MINUTES OF THE meeting
of the
Assembly Committee on Ways and Means
AND THE
Senate Committee on Finance
JOINT Subcommittee on K-12/Human Resources
Seventy-Second Session
March 28, 2003
The Assembly Committee on Ways and Means and the Senate Committee on Finance, Joint Subcommittee on K-12/Human Resources, was called to order at 8:00 a.m., on Friday, March 28, 2003. Chairwoman Chris Giunchigliani presided in Room 3137 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
Assembly COMMITTEE MEMBERS PRESENT:
Ms. Chris Giunchigliani, Chairwoman
Mr. Morse Arberry Jr.
Mrs. Dawn Gibbons
Mr. David Goldwater
Mr. Lynn Hettrick
Ms. Sheila Leslie
Senate COMMITTEE MEMBERS PRESENT:
Senator Raymond D. Rawson, Chairman
Senator Barbara Cegavske
Senator Bernice Mathews
Senator William J. Raggio
STAFF MEMBERS PRESENT:
Mark Stevens, Assembly Fiscal Analyst
Gary Ghiggeri, Senate Fiscal Analyst
Bob Atkinson, Program Analyst
Mindy Braun, Education Program Analyst
Linda Smith, Committee Secretary
Kate Caldwell, Committee Secretary
Chairwoman Giunchigliani said the Subcommittee would be discussing the Distributive School Account. Full-day kindergarten would be the first item discussed.
FULL-DAY KINDERGARTEN
Mindy Braun, Education Program Analyst, Fiscal Analysis Division, Legislative Counsel Bureau (LCB), said The Executive Budget included $4.1 million for set‑up costs and lease costs for portables for additional kindergarten classrooms in FY2004, and $20.2 million for salaries and continued portable classroom costs in FY2005.
Senator Rawson voiced concern with the state funding construction of school facilities, which would establish a whole new policy. Senator Rawson said he was willing to discuss developing a Nevada Plan formula for school construction, but it would take time to develop a formula and that might be a good interim project. Senator Rawson did not think the state should fund portable classrooms.
Senator Rawson noted the iNVest proposal for full-day kindergarten was a pilot program and, if approved, would result in some savings. In addition, implementation of the program would begin to establish a policy. Senator Rawson recognized full-day kindergarten was an important area for the Subcommittee and asked for input from the members.
Chairwoman Giunchigliani agreed with Senator Rawson on the portable classroom issue. She said studies indicated full-day kindergarten was best for at-risk students, not schools. Chairwoman Giunchigliani thought the iNVest program recommendation should be reviewed. She personally believed kindergarten children deserved the same class sizes as children in first grade classes. Chairwoman Giunchigliani said she had asked LCB staff to provide cost projections for a 16:1 ratio for kindergarten classes. After those costs were determined, she thought the Subcommittee could consider funding the iNVest pilot for full-day kindergarten for at-risk kindergarten populations only. A school might have five kindergarten classes, but perhaps only one class needed to be reduced to a 16:1 ratio because of the at-risk students; that one class could pilot the full-day kindergarten program. Chairwoman Giunchigliani emphasized that kindergarten students were in classes having larger pupil/teacher ratios than students in first, second, and third grades.
Chairwoman Giunchigliani said she had sponsored a bill during the 2001 Legislative Session on a revolving loan fund for school construction. She said during the interim the school construction issue could be reviewed. The Chair thought a separate formula for school construction was an interesting concept.
Senator Cegavske had concerns with the Legislature mandating anything that could not be fulfilled in Clark County. The major problem Clark County School District (CCSD) had experienced with class-size reduction (CSR) was insufficient space. Senator Cegavske said she also did not believe the state should be in the business of school construction and agreed with Senator Rawson that the state should not be funding portables.
Chairwoman Giunchigliani explained she was not talking about an unfunded mandate and she believed the CCSD did have adequate space. She noted only 23.5 kindergarten positions had been funded through the class-size reduction (CSR) program to reduce the pupil/teacher ratios in certain at-risk classrooms. Chairwoman Giunchigliani said it was nonsensical to have children who began school at a disadvantage not to at least have the same opportunity as their peers in the first and second grades.
Bob Atkinson, Program Analyst, Fiscal Analysis Division, LCB, explained the CSR funding covered only the salaries and benefits of the CSR teachers. The historic average for pupil/teacher ratios for kindergarten was 24.7:1—to reduce the ratio to 16:1 would require approximately $12.3 million in FY2004 and $13.1 million in FY2005.
Chairwoman Giunchigliani said local school districts would have to provide information on the impact of reducing pupil/teacher ratios to 16:1 in kindergarten classes. She indicated it was time to address the whole class‑size issue.
Senator Rawson said one possibility was allowing a 22:1 pupil/teacher ratio in the first five or six grades, and he asked staff to provide the projected costs for that scenario, including kindergarten.
Assemblywoman Gibbons wondered if funding should be provided for additional class-size reduction since there was a likelihood of having to cut budgets by 3 percent.
Chairwoman Giunchigliani said she thought everyone realized increased taxes were required, and she emphasized the importance of funding educational programs, such as class-size reduction, that had not been funded correctly in the first place. It was also important to require accountability for all the programs. Chairwoman Giunchigliani did not object to looking at an array of class-size options, however, she stated for the record that she did not support flexibility for class-size reduction. She thought flexibility would result in lost funding and accountability. The Chairwoman stated teachers with smaller class sizes had to work harder than teachers with larger class sizes. In smaller classes, learning centers were required and there were varying pupil/teacher engagements. Chairwoman Giunchigliani said she would ask staff to prepare various CSR options for the next meeting of the Subcommittee.
