Debate Transcripts
LB 313 (2001)
Select File
February 9, 2001
SPEAKER KRISTENSEN: Further debate on advancement? Seeing none, the question before the body is the advancement of LB 105. All those in favor of advancement say aye. Those opposed say nay. It is advanced. LB 313.
CLERK: Mr. President, LB 313, Senator Erdman, Enrollment and Review amendments first of all, Senator. (AM7025, Legislative Journal page 463.)
SPEAKER KRISTENSEN: Senator Erdman, you're recognized for an adoption of those amendments.
SENATOR ERDMAN: Thank you, Mr. Speaker. I move the adoption of the E & R amendments to LB 313.
SPEAKER KRISTENSEN: You've heard the motion for the adoption of the amendments. Senator Coordsen, debate on the ... the question before the body is the adoption of the E & R amendments. All those in favor say aye. Those opposed say nay. They are adopted.
CLERK: Mr. President, I had an amendment from Senator Baker, AM0149, but a note that he wishes to withdraw that particular amendment.
SPEAKER KRISTENSEN: Senator Baker, you wish to withdraw? It is withdrawn.
CLERK: Senator Baker would move to amend with AM0441, Senator. (Legislative Journal page 614.)
SPEAKER KRISTENSEN: Senator Baker, you're recognized to open.
SENATOR BAKER: Thank you, Mr. Speaker. Members of the body, what this amendment does is shorten the time frame that anyone can apply for these funds by one year. The original bill extended this application period three years, and we felt, as a
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reasonable compromise, we would make it only two. I think it's been extended once prior to this before people really took notice of what it did, and I'd like to go on record as saying that this, as far as I'm concerned, there will be no more extensions here; that something would have to change drastically. The AM0441 should, I think, be on your machines and it simply cuts the time frame back one year across the board. I do not have a new fiscal note on this but, talking to Senator Coordsen, and he certainly can speak for himself, but I would believe that this would cut the fiscal impact back, maybe not by one-third, because we may speed the process up and have more people apply for these funds in the two years that they're eligible now instead of dragging it out three. So I don't know how exactly that's going to come back, that new fiscal note, but it should cut back our exposure to potential expenditures with that. I have nothing else to add to the amendment, and be glad to answer any questions if I could, but, in a nutshell, that's all it does. It cuts it back from a three-year extension to a two-year extension. Thank you.
SENATOR CUDABACK PRESIDING
SENATOR CUDABACK: You've heard the opening on AM0441 to LB 313. Senator Coordsen, for discussion.
SENATOR COORDSEN: Thank you, Mr. President, members of the body. LB 313A, which we introduced a... I think earlier this week, did reflect a lower exposure with the language with a three-year date, as Senator ... a lower exposure of General Fund appropriations, I think is what I should have said. Senator Baker's amendment does, in fact, reduce the time and would have the practical effect of reducing the expenditures, however, for those of you that read the fiscal note on the original bill, you would find that the word "uncertain" is used a lot in that because what we're providing for is a maximum of incentive payments and how those are spent is not ... how much of those monies are used is contingent upon how many schools qualify for those payments. But the reason I put my light on wasn't so much to talk about the money as to indicate that I really don't have any problem with shortening the time up a year. It's a program that had a slow start. All At once it blossomed. We were faced
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with the ... with the real possibility of schools that had went through a merger and, in some cases, an affiliation agreement; had been told, I don't think "promised" is a good word, but told that they would be entitled to a sum of money over ... that would be distributed over a period of three years from General Fund resources to help them cover the costs of putting two or more schools into one. What I am concerned about, and it doesn't relate to the Baker amendment, is that we wouldn't be able to carry forward with those promises without making some provisions for the future. I think that the thing to do is we ... certainly, I have no problem with amending LB 313 to reduce it a year, but I would think that the wiser choice after that would be to move LB 313 and the accompanying LB 313A over to Final Reading and, of course, there it sits and waits till we do the biennial budget appropriations. I'm not as confident as a lot of members in this body that we've got money rolling out of our ears to spend on whatever programs that we might want to spend, and it appears to me that there is certainly an outside chance, if not a middle of the road chance, that we're going to have to be looking very closely at what we want to expend state resources on and a continuation of this program that creates an additional General Fund appropriation might be something that we find at that stage of this session we can't logically expect to do. However, I would hope that we would create enough funding to carry out our promises to those districts who have already made the qualifying steps and are in the merger and are entitled to the incentive payments that they have...
