expire on June 30, 2013. During previous performance audits, both the Department of Education and the Legislative Auditor recommended removing SESA from the sunset process. House Bill 198 would repeal the sunset requirement and thus allow SESA to plan long-term and have adequate funding to meet special needs of special children. 2:29:51 PM MILLIE RYAN, EXECUTIVE DIRECTOR, GOVERNOR'S COUNCIL ON DISABILITIES AND SPECIAL EDUCATION, testified in support of HB 198. She observed that the council's mission was to improve the lives of people with disabilities and the quality of education provided to students with disabilities. The council consisted of 27 members appointed by the governor. Sixty percent of the members were individuals with disabilities or parents or family members of people with disabilities. There were state agency representatives from the Department of Education and Early Development, Division of Vocational Rehabilitation, Department of Health and Social Services; and other representatives designated in federal law. Ms. Ryan noted that the council had five responsibilities in statute. Five Council members serve on the SESA board. There were representatives from: school administrators, special education administrators, and the National Educational Association. The special education director from the Department of Education and Early Development and Ms. Ryan were ex-official members. 2:32:33 PM Ms. Ryan noted that the job of board was to assure SESA provided assistance to school districts and early intervention programs serving students with low incidence disabilities, particularly those who lived in rural and remote areas of the state. The board also assured that SESA supported education that was student, family and community- centered and met the individual needs of students; assisted SESA in addressing other state education needs of individuals with low incidence disabilities, as external funding was obtained; and monitored SESA policies and procedures. Ms. Ryan observed that SESA was established in 1986, as a not-for-profit corporation that operated under a sunset provision. She noted that SESA received Low Incidence Disabilities (LID) funding from the Department of Education and Early Development based on prior year's statewide total enrollment and federal and state grants and contracts. 2:33:45 PM Representative Wilson referred to LID funding. She asked if funding was based on all students that were designated as special education students. Ms. Ryan explained that funding was based on the entire student count not just the count of special education students. Ms. Ryan pointed out that required services were itinerant outreach services to students who were deaf; deaf-blind; cognitively impaired; hearing impaired; blind and visually, orthopedically disabled, multiple disabilities, or autism. She noted that these disabilities tended to be uncommon. Special education instruction support and training of local school district personnel were provided to both special and regular education staff. Other services appropriate to special education needs were also provided. 2:35:13 PM Ms. Ryan spoke to the funding formula set in 1998, which was $15.75 times the number of students in the state in average daily membership in the preceding fiscal year. Ms. Ryan observed that the recommended change in funding formula for SESA was 0.40% of the current year base student allocation (BSA) X total average daily membership (ADM) from previous year. She explained that the increase would catch SESA up in terms of inflation. The formula would tie SESA funding to the BSA. The sunset provision would also be removed. Ms. Ryan explained that the funding formula for SESA was based on a fixed student allocation that was set in 1998 and did not keep up with inflation. She emphasized that SESA specialists traveled frequently to rural Alaska and travel expenses were rising. In FY 2013, SESA would receive less money than it did 10 years ago; SESA's BSA did not change when school district's BSA changed. If SESA's BSA had changed at the same time, its rate would be $22.71 instead of $15.75. 2:36:51 PM Ms. Ryan observed that the 2007 audit recommended that the statutory funding formula be reevaluated based on the effects of inflation and increased employee costs. The interim commissioner of Department of Education and Early Development concurred with the audit's recommendations at the time of the audit. Co-Chair Stoltze asked the position of the new commissioner. Ms. Ryan stated that the new commissioner was non-committal. 2:38:04 PM Ms. Ryan observed that in response to the last audit, SESA successfully secured additional grants and contracts that fit with its mission. "Soft" money dedicated for specific purposes in 2011 comprised 45% of SESA's budget; there was a $236,000 contribution to overhead. As a result, SESA was able to fund 3 positions for the LID program. She pointed out that specialists that consult with districts would have to be reduced if the "soft" money did not continue. She concluded that SESA had increased grant funding over previous years. 2:38:46 PM Ms. Ryan reiterated that SESA had already had difficulty meeting its statutorily mandated duties. If there was a reduction in grants and contracts the situation would worsen and negatively impact students and school districts. Ms. Ryan emphasized that SESA brought the ability to provide evidence-based strategies to school districts, which would be decreased without funding. A lack of funding would result in fewer and shorter on-site visits. Ms. Ryan stressed the importance of SESA for new special education teachers and to classroom teachers working with students who have unique, low-incidence disabilities. 2:40:14 PM Representative Wilson spoke to mentoring and observed that the Department of Education and Early Development already mentors first and second year teachers and suggested there was a duplication of service. P.J, FORD SLACK, PH.D, BOARD PRESIDENT, SPECIAL EDUCATION SERVICE AGENCY, observed that she was also the principal at Sitka High School and the former superintendent of the Delta Greely School District. She responded that the mentorship program did not mentor special education teachers or specialists while she was at Delta Greely. Only core academic areas were mentored. Representative Wilson argued that special education teachers were included in the Department of Education and Early Development's mentoring programs and asked for more data. PATRICK PILLAI, EXECUTIVE DIRECTOR, SPECIAL EDUCATION SERVICE AGENCY (SESA), added that a lot of the new teaching mentoring was done to bring teachers into the teaching environment for strategies, while SESA provided professional development in special education that might be specific to a particular syndrome. He observed that new teachers might have only taken one generic class. The professional development provided by SESA was for classroom strategies and on-going professional development for the general school body. 2:42:27 PM Representative Wilson suggested there needed to be discussion with the university and Department of Education and Early Development if there were special education teachers without a special education degree. Ms. Ryan explained that a special education teacher could have a general background, but SESA provided specialized services. Representative Gara summarized that urban districts had their own special education expertise and SESA focused on smaller districts. Ms. Ryan agreed that the focus was on rural districts and pointed out that Anchorage and larger districts had the expertise to work with special needs students. She added that SESA provided support and information to all school districts. Representative Gara stressed the common goal to provide needed services in the most sufficient manner. He asked how many students SESA served. Mr. Pillai noted there were 354 LID students. He added that SESA also worked with the general education staff and peers that interact with those students through training. Representative Gara asked the per student dollar cost. Mr. Pillai agreed to provide the information. He stressed that services were provided to more than just the students. 