The Subcommittee members agreed not to support funding portables for full-day kindergarten and to consider the iNVest full-day kindergarten proposal.
SALARY ADJUSTMENTS
Chairwoman Giunchigliani referred to the salary adjustments included in The Executive Budget and said there was not a separate decision unit for the cost-of-living increase and approval of the recommended budget would include approval of the increase.
Mr. Atkinson said typically cost-of-living adjustments were included in a separate decision unit outside of the base budget. He said the 2 percent salary trigger approved by the 2001 Legislature, which was to go into effect July 1, 2003, did not occur because the General Fund balance did not meet the required level. Mr. Atkinson wanted the members to be aware that the 2 percent increase was included in the base in The Executive Budget rather than a separate decision unit.
Senator Rawson understood the trigger was a salary increase that had been promised in a prior legislative session. The trigger did not go into effect because of budget considerations but had again been promised by the Governor. Senator Rawson did not want to have a separate decision unit and said he was not comfortable removing something that had already been given. He thought people had been promised the funding would be included in the base budget.
Mr. Hettrick said he had included the $34 million for the 2 percent pay raise in the plan he had submitted at an earlier hearing. He also supported leaving the salary adjustment in the base.
Senator Raggio said there had been an agreement that the new budget would be constructed to include the 2 percent pay raise, and he indicated his support for the commitment.
Chairwoman Giunchigliani moved to the class-size reduction (CSR) program and asked Ms. Braun to review the issues.
CLASS-SIZE REDUCTION PROGRAM
Ms. Braun noted that members had already begun to discuss some of the CSR issues. In addition to the flexibility issue, the Subcommittee needed to determine if funding for the 23.5 at-risk kindergarten teachers should be continued. If funding for the positions continued, the Subcommittee needed to determine if there should be guidelines on the use of the funds for the positions, including assurance that the kindergarten teachers were placed in high-poverty schools and high class sizes.
Chairwoman Giunchigliani said staff research indicated that CSR funding had been disseminated to kindergarten classes that already had pupil/teacher ratios of 7:1 or 10:1.
Senator Rawson suggested eliminating the 23.5 CSR kindergarten positions and building those positions into the formula the Subcommittee decided upon for kindergarten. Chairwoman Giunchigliani thought Senator Rawson’s suggestion was excellent. Senator Raggio did not disagree with the approach and said everything was ultimately tied to the decision made on flexibility for the CSR program.
SPECIAL EDUCATION
Mr. Atkinson said in FY2003 the Distributive School Account (DSA) funded 2,514 special education units; The Executive Budget included 2,615 units for FY2004 and 2,708 for FY2005, an 8.2 percent increase in the first year and a 5.6 percent increase in the next year.
Chairwoman Giunchigliani thought the percentage increase in special education units would be of some help to the local school districts. She had requested the inclusion of a separate line item in the budget for all of the gifted and talented programs so the Legislature and the public would be aware of the amount of funding provided to the programs. Chairwoman Giunchigliani emphasized that special education units continued to be underfunded, but she did not think that issue could be addressed during the current legislative session.
Senator Cegavske wanted the Subcommittee to be aware that in one of the subcommittees she was chairing there seemed to be some real cost issues for the districts and some problems with special education hearing officers. The subcommittee had looked at several options. One option being considered was hiring two part-time hearing officers. These would be attorneys who were specialists in special education. Senator Cegavske said her subcommittee was working with the Department of Education, parents, and the school districts in this matter. There were real concerns with the level of confidence in the hearing officers that had been utilized in the state. Senator Cegavske said there had been a special education audit that addressed the hearing officer issue. She acknowledged that Gloria Dopf, Assistant Deputy, Department of Education (NDE), had been working hard to make certain the audit exception was addressed and the new process and training were being implemented.
Senator Rawson said currently there were hearing officers who were attorneys who worked on a case-by-case basis and billed on an hourly basis. Parents and administrators felt the attorneys were “stacking” as many hours as possible. There was a sense that hiring hearing officers would alleviate any abuse as long as objectivity was maintained and as long as federal standards continued to be met.
Ms. Dopf said the issue of the hearing officers in a training pool was for the Individuals with Disabilities Education Act (IDEA) due process hearings. Nevada had a two‑tier process, the local school district hearing and the state review process. Ms. Dopf explained the local due process hearing was the focus of the current discussion. The NDE had trained a pool of impartial hearing officers and appointed them from the training pool on a random basis. The fees for the hearing officers were paid by the local school districts in accordance with federal law, which was different than the costs of attorneys. Ms. Dopf said the discussion was specifically about the conduct of the hearing officers. The hearing officers must conduct an impartial hearing, collect evidence, and render a decision within 45 days of receipt of the request by the school district.
Ms. Dopf said because the amount of activity requiring hearing officers in Nevada was relatively small, the trained pool of officers were not used often and the skill levels were not maintained. Special education was a consistently evolving field of law that required staying current with the changes. Ms. Dopf stated the concept was to have a smaller group of hearing officers working under contract and have them maintain a high level of training. Because it was difficult to predict activity that would require hearing officers, there had been consideration of keeping the existing pool. If the activity spiked and the two part-time individuals could not fulfill the need, the parents could not be told, “We will put that on hold for a half a year until we get some additional hearing officers to do it.”
