Very busy week at the Legislature

As I suspected it would be, this was a very busy week at the Capitol. The last day to
print bills in any committee was Monday and that coincided with our Day on the Hill.
There were numerous new bills printed in the House and Senate Education Committees
on that day. In addition, we continue to work on collective bargaining and labor bills,
charter school issues, and business personal property.

Day on the Hill

Day on the Hill was a great success this year. If you attended, you know that we
tried a slightly different format this year. We started with training on how to present
testimony and how to talk to your legislators, and then moved to a listening session
held by both committees. Congratulations to all the trustees and superintendents who
took the time to testify. You did an awesome job and your voices were heard. The next
morning was an opportunity for our President, Anne Ritter, to present to the House
Education Committee as well as for me to present three of our labor reform bills and ask
the Committee to print them, which they did. We followed that with lunch with your

local legislators. Again, you all did a phenomenal job talking with your local leaders!
And, we finished the day with some Common Core training. All in all, I think it was a
great success. You can all pat yourselves on the back for a job well done.

What is happening with business personal property tax?

For several weeks now, the ISBA, the Idaho Association of Counties (Counties), and the
Association of Idaho Cities (Cities) have been in discussions with the Idaho Association
of Commerce and Industry (IACI) and the Governor’s Office on how, or if to move
forward with the removal of the business personal property tax. On Tuesday of this
week, all of these entities met and were told that legislation would be forthcoming.
They asked ISBA, the Counties, and the Cities to respond to the legislation by end of
business on Friday. We finally received the legislation Thursday.

While there are many elements to the bill and it is very complicated, the bottom line is
that it still would have had a very detrimental impact to school districts. Their proposed
bill contained a six year phase in and there were some replacement dollars but not
enough to keep us whole. The bill indicates that school districts would be “exempt”.
What isn’t stated is that school districts would only be exempt until the local levy ended.
As you all know, that is only one or two years for most of us. At the end of that time,
any revenue from business personal property would be moved to the local property
owners. And, you can all guess how hard that would be to pass a levy from there on.

As such, the ISBA, the Cities, and the Counties sent a joint response to the Governor
thanking him for giving us the opportunity to comment. We indicated we could not
support the legislation they were bringing forward. We did, however, offer to bring
legislation forward that was created in HB599 in 2008. That legislation would trigger
an exemption on the first $100,000 of business personal property. This will completely
exempt 89% of all small businesses in Idaho and will provide a $100,000 exemption to
large businesses in every county in which they exist. The price tag on that exemption is
$20 million and the Governor has budgeted exactly that amount in his budget proposal
for replacement dollars.

We believe this is a fair proposal and are hopeful that the Governor and the legislature
will see the wisdom in this proposal as opposed to a full phase out. Keep talking to your
legislators. It is having an impact!

Your February 15 payment was received and it was short.
Are we going to get our replacement dollars?

Yes, I think you are going to get your replacement dollars. HB65 passed out of the
House Education Committee on a unanimous vote this week and is headed to the House
floor. We are confident that it will make it through both chambers and be signed by the
Governor.

A bunch of new education bills

As I previously indicated, Monday was the last day to print bills in all committees.
Please note that each chamber has three privileged committees where bills can still
be printed. The House Education Committee is a privileged committee but the Senate
Education Committee is not. In any case, we had several education related bills that
were printed. Below is a list of those bills and a short synopsis of what they would do.
I have included the fiscal impact that each of the bills will have as well as a personal
note from me at the end of each bill. If you don’t have time to read the full information
about the bill, my notes should give you a quick read of the intent.

HB181 – This legislation addresses a need in the Capitol Commission’s endowment
structure to create a Capitol Maintenance Reserve Fund, out of which expenditures
can be made to maintain and repair the Capitol Building as the need arises over
time. Currently the Capitol Commission only has two funds, unlike other land grant
endowments in Idaho which have a three fund structure. The Capitol Commission has
a permanent endowment, out of which no money can be spent, and an income fund
which supports the operations of the Capitol Commission, which is about $50,000 per
year, and also pays the management expenses charged to the Capitol Commission by
the Department of Lands and the Endowment Fund Investment Board (EFIB), about
$125,000 and $100,000 respectively. With this legislation, on July 1 of each year the
EFIB would approve an amount to be transferred from the permanent endowment
into this new Capitol Maintenance Reserve Fund for major repair and maintenance
costs for the Capitol Building, and pay for the management expenses charged by the
Department of Lands to manage the Capitol Commission endowment lands, and to
the EFIB for managing the permanent endowment fund. FISCAL NOTE: There is no
impact to the General Fund. This legislation would create a dedicated fund from existing
Capitol Commission endowment funds to establish a reserve fund for major repair and
maintenance projects for the Capitol Building.
Karen’s Note: We believe the intent of this legislation is to take money from the
permanent endowment fund for repairs and maintenance on the Capitol Building. We
believe that the monies in the endowment fund are for the sole purpose of those entities
that were originally listed as beneficiaries. If we are reading this bill correctly, we will
object to the bill.