2:45:52 PM Representative Costello observed that the foundation formula based on student attendance was approximately $5,682 per student. The LID program was a general percentage of total student population. Mr. Pillai clarified that the child count was the count of special education students. The calculation was $15.75 times the ADM, which was not tied to BSA. School districts were functioning at 5 percent of the consumer price index (CPI), while SESA was 30 percent below the CPI. Representative Costello concluded that the rate was based on total student population based on a historical number. Mr. Ryan clarified that the number of children was similar, but funding was tied to all the children receiving an education in the state and was a flat rate. She explained that SESA funding would decrease with the child count; unlike school districts whose funding was tied to the BSA. The legislation would tie SESA funding to the BSA. Districts refer children to SESA. 2:49:33 PM Representative Costello noted the program was set up to primarily help rural students. She referred to children with autism enrolled in Anchorage. Mr. Pillai clarified that while larger districts tended to have their own specialists; SESA provides training for larger districts. Representative Costello questioned how funding for SESA fit with other state needs and why the request was for a percentage instead of a dollar amount increase. Mr. Pillai stressed the difficulty of recruiting and maintaining staff at the current funding level. Multiple- disability specialists were reduced from five to three through attrition. New recruits did not receive the same level of wage or benefits as those being replaced. Competition with other school entities affected recruitment; there was a 40 percent discrepancy between SESA and the Anchorage School District. Mr. Pillai spoke to the demand for services. The ADM was dropping, but the LID numbers and the number of referrals from rural Alaska had increased. Some districts had up to eight or nine students with autism. Extra funding would allow more specialists to be hired and improve salary scales for retention. 2:53:31 PM Representative Costello asked the turnover rate. Mr. Pillai observed that there was a low turnover rate for many years due to retirement incentives, but six employees had left in the previous year. He noted difficulties with recruitment due to salary and the high degree of specialty needed. 2:54:53 PM Ms. Ryan spoke to the sunset provision. The 2007, audit found that: SESA performed a valuable, effective and efficient service to school districts that they could not provide themselves because of the nature of low incidence disabilities; students were able to be served in their local communities; and SESA did not duplicate services provided by the Department of Education & Early Development or local school districts. The audit recommended removal of the sunset. She observed that another audit was underway, which added to the difficulty of recruiting and retaining qualified staff. 2:55:53 PM Vice-chair Fairclough asked if the student count was breakdown by region. She asked if there was a concentration in specific school districts. Mr. Pillai observed that 54 school districts were served. Almost every school district was served, but there were cloisters in different districts. Some districts had eight to ten students, while others had one or two. There was a referral process in place. Vice-chair Fairclough reiterated that she wanted student service numbers. Vice-chair Fairclough asked for a copy of the 2007 audit and expressed concerned about the fiscal note. She suggested that the fiscal note did not adequately show the cost of continuing the program. She requested a breakdown of administrative costs and the cost of Public Employees' Retirement System (PERS) and Teachers' Retirement System (TRS) prior to servicing students. 2:58:55 PM Co-Chair Thomas observed that he had not heard of the program and spoke against the sunset. He expressed concern that money had been given several years prior to disadvantaged children and wondered whether the program would serve the same children twice. Vice-chair Fairclough discussed the district cost factor increment increases, which were currently in their final year. She thought that additional resources had been appropriated toward disabilities and wondered how the programs worked together. She asked for an explanation about how the program provided unique opportunities that were not covered by the Department of Education and Early Development. 3:02:19 PM Mr. Pillai, in response to a question by Representative Neuman, explained that intensive funding was provided to schools for special education; SESA was more in the role of providing onsite professional development for teachers based on the referral process. School districts referred students to SESA for services. Representative Neuman expressed concern on behalf of smaller school districts and requested a follow up on costs. MARCY HERMAN, SPECIAL ASSISTANT, DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT, testified in support of SESA with a sunset and offered that Michael Hanley, Commissioner, Department of Education and Early Development would be happy to attend the next hearing. Ms. Herman replied to an earlier question from Representative Wilson and explained that there were 36 special education teachers being mentored through the mentoring program. LARAINE ADANS, DIRECTOR OF SOCIAL SERVICES, LOWER YUKON SCHOOL DISTRICT, MOUNTAIN VILLAGE (via teleconference), spoke in support of continued funding through SESA. She observed that the 11 villages in the district were in strong support of the legislation. DR. CASSIE WELLS, DIRECTOR, STUDENT SERVICES, NORTH SLOPE BOROUGH SCHOOL DISTRICT, BARROW (via teleconference), spoke in strong support of SESA and the elimination of the sunset clause. She emphasized that SESA provided on-site specialized programing and training for those that work with the students with the most significant disabilities, particularly in rural and remote areas. Co-Chair Stoltze noted that HB 198 would remain open for additional public testimony. HB 198 was HEARD and HELD in committee for further consideration. AT EASE 3:08:29 PM 3:08:52 PM RECONVENED