House finance adopts new committee substitute for education bill


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The Alaska House Finance Committee released its committee substitute (CS) to the Governor’s omnibus public education bill, House Bill 278.

The CS comes after more than two months of comprehensive meetings, including numerous hearings with public testimony, on all aspects of Alaska’s public education system.

New reforms aimed at increased choice through charter schools and greater accountability for how education dollars are spent by districts is also included in the bill, as is an infusion into the trust used to fund teacher retirement.
 CSHB 278 surpasses the Governor’s proposed increase to the Base Student Allocation (BSA,) and includes a major fix to the student count component that is used to determine a school district’s average daily membership factor based on school size within the foundation formula.
The CS incorporates the following key elements, in addition to the changes made by the House Education Committee:
Funding Increases: Adds $100 to the Governor’s proposed three-year BSA increase in the first year, and forward funds the increase. The new total represents $185 for Fiscal Year 2015, and $58 for FY16-17.
Formula Fairness: Increases the fairness of the education funding formula by counting students in a more equitable manner, where schools with larger student populations are currently counting each student as less than one for funding purposes. The Finance CS removes the top two tiers, allowing urban districts to receive increased funding per pupil under the formula.
These two changes alone are projected to provide millions in funding to the state’s largest districts: Mat-Su ($7.7 million,) Fairbanks ($6.5 million,) Kenai ($3.3 million,) Juneau ($2.1 million,) and Anchorage ($15 million).
Retirement: Deposits $1.4 billion into the Teacher Retirement System, a significant driver in the upward cost of K-12 education. The plan, offered by the nonpartisan Legislative Finance Division, addresses the unfunded liability in a responsible manner and takes care of our commitment to our past and current educators. 

Reforms and accountability: The Committee Substitute includes an adjustment to how charter schools are funded, offering municipalities the option to give a property tax exemption to property owners who lease or rent space, or a portion of their space, to charter schools, and making charter schools equal in terms of formula funding. The bill also changes the charter schools formula to explicitly state that districts cannot take a portion of a charter student’s formula funding for administrative costs;
“I have serious concerns about unsustainable growth in the overall operating budget, even with our efforts to slow its growth across the board. However, on education, it is important that we’re planning a way to stabilize and continue to provide a more predictable revenue stream to our schools,” Rep. Bill Stoltze said. “It’s an example of the thorough process we’ve employed all session long, and one we believe will lead to better results for Alaskan students.”
 
 

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