Ms. Dopf said one concept that had been discussed in the subcommittee chaired by Senator Cegavske was to have two part-time hearing officers trained in special education who also had law degrees, and keep the pool as part of the current system. There had also been discussion about some cost “caps” as an alternative and a statute of limitations on the number of years available for filing a case.
Chairwoman Giunchigliani asked who was notified of the decision once a hearing was completed. Ms. Dopf said a decision was rendered by the hearing officer, and the decision was transmitted to both parties via a receipted process, either electronically or through the mail system. Additionally, under federal law the Special Education Advisory Committee received the decisions without personally identifiable information. Chairwoman Giunchigliani asked for further information on the notification process at the classroom level. Ms. Dopf explained that the decision of the hearing officer was generally an order to the school district “to do something that was the focus of where the problem was.”
STIPENDS AND BONUSES FOR SELECTED EDUCATIONAL PERSONNEL
Ms. Braun said for the 2003-2005 biennium, the Governor recommended funding three programs:
Ms. Braun said the Subcommittee needed to determine whether to fund the three programs and if individuals would be eligible for more than one bonus or stipend in a given year. The members might also want to look at the eligibility criteria, including requiring an individual to remain in an at-risk school, or in a high impact position, for a minimum of two years following receipt of a stipend or bonus.
Assemblyman Arberry asked if there was data indicating a $2,000 stipend for teachers remaining in “at-risk” schools would be successful, and he wondered if $2,000 was a sufficient amount for such a stipend.
Assemblyman Hettrick said he had received a letter from his constituents who indicated stipends were not helpful. The preference of the constituents was to have any funds that would be used for stipends spread across the entire teacher salary base. Mr. Hettrick did not think the $2,000 recommended for the stipend was sufficient to make a big difference, and the total cost was expensive. The Assembly had a proposal that included signing bonuses but did not include stipends for teachers and administrators who remained in at-risk schools. Mr. Hettrick thought the Subcommittee should approve the signing bonus program.
Senator Raggio felt the $2,000 stipend for teachers remaining in at-risk schools was extremely important and said the stipend had been a firm recommendation of the Legislative Committee on Education. Senator Raggio indicated it was obvious the greatest need for highly qualified teachers was in the at-risk schools. Whether intentional or not, the better teachers, who were teaching in at-risk schools, moved to other schools, and the more inexperienced, less qualified teachers moved to the at-risk schools. An incentive was needed to keep the highly qualified teachers in the at-risk schools. Senator Raggio thought $2,000 annually was an incentive. He firmly opposed any plan that removed the recommended stipend; all of the three recommended programs were important. Senator Raggio did not think the argument that “everybody should get the same salary” was valid. He emphasized at-risk schools absolutely had to have quality instruction.
Senator Rawson thought S.B. 191 included $1.5 million for a pilot program that would provide additional funding for staff in at-risk schools. Senator Raggio noted S.B. 191 was “sitting in committee” and there were numerous objections to the bill. He emphasized his unwillingness to have the stipends and bonuses deleted from The Executive Budget. Senator Raggio said, “It was a hill to die for.” Senator Rawson asked if the funding included in S.B. 191 was in addition to the amounts included in The Executive Budget. Senator Raggio said S.B. 191 included a recommendation for a stipend program for at-risk schools, but he did not want to remove the amount from the Governor’s budget because sometimes Senate bills died in the Assembly.
Senator Rawson wondered if the Subcommittee was concerned with the possibility that some people would be eligible for more than one stipend or bonus. Chairwoman Giunchigliani felt the eligibility issue was a concern and needed to be addressed. She agreed that qualified, experienced teachers were needed in at-risk schools. However, she questioned if $2,000 was really an incentive; there needed to be further discussion. Chairwoman Giunchigliani pronounced she would not stay in her school of employment, which was an at‑risk school, for $2,000, and, in fact, had chosen not to stay. She indicated working conditions in at-risk schools were the main problem. Chairwoman Giunchigliani emphasized the Subcommittee still had to reach a decision on the stipends.
Chairwoman Giunchigliani said she had asked Doug Thunder, Deputy Superintendent, Administrative and Fiscal Services, NDE, to provide additional information on the recommended stipends for high impact positions. The bonus program for high impact positions applied to teachers of mathematics, ESL, special education, and school psychologists. Chairwoman Giunchigliani said she had conducted a survey of the local school districts in 2001 that revealed some districts had no position shortages and some had no shortages in the areas included in the Governor’s recommended high impact stipend program. Rather than a mandate from the Legislature, Chairwoman Giunchigliani suggested the local school districts and the Nevada State Education Association (NSEA) work in partnership to develop an alternative salary schedule that included knowledge, skills, performance, ladders, and mentoring, similar to what was developed recently by the Lyon County School District.
Senator Raggio recognized there was some value in the Chair’s comments, but he did not want to see the recommended stipend and bonus funding used for bargaining rather than the intended purpose. He thought the dollars needed to be specifically identified for the particular areas. Chairwoman Giunchigliani said she was not necessarily in disagreement with the incentive for the at-risk schools, but was concerned that $2,000 was not the correct incentive.
Senator Mathews asked if the $2,000 was included in the base salary or was it a one-time bonus. She observed that including the $2,000 in the base would make a big difference in terms of moving along the salary schedule. Senator Raggio explained the $2,000 was not a one-time bonus, but was an annual stipend; however, the stipend was not included in the base salary.
