ALC-Administrative Rules
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Chair
Unverified
1:00
Folks, if everybody could take a seat, we'll try to get started here in the next couple of minutes.
Thank you. We have a, first we have a report from the executive
subcommittee. It's in your packet regarding its approval of an emergency rule. I'll give you just a minute to read through that. Just notifies us of a executive subcommittee meeting on the August 22nd. And if there are no questions or comments, a motion to adopt the report a second all in favor say aye opposed same thank you next moving on to rule c the next item on your agenda is the specific
specifications governing school board i'm sorry school bus design this rule been referred to the transportation committee and a copy of that report is included in your packet for informational purposes will someone from the agency please come up and introduce yourself and present the rule already there thank you morning I'm
Speaker 13
3:05
Jennifer Dedman I'm an attorney for the division of education elementary and secondary education and I've brought with me mr. Mike Simmons our director for transportation you may
go ahead and present the rule thank you senator rice has asked that we begin our presentation today with the answers to several questions posed during the Transportation Committee meeting. Mr. Simmons, what is the cost to add air brakes to a bus that currently has hydraulic brakes or
Speaker 15
3:37
is bought with hydraulic brakes and needs to
Speaker 17
3:43
be upgraded to air brakes? Yes ma'am. Actually we do not recommend that anybody upgrade or retrofit a
Speaker 18
3:50
hydraulic brake bus to an air brake bus there's just too much too many components too much to deal with so from that standpoint we would not want anybody trying to do that so do we have any evidence
Speaker 13
4:06
of dust particles crystallizing within the lines of hydraulic brakes air brakes rather and in my
Speaker 18
4:13
20 years and and I will say I will tell the committee I've been transportation director well this is actually my third tour of duty at the department of ed so
i started this 20 years ago and in the 20 years that i've been dealing with school buses i've never heard of a single instance where dust particles crystallized in the in the lines of an air brake system and in fact every log truck in the state of arkansas that i'm aware of runs air brakes and if you get air inside a closed system like air brakes you've got more of a
problem than you think so uh like i said i've not i'm not aware of any of that
Speaker 13
5:04
ever happening so why do rural schools not have the
Speaker 18
5:09
option to choose either air brakes or hydraulic brakes has nothing to do with urban or rural this air brake mandate has been in effect since 2010 and actually you know it has nothing to do with the district size number of buses anything like
that it strictly deals with gross vehicle weight rating any vehicle that weighs 26,001 pounds has to have air brakes and has had to have air brakes since
Speaker 18
5:47
add to the funding needed it doesn't add anything on the state contracts uh air brakes are included in the base price it's not an up charge um unless you're buying a smaller bus
which normally, you know, you're looking at $900 to $2,000 depending on what type system and what manufacturer you're choosing
Speaker 17
6:11
as an option. We were asked to collect data on
Speaker 13
6:18
incidents, accidents, and deaths in relation to hydraulic brakes. Could you tell us what data we were able to find and how
Speaker 19
6:29
you reached that data? honestly I didn't I didn't
Speaker 18
6:35
find any truly usable format of data state police
has I mean if they work an accident it doesn't necessarily it doesn't necessarily come out as whether as in a usable form if you call and ask for a report from them on accidents dealing with brake systems you're not gonna be
able to get it and I hate that but districts are required to report accidents through AppScan, our statewide reporting system, SIS, but it's just that they had an accident, the amount of damage, any injuries, any fatalities, and that type of stuff. It doesn't break it down into what actually caused that accident now anecdotally I sent an
email out when when Jennifer asked me about these questions to all the transportation directors in the state and and I gotta say I've only been back on board for three weeks here so i'm still trying to play catch up but when i sent that email out asking all the districts if they had had any incidents dealing with brakes i didn't differentiate
between air brakes hydraulic brakes or anything just with brakes on their buses in the last three years in about 30 minutes i had about three or four districts that did send me information about brake failures that they had had um and just coincidentally they were all hydraulic brake buses that the the system had bled off or had leaked out and they couldn't stop their bus
in fact one of them rolled completely off the parking lot while it was sitting out there at ball game off into a ditch. So the thing about, and I'll just elaborate real quickly, the thing about air brakes is air brakes, if things bleed off, if the air bleeds off and they malfunction, they are locked up. That vehicle is not going to move. Hydraulic brakes, if it bleeds off, if they have a malfunction, that bus is not going to stop
because there's nothing there to cause the friction. So, and we can go way off deep in the weeds with that, and I don't want to do that, so. We did receive a photo. Yes, we did receive a photo from Boxide on that bus that went off into the ditch. And that'll be available if any of
