[Vision2020] LEGISLATIVE NEWSLETTER III -- JANUARY 31- FEBRUARY 4, 2011

[Rep. Tom Trail]

LEGISLATIVE NEWSLETTER III -- JANUARY 31- FEBRUARY 4, 2011

Constituents:

     One has to keep a sense of humor in this current Idaho Legislative
session.    Tom D., the House Chaplain, came up to talk with me
Friday morning.  I remarked how terrible his Orange and Blue BSU tie
looked.  He apologized and said that he had many requests from other
legislators and members of his congregation to get a neat looking
Vandal tie.   I said that I would help him out, and immediately
e-mailed President Nellis for help.  In less than three hours a
nicely wrapped package arrived on my office desk with a note that my
request had been fulfilled.    Early next week I plan on presenting
the tie during one of our daily sessions to our House Chaplain with a
comment that such a gift should provide spiritual guidance to the
rest of the body in terms of supporting Higher Education budget
request.  And now we move on to other legislative news.

   1.  Good News!!!   Tax returns for January came in over $14 million
above projections. Economists think this is a sign of a slowly        
recovering economy.  PERSI--in our House Commerce and Human Resources
Committee,  PERSI Director Don Drum, gave us an hour report on the
State Retirement System.  PERSI is rated among the two top retirement
systems of its kind in the U.S.  The percentage return since July 1,
2010 is 16.5%.  There is now about $11.8 billion in the PERSI
portfolio.  The unfunded liability is about 12% which is very
acceptable.  On March 1, 2011 by law all PERSI retirees will receive a
1% Cola.  I have yet to see any actual legislation that would attempt
to change the PERSI program.

   2.  Budget  --  It is now apparent that Idaho is facing a $185 million
deficit.  We have a reduction of projected General Fund revenues
because of federal tax conformity--the House Revenue and Taxation
Committee agreed to partial conformity which means the state needs to
budget for $10.5 million in this current fiscal year and another $9.6
million in next year's budget. We also had some unanticipated higher
sales tax rebates for alternative energy, an incentive bill we passed
five years ago to get more renewables in the state.

       The Governor recommended $1,235,893,600 for K-12 education and
indicated there would be only a nominal cut for K-12.  Now the JFAC
Co-Chairs sent letters to all of the members of the House and
Education Committees that they would need to come up with suggested
prioritized cuts of between $50 million and $81 million.  The JFAC
Chairs also asked the Health and Welfare Committees to find between
$35 million and $50 million to deal with further cuts in Health and
Welfare Programs.

   3. Taxes and Tax Equity -- With the State Budget Shortfall ballooning
to $185 million, the AARP, for example says that it is time for
lawmakers to look at long-term sustainable solutions.  "You can't take
the same approach and expect a different result every year -- we've got
to get this state back on track financially and involves looking at new
revenue sources," said Jim Wordelman, State Director for AARP in Idaho
-- "Wielding the budget axe every time Idaho has shortfalls is not the
only approach and isn't the best approach in the long run."   Among the
revenue solutions AARP is urging legislators to move forward are:
increasing the state tobacco tax by $1.25 (currently it's the 42nd
lowest in the country); adding several services, such       as
professional and business, which currently pay no taxes, into the state
tax base; increasing the tax on beer and wine (neither tax has
increased in four decades); and joining efforts to tax purchases made
on-line.  AARP is also calling for a review of Idaho's tax exemptions,
which currently cost the state about $1.7 million in revenue.

     I like to approach taxes from a tax equity or fairness point of view.
 I recommend 1) hiring more tax auditors to go after non-paying
taxpayers, 2) call for a 90 day tax amnesty -- a period during which
non-taxpayers can settle up and not be prosecuted, 3)make certain
that the Tax Commission doesn't cut anymore "sweet heart" deals with
out of state corporations -- probably costing the state now an
estimated $40 million/year, 4) review all tax exemptions except
production and health exemptions and have the organizations now
claiming these exemptions to show they are a benefit to the state.
Those exemptions not found to be beneficial to the state can then be
eliminated and the funds can come back to the general fund.

