Legislature(2003 - 2004)

03/06/2003 01:40 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 20                                                                                                             
     An  Act relating  to reemployment  of  and benefits  for                                                                   
     retired  teachers and  principals,  including those  who                                                                   
     participated  in retirement  incentive programs,  and to                                                                   
     the  employment as  teachers  of members  of the  public                                                                   
     employees'  retirement  system  who  participated  in  a                                                                   
     retirement  incentive  program;  and  providing  for  an                                                                   
     effective date.                                                                                                            
SENATOR GARY STEVENS commented  that Alaska, like the rest of                                                                   
the nation  is experiencing  a severe  shortage of  qualified                                                                   
teachers  and   principals.    Research  has   shown  that  a                                                                   
qualified  teacher  in  the  classroom  is  the  single  most                                                                   
important school-based factor  in a student's success.  It is                                                                   
incumbent upon  the Legislature  to provide additional  tools                                                                   
to  Alaskan  school  districts   to  ameliorate  the  current                                                                   
teacher shortage to assist school  districts in their efforts                                                                   
to improve student learning.                                                                                                    
HB  20  would  allow  schools   experiencing  a  shortage  of                                                                   
education professionals  to reemploy teachers  and principals                                                                   
who had retired  under a Retirement Incentive  Program (RIP).                                                                   
The bill  would not require  any school district  to reemploy                                                                   
any particular  retired individual;  it would only  give them                                                                   
the 'option' to do so.                                                                                                          
Senator  Stevens   continued,   school  districts   would  be                                                                   
required to certify that they  are experiencing a shortage in                                                                   
order to reemploy a RIP-retired  teacher or principal.  Those                                                                   
reemployed under  the provision would not be  required to pay                                                                   
back their  retirement  incentive and  could elect to  either                                                                   
continue  receiving their  retirement benefits  or to  accrue                                                                   
new Teacher  Retirement System (TRS) credited  service during                                                                   
that re-hire period.  The Department  of Education would also                                                                   
be  able to  hire  RIP-retired  teachers and  principals  for                                                                   
Alyeska  Central  School,  Mt. Edgecumbe,  the  Alaska  State                                                                   
School  for the  Deaf  and Hard  of  Hearing  and the  Alaska                                                                   
Vocational Technical Center.                                                                                                    
Statute  allowing  school  districts   to  hire  any  retired                                                                   
personnel  without penalty  sunsets on  July 1, 2005;  school                                                                   
districts  would  not  be able  to  reemploy  any  additional                                                                   
retirees after that date.                                                                                                       
Co-Chair Harris asked  what would happen in  a district where                                                                   
there was not a shortage of teachers.                                                                                           
Senator Stevens  emphasized that  the district would  have to                                                                   
indicate that there was a 'shortage'.   The inability to find                                                                   
a  teacher  with  the  specific  criterion  needed  for  that                                                                   
position in that school district would have to be present.                                                                      
Co-Chair  Harris wanted  to  guarantee that  the  legislation                                                                   
would  only  fill areas  where  there  just were  not  enough                                                                   
teachers.  He pointed out that  there are new teachers coming                                                                   
up and  that the  proposed hirees  had gone  through the  RIP                                                                   
program  and had  benefited from  it.   He  stressed that  he                                                                   
would not want to see an advantage  for the retired employees                                                                   
coming back, over and above the new teachers coming in.                                                                         
Senator  Stevens   suggested   that  the  Department   remark                                                                   
regarding that concern.                                                                                                         
Representative   Joule   commented   that   the   legislation                                                                   
attempted to reach  an element of 'quality'.   Those teachers                                                                   
that 'ripped' were  often very valuable.  He  reiterated that                                                                   
it is important  to guarantee that the children  have quality                                                                   
in  their  classrooms,  particularly in  rural  areas,  where                                                                   
quality teachers are seriously needed.                                                                                          
Co-Chair Williams  interjected that  the Committee's  time be                                                                   
used for questions rather than debate.                                                                                          
Representative Chenault observed  that there has been concern                                                                   
voiced regarding  the 105% retirement  benefit pay back.   He                                                                   
asked if  these hired back  teachers would continue  to build                                                                   
retirement benefits.                                                                                                            
Senator Stevens  explained that under present  law, a teacher                                                                   
who ripped can  return to employment at 105%  of the benefits                                                                   
they received.   They would  come back  into the system  as a                                                                   
full tenured  teachers and would  continue to accrue  time in                                                                   
the  retirement  system.    The  advantage  of  the  proposed                                                                   
legislation  is that  it  would allow  the  district to  hire                                                                   