Assemblyman Arberry reiterated his concerns with the success of stipends. He asked if the additional funds actually helped in retaining teachers and if there was data to backup the success or failures of the stipends.
Senator Raggio commented that tracking the success of retaining teachers in at‑risk schools could not occur until the program began. Other states that had given bonuses had been successful. Senator Raggio said $2,000 might not mean much to the affluent members of the Subcommittee, but he thought $2,000 would mean something to teachers. Senator Raggio said his daughter, who was a teacher, had indicated $2,000 would mean a great deal to a teacher.
Chairwoman Giunchigliani thought the issue of including the stipends in the base salary should be considered; beginning teacher salaries had to be competitive. Recruitment allowances for teachers around the United States were running between $10,000 and $15,000. The Chair did not think the $2,000 signing bonus would be competitive. Chairwoman Giunchigliani said perhaps there needed to be additional incentives such as increased retirement or child care. She also thought the members should be looking at a longer school day and a longer school year in order to provide more instructional time.
SALARY INCREASES FOR NATIONALLY CERTIFIED SCHOOL COUNSELORS
AND SCHOOL PSYCHOLOGISTS
Ms. Braun said The Executive Budget included $285,460 in the second year of the 2003-2005 biennium to support a 5 percent salary increase for all school counselors and school psychologists holding national certification. Chairwoman Giunchigliani asked why school counselors were included in the recommendation for a salary increase for national certification. Ms. Braun said she would have to defer the question to the NDE.
Senator Rawson thought national board certification had been a good thing for teachers and he assumed the certification would also be good for school counselors and school psychologists. In order to realize some savings, Senator Rawson suggested approving the program as a policy decision during the current legislative session, but funding the program during the 2005 Legislative Session. Chairwoman Giunchigliani agreed there could be a delay.
Assemblywoman Leslie stated a delay was already built into the budget and she preferred to fund salary increases for nationally certified school counselors and school psychologists during the first year of the 2003‑2005 biennium. She definitely did not want to postpone the increases until the 2005‑2007 biennium.
Ms. Braun also noted that the application fee for the national board certification for teachers would be increased from $2,000 to $2,300 per teacher during the 2003-2005 biennium. If the Subcommittee wanted to fund the board certification program for teachers, the members needed to determine if they wanted to authorize the NDE to increase the amount to $2,300 per teacher. Chairwoman Giunchigliani thought there needed to be a policy that if a teacher received another grant for board certification, the total amount of all grants received by a teacher should not exceed the $2,300. Ms. Braun clarified if federal funds in the amount of $1,000 per teacher were available for the program, the state would fund $1,300 and the federal portion would be $1,000.
Senator Rawson referred to the earlier discussion on lengthening the school day or the school year. He said research indicated it would cost $160,000 a minute to add minutes to the school day, and $10 or $12 million to add school days to the school year. Senator Rawson said he had long thought 180 days was arbitrary and the Legislature could begin to add a few days to the school year. At some point Senator Rawson wanted to set a goal to lengthen the school year.
Chairwoman Giunchigliani asked for a copy of the research referenced by Senator Rawson, and said she had introduced a bill to lengthen the school year for both teachers and students. Teachers did not have sufficient time to adequately perform their jobs because of the increased standards. Chairwoman Giunchigliani suggested that perhaps the Nevada State Education Association (NSEA) or the NDE could provide information on the current length of the school day in each of the local school districts.
SUPPLEMENTAL APPROPRIATION
Mr. Atkinson said the NDE had indicated a supplemental appropriation would be required in order to meet the May 1, 2003, payment from the Distributive School Account. The amount required for the supplemental appropriation was contingent upon the amount of local school support tax (LSST) and estate tax collected for the remainder of the fiscal year. Mr. Atkinson explained the supplemental appropriation would have to be approved by May 1, 2003, based upon the best estimates, but cautioned that in order to make the account whole at the end of the year, the members might have to consider some other action later in the Appropriations Act.
Senator Rawson said it appeared there needed to be two supplemental appropriations, one on May 1, 2003, and perhaps another through the Interim Finance Committee. The amount required might be too large for the contingency fund. Senator Rawson asked if there would be a problem with a roll over between years and if that had been done in the past.
Mark Stevens, Assembly Fiscal Analyst, Fiscal Analysis Division, LCB, said he could not recall where “we have rolled” between biennia, but he did not see any reason why that could not be done. Chairwoman Giunchigliani asked Mr. Stevens for his input on the process. Mr. Stevens suggested Assembly Ways and Means process the bill for the supplemental within a couple of weeks and get the bill to Senate Finance so it could be heard. Senate Finance would probably wait until the next sales tax payment, make a quick amendment if needed, and then get the bill out so it could be ready by May 1, 2003. At that point, the choice would be whether to include extra cushion in the appropriation to make certain there was sufficient funding to make it through the fiscal year in case of a downturn, or whether the Subcommittee wanted to authorize transferring monies between FY2003 and FY2004. Senator Rawson thought the Subcommittee needed to look at the possibility of transferring monies between the two years.