SENATOR CUDABACK: One minute.
SENATOR COORDSEN: ...received. So, with that, I don't necessarily rise in support of the Baker amendment, but I certainly don't rise in adamant opposition to it either, Mr. President.
SENATOR CUDABACK: Thank you, Senator Coordsen. Senator Dierks, on the Baker amendment.
SENATOR DIERKS: Thank you, Mr. President. Members of the Legislature, I'd like to ask Senator Coordsen a question, please, for the record.
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SENATOR CUDABACK: Senator Coordsen, will you yield to a question, please?
SENATOR DIERKS: With the approval of this amendment, when would be the...what would be the date that the ... the last date that a school ... that a unified district could apply for funding?
SENATOR COORDSEN: I ... I think the last date would be 2002-2003? Is that right? I don't have the amendment right in front of me, 2003-2004?
SENATOR DIERKS: Yeah. Mr. President, could we could I have
SENATOR COORDSEN: Senator Baker.
SENATOR DIERKS: ... Senator Baker respond please?
SENATOR CUDABACK: Senator Baker, would you respond, please?
SENATOR BAKER: Yes. Yes, I would. The ... the final application period, approval of these ... this merger, consolidation, unification, whatever you call it, would be August 2nd of 2004.
SENATOR DIERKS: Two thousand four.
SENATOR BAKER: It was 2005, so they still have a considerable amount of time here to get this moving.
SENATOR DIERKS: Well, thank you very much, Senator Baker. The...it may sound like it's a considerable amount of time and most places it probably is, but sometimes these school districts move pretty slow and takes a lot of convincing of some of their... some of their constituency to do that. But ... and I, too, like Senator Coordsen, would say we've ... we've set our course to do unification and I don't think we should do anything to slow that down. If this amendment passes, why, we'll probably be looking at renewing the funding in 2003 or 2004, so I just think that this legislative body did ... did direct the course of this action with that unification legislation and it
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seems to be working. I visited this morning with the superintendent of unified District 1 in my legislative district and they're very pleased with what's happened with the administration part of it and with the transportation part of it and with the funding part of it. So I think that what we have started is working and there seems to be a tremendous amount of interest and I'd hate to see us put a wet blanket on that process. Thank you.
SENATOR CUDABACK: Thank you, Senator Dierks. Senator Beutler, on the Baker amendment, AM0441.
SENATOR BEUTLER: Senator Cudaback, members of the Legislature, I just wanted to briefly support the Baker amendment. Again, I think most of us feel that some kind of support in this area is certainly appropriate, but it's also expensive for something that affects a very small percentage of the school districts and an even smaller percentage of students. So his amendment makes some sense, especially in light of the committee amendment, which essentially doubled the cap and resulted in a fiscal note that went from $6.8 million of potential liability in the out year of 2002-2003, to a potential liability of over $10 million. So the Education Committee has made this a very good thing for a short period of time and I think Senator Baker's amendment starts to bring this into some kind scale that represents something that's arguably doable for a very small number of students out of state funds, but, even at that, it's a lot of money. But I would like to thank Senator Baker for proposing the amendment. Thank you.
SENATOR CUDABACK: Thank you, Senator Beutler. Senator Baker, you're recognized on your amendment. Senator Baker, did you wish to use your ... Senator Baker.
SENATOR BAKER: Thank you, Senator Cudaback and members. I misspoke when I answered the question for Senator Dierks. My amendment changes...it simply says this section shall apply, meaning the consolidations and unifications (inaudible) with an effective date after May 31st of 1996 and before August 2nd of 2003. The bill reads 2004. We shortened the application period one year. They have to have ... this merger, consolidation,
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unification has to have an effective date before August 2nd of 2003. Want to make sure we got it correct here now. That's all I have to say. Thank you.
SENATOR CUDABACK: Thank you, Senator Baker. Senator Wehrbein, on the Baker amendment.
SENATOR WEHRBEIN: Mr. President and members, just very briefly I want to say I support Senator Baker's amendment, but I don't want to got ... with reservations that, upon Final Reading and budget considerations in May, I may look very carefully at the General Funds in this. I definitely support the transfer of the funds that we have at this point, but I ... I don't want to mislead anybody in where we may end up in May. So, with that, I do support this amendment.