Speaker 22
9:48
the members would like to see it. um will federal funding be disrupted by not passing these rules no we do not have we don't
Speaker 18
9:59
draw any federal funding for school bus transportation
Speaker 18
10:08
schools expected to upgrade existing buses now the school buses the specifications apply only to manufacturing standards so if you have a 2009 school bus that is 26,012 pounds it only has to meet the
specifications that were in place in 2009 when that bus was manufactured so when my inspectors go out to inspect buses they carry a stack of specifications this deep and whatever your model that bus is they that has to meet those specifications for that year so we're not asking anybody to retrofit anything what is the
Speaker 22
10:53
effect of not passing the proposed rules today the
Speaker 18
10:59
only effect it would have is that that i mean the air brake mandate is there has been since 2010
So if the committee so chooses not to pass this rule, it just—the only brake change that we have in here proposed is to do away with outboard drums. So that would allow districts to partake in new technology and use air disc brakes. uh currently that would not be allowed under these under the old rule because the rule states
that all air brake buses have to have outboard drums um air disc brakes are a great new technology that's out there uh you can take a a large 30 000 pound bus run at 55 miles an hour and stop it in than a hundred feet with air disc brakes they are so much safer and so much better to operate
a little more expensive so if a district so chooses i bet it would strictly be up to the district to choose the disc option rather than the drum option okay um in
Speaker 13
12:24
closing i'd like to read an excerpt from a letter that we received from mr matthew valentine the transportation Director of Warren Public Schools. Mr. Valentine wrote, my fleet, Warren Public Schools, has 15 buses. Ten of my buses are air brake and range from 2001 models to 2019 models. The other five
are hydraulic brake buses ranging from 2002 to 2007. In the past three years, I have replaced six calipers, one master cylinder, six sets of brakes, and two brake lines. The total cost of these repairs including labor was approximately $4,930 in the same time period I have performed no air brake repairs period I am getting almost twice the wear time from air brakes I am from hydraulic brakes lower labor costs and much greater safety for pupils mr. Valentine closes our main focus and
student transportation should always be the safety of both the students we transport and other motorists on the road mr. Valentine is here today if the members have any questions I believe he's signed up
Speaker 22
13:28
for public comment. We are able to entertain your questions if
Chair
Unverified
13:32
you have any. Yes we do have a few questions up. Senator Rice you're recognized for a question.
Senator Terry Rice
Unverified
13:47
There we go. Thank you. I did understand you said you'd been back three weeks.
Is that what you said? Yes, sir. Okay. And Ms. Dedman? Yes, sir. You're the one who originally presented this, right? Yes, sir. Okay. And since I kind of started the ball rolling on this, let me just state, I understand you made the statement at that time, you'd had people retire, left, or whatever, you didn't have people, and I didn't expect you to have expertise and subject. I didn't have expertise and subject.
i had hoped you would have had it by the time the second meeting which was transportation this gentleman evidently wasn't back but knew it
would have been helpful where my and those by the way were not all my questions or a couple of them were but the the first comment in our packet is what originally
drew my concern to this and i never did hear anybody say the air brake mandate went in in 2010
and i may have voted for it i don't know but had i known at the time for a mandatory deal probably would not have after talking to our school bus maintenance supervisor, which we run the second largest, maybe the largest unpaved rule in the state, at least the second, if I'm still right. He assured me that they have had no problem.
They have a great maintenance department, and I think all of our buses, except one, are air brake. and I don't know that status may be being retired but the concern in this besides the fact of just mandating air brakes which we found out later has been since 2010 was the concern of trouble getting bus drivers that if they
got air brake certification they can go down the street and get in the dump truck and make a heck of a lot more money and we have that problem too so those were my initial thing you've answered all of my questions i appreciate that i wish this hadn't dragged out as long had somebody been able to rebuff what was in the first comment there other than what it just said in there uh you know it didn't it said comment considered no change made you know if they'd said this has been in since 2010 and all would have been very helpful but thank you for
the information that you've satisfied me along as well as my uh local school system and i thank you for that and
Speaker 18
16:38
senator i will say mr gillane runs a very good shop over there he does and mr embree did before him yes
Senator Terry Rice
Unverified
16:46
both of them good guys too thank you thank
Chair
Unverified
16:52
you senator senator hammer you're recognized thank you mr. chair
Senator Kim Hammer
Unverified
17:00
i want to direct this to y'all but maybe
