PUBLIC HEARING

HB 2338, 2440,2450

TAPES 69-70, A-B

002

Chair Butler

Calls meeting to order at 1:03 p.m.

OPENS PUBLIC HEARING FOR HB 2338 AND HB 2440

005

Steve Meyer

Gives overview of HB 2338 (Exhibit 1). The bill creates a grant for high-growth school districts as part of the State School Fund distribution. To qualify for the grant the district must have a growth rate of 4% or higher in the previous five years, making the district grant equal to $2 M. Sherwood is the only district that currently qualifies for the $2 M, and smaller districts would receive a smaller proportional amount. HB 2440 authorizes school districts to activate urban renewal agencies and adopt urban renewal plans for the purpose of funding school construction and improvements (Exhibit 2). No direct revenue impact until a school district initiates an urban renewal agency and plan.

034

Jerry Krummel

Testifies in support of HB 2338 because it is a tool that high-growth districts like Sherwood can use to manage resources. The bill changes the census dates to March 15, and the grant allocation would start with the 2005-2006 distribution of state school funds.

Testifies in support of HB 2440 to provide a more expedited system for planning. Current planning time for new construction is 8 to 10 years. With an urban renewal agency in place the district could bond against anticipated revenues and shorten the planning process to 4 to 5 years. Discusses some disadvantages of the bill: 1) it does not address facility replacement in areas with no growth; 2) it does not address the increased cost of operations. Suggests amendments to address those issues.

140

Rep. Gene Whisnant

Reads from written testimony in support of HB 2338 and HB 2440 (Exhibit 3). Testifies in support of HB 2338 and HB 2440 because they address the needs of high-growth districts to provide timely school construction and funding for capital construction. Refers to House Bill 2650 (page 1 and 2 of Exhibit 3) that Rep. Whisnant is sponsoring that concerns school districts with declining enrollment. Refers to HB 2964 (page 3 of Exhibit 3) concerning new construction funding.  

170

Rob Saxton

Discusses growth of Sherwood School District. Refers to data in Handout: Instructional and Support Expenditures per Student 2002-2003 (Exhibit 4).

• ·       Map, page 8
• ·       Projected Enrollment, pages 5-6
• ·       Per-Student Spending Data, pages 1-3
• ·       Housing Submissions, page 7
• ·       Oregon School Funding Factors, page 9 

348

Saxton

Discusses costs that Sherwood and other high-growth districts have that static districts do not incur: additional textbooks, technology components, additional buses, materials and supplies, and portable classrooms. Refers to data in Exhibit 4:

• ·         Levy Rate Projections, page 11
• ·         Selected Spending Comparisons, page 12

TAPE 70, SIDE A

030

Saxton

Supports HB 2338 and 2440 in order to provide needed funding to support growth issues and add additional facilities

044

Rep. Hass

Asks if the district has asked for a local option vote.

047

Saxton

Responds that the district asked the voters in 2000, but the measure failed.

051

Rep. Hass

Expresses concern that HB 2338 only benefits a few districts

060

Saxton

Responds that tax relief is needed in Sherwood for facilities and/or per-student funding. Taxpayers are facing five different tax measures to pay for schools.

074

Chair Butler

Asks for more information regarding the local option tax.

076

Saxton

Responds that he was not the superintendent in 2000, but he believes the proposed rate was $1.15 per thousand. The measure failed by about 4%.

084

Rep. Berger

Asks about the mechanics of the grant.

096

Rep. Krummel

Discusses the “triggers” that would allocate the $2 M grant for each school district that qualifies. Further discussion of the grant mechanics with Rep. Berger.

132

Meyer

Comments that he also interprets the language in the bill as $2 M per school district that qualifies. Further discussion with Rep. Berger.

147

Krummel

Additional comments regarding problems with the current State School Fund distribution formula.

151

Saxton

Responds to Rep. Berger’s question about the mechanics of the grant. States that Sherwood is the only district currently slated for the grant, but there are other area districts that will soon be eligible. Discusses the funding gap between Beaverton and Sherwood.

164

Rep. Komp

General comments about the current school funding formula.  

193

Rep. Berger

Asks witnesses about the effect and purpose of the apportionment change from May to March

200

Krummel

Responds that by backing up the apportionment date, the money arrives at the district earlier in the school year.

215

Meyer

Provides additional information about how funding dollars are calculated against student count.

241

Kent Hunsaker

Testifies against HB 2338. Discusses handout: District Level ADM 1999-2003-04 School Year (Exhibit 5). It shows the growth and decline of all districts statewide. The bill as it is written could apply to very small districts such as the Diamond district (page 3 of Exhibit 5). Discusses the facilities grant in the current school funding formula. His organization (COSA) does not support a change to the funding formula. Discusses the impacts of declining enrollment as well as growth impacts.