someone  if there  was a  need.   That person  would have  no                                                                   
tenure and no guarantee  of a job in the future.   They would                                                                   
have the option  of returning to teach and  getting back 105%                                                                   
from  the  retirement system,  or  under  HB 20,  they  could                                                                   
continue   to   receive  their   retirement   and   benefits,                                                                   
negotiating  a  deal  with the  school  district  for  salary                                                                   
without   tenure  or   insurance.     From   the   district's                                                                   
standpoint, there would be financial advantages.                                                                                
Representative Hawker  referenced language 'adopt  a policy',                                                                   
which would  allow the  school district  to adopt the  policy                                                                   
that permits  the employment of  retired teachers.   He asked                                                                   
if  there  was any  information  on  that policy  that  could                                                                   
provide guidance  in defining  'shortage'.   Senator  Stevens                                                                   
understood that  language would be found in  the Department's                                                                   
GUY  BELL, DIRECTOR,  DIVISION  OF RETIREMENT  AND  BENEFITS,                                                                   
DEPARTMENT OF  ADMINISTRATION, noted that the  Department had                                                                   
submitted a  zero fiscal  note because the  full cost  of the                                                                   
retirement incentive  program was paid  at the time  that the                                                                   
teacher retired.                                                                                                                
Mr.  Bell spoke  to the  declaration  of shortage.   The  law                                                                   
allows that the declaration of  shortage be self-policing and                                                                   
that  each  school district  makes  their  own  determination                                                                   
regarding shortage.   They will  need to notify  the Division                                                                   
and then the  school district would hire the  retired teacher                                                                   
under   that   provision.       Regarding   the   statistical                                                                   
information, only  80 of the 4,000 teachers  have returned to                                                                   
teaching under  these provision  waivers.   There has  been a                                                                   
fairly  limited use  and it  has been  used judiciously  when                                                                   
there is a shortage.  He did not  foresee a need to go beyond                                                                   
that self-policing arrangement.                                                                                                 
Co-Chair  Harris  pointed  out  that  the  sponsor  statement                                                                   
indicates that they  would not be required to  pay back their                                                                   
retirement  incentive  and could  continue  to receive  those                                                                   
benefits or  to accrue new  teacher retirement  system credit                                                                   
service during  the rehire period.   Mr. Bell  explained that                                                                   
they  could continue  to receive  the  rehire service  during                                                                   
that  period but  they  would  still be  subject  to the  RIP                                                                   
penalty.   The only  way to  avoid that  penalty would  be to                                                                   
file  to   elect  the  waiver   and  not  accrue   additional                                                                   
retirement credit.                                                                                                              
Co-Chair Harris  asked if the  penalty was the payback.   Mr.                                                                   
Bell advised that the penalty  is a determination made by the                                                                   
Legislature  and   if  that  person  comes   back,  the  110%                                                                   
additional  benefit  received,  the person  would  loose  the                                                                   
credit received by virtue of their  ripping.  The only way in                                                                   
which it makes sense is if the  teacher was intending to work                                                                   
more  than  three  years; otherwise,  the  teacher  would  be                                                                   
taking a 'big hit' in lost benefits.                                                                                            
Co-Chair Harris  asked if it would  be up to  each individual                                                                   
school  district  to  determine  the  level of  pay  for  the                                                                   
returning teacher.                                                                                                              
Mr. Bell  noted that the bill  is 'silent' regarding  the pay                                                                   
scale.   The issue of pay  is subject between  the bargaining                                                                   
agreement  between  the  school  district  and  its  employee                                                                   
union.  Whatever is in place for  that school district, would                                                                   
Co-Chair  Harris asked  if the  teacher would  be hired  back                                                                   
with their longevity.  Mr. Bell  advised that could happen if                                                                   
it was indicated in the school's contract.                                                                                      
Co-Chair Harris believed that  the only way that the contract                                                                   
would indicate that  would be an inclusion stipulated  in the                                                                   
contract about retired teachers  returning to work.  Mr. Bell                                                                   
acknowledged that  he did not know  about the law and  how it                                                                   
would apply to salary scales.                                                                                                   
Mr. Bell advised that today, a  non-ripped teacher could come                                                                   
back under these provisions.   The salary scale that they are                                                                   
hired back  at is  subject to  their school district's  call.                                                                   
They could come back at an entry-level  position or with some                                                                   
level of seniority.   He reiterated that the  Department does                                                                   
not make that determination.                                                                                                    
Co-Chair  Harris  commented  that  it  might not  be  a  cost                                                                   
savings to the district to hire  them back.  Mr. Bell replied                                                                   
that the State  would no longer contribute to  the retirement                                                                   
