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SENATE BILL NO. 238
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-THIRD LEGISLATURE - SECOND SESSION
BY SENATOR CLAMAN
Introduced: 2/19/24
Referred: Education, Finance
A BILL
FOR AN ACT ENTITLED
"An Act relating to education funding; relating to the public education fund; relating to 1
the base student allocation; and providing for an effective date." 2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 3
* Section 1. AS 14.03.150(c) is amended to read: 4
(c) The department may not award a school construction or major 5
maintenance grant under AS 14.11 to a municipality that is a school district or a 6
regional educational attendance area that is not in compliance with (a) of this section. 7
The department shall reduce the amount of state aid under AS 14.17.410(b)
8
[AS 14.17.400] for which a school district may qualify by the amount, if any, paid by 9
the department under (b) of this section. 10
* Sec. 2. AS 14.17.410(b) is amended to read: 11
(b) Public school funding consists of state aid, a required local contribution, 12
and eligible federal impact aid determined as follows: 13
(1) state aid equals basic need minus a required local contribution and 14 33-LS0938\A
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90 percent of eligible federal impact aid for that fiscal year; basic need equals the 1
amount appropriated by the legislature for state aid, distributed proportionately 2
to a district according to the district adjusted ADM of the district [SUM 3
OBTAINED UNDER (D) OF THIS PARAGRAPH, MULTIPLIED BY THE BASE 4
STUDENT ALLOCATION SET OUT IN AS 14.17.470]; district adjusted ADM is 5
calculated as follows: 6
(A) the ADM of each school in the district is calculated by 7
applying the school size factor to the student count as set out in AS 14.17.450; 8
(B) the number obtained under (A) of this paragraph is 9
multiplied by the district cost factor described in AS 14.17.460; 10
(C) the ADMs of each school in a district, as adjusted 11
according to (A) and (B) of this paragraph, are added; the sum is then 12
multiplied by the special needs factor set out in AS 14.17.420(a)(1) and the 13
secondary school vocational and technical instruction funding factor set out in 14
AS 14.17.420(a)(3); 15
(D) the number obtained for intensive services under 16
AS 14.17.420(a)(2) and the number obtained for correspondence study under 17
AS 14.17.430 are added to the number obtained under (C) of this paragraph or 18
under (H) and (I) of this paragraph; 19
(E) notwithstanding (A) - (C) of this paragraph, if a school 20
district's ADM adjusted for school size under (A) of this paragraph decreases 21
by five percent or more from one fiscal year to the next fiscal year, the school 22
district may use the last fiscal year before the decrease as a base fiscal year to 23
offset the decrease, according to the following method: 24
(i) for the first fiscal year after the base fiscal year 25
determined under this subparagraph, the school district's ADM adjusted 26
for school size determined under (A) of this paragraph is calculated as 27
the district's ADM adjusted for school size, plus 75 percent of the 28
difference in the district's ADM adjusted for school size between the 29
base fiscal year and the first fiscal year after the base fiscal year; 30
(ii) for the second fiscal year after the base fiscal year 31 33-LS0938\A
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determined under this subparagraph, the school district's ADM adjusted 1
for school size determined under (A) of this paragraph is calculated as 2
the district's ADM adjusted for school size, plus 50 percent of the 3
difference in the district's ADM adjusted for school size between the 4
base fiscal year and the second fiscal year after the base fiscal year; 5
(iii) for the third fiscal year after the base fiscal year 6
determined under this subparagraph, the school district's ADM adjusted 7
for school size determined under (A) of this paragraph is calculated as 8
the district's ADM adjusted for school size, plus 25 percent of the 9
difference in the district's ADM adjusted for school size between the 10
base fiscal year and the third fiscal year after the base fiscal year; 11
(F) the method established in (E) of this paragraph is available 12
to a school district for the three fiscal years following the base fiscal year 13
determined under (E) of this paragraph only if the district's ADM adjusted for 14
school size determined under (A) of this paragraph for each fiscal year is less 15
than the district's ADM adjusted for school size in the base fiscal year; 16
(G) the method established in (E) of this paragraph does not 17
apply to a decrease in the district's ADM adjusted for school size resulting 18
from a loss of enrollment that occurs as a result of a boundary change under 19
AS 29; 20
(H) notwithstanding (A) - (C) of this paragraph, if one or more 21
schools close and consolidate with one or more other schools in the same 22
community and district and, as a result of the consolidation, basic need 23
generated by the district's ADM of the consolidated schools as adjusted under 24
(A) - (C) of this paragraph decreases, the district may use the last fiscal year 25