SB1085 – This legislation would direct that Idaho schools provide, on a full time basis,
a ratio of one (1) school counselor per three hundred twenty-five (325) students, as
well as providing for an experience and education multiplier to determine counselors’
salaries. FISCAL NOTE: The added cost of adding an additional 282 counselors to meet
the requirements of this legislation would be approximately $12.96 million, assuming
an average salary of $45,913 a year. Initial costs would be reduced until additional
counselors accrue increased pay with experience.
Karen’s Note: This sounds like a wonderful idea, but I suspect the fiscal note will keep it
from moving forward.

SB1086 – This legislation would establish a maximum number of students assigned
to each teacher, with these limits being eighteen (18) students per class for grades K
through 3, twenty-two (22) students per class for grades 4 through 8, and twenty-five
(25) for grades 9 through 12. FISCAL NOTE: The Department of Education does not keep
precise statistics regarding class size per grade. However, using statistics provided by the
Office of Performance Evaluation regarding class sizes reported by teachers, combined
with a consideration of the number of teaching staff required per district under this
legislation, it can be estimated that the impact per year will fall between $30 and $50
million.
Karen’s Note: Aside from the fact that this language would take away the local control
at the school district level, this also sounds like a wonderful idea. Again, I feel certain
that the fiscal note will most likely keep this from moving forward as well.

SB1087 – Proof of attendance in school has been a requirement for obtaining a driver’s
license for applicants under the age of 18. This bill would also require applicants to
provide proof that they are making satisfactory academic progress. The express intent
of this bill is to provide an incentive for improving student learning. FISCAL NOTE: Short
term, this may increase costs to the state for increased Average Daily Attendance. In the
long run, increased education results in higher compensation and, as a result, payment
of additional taxes to the state.
Karen’s Note: This is a feel good bill. One question that may arise is what constitutes
“satisfactory academic progress”. We don’t think this will have an impact on local
school districts.

SB1088 – This legislation provides for a protocol to identify districts that would see
financial savings by consolidating services, as well as providing for incentives to
encourage consolidation. FISCAL NOTE: The financial impact of this legislation will be
positive due to consolidation of services. The amount of this positive impact cannot be
precisely determined, as an estimate of how many districts would consolidate services would be speculative. Some expenditure will be necessary in order to provide extra
funds to districts to coordinate the service consolidation process. There may also be a
need to add a full or part-time budget analyst within the Legislative Services Office in
order to perform the audits described in the legislation.
Karen’s Note: This could be an interesting bill. This bill would require a biennial audit of
all school district services for any school district with fewer than 5000 students. That is
approximately 100 of the 115 school districts in Idaho. If you are a rural district, I would
encourage you to take a close look at this bill. There are financial penalties tied to the
bill. If this bill comes forward we will object. In addition, I believe the fiscal note is not
accurate. To say that one legislative auditor can do an audit of all school district services
for 100 school districts every other year is not accurate. It will take far more than one
auditor.

SB1089 – This legislation repeals the Early Retirement Incentive program for teachers.
This program distributes bonuses to teachers who are at least age 55 and are retiring
before age 63 and before reaching their PERSI Rule of 90. The bonuses are paid over
the summer, after completion of their teaching duties. The program was originally
established in 1996 as a way to encourage the retirement of teachers who did not wish
to receive technology training and incorporate technology into instruction. All remaining
teachers have long since received this training, and it has been a requirement in Idaho
teacher preparation programs for many years. It has been claimed that this program
saves the state money by encouraging more higher paid, veteran teachers to retire and
be replaced by younger, lower paid teachers. However, Idaho’s actual experience has
shown that the number of teachers retiring early has remained essentially unchanged
during the most recent two years, in which the program was repealed, as compared to
the previous five years. Thus, the program does not appear to have functioned as an
incentive to encourage more teachers to retire, but rather, as an extra bonus to those
who would have retired regardless. This legislation ensures that these scarce dollars
remain in the classroom, as they have been in FY12 and FY13, and are not diverted
to pay bonuses to those who are no longer teaching. FISCAL NOTE: If this legislation
is not passed, it will cost the state General Fund an additional $3.6 million in ongoing
funding, beginning in FY14, to pay out bonuses to teachers who have retired early. If this
legislation is passed, there is no additional cost to the state General Fund.
Karen’s Note: This bill comes up almost every year. It is an attempt to remove teacher’s
early retirement incentive program. We will not take a position on this legislation.

