HFLR-20260511-1030

Will the House please come to order?

Will members please indicate their presence by voting?

Has any member failed to vote?

Will the clerk please tally the board? 39 Members present. With 39 members present, we have a quorum present to conduct business. Mr. Majority Leader.

Mr. Speaker, there are no previous excused absences today. Leading the invocation this morning is Douglas K. Mertz. Of Juno Friends Meeting. Will members please rise.

Good morning, and with respect for all religious beliefs of all persons, I ask you to join me in this prayer. We stand in awe of your goodness and mercy this day. We invite you to be present among us. Help us to slow down and hear your wisdom amid the noise of life. Amen.

Representative Nelson, will you please lead us in the Pledge of Allegiance? I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, indivisible, with liberty and justice for all.

Representative Story. Thank you, Mr. Speaker. I move and ask unanimous consent that the prayer be spread across the journal. Hearing no objection, the prayer will be spread across the journal. Will the clerk please certify the journal for the previous legislative days?

I certify as to the correctness of the journal for the 109th through the 111th legislative days. Mr. Speaker, I move and ask unanimous consent that the journal of the previous days be approved as certified by the Chief Clerk. Thank you, Mr. Majority Leader, and thank you, Madam Clerk.

Are there guests for introduction this morning? I don't believe I see any.

Madam Clerk, are there any messages from the Governor?

Messages dated May 8th stating, in accordance with Article 3, Sections 26 and 27, In accordance with Article 2 of the Alaska Constitution and Alaska Statute 39-05080, the governor submits the following list of appointees for confirmation. To the Alaska Judicial Council, Mike Miller. Judiciary Committee. Board of Massage Therapists, Carone Cobden. Labor and Commerce.

Real Estate Commission, Elise Buchholz. Labor and Commerce. Board of Social Work examiners, Judy Kendall. Labor and Commerce. A message also dated May 8th stating the governor has signed the following bill and is transmitting the engrossed and enrolled copies to the Lieutenant Governor's Office for permanent filing.

Senate Bill 40, establishing Hispanic Heritage Month, Chapter Number 3, SLA 2026. I have no further messages from the governor this morning.

Madam Clerk, are there any messages from the other body?

Brief at ease.

Will the House please come back to order. Madam Clerk, once again, are there any messages from the other body? Messages dated May 11th stating the Senate accepts the House invitation to meet in joint session at 11:00 AM Thursday, May 14, 2026, to consider confirmation of the governor's appointments to the boards and commissions. And the Senate has failed to recede from its amendments to committee substitute for House Bill number 263 Finance amended, namely Senate committee substitute for committee substitute for House Bill number 263 Finance amended Senate Appropriations Operating Budget Fund Supplemental with a title change, SCR 3. The President appointed the following members to a conference committee to meet with a like committee from the House to consider the bills: Senators Hoffman, Chair Steadman, and Cronk.

And the Senate has also failed to receive from its amendments to committee substitute for House Bill number 265 Finance amended, namely Senate committee substitute for committee substitute for House Bill number 265 Finance Appropriations Mental Health Budget. And the President also appointed the following members to a conference committee to meet with a like committee from the House to consider the Senator Hoffman, Chair Steadman, and Cronk. And the Senate has passed and is transmitting the following for consideration: Senate Bill Number 174 by Senators Dunbar, Yunt, Wilkowski, Bjorkman, Tobin, Kawasaki, Cronk, Merrick, Clayman, Tilton, Rauscher, Gray Jackson, Kaufman, Steadman, and Stevens, entitled an Act Establishing the Alaska Invasive Species in the Department of Fish and Game relating to management of invasive species and providing for an effective date. [Speaker] That will be referred to the Finance Committee. And given that the Senate has failed to recede from their amendments to House Bill 263, FY operating budget, and House Bill 265, the accompanying mental health budget, I'm appointing the following members to a conference committee to meet with a like committee from the other body.

Representative Josephson, Chair, Representative Schrag, and Representative Stapp. For the body's awareness, with the appointment of the conference committees for the budget bills under Uniform Rule 23D, the 24-hour rule for announcing committee meetings is now in effect. Madam Clerk. I have no further messages from the other body. Are there any communications?