 4. The Strange Life and Times of Superintendent of Public Instruction Tom
Luna -- Since Mr. Luna won election in 2006 he has championed the fact
that despite Idaho ranking 49th in the Nation in terms of per capita
expenditure for students that Idaho students were making very good
progress academically and testing well ahead of students in many
neighboring states. He said that much of this was due to his leadership
and a number of new initiatives.  Frankly, there were good signs of
progress in spite that teachers had not received an increase in pay for
three years and some even suffered pay cuts (and some teachers and
families qualified for food stamps).  Mr. Luna touted the progress in his
2010 campaign.

    The Sky is Falling---As soon as the Legislature opened up Mr. Luna
issued a desperate cry that the Idaho K-12 system was in shambles and
that only desperate measures could save the situation.   He then
unveiled a revolutionary plan that would increase class size, require
high school students to take two on-line classes per year to graduate,
 provide every 9th grader with a laptop,  pay for performance, and a
number of other initiatives.

    ATeam Player??   During his 2006 campaign Mr. Luna stressed that as a
Head of the Idaho K-12 system he would involve all of the major
stakeholders in the development of new plans and initiatives.  So as
we look to see if Mr. Luna met the test with his new Education
Proposal, we are sadly disappointed.  Major stakeholders including the
IEA (teachers), PTA, State School Boards Association, State District
School Administrators, The Idaho School Board Association, all of the
Idaho Universities and Colleges, and other key educational
organizations were not involved.  I asked President Duane Nellis, UI
President, if he or his faculty had been consulted and he said "No."  
Dr. Nellis also reported that no one on the State Board of Education
was consulted. So it appears that Mr. Luna must have been struck by
external spiritual inspiration, but he certainly failed the test that
he touted in his 2006 campaign and throughout the first four years as
SPI.  His entire process is desperately flawed.

    While educational reform is critically important to Idaho, Mr. Luna's
proposal is a poorly constructed initiative from several critical
milestones for a change initiative.   Mr. Luna is proposing a second
order change initiative (second order change is radical and results in
dramatic change versus first order change that is incremental or
evolutionary) that lacks evidence the initiative will succeed and puts
the entire Idaho K-12 system an extreme risk.  Some of the components
that Mr. Luna has evidently overlooked are: 1) lack of a pilot that
demonstrates tangible success, 2) lack of quantifiable success metrics
for the initiative itself, 3) lack of wide spread involvement of all
the stakeholders, 4) lack of multiple solutions to test and evaluate,
5) using a "pillar" which has failed for other school systems, and 6)
lack of experience is designing and managing a second order change.

   One needs to recall that in the business world the failure rate for
second order change initiatives ranges from 50% to 70%.  Just to   
give one example -- there is evidence that the giving laptops won't
succeed based on the experience of other school systems.   The NY Times
Education article from May 4, 2007 (Seeing No Progress, Some Schools
drop Laptops).  The article stated that both public and private, rich
and poor districts from multiple states have found laptops did not
improve achievement of students and created numerous problems and
expenses.

   During this past week I received three calls from suppliers of laptop
computers, software, and curriculum supplies urging me to support Mr.
Luna's Educational Reform Proposal.  I also noticed that a number of
the Albertson Foundation Board came out in support of Mr.   Luna's
plan.  A local reporter noted that these individuals all had ties to
the private educational company K-12.   Out of interest I   ran off a
list of Mr. Luna's campaign donations.  A substantial number of
donations came from the private educational company sector. The Senate
Educational Committee will start hearing on the plan this coming week.

   That's all for now.  Send me your comments and suggestions.   My email
is ttrail at house.idaho.gov and telephone (208) 332-1184

Rep. Tom Trail