Association of Alaska School Boards

Legislative Bulletin

A weekly digest of activity by the Alaska Legislature and U.S. Congress for Alaska’s School Board Members. AASB Tel. 907-586-1083, Fax 907-586-2995. Executive Director, Carl Rose crose@aasb.org; Editor, John Greely. Review past issues of the Bulletin on the AASB Website at http://www.aasb.org. To unsubscribe send an email requesting the same to jgreely@aasb.org.

This bulletin is distributed by email only. School districts should copy for board members not online.

April 7, 2006

--CHENAULT ANNOUNCES INTENT TO RAISE AREA COST DIFFERENTIAL

--SCHOOL BOND REIMBURSEMENT BILL PASSES HOUSE FINANCE

--EDUCATION BILLS ON THE SCHEDULE NEXT WEEK

CHENAULT ANNOUNCES INTENT TO RAISE AREA COST DIFFERENTIAL

The co-chairman of the House Finance Committee said today he plans to propose a $24 million boost to the Area Cost Differential in the K-12 school foundation funding formula. Rep. Mike Chenault, R-Nikiski, told his committee members that the money should be distributed to school districts through a phased implementation of a study by the Institute of Social and Economic Research (ISER), beginning with a 25 percent increase in the cost differential in the next school year.

Chenault made his announcement as the committee took an hour of testimony on Gov. Frank Murkowski’s proposal, HB 362, to raise the Base Student Allocation in the funding formula by $433 per student next year. Many school districts testified that while welcome, the increase of the BSA to $5,352 would still leave them short of meeting expenses. One of the districts with the largest projected budget shortfall is the Kenai Peninsula Borough School District represented by Chenault.

AASB Executive Director Carl Rose wrote to Chenault and committee co-chair Rep. Kevin Meyer, R-Anchorage, asking them to consider raising the Area Cost Differential (ACD) to help school districts avoid larger classes and staff cuts. In his letter of April 5, Rose noted that school leaders from around the state had endorsed such the move in a resolution adopted by the 2005 annual conference of AASB.

“Quite simply, the time is long past for the Alaska Legislature to address this portion of the funding formula for K-12 education,” Rose said. “Our children, schools and communities deserve nothing less than equity in the distribution of additional funds for K-12 education.”

HB 362 would authorize an additional $90.2 million in K-12 support. If Chenault’s proposal were adopted as an amendment to the bill, an additional $24 million would be injected into the formula through the ACD.

The committee took no action on HB 362. A schedule for further hearings was not announced.

SCHOOL BOND REIMBURSEMENT BILL PASSES HOUSE FINANCE

A bill extending the school bond reimbursement program for another two years, but at lower levels, emerged from the House Finance Committee on Thursday. HB 493 would extend the popular school construction program into 2008, but projects authorized by local voters after October 31, 2006 would qualify for 60 percent state funding, instead of 70 percent. The measure would also lower the reimbursement from 60 percent to 40 percent for districts that build schools exceeding the state’s space limitations.

A report by the Department of Education and Early Development recommended the lower rates as a cost containment move. The 20 percent spread between rates for schools meeting and exceeding space limits also was endorsed by EED.

More than $872 million in school construction and major maintenance projects were funded through grants or bond reimbursements between November, 2002 and December, 2004. Another $275 million in grants and bond authorizations were approved by the 2005 Legislature.

Rep. Kevin Meyer, co-chair of the Finance Committee, noted that communities with the ability to sell bonds would benefit from passage of HB 493. He said it was his intent to provide funds this session for construction of schools in Rural Education Attendance Areas, which do not have bonding capacity.

HB 493 was referred to the House Rules Committee, which scheduled a hearing next Thursday on a separate school bond reimbursement bill, HB 13.

EDUCATION BILLS SCHEDULED FOR HEARINGS NEXT WEEK

The following bills of interest to school districts have been scheduled for public hearings April 10-13:

HB 482 (Anderson) establishing procedures for school districts to prohibit and report on instances of bullying, intimidation and harassment in schools, House HESS Committee, Tuesday, April 11, 3:00. Here is a text of the bill as amended by the House Education Committee:

http://www.legis.state.ak.us/basis/get_bill_text.asp?hsid=HB0482B&session=24

SB 234 (Governor) funding a revenue sharing “community dividend” program for municipalities, Senate State Affairs Committee, Tuesday, April 11, 3:30. Here is the text of the bill as introduced by the governor:

http://www.legis.state.ak.us/basis/get_bill_text.asp?hsid=SB0234A&session=24

SB 48 (Davis) relating to psychological evaluations and treatment of students, Senate HESS Committee, Wednesday, April 12, 1:30. Here is the text of the bill as introduced:

http://www.legis.state.ak.us/basis/get_bill_text.asp?hsid=SB0048A&session=24

HB 13 (Gatto and Gruenberg) extending the school bond reimbursement program, House Rules Committee, Thursday, April 13, 1:30. The text of the bill as introduced in 2005 can be viewed here:

http://www.legis.state.ak.us/basis/get_bill_text.asp?hsid=HB0013A&session=24

HB 278 (Hawker) allowing local governments and the state to sell bonds to finance retirement obligations, House Rules Committee, Thursday, April 13, 1:30. Here is a text of the bill as adopted by the House Finance Committee:

http://www.legis.state.ak.us/basis/get_bill_text.asp?hsid=HB0278B&session=24

QUOTE OF THE WEEK

“I would like the House Finance Committee to remember two realities: that the $90.2 million foundation funding increased proposed by Governor Murkowski has already been budgeted for FY 2007 by Alaska’s 53 school districts, and that despite this proposed increase, any local school budgets still face difficult challenges next year because of inequities in the Area Cost Differential of the funding formula.”

Carl Rose, AASB executive director, in a letter to the committee on April 5.