There are no communications this morning. Any reports of standing committees? The Resources Committee considered Senate Joint Resolution Number 20, Clean Up Marine Debris, attached 1 previously published 0 fiscal note. Signing the report do pass: Representatives Fields, Calombe, Hall, Sadler, Prox, Mears, and co-chairs Dybert and Freer. The resolution has no further referral.

The Finance Committee considered committee substitute for Senate Bill Number 214 Finance Appropriations Capital Funds Supplemental Reappropriations, recommends it be replaced with House Committee Substitute for Senate Bill Number 214 Finance with the same title. Signing the report do pass: Representatives Jimmy, Galvin, Hannon, Moore, and Co-Chairs Schraggy, Josephson, and Foster. Amend, Tomaszewski, Bynum, and Stapp. The bill has no further referral, and I have no further reports of standing committees.

Are there any reports of special committees? There are no reports of special committees this morning. Any citations or resolutions for introduction? In memoriam Lon Thee Henrik Fop Don Du Theen by Senator Wilkowski and Representative Mears. In memoriam Beverly Ann Bev Walters by Senator Wilkowski— Representative Mears; In Memoriam Anton Tony John Wiese (by Sen.Wilkowski Rep.Mears); Byway Memorial Jerry Strong (Senator Wilkowski Rep.Eisheidt).

Sherry Ann Dunlap (Sen,Wilkowsky) /Rep:Eischeidt Alexander "Alex" Monterosa (Sen.Wilikowski Rep.Mears), Richard Lee Glor (Sen.Wilkowski Rep.Meers): In Memoriam Linda Hull by Senator Kawasaki and Representative Diver. I have no further citations or resolutions for introduction. Are there any bills for introduction today? There are no bills for introduction this morning. This brings us to the consideration of the daily calendar.

Madam Clerk, please read the first item on today's calendar.

House Bill number 261 by Representative Story entitled An Act Relating to Education Funding and Providing for an Effective Date.

The Education Committee considered House Bill 261, recommends it be replaced with Committee Substitute for House Bill 261 Education with the same title, attached two new zero fiscal notes and two new fiscal notes, and Signing the report do pass, Representatives Dybert, Eichide, and co-chairs Hemmschulte and Story. Do not pass, Schwanke. No recommendation, Elam and Underwood. The Finance Committee also considered the bill, recommends it be replaced with committee substitute for House Bill 261 Finance with the same title, attached one previously published fiscal note, two new fiscal notes, and one new zero fiscal note. Signing the report do pass, Representatives Jones, Jimmy, Galvin, Hannon, Co-Chairs Schraggi, Josephson, and Foster.

Do not pass: Allard. Amend: Tomaszewski, Stapp, Moore, and Bynum. There are 2 committee substitutes.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the Finance Committee substitute for House Bill 261 be adopted in lieu of the original bill. Hearing no. Objection until this very moment.

We do have an objection. Do you wish to speak to your objection, Representative Ruffridge? Thank you, Mr. Speaker. Just wanting to hear the summary of the changes with the current bill. Thank you.

Representative Story, if you would address that, please. Brief at ease. Brief at ease.

Will the House please come back to order to address the changes in the committee substitute? Representative Story. Mr. Speaker, the most significant change for version G to version H is deletion of district and inserting the word school. This was a request from DEED because it more accurate— accurately defines how the calculations were completed by, um, DEED. Is the objection maintained?

The objection has been removed. Finance Committee substitute has been adopted. Madam Clerk, are there any amendments? Amendments are being copied. The House will stand at ease until the amendments have been copied and distributed.

Under amendments in House Bill 261, Madam Clerk. Amendment number 1 by Representative Himchoot, beginning page 6, line 21. Representative Himchoot. I move amendment 1. Not hearing any objection to amendment number 1.

There is an objection. Representative Himchoot, do you want to speak to the amendment, please? Sure, Mr. Speaker, thank you. Amendment 1 is suggested language from the Department of Education. They think that the change in language will fare better in the impact aid review.

So it's a suggestion from the department. Thank you. Is the objection maintained? [SPEAKING FRENCH] The objection has been removed. Not hearing any additional objection, Amendment 1 has been adopted.