before the consolidation as the base fiscal year to offset that decrease for the 26
first four fiscal years following consolidation according to the following 27
method: 28
(i) for the first two fiscal years after the base fiscal year, 29
the district's ADM of the consolidated schools as adjusted under (A) -
30
(C) of this paragraph is calculated by dividing the sum of the district's 31 33-LS0938\A
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ADM of the consolidated schools as adjusted under (A) - (C) of this 1
paragraph for the base fiscal year by the sum of the district's ADM of 2
the consolidated schools for the base fiscal year without adjustment, 3
and subtracting the quotient obtained by dividing the district's ADM of 4
the consolidated schools for the current fiscal year as adjusted under 5
(A) - (C) of this paragraph by the sum of the district's ADM of the 6
consolidated schools for the current fiscal year without adjustment, 7
multiplying that number by the sum of the district's ADM of the 8
consolidated schools for the current fiscal year without adjustment, and 9
adding that number to the sum of the district's ADM of the consolidated 10
schools for the current fiscal year as adjusted under (A) - (C) of this 11
paragraph; 12
(ii) for the third fiscal year after the base fiscal year, the 13
district's ADM of the consolidated schools as adjusted under (A) - (C) 14
of this paragraph is calculated by dividing the sum of the district's 15
ADM of the consolidated schools as adjusted under (A) - (C) of this 16
paragraph for the base fiscal year by the sum of the district's ADM of 17
the consolidated schools for the base fiscal year without adjustment, 18
and subtracting the quotient obtained by dividing the sum of the 19
district's ADM of the consolidated schools for the current fiscal year as 20
adjusted under (A) - (C) of this paragraph by the sum of the district's 21
ADM of the consolidated schools for the current fiscal year, 22
multiplying that number by the sum of the district's ADM of the 23
consolidated schools for the current fiscal year without adjustment, 24
multiplying that number by 66 percent, and adding that number to the 25
sum of the district's ADM of the consolidated schools for the current 26
fiscal year as adjusted under (A) - (C) of this paragraph; 27
(iii) for the fourth fiscal year after the base fiscal year, 28
the district's ADM of the consolidated schools as adjusted unde
r (A) - 29
(C) of this paragraph is calculated by dividing the sum of the district's 30
ADM of the consolidated schools as adjusted under (A) - (C) of this 31 33-LS0938\A
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paragraph for the base fiscal year by the sum of the district's ADM of 1
the consolidated schools for the base fiscal year without adjustment, 2
and subtracting the quotient obtained by dividing the sum of the 3
district's ADM of the consolidated schools for the current fiscal year as 4
adjusted under (A) - (C) of this paragraph by the sum of the district's 5
ADM of the consolidated schools for the current fiscal year, 6
multiplying that number by the sum of the district's ADM of the 7
consolidated schools for the current fiscal year without adjustment, 8
multiplying that number by 33 percent, and adding that number to the 9
sum of the district's ADM of the consolidated schools for the current 10
fiscal year as adjusted under (A) - (C) of this paragraph; 11
(iv) to calculate the district's basic need for each fiscal 12
year, the number obtained through the calculation in (i), (ii), or (iii) of 13
this subparagraph is added to the number obtained under (C) of this 14
paragraph for the remainder of the district; 15
(I) if the basic need calculated under (H)(i) - (iii) of this 16
paragraph for one of the first four fiscal years after consolidation is less than 17
the basic need calculated under (A) - (C) of this paragraph for that fiscal year, 18
the basic need may not be adjusted under (H) of this paragraph for that fiscal 19
year; 20
(J) a district may not offset a decrease under (H) of this 21
paragraph if 22
(i) a new facility is constructed in the district for the 23
consolidation; or 24
(ii) the district offset a decrease under (E) of this 25
paragraph in the same fiscal year; 26
(K) a district that offsets a decrease under (H) of this paragraph 27
may not reopen a school that was closed for consolidation in the district until 28
(i) seven or more years have passed since the school 29
closure; and 30
(ii) the district provides evidence satisfactory to the 31 33-LS0938\A
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department that the schools affected by the consolidation are over 1
capacity; 2
(L) a district may not reopen and reconsolidate a school that 3
was consolidated in the district more than once every seven years for purposes 4
of the calculations made under (H) of this paragraph; 5
(M) a district offsetting a decrease under (H) of this paragraph 6
shall provide the department with the list of schools participating in the 7
consolidation and the corresponding ADM; 8
(2) the required local contribution of a city or borough school district is 9
the equivalent of a 2.65 mill tax levy on the full and true value of the taxable real and 10
personal property in the district as of January 1 of the second preceding fiscal year, as 11