staff can contribute to the conversation as well i'm looking on page four and five and one of the things in the response of the comments was regarding the the financial adjustments uh from the proposed rule to the current rule and i'm just wondering was there a fiscal study done on this so that we might know what the
total impact would be was a fiscal study ever done with this rule anywhere along the line of the
Speaker 13
17:31
original no sir there's there should be no fiscal impact this specification will only apply to buses
manufactured in 2019 and beyond so no no school
Speaker 22
17:40
bus will have to be upgraded there should be no financial impact to
Senator Kim Hammer
Unverified
17:46
districts could do some follow-ups mr. chair yes so on page five help me understand them because it says on the proposed rule the district is responsible for zero percent of adjusted amount from fifteen thousand one to sixty five under the current rule the district is responsible for twenty percent of adjusted amount from fifteen thousand to fifty thousand is
that different amount the wrong rule I just
getting ahead sorry about that um okay so let me ask you this question on the rule with regards to the thank you for bringing up my attention um for the for the rule regarding the
school bus breaks what is it that started the conversation and who is it that started the
Speaker 63
18:34
conversation in the first place i'll turn to mr simmons for that uh as far as uh the public comment on on
Senator Kim Hammer
Unverified
18:42
the air brake systems was did the school bus manufacturers start this conversation
what happened school district start the conversation
Speaker 18
18:50
or who started it honestly well I'll give you a little bit of history here we started this conversation in 2010 and the committee is comprised by law of 10 public school administrators and employees and blue bird sits at the table with ic and thomas all three manufacturers with their specification engineers uh when that committee meets and honestly what happened is
blue bird their corporate office for the dealer here is in st louis and they run a lot of hydraulic buses in illinois good flat land up there and uh and so at the end of a lease they would turn those around and bring them down here and sell them as used buses and and when we went to the 65 passenger
breaking point for anything 65 passenger and above in 2010 had to have air brakes well what they started doing then was short seating the bus when they would specify they would bring in a bus that was 64 passenger instead of 65 that way they could sell a hydraulic bus hydraulic brake bus instead of a 65 instead of an air brake bus so that's when in 2012 we changed
the rule to anything 65 passenger and above or 26,001 pound gross vehicle weight rating had to be air brake and it's always kind of stuck in Mr. Wanketer's craw and I can say that because mr wanketer and i grew up together and his daddy was my little league baseball coach so i would say it whether he was sitting here in the room or not so uh he's he's the one that has
argued against this none of the other manufacturers have so
Senator Kim Hammer
Unverified
21:08
so this was a manufacturer driven conversation not a school district driven conversation in its inception is correct correct thank you thank
Speaker 67
21:19
you senator uh representative portner thank you i agree with
Representative Jack Fortner
Unverified
21:24
senator rice had i have known what i know now what you said i wouldn't have been as concerned but i would
like to make a comment about the letter from mr valentine I dearly would like to know who manufactures the brake linings on those buses that have run from 2001 till now and never had a pad or brake shoe replaced. Because those are some long wearing product. Yes sir, Mr. Valentine is here today if you'd
Speaker 22
21:59
like to hear from Mr. Valentine we'd be happy to call him. Okay, maybe
Representative Jack Fortner
Unverified
22:04
later he could just tell me what brand of brake lining will not be replaced
on any bus in 18 years. That's all. Folks,
Speaker 71
22:18
maybe y'all could get together, Representative,
Chair
Unverified
22:21
after this is over because the hearing is on the rule and that's not necessarily directly. He is signed up to speak, so we'll hear from him in just a few minutes.
Okay. Representative Fortner, any other questions? Representative Dotson.
Representative Jim Dotson
Unverified
22:51
Thank you, Mr. Chair. My question was, I guess, as far as the purpose for this
rule, the main purpose is, if I understood you correctly, so that there was a disc brake option, that they could go ahead and do a disc brake option, not really over whether it's air brakes or hydraulic brakes, because
Speaker 18
23:14
the former rule or the existing rule
has a line in there that says all air brake buses shall have outboard drums which then disallows the disc so what the committee's purpose for the proposal was is to do away with that line which would
Speaker 17
23:40
allow either drum brakes or disc brakes but but not this
Representative Jim Dotson
Unverified
23:48
discussion doesn't have anything to do really with hydraulic versus
John Allen
Unverified
23:53
air brakes no sir as far as this the specifics
Speaker 17
23:56
of this particular rule correct the only the proposal only deals with
Representative Jim Dotson
Unverified
24:03
whether the drum or this i guess going back uh you say this was a rule that was passed in 2010 originally and then updated in 2012 correct but it wasn't necessarily based there wasn't a law that was passed there's no statutory change it was just no a rule that the commission, what authority do you have to disallow or to ban all hydraulic brake systems
with the 2010 rule?