Madam Clerk. Amendments are being copied. House will stand at ease awaiting the copying of the amendments.

Will the House please come back to order? We now have the amendment fully circulated, I believe, among the members. Madam Clerk, amendment number 2 by Representative Vance, beginning page 1, line 1. Representative Vance, I move amendment number 2. There's an objection.

Thank you, Mr. Speaker. What this amendment does is it allows school districts, municipalities, and the University of Alaska to optionally participate in the AlaskaCare healthcare program. This is purely optional. This says the water's warm, come on in. And I distributed a packet for everyone to view, and on the front of the packet it is a letter of support from the Matsu Borough and other municipalities.

But I'd like to refer to the last page on the packet, and it's a chart showing potential cost savings in some of the top school districts. And for— this is based on their estimated premiums versus our state healthcare premiums. And within the Kenai Peninsula School District, it could save a potential of $6 to $8 million per year. For the Matsu, it is estimated around $7 million. Anchorage School District, the largest, could save $12 to $8 million per year.

Fairbanks North Star Borough could potentially see $6 to $9 million per year. A total of $31 to $42 million per year if these school districts were to opt in. I've had smaller municipalities and school districts communicate with me that this would be transformative for them because it's hard for them to compete in the market since they're on such a small scale. This would transform our recruitment and retention. In the conversations that I have with teachers and with employees who work for our school districts, they're looking for great healthcare.

This often determines if they can take the job or not. And on the Kenai Peninsula, we have had a really tough time in the market. Years— a number of years ago, they had a fantastic healthcare plan, and they said, "Hey, we don't need this." But now they are seeing close to a $1,000 premium for family plans. And we know that the cost of healthcare has increased for everyone. What this overall impact is that it could lower, lower the overall premiums.

The more people who are part of the pool, the lower the cost. It also provides access to the state plan rates and also more— makes the negotiations more competitive. It also could offer richer benefits. But the bottom line is that most employees would likely pay less in monthly premiums under this amendment if their district opts in and shares the savings because the total plan cost typically drops due to a bigger risk pool. Obviously we know that this is all dependent on who opts in and when, but under this proposal it allows the Department of Administration who administers the AlaskaCare to create a tiered system and also allows for, uh, self-insurance.

So if a municipality is school districts wanted to do self-insurance, they could partner with the state to do that. Again, this is purely optional. And when I think about the millions of dollars in potential savings, this could help fill deficits that our school districts are currently facing. This could help retain teachers and programs that we've all been debating about, that we hear from our school districts. This could help potentially keep schools open with the the long-term savings that this sees.

And the more, more school districts that opt in, the greater the savings will continue to be. So I ask for your support. Representative Story. Thank you, Mr. Speaker. I am going to speak in opposition to this amendment.

I appreciate the member from Homer's passion about helping our districts with health insurance. I share this. The task force and many of you in the room spent a whole day looking at health insurance issues for our schools. It's a complicated issue, and this bill is one about how we can provide stability and with student count averaging, and I think this should be a separate bill. Thank you.

Representative Mears. Thank you, Mr. Speaker. I think we're going to see— this is a new policy, a separate policy, and I think we're going to see today that there's a lot of passion and support for changes in education policy. My— I'm just going to state from Amendment Number 1, I am not looking to add additional policies into this bill. We'll see how the day goes, but I will not support this additional policy.

Thank you. Representative Bynum. Thank you, Mr. Speaker. I rise in support of the amendment. I think that this is a much-needed, much-needed thing that needs to happen in our districts for our schools.

When I talk to my school district, this is something that they absolutely 100% would support seeing in law, giving them that option. This is an option to lower costs in our school districts, especially at a time when I hear that they are looking to have stable funding. That's what this bill is doing. This provides them a tool to do that. And so if this isn't successful in this bill today, I would urge the body to continue supporting this concept as it can bring savings to our school districts, which means additional dollars going into the classroom for teaching our kids.

So I appreciate the maker of the amendment for bringing it forward, and I will be supporting it. Thank you, Mr. Speaker. Representative McCabe.