357

Rep. Berger

Asks Hunsaker what he would suggest to address the rapid population growth in a district like Sherwood.

371

Hunsaker

Responds that the problem of changing the funding formula without new revenue results in shifting money from one district to another. The facility grant is meant to fund 80% of construction costs and would be the best way to help high-growth districts.

420

Rep. Hass

Comments about growth rates in Beaverton and Sherwood districts and their impacts.

TAPE 69, SIDE B

030

Hunsaker

Agrees with Rep. Hass’ comments. Discusses the funding formula issues and impacts on various districts with different student populations.

057

Rep. Hass

Asks if a component addressing school consolidation should be considered in the school funding formula.

063

Hunsaker

Responds that consolidation is unique to every district and difficult to address on a statewide basis.

100

Jeffrey Tashman

Testifies against HB 2440 because “it is not the right tool for school districts.” Explains that urban renewal money is used for investment purposes in order to generate growth and eliminate blight. School districts are not structured to make those kinds of investments. Urban renewal is a good tool for school district development when a joint-use facility can be used by the district and the public. Urban renewal agencies buy sites for schools at a less than fair market value. Submits written testimony (Exhibit 6).

161

Chair Butler

Asks about impact of property tax in an urban renewal area. Further questions and answers exchanged with Mr. Tashman regarding conflict issues between schools and urban renewal areas.

196

Meyer

Refers to a section of the bill that addresses blighted areas.

205

Rep. Berger

Asks Tashman if he knows of other states that use urban renewal agencies for school construction.

207

Tashman

Responds that he is not aware of any and comments that his knowledge of other states’ urban renewal districts is limited.

209

Rep. Berger

Asks how urban renewal financing and the time limits associated with bonds would impact the longer timeline needed for school construction.

225

Tashman

Responds that it takes a significant amount of  time to raise revenues with bonds at the beginning of urban renewal planning.

238

Hasina Squires

Testifies against HB 2440. Her group, the Special Districts Assn., does not oppose urban renewal districts but is concerned about the impact of property taxation on special districts. The ability for school districts to create urban renewal districts would impact special districts such as fire districts. Discusses HB 3380 and amendments  that will allow an urban renewal agency to “opt out” school and fire protection districts.  Refers to testimony already given on SB 402 .

304

Kyle Gorman

Discusses impacts of urban renewal agencies on rural fire districts such as Clackamas. Believes that urban renewal growth boundary issues need to be addressed. His fire district serves a large urban renewal district, and Gorman discusses the unintended consequences of growth.

TAPE 70, SIDE B

012

Alec Jenson

Discusses current urban renewal projects in the Tualatin Fire District. Supports the “opt-out” legislation as previously stated by Squires. Supports some components of HB 2440 but is concerned that it shifts revenue from public safety to schools.

066

Michelle Deister

Discusses issues on integrating school districts and urban renewal agencies for mutual benefit.

CLOSES PUBLIC HEARING FOR HOUSE BILLS 2338 AND 2440

OPENS PUBLIC HEARING FOR HOUSE BILL 2450

097

Meyer

Gives overview of HB 2450 pertaining to two sunset dates affecting the high cost disabilities grant and small school district supplemental fund.

117

Latini

Testifies in support of HB 2450 regarding the high cost disabilities grant. Discusses her special committee recommendations: 1) removing the  sunset date; 2) raising the threshold from $15,000 to $30,000, which would remove 50% of students affected. 3) doubling the weighted factor on student funding

155

Hunsaker

Testifies in support of HB 2450. Suggests using some type of an  inflation factor to address increased costs over time.

185

Chair Butler

Asks Meyer what inflation factors, if any, are used in the school formula.

187

Meyer

Responds that no inflation factors are used currently. There have been studies but they have not yet been used.

200

Chair Butler

Comments to the witnesses and LRO staff that determining an inflation factor needs to be addressed along with medical and labor costs associated with high cost disabled students.

214

Meyer

Refers to table comparing current law funding numbers by school district and the impact of HB 2450 (Exhibit 8). The table incorporates new data from the Dept. of Education.

245

Rep. Komp

Asks about where in the bill the $25,000 cost versus the $30,000 replacement cost is stated.

260

Meyer

Responds that the amount is not stated in the bill because the bill only addresses the sunset removal. The $30,000 cost is in the existing statute. An amendment would have to address the cost change.

328

Chair Butler

Adjourns meeting at 2:48 p.m.

Tape Log Submitted by:

Reviewed by:

Kristi Bowman, Committee Assistant

Kim Taylor James, Committee Coordinator