Speaker 18
24:35
Congress. Well, hang on just a second. Arkansas Code 621-304 is very specific that a committee of 10 school administrators representing all sizes and areas of the state assist in drawing up
Speaker 17
24:53
specifications the minimum manufacturing specifications for school buses they do rely
Speaker 13
24:59
on the national congress for school bus
specifications yes we refer
Speaker 17
25:05
to national the national standards for school bus specifications And they're the ones
Representative Jim Dotson
Unverified
25:11
that say the 65 or 26,001 pounds is the standard? Yes,
Speaker 18
25:17
sir, and also the National Highway Traffic Safety Administration and Federal Motor Carrier Safety Administration. I also recommend that simply because,
Speaker 17
25:30
I mean, air brakes are designed to stop bigger, larger vehicles,
Representative Jim Dotson
Unverified
25:36
and that's what it's about. And then finally, are there any school
Speaker 17
25:48
buses under 26,000 pounds? Oh, yes, sir. Yes, sir, there's a lot. But they would all have to have air brakes now? No, sir. If they are under 26,000 pounds, like a 55-passenger
Speaker 18
25:57
or a 40-passenger, or we even have 15 passengers, they can be hydraulic brake buses. And it's simply because they're not near as heavy
Speaker 17
26:05
and they don't have the problem stopping that a large bus
would have, just like an 18-wheeler. Thank
Chair
Unverified
26:16
you. Thank you. I don't see any other questions. We do have one person scheduled to testify. Would they please come to the table? if you would introduce yourself and you
Speaker 93
26:38
may present matthew valentine warren public schools
Speaker 97
26:40
um on the subject of breaks my letter clearly
Speaker 98
26:57
states that in the last three years It states in the last three years, not the last 18 years. The reason we did three years was because three years ago we switched all of our hydraulic and air brakes over to silverback, which are better brakes, industry studies show. We use that as our starting point for the judgment of how we changed out brakes.
In that three year period, we have not, until last week, changed out a set of air brakes. week I changed out my first set of air brakes. In that three-year period we have changed out six calipers, several sets of air or several sets of hydraulic brakes and the brake lines. It's a three-year period not an 18-year period. Nobody makes a lining that lasts 18 years. The other thing I'd like to say on this just so that y'all know this hasn't been mentioned diesel engines are a non-vacuum system which means the only way hydraulic brakes work is if
they're tied into the power steering system on that bus. If you lose power steering on a bus, i.e. a belt breaks, the power steering pump goes out, a power steering line blows, you also no longer have brakes. You now have a system where you have no steering and no brakes. With an air brake bus, you will always have the brakes no matter what happens with the steering, and you will always have the steering no matter what happens with the brakes. It's just a much safer system it's it's safety is the biggest thing our district won the the aapt safety award this
year for transportation and safety is our biggest concern above all else above financial above anything safety is our biggest concern i
Speaker 72
28:33
think representative fortner had asked you a question you have the manufacturer well he had asked
Speaker 98
28:38
he wanted to know which breaks lasted 18 years and that's what i stated in the letter it says three
Chair
Unverified
28:43
years okay okay thank you members i don't see any questions thank
Speaker 12
28:56
you now without objection then this rule is reviewed and
Chair
Unverified
28:59
approved thank you very much next we are moved to item D and the next item on your agenda is the special education high cost occurrence rule this rule has been referred to the Education Committee and a copy of the report is included in your packet for informational purposes. Will someone with the agency please come up, introduce yourself, and present the rule.
Speaker 103
29:34
Good morning Courtney Salis Ford for the Division of Elementary and Secondary Education. Just to avoid any
Speaker 104
29:41
confusion going forward, many of you may have known that this was previously referred to as the special education catastrophic occurrence funding rule we were trying not to change midstream however with the passage of Act 757 becoming effective on July 24th we felt it was necessary to go ahead and start referring to it by the newly termed special education high-cost
occurrence fund but it is the same rule that originated as catastrophic and the The current Special Education Catastrophic Occurrence Funding Rule has been in existence since 2004, following the 2003 Auden and Pikus Adequacy Report, which led to Act 59 of the Second Extraordinary Session of 2003 and the Public School Funding Act, which actually established the Catastrophic Fund at that time. Since 2004, the amount of funds appropriated to this high-cost fund has increased $12 million,
the percentage of claim reimbursement districts have received has decreased over 50 percent for that reason among many other concerns that were raised that for the last several years the department's special education unit has been reviewing our procedures reviewing the process making adjustments as necessary and as possible within the confines of the existing rules however in November of 2018 the Bureau of Legislative Research issued a report as part of its 2018 Educational Adequacy Study,
again prompting the Education Committee and the Department of Education to look further into the high-cost fund and the possible need for an increase in the appropriated funds. It was during this review that ADE concluded that because districts had been being reimbursed for the usual and normal cost of providing special education programs and services, that we needed to make adjustments. We needed to make changes to the rules into the procedures. As a result, ADE convened a committee of stakeholders to research similar
funding structures in other states to consider several different options and get feedback from the stakeholders on what could be the, we knew we couldn't find a decision that would make everyone happy, but that would be the most beneficial to the students that the funds were intended to benefit. Ultimately, we decided on the proposed revisions that are before you today, which we feel most closely align with the purpose intended for these funds as stated in the law.