Thank you, Mr. Speaker. The Matsuobu School District as well supports this and have, frankly, for as long as it has been a separate bill. So it seems like whenever we don't want to or we don't know how to oppose something, we say it needs to be a different bill. And that's fine, but it has been a different bill. It has been looked at.

It's gone through fiscal notes, but at the end of the day, Mr. Speaker, this is optional. All we are doing is putting optional language in there. Why would we spend our valuable time as a task force to even bother to look at this when we can put it in a bill as optional and let the school districts look at it? Let the school districts determine if they want to do, um, do this. That puts the control of this and the budget closer to the school district.

In fact, we've spent a whole bunch of time this year talking about retaining good employees. And one of the things we have discovered, that I have discovered, is one of the ways you retain them is with great healthcare. So if a school district such as the Matsu wants to put something like this in place to help retain good teachers, to spend time retaining them, then I think it should be in a bill. It should be optional, optional for our school districts. This adds No policy to the bill other than an option.

And for my money and for my school district's money and for my district's money, and frankly for the Denali Borough School District as well, this seems like a really, really great option to help retain state employees. So I think a no vote on this would say that we really don't care about retaining employees. All we care about is retirement. Thanks. Representative Sadler.

Thank you, Mr. Speaker. I do rise in support of Amendment 2 and thank the sponsor of the amendment for bringing this forward. This is an important policy discussion that we have had for years now, and this is a very common-sense way to improve the finances for our districts. You know, for years now, this floor in the building and the communities, we've been hearing about the escalating costs for education, and one of the important components of that is healthcare. Well, this actually provides a way to address that high cost.

You know, we have increased the base student funding formula, and that happened here. And so that's an important element, but we can take another additional step to improving education finances in the state by adopting this amendment. It is a structural change in financing that will lower districts' costs if they choose to exercise that option. You know, it's a fundamental principle of insurance. If you want to decrease the cost per unit, per covered person, you expand the pool.

It's a common-sense solution that's been available to us for years, and I'm glad to see it come before us now. Clearly, we've seen evidence of broad support from all the school districts who have been pounding on us for years to increase the BSA, increase the BSA. That's happened. Next step here is adjust the health insurance for education. This is the opportunity, the mechanism before us right now to take an important step to improve finances for education.

I hope members look around and see the need to do this and see the need to vote for this. Um, that don't need a new bill. This has been in circulation, socialized for many years now. It's before us now. We can take a step now with your green vote today to improve school district finances.

I hope we all take advantage of that opportunity and pass this amendment. Representative Vela. Thank you, Mr. Speaker. I rise in support of this amendment. I think that it's actually a really great idea.

I know that for the Kenai Peninsula Borough, for the last 8 years in particular, we have had countless conversations every time the budget comes up. Healthcare. It's our largest expense on, you know, any of these areas. And so for us to be able to address this in a bill that has been vetted by the body, both bodies— we've had a lot of conversations about this particular subject for a number of years. We know that this is a big need, particularly in our larger school districts.

And so just hope we can get this one added to it. Thank you. Representative Stapp.

Thank you, Mr. Speaker. I'm going to be a bit of an odd duck, I think, on this amendment. I really like this idea. I am not going to support the amendment. I do really think that this bill has a ton of merit and it needs to get heard.

The sponsor has worked on this for years, and I hope that the next legislature, even the time we have remaining, takes this concept really seriously. Fundamental problem of allowing an opt-in voluntary is you get what's called adverse experience on groups. So the only people who are going to opt into the plan are the ones that carry the most risk. In order for this concept to work, you will essentially have to force the 3 major school districts into a self-funded plan, i.e., Anchorage, Fairbanks, and the Matsu, because those 3 school districts school district employers would form a basis of which everyone else who's more risk advantageous would be able to streamline the costs. The problem with doing it on a voluntary basis is when these smaller districts that have really high costs, Mr. Speaker, you know this 'cause a lot of them are your district because of the nature of transportation.

