School funding changes added to bill

Posted: Thursday, April 28, 2005

A proposal to change part of the state's school-funding formula at a cost of $80 million to $90 million over four years has been tacked onto a school-construction reimbursement bill.

House Bill 13, which passed the House Finance Committee on Friday, now includes the recommendations of a recent study by the University of Alaska Anchorage's Institute of Social and Economic Research. That study recommends adjusting what's called the district cost factor to better account for the greater expenses, mainly in salaries, of running schools outside of Anchorage.

The cost factor is just one part of the state's complex public school- funding formula.

Most smaller city and rural school districts would garner more money under the change. Juneau would gain $1.25 million a year at the current level of per-student funding.

But with no increase in per-student funding, Anchorage, Fairbanks, and several other districts would lose because money would be shifted from some districts to others.

It would cost $82.5 million in new funds to hold all districts harmless under the proposal, the state Department of Education has said. Under that scenario, Juneau schools would gain nearly $4.4 million a year.

The amendment by House Finance Co-Chairman Mike Chenault, R-Nikiski, would bring ISER's recommendations into the district cost formula over a period of four years. He said the phase-in will help keep the state's budget under control, allow districts to examine their costs, and allow a legislative committee to form and find where ISER's numbers are correct or flawed.

Rep. Mike Hawker, R-Anchorage, failed to pass an amendment to take Chenault's changes out of the bill.

Rep. Eric Croft, D-Anchorage, succeeded in getting the committee to adopt an amendment to "hold harmless" school districts such as Anchorage and Fairbanks.

The bill's sponsor, Rep. Carl Gatto, R-Palmer, said attaching the ISER recommendations threatens his measure.

The bill's original intent - to reimburse 70 percent of a school district's debt for new construction - was meant to help the Matanuska-Susitna Borough build three new schools.

Many consider the ISER study flawed and time is needed to verify the numbers, he said.

Gatto said he would try to take the cost changes out of the bill when it reaches the House floor. He also said he doubted the changes would make it past the Senate.

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