SB1090 – Amends Idaho Code § 33-552 “Financial Emergency” by lowering two separate
requirements for a local school district to declare a financial emergency, should financial
conditions exist that would require the district to reduce personnel costs. Requires that
the Reduction in Force (RIF) decisions, which are at the sole discretion of the board of trustees, not be made solely on seniority or contract status; further requires school
districts to adopt policies establishing the methods to recall individuals who have been
part of a RIF. FISCAL NOTE: There is no fiscal impact to the state.
Karen’s Note: This is legislation that the IEA is proposing to reduce some of the
percentages needed in order to file for a financial emergency. On its face value, we
have no problem with that concept. However, they would like to see this legislation in
place of the ISBA’s legislation to grant the ability to school boards to reduce salaries. We
would like to see it in conjunction with our legislation. In addition, this legislation sets
out some different criteria for reduction in force. ISBA’s legislation sets out different
criteria and we have the reduction in force language in a new section of the code. We
don’t believe reduction in force should be tied to declaring financial emergencies.

SB1091 – This legislation creates a stable, long-term funding formula for the Idaho
Digital Learning Academy (IDLA), establishes a portal for online classes, reestablishes
the dual credit for the early completers program and makes technical changes to the “8
in 6” legislation. FISCAL NOTE: Fiscal Impact – Section 1: none; Section 2: $6,445,000;
Section 3: $150,000; Section 4: $250,000; Section 5: no additional. Total Fiscal Impact
$6,845,000.
Karen’s Note: This is the legislation that sets out funding for the IDLA. We are working
with leadership at IDLA to ensure it meets their needs.

SB1092 – This legislation reinstates ongoing formula-driven funding for school districts
and public charter schools to meet the state’s increased high school graduation
requirements for math and science courses, which start with the Class of 2013. SB 1184
(2011) previously provided this funding to hire additional math and science teachers, or
pay for the necessary online math and science classes, at local school district discretion.
The repeal of SB 1184 through Proposition 3 eliminated this funding for schools. FISCAL
NOTE: If this legislation is not passed, it will reduce the amount of funding required for
Public Schools in FY14 by $4.85 million, as compared to the FY13 appropriation. If this
legislation is passed, the $4.85 million appropriated for this distribution in FY13 will
remain in place in FY14 and into the future.
Karen’s Note: This legislation will make funding for extra math and science teachers
permanent language as opposed to intent language in the appropriation bills each year.
This makes for a more secure stream of funding.

SB1093 – This legislation codifies the Legislature’s approach to budgeting for public
school pupil transportation costs and discretionary funds, which has been in place
for FY11, FY12 and FY13. Under this approach, intent language was included in the
appropriation bill which set aside the provisions of Section 33-1006, Idaho Code, reduced pupil transportation reimbursements by $7.5 million, and transferred the
savings to state discretionary funds for public schools. This legislation eliminates the
need to continue setting aside Idaho Code through intent language by moving that
language into Idaho Code. FISCAL NOTE: If this legislation is not passed, it will either
cost the state General Fund an additional $7.5 million in ongoing funding, beginning in
FY14, to increase distributions for pupil transportation reimbursements, or will require
a $7.5 million reduction in state discretionary funds distributed to public schools. If this
legislation is passed, there is no additional cost to the state General Fund or reduction
required in state discretionary funds for public schools, since this legislation codifies the
Legislature’s existing approach to budgeting for public schools, as expressed historically
through budgetary intent language.
Karen’s Note: This legislation will also make a permanent shift of funds from the
transportation budget to discretionary funds each year. We have been doing that
through intent language in the appropriation bills but this will make the shift permanent.
The one question we have is whether or not a set amount is appropriate or should it
be some percentage of the full transportation budget. $7.5 million dollars may be
appropriate today but may not be much 10-20 years from now. We will ask the question
about a possible formula rather than a set amount.