When they all hop into the pool, a big district like Anchorage or Mat-Su Fairbanks is gonna look at the risk pool and they're gonna say, actually, we're better off pooled with our own little entity. So where I live in Fairbanks, we're pooled with our borough, and it would be advantageous for us to be able to join AlaskaCare and be pooled under the state's umbrella, especially if we drug the university into it. But if you make it voluntary and you get adverse experience on the plan, what you're gonna see is the groups that really provide the anchor to maintain the cost and shared risk nature of the self-funded plans are gonna scare away the people you actually need for your anchors on the plan. So the university, for example, has thousands of employees, Municipality of Anchorage, thousands of employees. So in my opinion, it'd be best like to work on the bill and really do it so you really provide a strong basis of involvement.

Because my fear is on a volunteer basis, all you're gonna have is a bunch of adverse experience to your AlaskaCare plan. Plan and you're going to end up not including the folks that you actually want to include unless you try to force them in. Thank you, Mr. Speaker. Representative Galvin. Thank you, Mr. Speaker.

I rise with a very reluctant encouragement for those to vote no on this one, and I'll tell you why. Forever I have been tracking what is causing the rise of costs in education, and healthcare has certainly been the top and the most unpredictable rising costs. That said, this particular bill has not had a public hearing yet. I do think that we need to better understand what we just heard from the member from Fairbanks by way of further really truly studying that and making sure that it— this fits the whole puzzle. I appreciate that healthcare again is What I'm hearing is one of the biggest pieces of the puzzle that needs to be solved in education, but it's a lot of things.

The underlying bill is average daily membership and smoothing that out. That's really important. Healthcare formula, local caps. There's many different parts of this, and this particular one I don't think has been fleshed out enough publicly, and I want to respect that. Respect the need for public to weigh in.

And I, again, I want to thank the member from Homer for bringing this up because I think that the core concept sounds important and good and like a worthy piece for us to make sure that we get all the way across the finish line. But I don't believe I will be supporting this amendment. Thank you. Representative Schwacke. Thank you, Mr. Speaker.

I rise in support of this amendment, and I really want to thank the member from Homer for bringing it forward. This concept was something that immediately I recognized as something that would be really very beneficial for our REAA districts. When I joined the legislature, I had recently stepped down to run for this position, but I served on our school board for 6 years, and One of the problems that we recognized year in and year out was the excessive increase in costs to our insurance. We asked as a school board, our administrators, please do everything that you can to negotiate with the insurance companies. Please do a review of insurance opportunities.

Please go out and try to find a better solution for our school district. We were told year in and year out, we don't have the bandwidth, we don't have the expertise, and we don't know how to do this. We spent 4 years asking our administration, please just make some phone calls. Finally, this last year, um, we had an individual that stepped onto the board that had some time and expertise and worked directly with our school district. Um, they made the phone calls, they did the negotiation, they got our insurance costs down.

Finally, that all had to do with one very specific person that stepped onto an REAA school board. But we have districts all across our state that don't have this expertise. They don't have the bandwidth, they don't have the ability, they absolutely need the opportunity to opt into AlaskaCare. So thank you, I'll be in support. Brief it ease.

Brief it ease.

Will the House please come back to order. Under debate on Amendment Number 2, Representative Gray. Mr. Speaker, this is a difficult one for me because we have a packet that has a letter from the Anchorage School District, including— it's signed by the superintendent and by the president of the school board supporting the bill. And there's nothing that I want to do more than lower the cost of healthcare in Alaska. I think about it all the time.

However, um, as the member for Fort Wainwright, who— if there was ever anything that was his wheelhouse, it's literally this topic. Said, there are a lot of questions. And when I've, I've texted some folks about it, and the bottom line is that yes, making a change like this could be a valuable cost savings, but this policy needs to be vetted and possibly amended in order to make sure that we don't have any unintended consequences for our smaller districts, for our big districts, for everyone involved. And so although I would do anything to lower the cost of healthcare in Alaska, I will be voting no, and I encourage others to as well. Representative Colon.

Thank you, Mr. Speaker. So I'm hearing a lot that this should have been vetted. Uh, it could have been vetted. It could have gone to committee. You could have done it if you really thought it was that important.

Could have gotten a hearing, could have gotten it fixed. But I have a letter from my school district, the Anchorage School District, that wants the option. So here we are. It wasn't under our control to schedule the bill and hear it. And refine it.