determined by the Department of Commerce, Community, and Economic 12
Development under AS 14.17.510 and AS 29.45.110, not to exceed 45 percent of a 13
district's basic need for the preceding fiscal year as determined under (1) of this 14
subsection. 15
* Sec. 3. AS 14.17.430 is amended to read: 16
Sec. 14.17.430. State funding for correspondence study. Funding [EXCEPT 17
AS PROVIDED IN AS 14.17.400(b), FUNDING] for the state centralized 18
correspondence study program or a district correspondence program, including a 19
district that offers a statewide correspondence study program, includes [AN 20
ALLOCATION FROM THE PUBLIC EDUCATION FUND IN] an amount 21
calculated by multiplying the ADM of the correspondence program by 90 percent. 22
* Sec. 4. AS 14.17.440(a) is amended to read: 23
(a) Funding [EXCEPT AS PROVIDED IN AS 14.17.400(b), FUNDING] for 24
state boarding schools established under AS 14.16.010 includes [AN ALLOCATION 25
FROM THE PUBLIC EDUCATION FUND IN] an amount appropriated by the 26
legislature [CALCULATED BY 27
(1) DETERMINING THE ADM OF STATE BOARDING SCHOOLS 28
BY APPLYING THE SCHOOL SIZE FACTOR TO THE STUDENT COUNT AS 29
DESCRIBED IN AS 14.17.450; 30
(2) MULTIPLYING THE NUMBER OBTAINED UNDER (1) OF 31 33-LS0938\A
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THIS SUBSECTION BY THE SPECIAL NEEDS FACTOR IN AS 14.17.420(a)( 1) 1
AND THE SECONDARY SCHOOL VOCATIONAL AND TECHNICAL 2
INSTRUCTION FUNDING FACTOR SET OUT IN AS 14.17.420(a)(3) AND 3
MULTIPLYING THAT PRODUCT BY THE BASE STUDENT ALLOCATION; 4
AND 5
(3) MULTIPLYING THE PRODUCT DETERMINED UNDER (2) 6
OF THIS SUBSECTION BY THE DISTRICT COST FACTOR THAT IS 7
APPLICABLE TO CALCULATION OF THE STATE AID FOR THE ADJACENT 8
SCHOOL DISTRICT UNDER AS 14.17.460]. 9
* Sec. 5. AS 14.17.500(a) is amended to read: 10
(a) A district shall prepare and submit to the department by November 5 of 11
each fiscal year, in the manner and on forms prescribed by the department, an estimate 12
of its ADM and other student count data, including per school student count data, for 13
the succeeding fiscal year upon which computations can be made to estimate the 14
amount of state aid for which the district may be eligible under AS 14.17.410(b) 15
[AS 14.17.400] in the succeeding fiscal year. In making its report, the district shall 16
consider its ADM, other student count data, the pattern of growth or decline of the 17
student population in preceding years, and other pertinent information available to the 18
district. 19
* Sec. 6. AS 14.17.610(b) is amended to read: 20
(b) Distribution of state aid under (a) of this section shall be made as required 21
under AS 14.17.410. If a district receives more state aid than it is entitled to receive 22
under this chapter, the district shall immediately remit the amount of overpayment to 23
the commissioner, to be returned to the general [PUBLIC EDUCATION] fund. The 24
department may make adjustments to a district's state aid to correct underpayments 25
made in previous fiscal years. 26
* Sec. 7. AS 14.17.900(b) is amended to read: 27
(b) Money to carry out the provisions of this chapter may be appropriated 28
annually by the legislature [INTO THE PUBLIC EDUCATION FUND. IF THE 29
AMOUNT APPROPRIATED TO THE FUND FOR THE PURPOSES OF THIS 30
CHAPTER IS INSUFFICIENT TO MEET THE ALLOCATIONS AUTHORIZED 31 33-LS0938\A
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UNDER AS 14.17.400 - 14.17.470 FOR A FISCAL YEAR, STATE AID SHALL BE 1
REDUCED ACCORDING TO AS 14.17.400(b)]. 2
* Sec. 8. AS 37.07.020(b) is amended to read: 3
(b) In addition to the budget and bills submitted under (a) of this section, the 4
governor shall submit a capital improvements program covering the succeeding six 5
fiscal years. The governor shall also submit a fiscal plan with estimates of significant 6
sources and uses of funds for the succeeding 10 fiscal years. The fiscal plan 7
(1) must include sufficient details to identify 8
(A) significant sources of funds; 9
(B) significant uses of funds, including lump sum projections 10
of 11
(i) operating expenditures; 12
(ii) capital expenditures; 13
(iii) debt service expenditures; 14
(iv) fund capitalizations; 15
(v) appropriations of income of the Alaska permanent 16
fund (art. IX, sec. 15, Constitution of the State of Alaska), if any; 17
(2) must balance sources and uses of funds held while providing for 18
essential state services and protecting the economic stability of the state; 19
(3) must include projected balances of significant funds held in 20
separate accounts, including the budget reserve fund (art. IX, sec. 17, Constitution of 21
the State of Alaska) [, THE PUBLIC EDUCATION FUND (AS 14.17.300),] and the 22
Alaska capital income fund (AS 37.05.565); 23
(4) must set out significant assumptions used in the projections with 24
sufficient detail to enable the legislature to rely on the fiscal plan in understanding, 25
evaluating, and resolving issues of state budgeting, including information that supports 26
major areas of operating increases, such as population demographics that affect the 27
need for particular government services. 28
* Sec. 9. AS 14.17.300, 14.17.400, 14.17.470, 14.17.480(b), and 14.17.490(c) are repealed. 29
* Sec. 10. This Act takes effect July 1, 2024. 30