SB1097 – This legislation will prevent Idaho school districts from having to use Idaho
taxpayer funds to educate out-of-state students who are placed in Idaho group homes.
FISCAL NOTE: State savings would be minimal, based on average daily attendance-
driven funding of $4,160 per enrolled pupil. Local school district savings would be more
significant, based on an average expenditure of over $28,000 per pupil for such students
in the state’s largest school district, but more varied, depending on how many out-of-
state students were placed in group homes within the school district’s boundaries.
Karen’s Note: The purpose of this legislation is to assist those school districts who are
educating out of state special needs students who have been placed in facilities in Idaho
because of the services they provide. While this will not impact many students, it is still
a huge financial burden to those school districts who do educate these students. The
additional dollars to educate the student will be paid by the facility that is housing the
student.

SB1098 – To provide for a negotiations process that is open to the public. FISCAL NOTE:
There is no fiscal impact to the state.
Karen’s Note: This language is the same exact language found in one of our labor bills
and is brought by the IEA. Our bill also contains language on last best offer. This is an
attempt to split the language out.

What happened this week with the collective bargaining and labor bills?

If you attended Day on the Hill, you know that we printed six new bills this week. Those
amended bills were the result of discussions with the IEA, IASA, PTA, and the Education
Chairs. All of the edits we made were suggestions or comments from the IEA. Below is
a list of the new bills.

We are still in negotiations on some of the language and we may yet see some of these
bills be printed again. I know it is sometimes hard to understand how this system works
– even I get frustrated with it. But, we are trying to ensure that we have language
that will pass legal muster and that will get passed by both the House and Senate. As
more people look at the bills, there are more suggestions and comments. Some we will
incorporate and others we will not.

Things will be moving quickly now so you may hear from me mid-week on these bills. I
want to make sure you are as up-to-date as possible with what is happening.

In case you want to look at the new bills, here are new numbers:

HB163 – Electronic Delivery of Contracts
HB164 – Open Negotiations and Last Best Offer
HB165 – Reduction in Force and the Use of Seniority
SB1038 – De Novo Hearings (Note: This bill was not reprinted)
SB1094 – One Year Agreements/No More Evergreen Clauses
SB1095 – Proof of 50% + 1 and Majority Ratification
SB1096 – Unpaid Administrative Leave and Reducing Salaries

Other legislation

HB0065 – FY13 Funding from SCF
This legislation is discussed above but this is the bill that brings back the $30.1 million in
funding for FY13 that was lost in the repeal of Students Come First.
Status: Passed the House Education Committee and is headed to the House Floor.

HB72 – Charitable Contributions to School Foundations
Under current Idaho Code Section 63-3029A, voluntary donations to qualified higher
education institutions, elementary or secondary institutions and specified 501(c)(3) nonprofit organizations located in Idaho receive an income tax credit for charitable
contributions. In order to take advantage of these credits, many eligible entities are
required to form separately governed nonprofit foundations that are tax-exempt under
Internal Revenue Code 501(c)(3). This amendment would establish a mechanism
through the Idaho Community Foundation whereby small organizations would have the
option to deposit their funds into a dedicated account. This dedicated account would be
established to exclusively support the charitable purpose that would otherwise qualify
the donor for the tax credit.
Status: This bill has passed the House Floor and is headed to the Senate.

HB0084 – Clarifies Procedures for Inspection After Building Deemed Unsafe
This legislation deals with those school districts that have a building that has been
deemed unsafe by the Division of Building Safety but the school district is still unable
to get a bond passed. It clarifies several issues. This legislation would amend section
33-909, Idaho code to specify that all approved projects remain under the purview of
the panel until finalized. These changes will eliminate any jurisdictional conflicts with
local agencies by specifying the Division of Building Safety’s responsibility in regards to
inspection and issuance of certificates of occupancy.
Status: This bill has passed the House Floor and the Senate Education Committee. It is
on the Senate Floor.

HCR003 – Cursive Writing
This is a concurrent resolution, not a statutory change. This concurrent resolution
requests that the State Board of Education commence rulemaking to provide that
cursive handwriting be taught in the public schools of the State of Idaho.
Status: This concurrent resolution passed the House Floor and is headed to the Senate.

SB1005 – Prohibits SBOE from Passing Online Requirement
This legislation establishes a prohibition on the establishment of online class
requirements for high school graduation by the State Board of Education or the State
Department of Education without the express authorization of the Idaho Legislature.
Status: This bill was printed in Senate Ed but has yet to receive a hearing.