Just to have the excuse, well, it needs to be in committee, that's a point of order. Mr. Speaker, we do not want to impugn the motives of others in discussing this amendment, and that seems to be the direction we're going. Thank you. Representative Kollum, will you please take that under advisement and continue? Yeah, thank you, Mr. Speaker.

I'm just stating the facts that didn't get any hearings. And now I'm hearing that we should have had hearings. So I don't know why you wouldn't support it and go against ASCA and your own school districts with a letter of support on your desk. So I'm going to support the amendment.

In wrap-up, Representative Vance.

Well, here we are. I have introduced this work since I was a freshman legislator. This year I introduced it again. I believe I pre-filed the bill and I put in immediate bill hearing request. It never received a single hearing.

I put in multiple requests electronically, personally, and verbally. I was told, I was promised that it would be taken up under the Education Task Force. It has also not been taken up by the Education Task Force. So I'd like to put that on the record so everyone knows I made multiple attempts for this bill to be heard. I, last session, I made an attempt through an amendment to offer it so that it could be considered So I'm offering it again, but I'd like to address some of the current concerns.

I'm, you know, this is the last 10 days of session. I'm not going to pick a fight on hearings. We still have the ability to move good policy, and I've had other bills move on the floor that with policies that we said let the Senate vet it out. It's only halfway through the process. Surely they could ask the questions that we aren't able to ask right here because it didn't have a committee hearing.

So if it worked on other policies that did pass the body, surely it could work on this one. Now, as to the adverse experience, that is a legitimate concern, thinking that we would only attract the high-cost users. And I asked that very question of the people who manage our AlaskaCare system, and I said, help me draft the bill, give me recommendations that could make this system work, much like the current plan that we have now. So this draft does include recommendations from them that allows the Department of Administration to make a tiered system. It also allows for self-insurance, that if it says, hey, if you don't fit into the tiered system, we can also self-insure you, because as, uh, the Member behind me indicated we have some smaller communities that just don't have the bandwidth to take on this task of finding healthcare in the marketplace.

So those have been addressed in this amendment. I don't want the cost of our current employees to go up. I— my goal is that everything goes down. And so this amendment, this also includes a recommendation from Labor and Chair— Labor and Commerce previous chair that said we need to have an actuarial at the time of a municipality or school district coming to join the state healthcare plan. That's also in here.

So people, we won't have them just jumping into on the wagon here. There will be an actuarial that says, does this pencil out for both parties? And, and, and where, where should they fall into it? What tier should they fall into? Or would self-insurance be best?

Maybe they have a better rate with what they currently have. That's why it's important that this is optional. A decade ago, when this policy was introduced, it forced every school district to join, and all they said, absolutely not. And it was faced with fierce opposition because we want the flexibility that if a school district, a municipality, or even the university can get a better plan themselves, they shouldn't have to be forced to join us. We like local governance and local option.

This amendment retains that, but it does create a system that can maximize the best. We have support from the top school districts that, that do want to join, so that the concern that it only attracts the smaller ones, that's going to increase our cost, I think is kind of moot at this point, Mr. Speaker. So I say let's adopt this because we have the support from our communities. It's the right thing to do because it is permissible in statute, not forcing, and we still have the other body that can ask the important question and do a quick analysis. It— this has been through committees before.

I, I want it to be done right, but right now Our school districts are underwater and they're losing great teachers and staff because they're struggling with healthcare costs. So I ask for your support today.

Are you ready for the question? The question being, shall Amendment Number 2 pass the House? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote?

Will the clerk please announce the vote? 19 Yeas, 21 nays. With a vote of 19 yeas to 21 nays, Amendment No. 2 Has failed to pass the body.

Brief at ease.

Will the House please come back to order? We are about to entertain Amendment No. 3, But just for the body's awareness, the plan is to take a break at 12:15 for the panoramic photo, the annual photo taken at the steps of the Capitol. That will be at 12:30, just know that. And then our plan is to break until approximately 3:00 p.m.