SENATOR CUDABACK: Thank you, Senator Wehrbein. We're discussing the Baker amendment to LB 313. Senator Baker, there are no further lights. Did you wish to close? Senator Baker waives his option to close. The question before the body is AM0441 to LB 313. All in favor of the amendment vote aye, opposed nay. We are voting on the Baker amendment to LB 313. Have you all voted who care to? Have you all voted? Record, please, Mr. Clerk.
CLERK: 30 ayes, 0 nays, Mr. President, on the adoption of Senator Baker's amendment.
SENATOR CUDABACK: The Baker amendment is adopted. Speaker Kristensen.
CLERK: I have nothing further. I'm...
SPEAKER KRISTENSEN: Mr. President, members of the Legislature.
SENATOR CUDABACK: Speaker Kristensen, you're recognized for an announcement.
SPEAKER KRISTENSEN: Okay, thank you, Mr. President. Members, just to give you a heads up yet this morning, we're going to pass over LB 270 and LB 270A, so we will not take them up.
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We'll continue on with Select File obviously here, but when and if we get to General File we'll not do LB 270 or LB 270A. We'll start with LB 334 and work our way through. We will not work through the noonhour today. Thank you, Mr. President.
SENATOR CUDABACK: Thank you, Speaker Kristensen. Mr. Clerk, next item.
CLERK: Mr. President, again I misspoke. Senator Smith would move to amend with AM0444. (Legislative Journal page 615.)
SENATOR CUDABACK: Senator Smith, to open on your amendment.
SENATOR SMITH: Thank you, Senator Cudaback. Members, AM0444 has to do with mergers of educational service units, and right now ESUs receive state dollars for core services: staff development, technology and a couple other ... other objectives. This amendment has no fiscal impact in terms of increased spending. It does not affect that at all. What it does is it ... that it says that if ESUs merge for three years, they get those same core service dollars as they did before, so that they can achieve the efficiencies that they are looking to achieve through the merger and then that ... that way they wouldn't be cut off from those dollars that are provided through the core service dollars right now. And to give you a little more information on that, each ESU receives the core service dollars based on enrollment and based on the fact that each unit receives 2.5 percent of the total $9.7 million, and then after the 2.5 percent for each ESU is divvied out, then the rest is based on student enrollment. And, with that, I would take any questions.
SENATOR CUDABACK: Thank you, Senator Smith. Senator Raikes, on the Smith amendment.
SENATOR RAIKES: Thank you, Senator Cudaback and members. Senator Smith, I do have some questions for you. Let me try to make sure I understand how the funding works now for ESUs and how this may affect it. Currently, an ESU receives a certain amount of funding as, more or less, a fixed amount regardless of the number of students. Is that correct?
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SENATOR CUDABACK: Senator Smith.
SENATOR SMITH: Correct. Approximately ... or it is 2.5 percent.
SENATOR RAIKES: Okay. And under current statute, if two ESUs were to merge, and let's 0 lust pick a number, I don't have any idea what it was, but let 's say that that 2.5 percent amounts to $250,000. Under current statute, if two were to move...to merge, in effect, that allocation, rather than being...currently, each of them gets $250,000, for a total of $500,000.
SENATOR SMITH: Correct.
SENATOR RAIKES: If the two of them merged, under current statute that merged unit would get $250,000..
SENATOR SMITH: Correct.
SENATOR RAIKES: So there would be a loss of $250,000 in some sense.
SENATOR SMITH: Yes.
SENATOR RAIKES: Under your proposal, the merged unit would get both chunks, both individual chunks, for three years, so the merged ESU would receive an allocation of $500,000 for each of three years, and then they would drop back to $250,000 in the fourth year. Is that correct?
SENATOR SMITH: Right, following the transition period of three years.
SENATOR RAIKES: Okay. Another question for you, how many ESU mergers have there ... have there been?
SENATOR SMITH: One, to my knowledge,...
SENATOR RAIKES: Okay.
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SENATOR SMITH: ... in the last five years anyway.
SENATOR RAIKES: Do you know of some that are being considered' or proposed at this time?
SENATOR SMITH: I ... I understand that some discussion is taking place.
SENATOR RAIKES: Do you ... do you think that the current statute would be ... would act as an impediment to this sort of a merger; that, in effect, if we... if we merge we would lose this, in my example, $250,000?
SENATOR SMITH: I really would, because I would see it as a disincentive for merging with current statute in place.
