SENATE BILL NO. 167 "An Act relating to scholarships to attend the University of Alaska; establishing the Alaska scholars program; and providing for an effective date." This was the first hearing for this bill in the Senate Finance Committee. This bill relates to the University of Alaska's new program to grant scholarships to the top ten percent of each Alaskan high school's graduation class. Co-Chair John Torgerson explained the proposed committee substitute, CS SB 167 1-LS0900/G 5/13/99, before the members, which eliminates from statute, the Alaska scholars program. In addition, the committee substitute maintains the objective to allow information to be released from school districts to the University of Alaska for the purpose of notifying students who are eligible for the new scholarship program. Co-Chair John Torgerson explained that this committee substitute is necessary to place provisions into AS 14.40 to comply with a federal law that limits the release of educational records that contain personally identifiable information. Co-Chair John Torgerson stated he would make available a legal opinion relating to SB 167 written by Mike Ford, Legal Council at the Division of Legal and Research Services. [Copy on file] Co-Chair John Torgerson read a portion of the memo into the record where Mike Ford stated, "I find no reason why the legislature could not chose to provide for the release of this kind of educational record. While the federal law does limit the release of educational records that contain personally identifiable information (see 20 U.S.C. 1232g), this law also contains an exception for the release of an educational record for the purpose of applying for financial aid (see 20 U.S.C. 1232g(b)(1)(D))." Senator Gary Wilken moved to adopt CS SB 167 1-LS0900/G 5/13/99 as a Workdraft. There was no objection and it was so ordered. Senator Gary Wilken moved for adoption of Amendment #1. Co- Chair John Torgerson objected for the purpose of explanation. Senator Gary Wilken referred to page two, line 11 of the committee substitute noting the amendment inserts, "for each scholarship program" following ".students.who meet scholarship eligibility requirements". This limits the release of names and addresses of students relevant to individual scholarship programs, he explained. Senator Gary Wilken explained the second part of the amendment inserts new paragraphs on page two following line 13 of the committee substitute. The new paragraphs provide that school districts shall amend their policies as necessary to comply with the bill but that a school district shall not provide the information if the student or parent objects. He said this is the provision that allows school districts to release the student's names and information and to comply with the federal Family Educational Rights and Privacy Act (FERPA). Senator Randy Phillips asked if this bill is the result of a new federal law and who was the prime sponsor of that federal law. WENDY REDMOND, Vice President, University Relations, University of Alaska, replied that the federal law is not new and has been around for over a decade. She explained this is the first time Alaska had ever come up against the FERPA law and is because of the University's attempt to award scholarships to the top ten-percent of graduating high school students. She said some of the school districts would not release the names to the University citing that the federal law prohibits them from doing so. She told the Committee that the University's legal council determined FERPA provides an adequate allowance so the schools can release the names for financial aid purposes. However, she pointed out, the school districts' attorneys argued that a state law is also needed. Senator Randy Phillips asked if the issue of compliance was raised by the local school districts. Wendy Redmond responded that the compliance issue was raised by some of the districts. Co-Chair John Torgerson clarified that this matter came up because of the University's new scholarship program. Wendy Redmond confirmed that the current scholarship is awarded to the one, top-graduating senior from each high school and is granted only after the qualifying student applies for it. The new program is broader and entails the University notifying all qualified students of their eligibility for the scholarship. Because of the notification process, the University needs to know who those qualifying students are, stressed Wendy Redmond. Senator Randy Phillips wanted to know if the school districts were claiming a right to privacy. Wendy Redmond said the school districts were only saying they were afraid to release the information because of restrictions in the FERPA law. She explained that most school districts send notification to students' families at the beginning of each school year asking permission to use the student's name in a school directory. Parent's who sign the form are signing a basic FERPA release, according to Wendy Redmond. Senator Dave Donley wanted to know if, in order for the information to be given from the high school to the University, the student had to sign a release. Wendy Redmond answered it was the parents who signed the release. Senator Dave Donley asked if therefore, the University wouldn't get a complete list of all qualifying students because some students' families would chose to not release that information. Wendy Redmond replied the University wanted to leave that option available to the parents and that is the reason AS 14.43.930(d) is proposed in Amendment provide to the board the name of a student if the parent of the student objects to the disclosure." Senator Dave Donley wanted to know what prevented the University from selling the information received to other universities or otherwise distributing it. He asked what controls govern the information once the University of Alaska receives it. Wendy Redmond responded that there were no provisions in statute or in regulations but that keeping the information confidential is just common sense. She added that the University is also held under FERPA requirements to keep student information confidential. Senator Dave Donley wanted assurance that this information would not be sold by the University. Wendy Redmond promised that the University of Alaska would never sell the information. Senator Lyda Green said this was no different from information going to other scholarship programs. She explained that a lot of information was gathered by scholarship review committees and was kept guarded. She didn't want the Committee to lose sight of the honorable intent to provide scholarships to Alaskans. Senator Randy Phillips said this was the first time he had seen the bill. Senator Gary Wilken referred to a letter from the University of Alaska Scholars Program [Copy on file] stating that from the participating school districts, 181 students plan to take advantage of the scholarship. Senator Gary Wilken commented that the question remained as to how many of those students would have attended the University of Alaska without the scholarship program in place. He stressed that this bill is an attempt to get the quality students to attend the University. He knew students followed their peers and that this also applied to where they go to college. He expected that in five years the State would wonder what it ever did without the program. Amendment #1 was adopted without objection. Senator Gary Wilken offered a motion to move from committee, CS SB 167 (FIN) Version "G" as amended with individual recommendations and accompanying fiscal note. There was no objection and the bill was reported out of committee. AT EASE 8:30AM / 8:59 AM Co-Chair John Torgerson made a brief announcement that HB 40 would not be heard at this meeting. Members were working on drafting amendments to SB 67 and the meeting would come back to order when they were ready. AT EASE 9:00AM / 9:57AM