So we will do our best to get through Amendment No. 3 In the meanwhile, which is about 10 or so minutes. Madam Clerk, Amendment Number 3 by Representative Bynum, beginning page 6, line 25. Representative Bynum. Thank you, Mr. Speaker.

I move Amendment Number 3.

There's an objection. Representative Bynum. Thank you, Mr. Speaker. Permission to read. Permission granted.

Uh, Mr. Speaker, my proposed amendment would make the bill more straightforward and more consistent with the stated goal of levelizing school funding. Instead of using the greater of a 3-year average, a prior year ADM, or a current year ADM, the amendment would make the prior 3-year average ADM the default count for the school funding purpose. The amendment would still provide protections for districts that are actually growing. If the current year ADM exceeds the prior year 3-year average by more than an established growth threshold, the district would receive a current year adjustment or a true-up. My proposed, proposed revision uses a 2.5% growth trigger instead of the higher 5% threshold in the current bill.

That means that the district experiencing growth would not be underfunded, but the district would be able to by default use the higher amount. The district would not be able to use the default to a prior higher year account simply because it provides more additional funding. The amendment would also apply to the same concept for our special education and intensive needs students, the intent is to use the prior 3-year average for those students as well. It's important that those students receive the same kind of levelized funding because the intensive needs is one of the most volatile parts of funding in our education formula.

This would allow for the current year true-up also to account for those students if it's beyond that 2.5% threshold. This is important because intensive needs students create a significant cost impact for school districts. And the formula should recognize both stability and real growth. Mr. Speaker, I had handed out a document for the body to consider, and it says that it's for H.12.

And that's the amendment that's in front of us right now, Amendment Number 3. And in that document, what I did is, is that it provides some additional information and data. Mr. Speaker, this item came in front of us in Finance. And while it was in front of us in Finance, many questions were asked, specifically, was this modeled? And the answer, Mr. Speaker, was no.

This bill was not modeled. To demonstrate how it would be able to be used and how it would functionally apply to the formula. So, Mr. Speaker, I'd asked for that information to be provided to the committee. Another committee member also asked for that information, and that information was not provided at the time in Finance. So I took the time, Mr. Speaker, to go back and grab all of the information and data Being an engineer, that's something I like to do.

And I went and I looked at the prior 20 years. And I said, what would happen if we applied this model or applied this bill to the prior 20-year data? How would it give us an outcome? And I modeled several different scenarios. I modeled a scenario where we used 5% like the bill says.

And then I also used 2.5%, which I put in my amendment. And what I found, Mr. Speaker, was, is that using the 2.5% safety threshold provided relief to our school districts when they are actually growing, and it provided in a significant, significant way to give them the funds necessary for the actual students they have in the classroom. But what the modeling also showed, Mr. Speaker, was this mechanism to be able to use the prior year number did not produce funds specifically for the purposes of supporting students in the school. What it did was, is it provided an additional amount of money if the student population tended to decline. And if you look at the— permission to refer to the information I provided out, Mr. Speaker.

If you look at the charts that I provided, I'll make one note that there is a correction or an error on page 3. The first charts that are shown under the Alaska Gateway, it says a 3-year or greater than 2.5%, and/or the next chart was a 3-year or greater than 5%. Those two charts are backwards. That was an error that I caught, but did not want to go through the process of having our staff here in the chamber print off a bunch more paper just for this purpose. So, but if you look at the— on page 3 and you look down at the bottom right-hand corner, you will see a graph there, and the in green will show what my amendment actually does.

It provides funding for the students in the classroom. It provides levelized funding for declining enrollment. But in yellow, there's also some little indications, and what that is showing is that's showing that prior year number being used. Effectively, when school districts are using that prior number as it is in the bill, it is giving them the opportunity when we have declining enrollment to add more money to the school without a correlation directly to the students. So I have this modeled for every school district for the last 20 years.

I wasn't going to provide a 150-page document for the body, but I did give some representative examples for you to consider. And this amendment that I'm offering, Mr. Speaker, fully provides funding in a levelized way while protecting declining enrollment in our schools. I urge support for the amendment. At ease. Before we go to at ease, just once again, a reminder of the photo at 12:30.

And at this time, the House will stand at ease till approximately 3:00 PM.