SENATOR RAIKES: Okay. Another question. This bill deals with the reorganization incentive money for schools and the reorganization incentives are based on movement from one cost group to another cost group, which largely is enrollment levels. For example, if a school moved from a size category of a hundred to two hundred students up to a thousand students there would be a certain amount of money that they would be allocated under this bill. Does that affect ESUs at all?
SENATOR SMITH: Not to my knowledge, and...and this amendment does not even affect any funding to ESUs based on enrollment.
SENATOR RAIKES: Okay. So... so this is ... this would not bring ESUs into that...
SENATOR SMITH: Correct.
SENATOR RAIKES: ... arrangements.
SENATOR SMITH: Correct.
SENATOR RAIKES: Okay. The other question then finally I would have, the ... the $250,000 in my example that the merged unit, the extra $250,000 they would get for the three years, where does that money come from?
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SENATOR SMITH: That comes from the entire appropriation to ESUS for core service. We can call that state aid to ESUs I think.
SENATOR RAIKES: Okay, so this would not...
SENATOR CUDABACK: One minute.
SENATOR RAIKES: ... would not make the total appropriation to ESUs any ... any larger. What it would do, it would cause a certain reallocation of that money.
SENATOR SMITH: That's right.
SENATOR RAIKES: Is that correct?
SENATOR SMITH: Only upon merging.
SENATOR RAIKES: Okay.
SENATOR SMITH: And for a short period of time.
SENATOR RAIKES: Okay. Thank you, Senator Smith, and thank you, Mr. President.
SENATOR CUDABACK: Thank you, Senator Raikes. We are on AM0444 to LB 313. Those wishing to speak, Senators Hartnett, Smith, and Janssen. Senator Hartnett, you're recognized.
SENATOR HARTNETT: Mr. President, members of the body, Senator Smith, if I could ask you some questions.
SENATOR CUDABACK: Senator Smith, would you yield, please?
SENATOR HARTNETT: Was there a bill? Did you introduce a bill on this subject?
SENATOR SMITH: No, I did not.
SENATOR HARTNETT: Where did the amendment come from?
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SENATOR SMITH: My office.
SENATOR HARTNETT: Your office. Isn't it kind of a rule of this body that we have a hearing on things like this before they come up?
SENATOR SMITH: It depends to what extent. I think that if this included new dollars I would agree with that concern. I believe that, because this doesn't impact significantly the dollars spent or even increase the dollars spent, I believe that it's relatively insignificant.
SENATOR HARTNETT: What's the Process for merging ESUs?
SENATOR SMITH: I'm not intimately familiar with the exact process, but it's a very deliberate process to make sure that everyone is included, and I believe it was about a two-year process when ESUs 12 and 13 merged in the Panhandle.
SENATOR HARTNETT: What you're doing with this bill, Just guaranteeing that if there is a merger that they would keep the (inaudible).
SENATOR SMITH: If there is a merger. Correct.
SENATOR HARTNETT: Thank you.
SENATOR CUDABACK: Thank you, Senator Hartnett. Senator Smith, you're next.
SENATOR SMITH: Thank you, Senator Cudaback, members. I do want to point out that in the areas of the state that are more sparsely populated, shall we say, call it rural, call it whatever you would like, I believe that when ... when we expect efficiencies to occur we can't expect those to occur overnight, and our current policy expects that to occur overnight. And so I think that this allows a short transition period to provide the dollars for ESUs to become more efficient over that three-year period, as stated in the amendment. Thank you.
SENATOR CUDABACK: Thank you, Senator Smith. Senator Janssen,
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on the Smith amendment to LB 313.
SENATOR JANSSEN: Thank you, Senator Cudaback, members of the body. Senator Smith, would you yield to a few questions, please?
SENATOR CUDABACK: Senator Smith, would you respond, please?
SENATOR SMITH: Yes.
SENATOR JANSSEN: Senator Smith, if I understand you right, now, you know of one or two ESUs that have ... have merged. Is that correct?
SENATOR SMITH: That is correct.
SENATOR JANSSEN: And the reason for them merging was the lower enrollment in the schools and the schools have merged so they have less school districts to work with. Is that right?
SENATOR SMITH: That could be one consideration, but I think they felt that if they merged they would have a greater economy of scale and be able to meet the needs of the districts more appropriately.
SENATOR JANSSEN: Um-hum. So they would probably have ... these ESUs would, the merged ESUs would probably have more students, but they would have less districts. Is that correct?
SENATOR SMITH: Well, merged ESUs, barring any other action by individual districts, would have the same number of students, same number of districts.