The law defines the special education catastrophic, now high cost occurrence fund to be supplemental financial support in individual cases in which special education and related services required by the IEP of a particular student are unduly expensive, extraordinary, or beyond the routine and normal cost associated with special education and related services provided by the school district. Under the current procedures and the current rules, districts are reimbursed
the initial $15,000 of cost. Under the proposed change, districts would be responsible of their own other funding for that first $15,000 cost, but then would receive 100% reimbursement above that amount up to 65 000 and 80 above that amount up to a hundred thousand it is shifting the responsibility of the cost for the first 15 000 to the district as normal and routine cost
in addition to the several stakeholder meetings these proposed changes were sent out for public comment a public comment hearing was held and the division received four comments from three school districts who could potentially receive less total funding as a result of these changes we had been asked by some legislators to provide a map indicating the potential effects on certain districts and I think that was provided to you all yesterday as well as the list of districts these are just projections based on 2017 data we will not know for a fact and there's no way
to know for a fact how any district could be affected because students move districts students needs change the cost of things change so all of the information is provided as simply projections however we do feel that these proposed changes again most closely align with the intent of the funds as stated in law and that it will direct the funding to the students with the highest cost needs I had also been asked by a legislator to address the
possibility of students transferring districts and without going into a lot of additional detail school districts cannot deny services to students with disabilities they can't refuse to provide them services they have to make those decisions the IEP team has to make those decisions as to what services is provided and the district has to provide those under federal and state law they cannot simply refuse and encourage a child to go to a different district the only way a child could attend a different district would be if they
moved in and became a resident of that school district or if they participated in one of the three school choice options which has several requirements as well and so with that we ask for
Chair
Unverified
35:13
your review and approval of these rules and i'd be happy to answer any questions
Representative DeAnn Vaught
Unverified
35:24
representative vaut you're recognized for a question thank
you mr chair i'm wondering if you know what the percent is in schools that fall in this fifteen thousand dollar
Representative DeAnn Vaught
Unverified
35:59
the reason I'm asking is because that's the group of kids that
Speaker 113
36:05
the school has to pay 100% for anyone under $15,000 correct so in 2017
Speaker 104
36:12
I don't have the percentage. I'm sure I could do that real quick with a calculator, but of the 1,300 student claims submitted, 1,285 were above the 15,000, so roughly 20 students were below the 15,000.
Senator Keith Ingram
Unverified
36:50
Thank you, Mr. Chair. Mr. Ingram, you're recognized. Thank you, Mr. Chair. And you might have said it and I might have missed it, but did you not have any fiscal impact on what we're talking about? Because if I remember the overall numbers, we fund about, what, $113 million for statewide
for catastrophic. And the recommended number, I think, was somewhere about $120 million, $121 million. fall short in what was the recommended number. So is this an attempt to, I mean, obviously they're going to have to front the money the school districts are. Is this, what's the fiscal impact? Is this going to save the state money and put it more on the local districts? So currently the catastrophic
Speaker 104
37:51
high cost fund is appropriated $13 million. It has been for
the last two years there was a projection done that it would take approximately 30 million to fully reimburse every submitted claim on behalf of school districts from 2017 that was one of the things that we looked at in that if we did not fund if we did not reimburse districts for that first 15,000 based on 2017 data we would only need 13 million there would have been no need for an increase now if we look at 2018 or 2019 2020 data cost continue to
increase student needs continue to increase so we can't say for a fact that that same 13 million would cover all claims at 100% in the future but we do feel like following this change and following the first year of implementation we could get a better picture of what the needs the financial needs of the state are um and then you know let the legislature determine if an increase was necessary above the current 13 million
Senator Keith Ingram
Unverified
38:58
so i mean you you're you're basically cost shifting down to
the local school districts uh where are they gonna find the money to fund this so excuse me they
Speaker 104
39:12
currently get foundation funding for each of these students uh just a little less than seven thousand dollars they get special education federal funding for these students excuse me there are a couple of other special education state line item funding that they get for these students and then any difference would be to other state and local funds the average cost of average per pupil expenditure
for the state is around ten thousand dollars which is about the same amount that they are getting and so it's not likely that they would have to have much additional money above what they already
Chair
Unverified
39:59
receive. Thank You Mr. Chair. Presentive Dodson
Representative Jim Dotson
Unverified
40:02
you're recognized for a question. Thank You Mr. Chair. So of the
1285 students roughly that were in 2017 that were above 15,000 between 15 and 65,000 well what was the average per student cost for those is it I mean is there total 18,000 25,000
Speaker 104
40:24
30,000 what is I don't have the average I could get that for you certainly we have it broken down by numbers In terms of 183 students were between 15,000 and 17,000, 834 students were between 17,000 and 30,000, 268 students were between 30,000 and 50,000, and 18 students were between 50,000 and 100,000.