BUDGET AMENDMENT FOR PERS COSTS
Mr. Atkinson said Budget Modification 11, submitted by the Governor’s Office, would increase the General Fund amount in the DSA by approximately $10 million in FY2004 and $10.6 million in FY2005 to cover the entire amount of the increased contributions to the Public Employees’ Retirement System (PERS) for K-12 employees. Mr. Atkinson said covering the entire amount of the PERS contribution was contrary to the way contributions had been handled in the past. In 1995, when there was a PERS increase, one-half of the increase was funded by the employee groups and one-half was financed by the employer. In The Executive Budget, PERS contributions for state employees and the employees of the University and Community College System of Nevada (UCCSN) would be handled as in the past with 50 percent of the PERS contribution being the responsibility of the employee and 50 percent being the responsibility of the employer.
Senator Rawson did not think it was a good idea for the Legislature to establish two different mechanisms for funding PERS contributions. Senator Rawson said if the amount was taken out of the K-12 budget, he was not opposed to using the funding for pay raises.
Chairwoman Giunchigliani said “she wanted to make certain she understood” and said the two options would be to either (1) maintain the current policy, but take that $20 million and add it, as a percentage, to the 2 percent that was recommended for salaries making it 2.5 percent or whatever, and that way we are not changing the policy; or (2) approve it the way the Governor recommended and add the .5 percent to the other employee groups.
Senator Rawson said he was not trying to make a strong case either way, but he did not want to create a new policy.
HOLD HARMLESS PROVISIONS
Mr. Atkinson said that funding to cover the costs of the “hold harmless provision” had not been included in the DSA budget. In the past, a few districts were eligible for the hold harmless provision and the fiscal impact had not been significant. If times were good and sales tax collections came in higher than budgeted, then the additional allocations could be made up within the DSA. The 2001 Legislative Session changed the hold harmless provision from one year to two years, and the cost of hold harmless during the current biennium was approximately $8.6 million in the first year and $7 million in the second year. Passage of A.B. 122 would change the hold harmless provision back to a one-year provision. Mr. Atkinson said from 1986 to 1989 districts with declining enrollments greater than 5 percent were given a two-year hold harmless and districts with declining enrollments less than 5 percent were given a one-year hold harmless. Mr. Atkinson thought the members needed to address the period of time that would be covered by the hold harmless provision and also needed to determine if funding should be built into the budget to accommodate the provision.
Because of the current budget crisis, Assemblyman Arberry suggested having a one-year hold harmless provision and then returning to a two-year hold harmless provision when the economy improved.
Senator Rawson noted there were 11 school districts experiencing declining enrollments and those districts did not have the ability to adjust—losing any portion of the basic support guarantee was devastating. Senator Rawson said the projected hold harmless costs for FY2005 were $3.2 million for a two-year hold harmless, $1.5 million for a one-year hold harmless, and $1.8 million if the proposed 5 percent scenario were adopted. He felt the 5 percent scenario was a reasonable compromise that recognized a district with a declining enrollment greater than 5 percent was in dire straits and the Legislature needed to be concerned.
Chairwoman Giunchigliani felt the districts had made a compelling argument about the need for the hold harmless provision and she, too, thought the provision that covered declining enrollments greater than 5 percent would be a good solution. She recognized $16 million had been paid to the districts under the hold harmless provision during the past biennium. Chairwoman Giunchigliani also recognized the hold harmless provision had an impact. She stated the Senate was conducting a study on consolidating and deconsolidating some of the districts. Chairwoman Giunchigliani said she had actually recommended looking at consolidating a few of the rural counties. If consolidation occurred, it would be important to ensure programs were held intact.
Mr. Arberry recognized the hold harmless provision only affected local school districts. He asked if there was a hold harmless provision for inner-city schools. Teachers and students were leaving at-risk schools for “so-called better schools” that had better equipment and better technology.
Senator Rawson thought it would be appropriate for a local school board to set a policy for declining enrollments in the inner-city schools. He was not certain a state formula would be appropriate.
Assemblywoman Leslie said she was not in favor of including charter schools in the hold harmless provision.
Senator Rawson recognized there was a great deal of controversy related to charter schools and thought at some time in the future there needed to be a “charter school district,” or the charter schools needed to be addressed within the context of the districts. He recommended the charter schools remain in the hold harmless formula for the 2003-2005 biennium, but notice should be given that charter schools would not receive a separate hold harmless appropriation in the future.
Mr. Arberry thought perhaps “we need to get the wagons around charter schools.” He thought the charter schools were “running amuck.” Some schools received charters, took the funding, and then closed. The students returned to the public school system. The public schools were being penalized. Mr. Arberry recognized the members were all looking at the best interests of the children, and he noted the children were suffering because of the poor performance of some of the charter schools. Mr. Arberry thought the 2003 Legislative Session needed to address the charter school issue.
Ms. Leslie said she appreciated Senator Rawson’s comments. She did not object to having the charter schools remain eligible for the hold harmless provision during the 2003-2005 biennium if that was the desire of the Subcommittee. However, Ms. Leslie thought the charter schools that experienced declining enrollments did so because of poor performance. Ms. Leslie felt the public school system was being penalized and did not approve of continuing to have the charter schools eligible for the hold harmless provision.
Chairwoman Giunchigliani said the hold harmless provision was intended to assist school districts experiencing declining enrollments with continuing program needs. When parents of students in charter schools elected to withdraw their children from a charter school, those children were then enrolled in the public schools and the state continued to pay the charter school for not having the students. The Chair emphasized that the charter school hold harmless issue needed to be addressed.