SENATOR JANSSEN: Um-hum. But the bill before us is to allow school districts more time to complete their merger if they so desire to do so. You would see more consolidation of districts if we ... if we take this carrot, so to speak, and hang out in front of those school districts to help them make themselves more efficient. That is the reason for the ... for the bill that we have, is so that we see more consolidation, so on and so forth. And I, you know, I have a little problem with ... with
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leaving the funding, the $250,000, for each ESU and putting that and making that $500,000 for the ... for the merged ESU, where I think, maybe I'm wrong here, but in my opinion I think that they're workload would be ... would be reduced to an extent where maybe they wouldn't need that other $250,000 because they would be less, so to speak, buildings or ... or less districts to work with. They'd have more students, but, you know, we've always ... we've always said that efficiency is larger... larger classrooms and so on, so forth, and that's where we're getting our efficiency. Are you following me? Do you understand what I'm talking about? I think their workload would probably be lessened a little bit by the merger. Would you want to comment on that?
SENATOR SMITH: Yes. I agree with you and that is why it has a three-year... it's basically a sunset, so the ESUs merging to one ESU will not carry the supposed $500,000, $250,000 times 2,...
SENATOR JANSSEN: Um-hum.
SENATOR SMITH: ... that will not be indefinite. It's three years. It says, hey, let's... let's cut this down while we become more efficient and carry on. And let me... let me add that I agree with you in... in saying that the merged entity or the merged ESUs should be more efficient and their expenses should reflect that. I will say that when ESUs 12 and 13 merged, it's pretty big and there are a lot of miles in between the school district buildings and up to 150-160 miles for...
SENATOR CUDABACK: One minute.
SENATOR SMITH: ... for staff to travel to set up workshops in various communities in and around the ESU. So there's a lot of new things to accommodate upon the merger.
SENATOR JANSSEN: Now let me ask you a question. When this happened in that particular case, were ... did they reduce their staff?
SENATOR SMITH: There were several positions eliminated, yes.
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SENATOR JANSSEN: Okay, so...
SENATOR SMITH: There were buildings that they didn't need anymore because of the merged unit and so they could save there, but there are a lot of transportation costs that they need initially while they're getting things set up and coordinated.
SENATOR JANSSEN: Okay. So in one case they reduced their cost; in the other case there were some costs that went up, such as mileage and so on.
SENATOR SMITH: Right, that I believe can be temporary if they're given the capacity to carry out that transition period and be able to...
SENATOR CUDABACK: Time.
SENATOR SMITH: ... plan on that.
SENATOR JANSSEN: Thank you.
SENATOR CUDABACK: Thank you, Senator Janssen. Senator Coordsen, you're recognized on AM0444.
SENATOR COORDSEN: Thank you, Mr. President. Senator Smith showed me this, and I was aware of the issue before, but I would be of the opinion, Mr. President, members of the body, that since this represents a significant departure from the intent of LB 313, which was to continue an existing program, not to create a program, this issue hasn't had a public hearing, although it's had some public discussion now, that this would not be an appropriate time to add AM0444, AM0444 to the bill. Whether or not it has a fiscal impact, there may be other impacts that we're not familiar with, so I believe it does represent enough of a different issue that it ought not to be attached to LB 313 at this time. Thank you.
SENATOR CUDABACK: Thank you, Senator Coordsen. Senator Smith.
SENATOR SMITH: Thank you, Mr. President. I was going to yield to Senator Janssen, if he wanted more time.
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SENATOR CUDABACK: Senator Janssen, did you wish? He waives off. Senator Smith.
SENATOR SMITH: Thank you. Mr. President, I believe that we've had some good discussion here and I think that we are talking about the issue at hand and the efficiencies that can occur, but not mandated upon local political subdivisions, primarily those in education, and I would respectfully withdraw my amendment. Thank you.
SENATOR CUDABACK: It is withdrawn. Senator Raikes, your light was on. Did you wish...Senator Raikes waives off. No further discussion?
CLERK: Senator Erdman, I have... I have nothing further on the bill at this time, Senator.
SENATOR CUDABACK: Senator Erdman, for a motion.
SENATOR ERDMAN: Thank you. I move the advancement of LB 313 to E & R for engrossing.
SENATOR CUDABACK: The motion is to advance LB 313 to E & R for engrosaing. All in favor say aye. Opposed nay. It is advanced. Mr. Clerk.
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