HB 1 - INCREASE AMT OF BASE STUDENT ALLOCATION 3:10:56 PM CHAIR WILSON [announced that the first order of business would be HOUSE BILL NO. 1 "An Act relating to the base student allocation used in the formula for state funding of public education; and providing for an effective date."] REPRESENTATIVE SEATON moved to adopt CSHB 1, [Version 24- LS0001\I, Mischel, 2/15/05] as the working document. There being no objection, Version I was before the committee. CHAIR WILSON explained that this CS would increase the base student allocation to $4,919 per student, therefore increasing the total by about $70.09 million. 3:12:06 PM REPRESENTATIVE CISSNA commented that she has an amendment that she would like to make, but she would prefer to hear public testimony first. CHAIR WILSON agreed and turned to public testimony. 3:12:51 PM REPRESENTATIVE SEATON stated that though there is a CS for a new base student allotment of $4,919, everything he has been hearing from the districts and school boards, this isn't the number that he would choose. He pointed out that a geographic cost differential study would be coming out in two days, and that the committee needs to move this bill to the finance committee so that the base student allocation and the geographic cost differential can be coordinated with one another. He remarked that though he supports moving this bill forward, he is not totally comfortable with the level of the funding. CHAIR WILSON commented that this was the main reason why the proposed base student allocation was not any higher than it is. She stated, "We also have the eroding floor; that's another [$]2 million. ... Because those bills all take a lot more time than we have time for now and we want to get the bills out, ... I didn't include more in the bill than I did." 3:14:55 PM JENNIE HAMMOND stated that she lives in Nikiski and has a kindergartener and a prekindergartener. She commented: The school districts from all across the state have sent in their facts and reasons for increased education funding. Please listen to them. The Kenai district is funded to the cap by the Kenai Peninsula Borough. Every morning when my son goes to school, I try to remind him of two things: give glory to God for everything and this will lead you to make good choices. I tell him that the Bible has an answer for everything if we open our heart and mind. The story that comes to me is the master entrusting his servant with money. Every servant but one multiplies their money; in other words, the legislation has given the school district a portion of money to educate the students. Each district has taken that pool of money and made it grow by the results of achievement by the students. It is time for the legislators to entrust more to the school districts. The school districts have shown that they are wisely using the money that is actually less because it has not been inflation- proofed. Let's truly show the priority of the State of Alaska: children first. So please remember: kids first, $5,200, forward funding, and thank you. 3:16:25 PM KATIE MANDLEDORF, Palmer, stated that she is the parent of three middle and high school students. She expressed her appreciation for the education funding last year and for the early movement of an education bill this year. She stated: I am here today to support those ideas that we have not yet heard. ... I will support your courageous commitment to make sure education is funded at the beginning of each session and that education can be adequately funded each year. I would encourage all legislators to put politics aside and work towards the honest, bipartisan commitment to ensure each year is a good year for education and the best we can give to our children. Last year I researched what our schools used to have and now don't have in the [Matanuska- Susitna] School District. Then I went out and talked to legislators, borough assembly members, parents, teachers, anyone who would listen. What we needed last year we still need today. Only now we have an immediate need for 20 portables to handle the continued increase in enrollment. Three new elementary schools and a high school are really needed. Every legislator I spoke to says they support education, and I am ever so grateful for that. But what we really need is a strong voice taking a visionary lead for education. MS. MANDLEDORF continued: Minimum, flat funding leads to mediocre, overcrowded, poorly maintained schools. Visionary funding opens the door to exemplary schools and the finest education our children can get. We have outstanding teachers in our state. How grand it would be for this strong united voice to support their gallant efforts with facilities and the means to offer smaller class sizes and more variety of classes for our children. Where is this strong voice? Is fear limiting that voice from asking for what is really needed because it will seem like too much and then we'll get nothing? I have never been fearful to stand up for my children or any children. That is why I am here today. Will you be our strong voice? As the PTO president at Palmer Junior Middle School, I can tell you that our parents and teachers have a vision for education. We have a long list of what we need for our schools. We are working very hard to provide some of the needs, but we need your help in a very big way. Please listen to what the parents ... and the teachers are saying. We are small voices but we are also at the heart of our schools. 3:19:54 PM ANNE KILKENNY, Wasilla, complimented the superintendent of the schools for the Matanuska-Susitna School District for his honesty in stating that the Mat-Su schools would maintain status quo with the governor's proposed funding increase. However she expressed dissatisfaction with status quo both as a mother and as the president of the parent organization at the middle school. She commented that there would have been no No Child Left Behind legislation if the status quo was acceptable. She said: It's time that we move ahead. This No Child Left Behind legislation demands it of us, that we make improvements and that we educate our children to rising standards. ... This legislative mandate has so many requirements that it's necessary to increase funding to education to enable these rising expectations and rising standards to be met. I'm asking that you amend this bill and that you increase [the base student allocation] to at least $5,086. [Based on] the testimony given to the [House Special Committee on Education], half of the students in the State of Alaska... are in districts that would be able to function at an improved level with $5,086. It's not enough for Nikiski, it's not enough for a lot of places. But it is enough for at least half the kids. ... Our expectations are not wild. Juneau is only asking to reduce high school classes to 30, and kindergarten to 20. These are modest goals. 