Representative Jim Dotson
Unverified
40:49
wow um so i guess have you looked any further into adding at least some sort of district share on that 15 to 65 000 so that districts have a little bit of incentive to control the cost and not go from and i know we talked about this in education committee the other day um and i don't know if you've had a chance over the last week to to look into what that might look like if it's 5%, 10%, 15 or 20. But, um, as, as your department testified last week, this is kind of like
insurance, uh, where the first 15,000 is the deductible, but under most insurance, the first 15,000 is the deductible. There's a, there's a copay on the next amount. And then there's a stop loss after that. This is kind of the reverse of that, um, where you have that deductible but there's no there's no skin in the game on the next portion of it so once they hit $15,001 there's no I can go to 65 and pad their budget and so very concerning there do you have
Speaker 103
42:05
on that in the last week and a half we have discussed that and
Speaker 104
42:09
we have you know looked at numbers and obviously the the more percentage responsibility you place on the district, then the less state funding they would need to be reimbursed for. We, of course, didn't want to propose any changes at this time. That would require us to start the procedure over. But I think we will continue to look at the effect on school districts,
the effect on the state funding amount in determining if changes need to be made going forward. Something that we are also looking at is our internal procedures. which addresses the allowable cost that districts can claim. And we think that there is room for efficiency and improvement in that so that we can, we don't ever want to be incentivizing districts to just get to that $15,000 mark and then spend all they can to get the reimbursement. They should be making decisions based on kids' needs.
And so we are going to make every effort to make it an efficient process, to make sure we're meeting students' and districts' needs, But I think that is something we will look at going forward. I
Representative Jim Dotson
Unverified
43:17
agree they shouldn't, but it's one of those things where you have to trust and verify. So over the next year and a half or so as we're getting this, please keep a close eye on that. I have no reason to believe this rule is not going to pass today, but if that needs to be addressed after the new standard is set,
I'd like to see another rule back in here as soon as possible If we begin to see abuse of that average, if you start seeing more students that are, the numbers you just gave me start going up on average, we need to look at that very closely.
Chair
Unverified
43:55
I understand. Thank you. Senator Hammer, you're recognized
Senator Kim Hammer
Unverified
43:58
for a question? Thank you. based on the testimony i'm getting the impression that there's some suspicions that the districts are just utilizing this as an additional ability to get funds on the backs of the students that
fall under this category maybe i've got misinterpreted on that but on the basis of what i'm interpreting being heard do you know that the district's expenses are not legitimate and how do you audit them to determine that the money that they're spending doesn't truly meet the needs of the population they're addressing i'm
Speaker 104
44:30
education services to come up and talk to you a little bit more about the actual internal procedure i certainly don't mean to infer that districts are doing anything fraudulent or you
know that the expenses are not actual expenses that they've incurred but it's all about again making sure that the costs that we reimburse for meet the definition in law of above routine and normal and that they are not being reimbursed for things like um the classroom teacher which they have to provide regardless for students but i'll allow lisa to talk a little bit more about that so if you would please introduce yourself first lisa tyler director of student support
Speaker 134
45:13
services division of learning services so the question was whether the districts are taking advantage if you will of the the funds to things that are not allowable what they are asking for reimbursement for is totally allowable under our rules but there's a flaw in the rule and in the way that we have administered the catastrophic fund because our rule allows us by having this $15,000 threshold and once a district meets that threshold they're entitled to everything
below that so basically we're funding the cost of a special education classroom and when you look at the law and it says that this is for extraordinary costs beyond routine and normal so we have about 20% of our students in self contained classrooms roughly are submitted for reimbursement under the catastrophic fund and that means 80% or not but they're all in the same types of classrooms, and we're allowing districts under this rule to collect reimbursement for portions
of teachers. Some of them submit reimbursements for three or four paraprofessionals who are likely working in that classroom, and we have allowed that, but can you really say that that's the individual needs of a student that this fund was set up for? So it's not that they're doing anything wrong. They're taking advantage of a funding source to receive additional funding for special education, and all of our districts need more money for special education, but this rule was about high cost, extraordinary, catastrophic costs to districts for individual
students, and what it is now is the way that we have the rules set up, we're funding programs. We're funding special education classrooms, especially at the lower end, like the districts are submitting claims on students with needs around 15 16 17 thousand dollars but it's totally allowable and if you were at the district you would want to take advantage of every funding source there was available so how long is this rule