Senator Rawson suggested beginning the phase-out during the 2003‑2005 biennium to allow the charter schools to adjust to any change. Senator Rawson indicated he was merely looking for some way to reduce the impact.
Chairwoman Giunchigliani asked Mr. Atkinson to provide additional information on the hold harmless provision as it related to charter schools, including the number of charter schools, the number that had experienced declining enrollments, and if the students who left the charter schools returned to public schools. The Chair thought the Subcommittee preferred the 5 percent scenario presented by committee staff for the hold harmless provision.
$50 ADJUSTMENT FOR BOOKS, INSTRUCTIONAL SUPPLIES, AND HARDWARE
Senator Rawson said each session the legislators took “a beating” on the textbook issue even though the Legislature had included funding for textbooks, supplies, and hardware. Senator Rawson felt all three areas should be included in a separate budget, or “fenced off,” so the public would be aware of the funding that had been provided. There would have to be a stipulation indicating there would be no reversion and the funding would not have to be expended in one year. A sizeable amount of funding was included in The Executive Budget for textbooks, instructional supplies, and hardware. Senator Rawson indicated he would support a salary increase equivalent to the amount of “fenced off” funding in order to separate the salary bargaining from the textbooks, instructional supplies, and hardware.
Senator Cegavske agreed with the suggestion made by Senator Rawson to “fence off” textbooks and technology money. She was disheartened to learn that the bill she had introduced for textbooks and technology in 1999 did not result in segregation of the funding; the bill stipulated that funding could be used only for textbooks and technology for students. Senator Cegavske recognized the funding for textbooks had been provided, but she did not think the funding had been expended appropriately. The funding had been used in other areas, which was unfortunate because approval of the funding sent the message that the Legislature wanted and recognized the need for textbooks and technology.
Senator Raggio said any extra funding provided for textbooks, instructional supplies, and hardware, should include requirements that the funds could only be used to supplement the funding, and not supplant the funding.
Senator Rawson indicated it was his understanding that the DSA included $16 million for textbooks, $24 million for supplies, and $2 million for hardware without the $50 enhancement. The $50 enhancement added $18 million, which could be split providing $6 million in each of the three areas. He recognized that S.B. 191 had $10 million for hardware and he indicated the sum of those could be “fenced off” and used specifically for those areas. Senator Rawson said he was willing to talk that kind of a raise so that the bargainability of that money would not be an issue.
Assemblyman Hettrick said he was not aware of the $10 million in the No Child Left Behind Act and asked if that amount was outside the budget. He indicated that the enhancement of $18 million a year, plus the $10 million would bring the total to $46 million, in addition to the $16 million that was included in the base budget. Alternatively, the Subcommittee could consider approving one‑half of the proposed enhancement, or $25 per student, which would be a help to the districts. This could be considered especially in light of the $10 million in S.B. 191. If the $10 million was an annual amount, that would bring the total to $38 million. Mr. Hettrick said he did not know where all of the additional funding would be coming from.
Mr. Thunder reminded the members there could be a non-supplant provision in the funding provided through the No Child Left Behind Act and the funds could not be merged into the DSA and would have to be in a separate account.
Chairwoman Giunchigliani asked if the $10 million included in S.B. 191 for the No Child Left Behind Act was federal grant money. Mr. Thunder thought the $10 million included in S.B. 191 was a continuation of state funding for educational technology, which had been appropriated by the Legislature in the prior biennium. Mr. Thunder said the $10 million for educational technology was not included in The Executive Budget at the present time. Chairwoman Giunchigliani said the Subcommittee would also need to decide if the $50 enhancement should be part of basic support, or if it should be a separate allocation.
Mr. Atkinson explained as the budget was originally submitted, the $50 adjustment was merely an increase in the average basic support, which when adjusted for wealth, resulted in some districts receiving more than $50 and other districts receiving less than $50. In an earlier hearing, the NDE had indicated the intent was for a flat $50 per student. Mr. Atkinson said if the Subcommittee wanted to allocate $50 for books, instructional supplies, and hardware that would not be adjusted for wealth, a separate decision unit would be required because the recommended budget included the funding in the basic support amount.
Chairwoman Giunchigliani thought there was some worthwhile discussion regarding the offset suggested by Senator Rawson. She recognized Nevada was a bargaining state and bargaining was through a pool of dollars. If the Subcommittee wanted to make sure that certain key elements of the funding formula were properly funded and those expenditures could be tracked, and then equalize that pool of dollars for purposes of bargaining, then that should be placed on the table and discussed by the Subcommittee.
Mr. Thunder said if the $50 remained within the basic support amount there would be no restrictions on how the funding could be used by the school districts unless there were some legislative changes. It was the responsibility of the local boards of trustees to do the best possible job in budgeting the funds. Mr. Thunder thought the only way to specify that certain line items had to be spent in certain ways would be to place the funds in a separate categorical fund, which would be in addition to the basic support amount.
Chairwoman Giunchigliani commented that regardless of the policy, the districts should not be encouraged to purchase unneeded books. Books should only be purchased to meet the needs of the children. She thought the issue before the Subcommittee was whether the funding for textbooks, instructional supplies, and hardware, plus any new funding for those items, should be segregated and accounted for separately. The budget could then be increased so the collective bargaining procedure could move forward.