3:22:58 PM LAUGHTON ELLIOTT stated that the school system needs more funding. He said that classes are overcrowded due to lack of teachers, textbooks are broken and have to be shared, and there is a high dropout rate, which he attributed to the lack of teachers and attention. Special needs children do not have enough assistance, he commented, and there are no music or arts programs in elementary schools. He remarked that it was his understand that if HB 1 is passed, funds that were previously cut would be restored. He said, "Alaska is a wealthy state, and I say we put the money where it's needed." MR. ELLIOTT, in response to Representative Anderson, stated that he is a high school freshman. 3:24:34 PM DOROTHEA ADAMS, President, Yukon Flats School Board, stated that she supports all of the issues that they are advocating. She is lobbying for a new school in Arctic Village and she pointed out: We're currently number 12 on the CIP [Capital Improvement Project] list for a new school. ... [The current school] is from the old BIA [Bureau of Indian Affairs] days; it's saturated with oil, as the boilers are on the second floor. And the kitchens are right under, and years and years of spills have occurred so the building is saturated with oil, making it unsafe for the students. And we have an asbestos problem at that school that was temporarily resolved by covering, but it still needs to taken care of. Our needs are immediate and real. Our students want to stay in this community where they are nurtured and raised with traditional values inherent to the Gwich'in Athabascan. And I urge you to fund a new school for Arctic Village. GALEN GILBERT stated that he is 16 years old and a junior at Arctic Village High School. He informed the committee that the school is over 40 years old and is in bad condition; it is poorly insulated and therefore a lot of money is spent on fuel, and the pipes freeze. There are 51 students K-12 at the school, he explained, and they would really like a new school. MS. ADAMS commented that she is also lobbying for improvements to the Fort Yukon school gym, which is also 40 years old and has been condemned. However the building is still used every day by 140 children because there is no other place for their physical education class. She mentioned that the gym is number 29 on the major improvement list. 3:28:50 PM ROBERT WELLS, Member, Matanuska-Susitna School Board, expressed appreciation to the committee for its effort to move the early funding House Bill along and to the House Special Committee on Education, which reported the bill from committee with an increase. On February 2, the Mat-Su School Board went on record as supporting a minimum base student allocation of $4,995, he noted. 3:30:00 PM CARL ROSE, Executive Director, Association of Alaska School Boards (AASB), commented that the association has met and has agreed upon a base student allocation of $4,995, which is about $85 million total. He reiterated that many of the districts have needs that exceed the $4,995, but they ask for this amount as a minimum. He said, "This represents some discipline and ... a responsible request. It sets an expectation for next year." He referred to a graph that demonstrated that $46 million of $82 million last year went into construction and operation. He remarked that while he appreciates the governor's proposal, it only produces $24 million in terms of instruction and operational funds, which represents a decline. 3:31:51 PM JOHN ALCANTRA, Government Relations Director, National Education Association of Alaska (NEA-Alaska), stated that NEA-Alaska supports a base student allocation of $5,315 in order to address the PERS and TRS situation as well as inflation. He noted that class sizes in Anchorage are large, and that the schools need to be funded beyond status quo. He said, "Any increases are supported. Anchorage has a number of [$]5,120, Kenai has a number of [$]5,200. ... Our number of [$]5,315 represents a real down payment into the future of adequately funding our schools." MR. ALCANTRA, in response to Representative Anderson, stated that this would make a total of $147.8 million, which is about $85 million above the governor's proposal and about $78 million above the committee's working document. He pointed out that every $5 increase to the base student allocation equals about $1 million total statewide. 3:35:47 PM MERLE THOMPSON stated that he is from the Matanuska-Susitna Valley and that he is not connected with the schools. He said: I do realize that we have to fully fund the education of our children. It's one of the most important things that a society can do for itself and for its kids. ... The level we're at now just doesn't get the job done. I went through my particular area of the Susitna Valley; I went to a number of the schools. A library [I used] in high school is almost void of books. It startled me. I had nearly as many in my own personal library. ... I sat in on an elementary school ... class and the teacher explained to me that she had to buy the shelvings and bookcases to store the supplies in there because there were no funds for it. I heard a lot of lip-service during the campaign about funding education but I think we need a little less lip and a little more service, and I respectfully ask that you up this number to where it's reasonable. We have an unfunded mandate with No Child Left Behind; it just doesn't make any sense. We can do a lot better. According to 20/20 Alaska, we rank 50th in the nation in the percentage of our state budget that goes towards education. And I think that's pretty pitiful. 