SB1026 – Signatures for Referenda
While this legislation is not education related, if passed, it will have an impact on any
referenda that may be brought forward in the future. This legislation addresses the
balance between urban and rural voters in the question of qualifying initiatives or
referendums for the ballot. It would require collecting signatures of not less than 6% of
registered voters in each of at least 22 Idaho legislative districts, provided that the total
number of signatures equals at least 6% of the number of registered voters in the state.
Status: This bill was pulled and rewritten in a new form.

SB1028 – Mastery Advancement Program
This bill would end the pilot phase for the Mastery Advancement Program, removing
language limiting the availability to school districts and the duration of the program.
Status: This bill was passed by the Senate Floor and is headed to the House.

SB1054 – High School Reading Requirement
This bill would require all high school students to read Atlas Shrugged before
graduating. The sponsor indicates that in an age when personal responsibility is waning,
this high school graduation requirement will stimulate debate.
Status: This bill was printed in Senate Ed but will likely never have a hearing.

SB1055 – Posting Information on the District Website
This legislation reinstates requirement that school budgets and master labor
agreements be posted on a district’s website.
Status: This bill passed the Senate Education Committee and is now on the Senate
Floor.

SB1056 – Denying Enrollment for Convicted Felons
This legislation would require the School Board to deny enrollment at any of its schools
to anyone who has been imprisoned for one year or more, unless five years or more
have elapsed since their pardon. We have strong reservations about this bill and
the requirement that all students remain in school. In addition, the Department of
Corrections also has concerns about this legislation
Status: This bill was pulled by the sponsor. It is unclear if he will bring an amended
bill back this session.

SB1057 – Instructional Staff Time Allowance to Visit Parents
The purpose of this bill is to facilitate kindergarten teachers visiting with parents to help
strengthen the working relationship between the teacher, the parents or guardians, and
the student.
Status: This bill was printed in the Senate Ed Committee and is awaiting a hearing.

Other ISBA legislation

Funding – Resolution #1
This resolution contains many elements – all related to funding of public education in
some way. Below is a breakdown of the pieces we are currently working on:

Bringing Back Use it or Lose it on a Permanent Basis
It is our understanding that the Idaho Association of School Administrators (IASA) will be
bringing this legislation forward. The SDE assisted with writing the bill and it has been
forwarded to their leadership. We will stay in close contact with IASA and assist them in
any way we can. We will continue to support this legislation.

Lottery Funds and Building Maintenance
One of the elements found in our Resolution #1 was to move the Lottery Funds
back into building maintenance rather that allowing it to be used as discretionary
funds. While the Governor’s proposed budget did make that change, Superintendent
Luna’s budget proposal contained one-half of the replacement dollars. He indicated
that if approved, he will ask for full replacement next year. We will support the
Superintendent’s budget on this issue.

Charter School Oversight – Resolution #2

This past week we were able to come to agreement with the IASA, SDE, the Charter
School Network, and the Charter School Coalition. There are definitely parts we like and
parts that we don’t particularly care for. I always say that when both parties like some
and don’t like some that it is probably a good piece of legislation. That is the case here.

We agreed to print two bills. One bill will have all the charter school oversight language
in it (we like this part) and the ability for multiple authorizers (not so crazy about this).
The second bill will contain funding that will go to authorizers (we like this part) and
funding to charter schools for facilities (again, not so crazy about this).

There will be a net fiscal impact because of the facilities funding piece, but we feel that
we struck as good a deal as we could. We agreed to support the first bill and we will
remain quiet on the second.

PERSI Retirement for Employees in Four Day School Weeks – Resolution # 5

We have had several meetings with PERSI and have discussed the issue with
superintendents in four day school weeks. Because this is a rule amendment and not a
legislative issue, we have a little more time to complete this. We do believe that PERSI
is making some assumptions that may not be accurate and thus affecting the retirement
of four day school week employees. Once the legislature has slowed down, we will
pursue this more fully.

Increasing Supplemental Levies to Three (3) Years – Resolution #7

This legislation would allow school districts to run a supplemental levy for 1, 2, or 3
years. Currently, the maximum length of time for a supplemental levy is two years.

We have had this resolution before and have been unable to find a sponsor for the
legislation. The Boundary County School District is currently working to find a sponsor.

Non-Certificated Personnel Grievance – Resolution #8

Both the Kellogg and Meridian school districts have agreed on language on this bill. The
legislation has been forwarded to a representative who will be printing this bill on the
House side. We will work closely with him to sponsor the bill. We hope to see it printed
this week.

Link to Legislation:

If you want to view the actual language of any piece of legislation, click here. You can search by topic or the actual bill number.