EARLY CHILDHOOD EDUCATION PROGRAMS
Ms. Braun said for the 2003-2005 biennium, the Governor had recommended $2.9 million each year for early childhood education programs. Funding of $2.6 million was included in the DSA for the Even Start program and other community‑based programs. Budget Account 2699, Other State Education Programs, included $301,000 specifically for the Classroom on Wheels (COW) program. One of the questions raised was if the early childhood programs should be funded in one account, or should there continue to be a separate funding.
Ms. Leslie felt strongly that the COW program belonged in the DSA to enable better program evaluation. She supported the COW program and thought the program had been successful, but it was an early intervention program and she did not understand the reason for keeping it separate.
Senator Rawson was also a fan of the COW program, and he also thought the program should be properly evaluated. He noted A.B. 377 appropriated $100,000 for the COW program for homeless children in Clark County. If A.B. 377 passed, the Subcommittee would need to decide if the $100,000 would be in addition to the $301,000 included in The Executive Budget or be deducted from the $301,000. Senator Rawson also thought the Subcommittee supported including the COW program in the DSA.
Chairwoman Giunchigliani thought it made good sense to consolidate like programs when possible. She thought longitudinal evaluation studies should be required of all state-funded early childhood education programs. The Chair acknowledged the importance of funding being used for the instruction of pupils and not for things like playground equipment. There had again been reports of early childhood funding not being used for the intended purpose.
Senator Cegavske referred to A.B. 377 and emphasized there had to be accountability for the COW program. She suggested combining all the funding for the COW program under one budget account in order to have accountability.
PROFESSIONAL DEVELOPMENT OF TEACHERS AND ADMINISTRATORS
Chairwoman Giunchigliani asked if the budgets for the Regional Professional Development Programs (RPDPs) and the Nevada Early Literacy Intervention Program (NELIP) should be combined. In addition, the Chair did not understand the need for continuing to fund Project LEAD (Leadership in Educational Administration Development) in a separate budget (BA 2699, Other State Education Programs). Based upon discussions among the members, Chairwoman Giunchigliani stated the recommendation would be to combine the three programs.
Chairwoman Giunchigliani asked Ms. Braun to provide information on the NELIP training for K-3 teachers. Ms. Braun said there had been some discussion about the continued need for the NELIP. There was federal funding available and the NDE had provided information indicating that federal funding for the Reading First program went to particular at-risk schools. The NELIP program was a statewide K-3 program. Ms. Braun said one of the duties of the RPDPs was providing K-12 regional professional development to teachers and administrators, which would include instruction in how to teach reading. Ms. Braun said the Subcommittee needed to determine if there was a continued need for a specific NELIP.
Senator Rawson said combining the NELIP and the RPDPs could save $1.6 million over the 2003-05 biennium. Chairwoman Giunchigliani agreed with Senator Rawson’s assessment and she thought all the professional development training projects should be under the same umbrella, even if separate line items had to be maintained based on the funding streams. There were no objections from the Subcommittee.
REMEDIATION PROGRAMS
Ms. Braun said for the 2003-2005 biennium, the Governor recommended funding of $12.7 million for remedial programs for low-performing schools and for “before/after/summer/intersession programs”; a 6 percent decrease in the amount approved for the 2001-2003 biennium. Under the No Child Left Behind Act, it appeared many more schools would be identified as demonstrating need for improvement. In the past, $1 million had been designated each year of the biennium for the before/after/summer/intersession programs, and the balance went to the low-performing schools.
Chairwoman Giunchigliani asked if the $11.7 million funded during the current biennium for remediation had been used for only nine schools. Ms. Braun said in addition to the nine schools designated as needing improvement, the Legislature funded remediation programs for any school that had over 40 percent of pupils scoring in the bottom quarter in any one of the four subject areas tested. Ms. Braun said 80 schools were funded with the remediation funds during the current school year. In response to the Chair’s question about the success of the remediation programs funded, Ms. Braun explained teams had visited each of the 80 schools and reviewed the programs. In addition, at the end of the school year, each school was required to submit evaluation data detailing the pre‑program and post-program evaluation information. Ms. Braun clarified by providing an example that a school without 40 percent of pupils scoring in the bottom quarter in math received targeted money for math remediation. The math program could be implemented for the entire school, but the students who did poorly had to have access to the program. The school selected math programs from the List of Effective Remedial Programs and then provided pre-data and post-data showing the effectiveness of the math program. Chairwoman Giunchigliani indicated teacher training was more important than the actual programs. Ms. Braun said she understood part of the duties of the RPDPs was to focus on the low-performing schools and provide the training necessary to enhance the remediation programs that were implemented.
Senator Cegavske said in previous sessions she and Chairwoman Giunchigliani had fought for summer school programs. She asked if the summer school programs were only for remediation programs. Ms. Braun said the guidelines for summer school programs required a district to apply for funding and the funding was to be used to increase the academic achievement of any at-risk pupil in grades K-12. Senator Cegavske asked who made the determination that a child was at-risk. Ms. Braun said the majority of funding had been directed to students who had not passed the High School Proficiency Examination or were credit deficient. There had also been some elementary summer school programs.
Chairwoman Giunchigliani thought the Subcommittee needed to look at all of the before/after/summer/intersession funding and determine who was the best provider. School districts were not always the best provider. Maybe the members should look at a nexus that could contract with groups and organizations to provide the services. The Chair stated the TRIO Program was a good example.
Senator Rawson suggested the Subcommittee might wish to consider utilizing this funding to extend the school year rather than utilizing the funding for before/after/summer/intersession programs. More students might end up benefiting from additional school days.