3:37:49 PM MACON ROBERTS, Member, Anchorage School Board, stated that the Anchorage School Board passed a resolution supporting a base student allocation of $5,120. He commented that the No Child Left Behind mandate will require schools to spend more money than last year. He also mentioned some of the unfunded mandates for the students with special needs. He said, "I will not be disappointed if you didn't make this figure that I'm recommending, ... but I would be appreciative if you somehow ... see fit to fund more than the [$]4,915." 3:41:05 PM REPRESENTATIVE MCGUIRE asked Mr. Roberts to give the committee a few examples of increased costs due to No Child Left Behind, and also asked him to explain why Anchorage does not tax up to its cap. 3:42:05 PM MR. ROBERTS explained that due to No Child Left Behind, teachers and teachers' assistants have additional expenses to become "fully qualified" and the districts are paying for those expenses. He mentioned the transportation of students to Title One schools. He clarified that Title One schools are determined by the income level of the families, particularly for those students that are qualified for free lunches. He also pointed out that in the coming years more students will be added and therefore there will be more expenses. MR. ROBERTS stated that the cap is set by the municipal charter and even if public officials wanted to raise the tax cap they wouldn't have the ability to do it. He commented that his understanding was that there would have to be a municipality- wide vote to change it. 3:46:01 PM CHAIR WILSON closed public testimony. 3:46:19 PM REPRESENTATIVE CISSNA moved to adopt Conceptual Amendment 1. REPRESENTATIVE SEATON objected for discussion purposes. 3:47:14 PM REPRESENTATIVE CISSNA explained that Conceptual Amendment 1 would delete the number $4,919 for the base student allocation and replace it with $5,120. She remarked that $5,120 is nowhere near high enough for many of the schools in Alaska, but it is a reasonable number, and she considers it to be the minimum number. She said that [the legislature] doesn't want to fail by not investing enough in the students and schools. 3:49:47 PM REPRESENTATIVE GARDNER endorsed Conceptual Amendment 1. She reiterated an earlier witness who said that if the status quo were adequate there would be no need for No Child Left Behind. She said, "We need to get beyond status quo. We need to address the issue of reducing class sizes and talk about, not how much money we're going to spend, but what it costs to meet the needs of the children in this state." REPRESENTATIVE MCGUIRE stated that she does not support Conceptual Amendment 1, but noted that "this bill has a long way to go. ... Oftentimes it's very difficult when you're watching one part of a legislative process to see that there are a lot of pieces that fit together." 3:51:55 PM REPRESENTATIVE ANDERSON commented: At first blush, I support to $5,120 base student allocation on the merits that it would increase funding statewide, but as Representative McGuire stated, this budget process is in progress and forming, and we have the PERS and TRS issues, we have so many other issues in concert with this that I think this is the wrong time.... I think we need to keep assessing this before we amend the bill and have more dialogue and listen to exactly the accountability and security measures for where the spending will be. But I do agree that the amount ultimately will be raised higher and it'll depend on what I think the finance committee dictates and where they can secure funding from. And I just don't think HHES is the place to change that this early. So I won't support the amendment of the bill. 3:55:02 PM REPRESENTATIVE SEATON reiterated that he sees the need for coordination between this and the geographic cost differential study, and stated that he does not support Conceptual Amendment 1. CHAIR WILSON, regarding Conceptual Amendment 1, said: The numbers are wonderful and I don't argue with them even, except that going through the process, we've got the cost differential study, we've got the PERS and TRS, we've got the eroding floor, we've got the debt reimbursement. There's a lot that we have to deal with yet and I don't want to jeopardize any of that. A roll call vote was taken. Representatives Gardner and Cissna voted in favor of Conceptual Amendment 1. Representatives McGuire, Anderson, Seaton, and Wilson voted against it. Therefore, Conceptual Amendment 1 failed by a vote of 2-4. 3:57:00 PM REPRESENTATIVE MCGUIRE moved [to report CSHB 1, Version 24- LS0001\I, Mischel, 2/15/05] from committee with individual recommendations and attached fiscal notes. Representative Gardner objected for purposes of discussion. 3:58:13 PM REPRESENTATIVE GARDNER stated that she understood the urgency of moving the bill and she understood the arguments of other items that impact the ultimate base student allocation funding decisions. She said that she had intended to introduce another amendment but in the interest of time, she had decided not to do so. She noted that she looks forward to a bill that would eliminate the eroding floor, which is still hurting school districts, she opined. She remarked that she hopes that ultimately any education funding plan is not only adequate for current needs of all classrooms, but also eliminates the eroding floor. REPRESENTATIVE CISSNA commented: I'm going to vote in favor of this bill, but ... with enormous trepidation and reservations because ... the very schools that will suffer the most by ... not making sure that we are at top dollar for these schools, the schools that will be hurt the most are the ones that ... are at most risk, are getting the lowest scores in No Child Left Behind, have the highest costs, and they're the ones that are being hurt the most by present circumstances. So I'm going to say yes with an enormous leap of faith that there is going to be a huge effort to try to solve these problems ... this year. 3:59:14 PM REPRESENTATIVE MCGUIRE moved [to report CSHB 1, Version 24- LS0001\I, Mischel, 2/15/05] from committee with individual recommendations and attached fiscal notes. There being no objection, CSHB 1(HES) was reported from the House Health, Education and Social Services Standing Committee.