Senator Kim Hammer
Unverified
47:23
as it's currently in its current state been around when
was it originally passed it allowed the districts to have that latitude as interpreted
Speaker 104
47:32
to the letter of the law since 2004 the rule when it was originally promulgated has not been changed 2004
Senator Kim Hammer
Unverified
47:39
okay and so I guess I'm going back to a question was asked a while ago we're about to change the rule that the schools have been accustomed to operating they're not doing anything wrong they're operating according to the letter of the law and everything but we're about basically put a cap on this and then it's going to become the district's choice as far as how they go about providing those services from that point so you said but I heard 13
million and then I heard a 30 million is this going to be an indirect shift to the local school districts of that difference between the 12 something million you mentioned 13 and the 30-something number you mentioned a while ago or they just going to have to kind of get it back in the in the box as far as how they're providing
Speaker 104
48:24
services I mean it is a shift in the responsibility for the financial cost from the state to the districts but it's a financial responsibility that they are obligated under law for every student
not just students with disabilities. And as Lisa stated, the way the current rule has been set up, we have been reimbursing them for those costs, for those initial $15,000 of costs that they don't receive reimbursement for any other student on. And so our proposal is to shift the responsibility for the state to the higher cost. So the districts would be responsible for the first 15, like they are for every other student, but then the state funding would kick in at 15 and be reimbursed at a higher rate
Speaker 138
49:07
for the highest cost students. Go ahead.
Speaker 134
49:12
No, you go ahead, please. Well, I was just gonna say that the 13 million is still going to go out to the districts and they're going to receive 13 million. The shift is gonna be to which students that 13 million dollars funds to the greater extent. So those students with the highest cost needs will receive reimbursement at a higher rate those students who have lots of needs but not to the extent that you might
consider catastrophic will be reimbursed at a lesser rate so it just depends in terms of the shift to the district if you're a district who has students in the twenty five thirty forty thousand dollar range it's going to be advantageous because the cost of that student are going to be reimbursed at a higher rate but if you're a district that's submitting um a large majority of kids in that 15 16 17 000 threshold and and really submitting the cost for their special education self-contained
classroom you're going to probably receive less under the new rule although you will still receive some reimbursement all right because part of thank you ms
Senator Kim Hammer
Unverified
50:22
chair because part of what i'm gearing up for in the in my mind is if it ends up
that the school districts start to cut services or I can see those phone calls coming
Speaker 134
50:33
sure and as Courtney said one of the things we plan to do especially after the first year is really monitor the implementation and see if we see shifts because we have that data
available to what kinds of services are being provided to kids particularly if we see shifts in cost being submitted through district budgets or through the catastrophic occurrence fund. Thank you,
Chair
Unverified
50:57
Mr. Chair. Senator Dismayne, you're recognized for a
Senator Jonathan Dismang
Unverified
51:06
question. Thank you. Sorry, it's me. I switched seats. No, I appreciate the rule. I've heard from my schools, actually, that do have those higher catastrophic cases where, you know, they struggle to pay for what
they're trying to employ um I mean they have to have a full-time nurse you know right for someone who is in a wheelchair and um but that is completely really unresponsive I mean it's so I I do understand this and actually I've heard from some of my schools like I said on the flip side of this where they've not been able to really keep up with the true cost of providing the actually care that they are required by law to to provide for those students so i do appreciate it
i think that i appreciate also the information on page five where you've outlined all the different funding sources that are available to those do you know the impact to the medicaid budget by chance or what the current spend is for this category within medicaid
Speaker 104
52:08
no and that would be very difficult to ascertain because it depends on if the student is medicaid eligible it depends on if the parent is giving permission to bill you know for services um the amount that different
districts bill it would be not all catastrophic or high
Speaker 103
52:26
cost students are are medicaid eligible so i think trying to determine that impact would be very difficult okay thank you Senator
Chair
Unverified
52:38
Ingram you're recognized for a question
Senator Keith Ingram
Unverified
52:44
well we know for certain from testimony that the there we are underfunded it in the past that there's a need to me I am very concerned that this is just gonna make the problem
worse and if you look at if read the superintendents I've yet and somebody can point it out to me but I've yet to see a superintendent that's for this rule change in that how how critical is this that we do this today I sure would like to visit with my my school district my superintendents about this because just on the surface to me we're cost shifting back to the school district and
And as Senator Hammer said, you know, I worry about services being cut on the local level that are already underfunded. So I guess, Mr. Chair, I would ask how critical is this that we pass this today?