system  on   that  person's   behalf,  creating   a  savings.                                                                   
Currently,  the retirement  system requires  that the  school                                                                   
district  pay 12%  of the  salary to  the retirement  system,                                                                   
which would be waived.                                                                                                          
Co-Chair Williams inquired about  the health care costs.  Mr.                                                                   
Bell  responded  that  as  long  as the  person  stays  as  a                                                                   
retiree, they are subject to the retiree medical plan.                                                                          
Representative  Stoltze suggested that  the intent  should be                                                                   
that  the teachers  come  in at  entry-level  positions.   He                                                                   
believed that legislative intent  should be added to indicate                                                                   
that language.                                                                                                                  
Co-Chair Williams  responded that  had not  been used  in the                                                                   
statewide school system information.   Representative Stoltze                                                                   
mentioned the  'unintended consequences' of  not implementing                                                                   
KEVIN SWEENEY,  LEGISLATIVE LIAISON, DEPARTMENT  OF EDUCATION                                                                   
AND  EARLY   DEVELOPMENT,  impressed  upon  members   of  the                                                                   
Committee that  there exists a  serious problem  with teacher                                                                   
shortages  in  the State  of  Alaska.    There is  a  chronic                                                                   
difficulty in  attracting and  retaining teachers  in certain                                                                   
areas  of the  State and  in certain  education  fields.   He                                                                   
provided members  with a handout, RETAINING  QUALITY TEACHERS                                                                   
FOR ALASKA,  written by  the Institute  of Social &  Economic                                                                   
Research.  (Copy on File).                                                                                                      
Mr.  Sweeney commended  the Legislature  in recognizing  that                                                                   
the  challenge  exists.   He  acknowledged  that  there  were                                                                   
several bills that deal with teacher  shortages.  Some of the                                                                   
bills will help  the Department and the  individual districts                                                                   
attract and  retain qualified  teachers for the  communities.                                                                   
He stressed  that HB 20  is one of  those bills and  that the                                                                   
Department supports it.                                                                                                         
Mr. Sweeney clarified  that the bill as amended  by the House                                                                   
State  Affairs   will  assist   the  Department   to  attract                                                                   
qualified  people to  fill positions  within the Division  of                                                                   
teaching  and  learning  support.   These  positions  provide                                                                   
support and monitoring  of programs throughout  the State and                                                                   
as  such,  the  positions  require  that  they  be  certified                                                                   
teachers.    He  noted  that he  was  speaking  to  about  30                                                                   
positions Division-wide  and that there have  been high rates                                                                   
of turnover  and positions  have gone  unfilled for  extended                                                                   
periods of time.                                                                                                                
Mr. Sweeney  reiterated that HB  20 addresses areas  in which                                                                   
shortages have  been experienced and where the  Department or                                                                   
the district can declare a shortage.   He reiterated that for                                                                   
those reasons, the Department supports HB 20.                                                                                   
Co-Chair  Harris reiterated  his  concern regarding  multiple                                                                   
applications for  certain positions  and who would  be chosen                                                                   
to  fill   them.    Mr.   Sweeney  responded   that  multiple                                                                   
applications would  not indicate a shortage.   The bill talks                                                                   
about a place where shortages have been identified.                                                                             
Co-Chair  Harris commented  that  'sometimes, politics  rears                                                                   
its ugly  head', in these types  of situations.   Mr. Sweeney                                                                   
hoped that would not happen and  did not believe that was the                                                                   
situation experienced in many of these districts.                                                                               
Co-Chair  Harris  stated  that his  concern  addresses  those                                                                   
areas  where  new teachers  want  to  come and  then  perhaps                                                                   
certain  people are  given an  advantage over  the new  ones.                                                                   
Mr.  Sweeney  reiterated  that  was not  the  intent  of  the                                                                   
proposed legislation.                                                                                                           
Representative Joule inquired  if there would be a quick turn                                                                   
around time for  the people needing this certification.   Mr.                                                                   
Sweeney did  not know  if the  legislation would require  the                                                                   
Department to oversee certification of the shortage.                                                                            
Representative Joule asked who  would verify that there was a                                                                   
shortage.   Mr.  Sweeney stated  that would  be addressed  by                                                                   
each  individual   district.     He  emphasized   that  these                                                                   
shortages are 'real'; in some  areas, there is a 30% turnover                                                                   
Representative  Foster MOVED  to report  HB 20  (STA) out  of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal note.                                                                                                       
There being NO OBJECTION, it was so ordered.                                                                                    
CS HB 20 (STA) was reported out of Committee with a "do                                                                         
pass" recommendation and with fiscal note #1 by the                                                                             
Department of Administration                                                                                                    

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