PROGRAMS RECOMMENDED FOR DELETION
Senator Mathews recommended keeping all three programs: LEA Library Books, Public Broadcasting, and National Board Certification for Teachers. She particularly wanted to continue with the program for library books.
Senator Rawson said because of an error in generating The Executive Budget, funding for the three programs remained in a Reserve for Reversion category in Budget Account 2699, Other State Education Programs. Therefore, the funding for the programs could be continued without a General Fund impact to the budget.
Assemblywoman Leslie disclosed she served on the Board of Directors of Channel 5 Public Television in Reno, which received a portion of the public broadcasting funding.
Senator Rawson said in the past the funding for these programs had been provided through separate bills and it appeared the Subcommittee supported continuing the funding in the budget.
STATEWIDE MANAGEMENT OF AUTOMATED RECORD TRANSFER (SMART) SYSTEM:
Senator Rawson said the No Child Left Behind Act was going to require certain information to judge the success of schools and students. The data currently generated by the SMART system provided only a piece of the information that would be required. Senator Rawson emphasized the need for a reorganization of the entire SMART system. Senator Rawson said the first page of the document he had distributed to members detailed the conceptual idea of a reorganization. Because of the confusion of referring to the SMART system, a new acronym was being suggested—the System for Accountability Information in Nevada (SAIN). The SAIN would tie together the individual educator data, the school district data, the individual student data, and the program financial data. All the information would be included in one system.
Ms. Braun said the LCB staff had been reviewing the SMART system for some time and issues and problems had been addressed over the past several years. Ms. Braun said as of March 31, 2003, the SMART component would be complete and operational and it appeared to staff the system did not begin to meet the requirements of the No Child Left Behind Act, as Senator Rawson had pointed out. The Executive Budget included $1.4 million for the SMART system in each year of the biennium in an enhancement decision unit. Those funds could be used for the SAIN program. Ms. Braun said LCB staff was currently working with the NDE staff to determine the actual enhancement amount that would be needed. Senator Rawson noted that the enhancement amount needed to be determined soon because of the need to close the budget. Senator Rawson emphasized he did not want “to go down this road again.” He thought there should be a subcommittee created in the Interim Finance Committee that could follow the progression of the SAIN system as there needed to be regular reports and decisions made. Senator Rawson said the Legislature had funded the SMART system many years ago and the information that was initially promised was still not available. He noted the Interim Finance Committee had members who were extremely well versed in the area of system development and could serve on a subcommittee that would shepherd the SAIN system.
PROFICIENCY TESTING
Ms. Braun said the NDE had indicated there was a potential budget shortfall in the criterion-referenced portion of the proficiency testing budget. Initially, the shortfall was projected at $500,000 in each fiscal year of the 2003‑2005 biennium. Based upon a delay of the science examination for the high school proficiency examination, the revised shortfall was projected at $163,837 in FY2004 and $261,925 in FY2005.
Mr. Thunder said the NDE had provided information on the expected shortfall to LCB staff, and he offered to answer any specific questions. Senator Rawson asked if there was a representative in attendance from the Budget Office. Mr. Thunder indicated Stephanie Phoenix had been in attendance earlier, but had a conflicting meeting. Mr. Thunder said Ms. Phoenix had indicated a budget amendment would be submitted.
Senator Rawson wanted the record to reflect that he was extremely upset that the Budget Office had not provided information on the anticipated shortfall. The Subcommittee would begin closing the budgets Monday. He asked LCB staff and Mr. Thunder to advise Ms. Phoenix that the Subcommittee wanted the requested information by next week. If the information on the projected shortfall was not received, Senator Rawson indicated he would ask for a “head to roll on this” and did not know how to deal with the issue in more forceful terms. Senator Rawson emphasized there would be a consequence if the information needed to close the budget was not provided.
NO CHILD LEFT BEHIND ACT (NCLBA)
Ms. Braun said the NDE had requested 3 FTE positions under the NCLBA, Budget Account 2713. The Budget Office had not provided any amendment or communication to indicate if the Governor was in support of the requested positions. At this point there was no reason to look at the positions. Ms. Braun said an Administrative Aide II position was included in The Executive Budget in Budget Account 2673, Education State Programs. The position was state‑funded and would assist the state portion of the Nevada Education Reform Act (NERA). Ms. Braun said under the NCLBA there was no longer a distinction made between NERA and the federal NCLBA. Ms. Braun said the Subcommittee needed to determine if the aide position should be state‑funded or if it could be funded through the NCLBA. One of the positions the NDE was requesting under federal funds was also an aide position.
Senator Rawson recognized state funds did not need to be expended if federal funding was available. He asked if staff needed any direction to complete the budget closing process. Ms. Braun said the major issue was to determine if the Governor was going to provide an amendment for the three positions and then staff could make the appropriate analysis.
Senator Cegavske said in light of Senator Rawson’s comments on the proficiency testing issue, she recommended that a letter be forwarded to the Budget Office, along with the staff request. She thought a letter from the Subcommittee might have more impact. Senator Rawson, hearing no objections, directed staff to prepare the letter.
Senator Rawson adjourned the meeting at 9:54 a.m.
RESPECTFULLY SUBMITTED:
Linda J. Smith
Committee Secretary
APPROVED BY:
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Assemblywoman Chris Giunchigliani, Chairwoman
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Senator Raymond D. Rawson, Chairman
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