Speaker 72
53:46
Senator, I think they've been here once already, correct? Correct. We
Chair
Unverified
53:50
came once and were referred to Education
Committee. And went back to Education and presented again. that we haven't had any comments from superintendents to show up.
As a matter of fact, I've heard from my districts that they're supportive
Speaker 12
54:05
of this. So I guess you could make a motion if you want, but I think we've heard
Senator Keith Ingram
Unverified
54:11
it several times. I hope this is beating it around now, and usually I'll say superintendents are very good about letting us know if it's
Speaker 144
54:19
going to have a tremendous negative impact. Okay, thank you. If I may
Speaker 103
54:24
add, we have heard from numerous superintendents on both sides, and
Speaker 104
54:27
then we have also sat down and met with Dr. Abernathy of the AAEA and talked to him about concerns that he had heard, and he seemed to be in agreement with our proposal.
Speaker 12
54:39
You know, I was one of the ones that asked the questions you presented to. I know there's a tendency for some schools to shift their population to a neighboring school with these high-cost students. And I think this is an attempt to try to supplement that funding when that student population moves. And it's going to cause schools to be more circumspect in how they spend up to that $15,000 threshold. and i'm sure we will get calls but i think this is a from what i read it's a good attempt to try
to help manage our money better we can always use more but this is a good attempt to do that do we have
Chair
Unverified
55:22
i don't see any more questions so with no without objection this rule is reviewed and approved. Thank you. Thank you. Next we have the Bank Department. Will someone with the agency please come up, introduce yourselves for the record and present your rule. Thank you Mr.
John Allen
Unverified
55:53
Chair. My name is John Allen. I'm deputy
bank commissioner for the Arkansas State Bank Department the rule I'm here to present today is a cleanup rule we're basically just mirroring what exists in federal federal rule and the prior rule that we had referred to a prior version of that it's my understanding that some members of the committee have expressed some concerns about some of the wording in the rule we're proposing and if that is the case and the committee would prefer not to have that language in it And I'm referring specifically to line three after the comma after 2019 that reads and any subsequent amendments to 12 CFR
9-18 thereafter we Agency would be more than happy to have that language removed from the rules That's the committee's will and have it passed
Chair
Unverified
56:41
without it. Thank you Members, I was the one that had that concern. Yeah, I feel that's inconsistent with the legislative intent of the administrative procedures act that would require the agency to go through the administrative process and seek review and approval for the changes so It sounds like the agency is agreeable to striking that any subsequent amendment. Yes, sir. That'd be correct. Okay. Thank you members
Does anyone have any questions? Seeing no questions Without objection this rule is reviewed and approved. Thank you. Thank you, sir i see no further anything on the agenda anybody have any comments or questions if not we're adjourned
Agenda
A. Call to Order.
B. Reports of the Executive Subcommittee.
C. Rules Referred to the Senate Interim Committee on Transportation, Technology, and Legislative Affairs and the House Interim Committee on Public Transportation.
D. Rules Referred to the Senate and House Interim Committees on Education.
E. Rules Filed Pursuant to Ark. Code Ann. § 10-3-309.
F. Adjournment.
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — ALC - ADMINISTRATIVE RULES, Sep 18, 2019 | Agenda | 1 | Official source ↗ |
| A Summary Agenda | Exhibit | 13 needs OCR | Official source ↗ |
| B Executive Subcommittee Report | Exhibit | 1 needs OCR | Official source ↗ |
| C.01a CAPSAFT Specs Governing Sch Bus Design and Act 375 of 2017 | Exhibit | 41 needs OCR | Official source ↗ |
| C.01a Report from Transportation Committees | Exhibit | 1 needs OCR | Official source ↗ |
| D.01a ADE Spec Ed High-Cost Occurrences and Act 757 of 2019 | Exhibit | 5 needs OCR | Official source ↗ |
| D.01a Report from Education Committees | Exhibit | 1 needs OCR | Official source ↗ |
| E.01a Rule 47-701.9 Fiduciary Powers and State Banks | Exhibit | 6 | Official source ↗ |
Speakers
Chair
Unverified
Speaker 13
Speaker 15
Speaker 17
Speaker 18
Speaker 22
Speaker 19
Speaker 11
Senator Terry Rice
Unverified
Senator Kim Hammer
Unverified
Speaker 63
Speaker 67
Representative Jack Fortner
Unverified
Speaker 71
Representative Jim Dotson
Unverified
John Allen
Unverified
Speaker 93
Speaker 97
Speaker 98
Speaker 72
Speaker 12
Speaker 103
Speaker 104
Representative DeAnn Vaught
Unverified
Speaker 109
Speaker 113
Senator Keith Ingram
Unverified
Speaker 82
Speaker 134
Speaker 138
Senator Jonathan Dismang
Unverified
Speaker 144