The state allocates funding for a program of special education for students with disabilities using an excess cost formula. For eligible students in kindergarten through age 21 (K-21), the formula multiplies a school district's base allocation by an excess cost multiplier up to an enrollment limit of 16 percent of a school district's full-time student enrollment. Students in K-21 receiving special education generate funding through both the base allocation and excess cost formulas.
School districts receive a tiered excess cost multiplier based on inclusion in a general education setting for K-21 special education students. A multiplier of 1.12 is provided for special education students that spend at least 80 percent of the school day in a general education setting. For students in a general education setting less than 80 percent of the time, districts receive a 1.06 multiplier. Funding has been provided in the last three biennial operating budgets for professional development to promote the inclusion of special education students within general education classrooms.
Prior to kindergarten, students ages 3 to 5 (Pre-K) receiving special education services receive a multiplier of 1.2. Children with disabilities ages birth to 3 that receive early intervention services though the Early Support for Infants and Toddlers (ESIT) program receive a multiplier of 1.15.
Safety Net Funding.
Beyond allocations from excess cost multipliers, the Office of the Superintendent of Public Instruction (OSPI) may provide safety net funding if a school district has one or more high-need individual (HNI) students or is in a community impacted by large numbers of families with children eligible for special education, such as communities with group homes, regional hospitals, or military bases. For HNI awards, the school district's expenditures for the student must exceed an expenditure threshold. Currently, the threshold for a student in any district to access state safety net funds is 2.2 times the statewide average per pupil expenditure (APPE) for school districts with more than 1,000 full-time equivalent students, and 2.0 times the APPE for school districts with fewer than 1,000 full-time equivalent students. Most safety net awards come from state funding and cover HNI costs, while community impact awards comprise a smaller portion of the safety net. Safety net awards are distributed annually in August of each school year.
As part of its duties related to special education, the OSPI may authorize out-of-state entities to contract with a school district to provide a program of special education for students with disabilities. Students receiving services out of state are eligible for safety net awards if they reach the expenditure threshold.
General Apportionment Funding Used for Special Education.
The K-21 students receiving special education services generate funding through both general apportionment, also referred to as the basic education allocation (BEA), and excess cost formulas. The OSPI is required to develop an allocation and cost accounting methodology to ensure general apportionment funding is prorated and allocated to a student's special education program and accounted for before calculating special education excess cost when services are provided outside of the general education setting. A portion of the BEA amount based on the least restrictive environment (LRE) percentage of time a student is outside a general education setting is redirected from general apportionment and dedicated to special education purposes by the OSPI.
The formulas for special education also apply to charter schools and tribal schools in state-tribal education compacts.
Excess Cost Multipliers.
For K-21 students spending 80 percent or more of the school day in a general education setting, the multiplier is increased from 1.12 to 1.18. For K-21 students spending less than 80 percent of the school day in a general education setting, the multiplier is increased from 1.06 to 1.09.
The multiplier for ESIT students ages birth to 3 is increased from 1.15 to the multiplier used for Pre-K students receiving special education services, which is currently 1.2.
Inclusionary Practices Grants to Schools.
Subject to amounts appropriated, the OSPI must award grants to up to 20 pilot schools to support school-wide centers of excellence for inclusionary practices. Selected schools will receive grant funding to bring them to a multiplier of 1.5 for special education students each year for four school years.
Safety Net.
Safety net awards are distributed quarterly, rather than annually, if the school district receiving the award is a second-class school district, meaning it has less than 2,000 students, or if the award meets the following criteria:
General Apportionment Funding Directed to Special Education.
Beginning in the 2025-26 school year, the allocation and cost accounting methodology for special education (SPED) is changed as follows:
Statewide Special Education Activities.
The Superintendent of Public Instruction (SPI) is required to engage in statewide activities to support special education students. Up to 0.5 percent of the allocations from excess cost multipliers can be reserved by the SPI for statewide activities.
Statewide activities must include an annual review of data, including the percentage of students receiving special education services, to ensure there is not a disproportionate identification of students, and technical assistance to school districts with disproportionate data.
Optionally, the SPI may provide professional development in inclusionary practices to local education agencies, schools, and community partners, and maintain common templates and resources, including a statewide tool for individualized education programs.
The SPI must report annually to the Legislature on the statewide activities funded using the reserved excess cost allocations by December 1 of each year. The 2025 and 2026 reports must include an update on the impact of removing the cap on the special education enrollment percentage and safety net needs.
Demonstration Projects.
Subject to appropriations, the OSPI must provide grants for the demonstration projects established under the 2023-25 State Omnibus Operating Appropriations Act. To the extent funding is sufficient, the OSPI must provide grants to support inclusive teaching practices and student behavior management practices for six demonstration sites ready to exhibit adopted best practices and 16 pilot sites committed to adopting best practices, as well as funding for best practices training for the pilot sites.
The demonstration sites must showcase specified practices, for example: behavior management and crisis de-escalation strategies, needs assessments, use of regulation spaces, reduced use of student isolation and restraint, inclusionary practices, and incident data collection and reporting. The demonstration sites must continue to serve as learning communities and examples for other school districts to observe positive practices in real-world settings.
The pilot sites must take advantage of learning experiences provided by state contractors and demonstration sites to build systems that incorporate positive, trauma-informed behavior support practices to prevent crisis escalation and reduce the use of restraint and isolation. The pilot sites must improve data collection and reporting systems and complete other tasks to achieve the project goal.
By November 15, 2026, the OSPI must submit to the Legislature a final report on the demonstration projects. The report must, to the extent possible, quantify the impact of the demonstration projects in terms of student outcomes. It must also address key implementation challenges and findings, as well as include recommendations for statewide policy changes.
The OSPI must use information gathered from demonstration projects and provide technical assistance to develop a strategy and timeline for prohibiting isolation of students in prekindergarten through grade 5 and to report on the plan by December 1, 2027.
The Appropriations Committee substitute bill recommended:
(In support) This bill is a floor from which we should start considering special education funding options. It increases the special education multiplier and promotes inclusive classroom models through mechanisms such as centers of excellence. The multiplier dial can be turned up when the state's budgetary situation is improved.
The funding provided through the multiplier is helpful but will not entirely close the existing special education funding gap. Many districts report being significantly underfunded over several years, which forces them to divert resources from other areas, including local levy funds. Additional steps are needed to increase the per-student multiplier to reflect the true cost of special education services, remove the enrollment cap on the percentage of students for which districts can receive funding, and lower the safety net threshold to allow more districts to qualify for support.
There is significant support for inclusive practices. When general education teachers, special education teachers, and school administration and staff work as a team to create an inclusive environment, students can thrive. Inclusive education benefits all students, not just those with special needs. While inclusion is positive, it should not mean less support for students with different abilities. There are many examples of successful inclusionary practices in schools, demonstrating positive impacts on student achievement and school culture. The creation of centers of excellence for inclusionary practices is a positive step. Inclusion does not work without adequate funding.
Early intervention for children with developmental delays is critical. Increasing the special education multiplier for children ages birth to 3 provides funding for this early support. An estimated 39 percent of children exiting early support do not require further special education services, which created long-term savings for the state.
(Opposed) None.
(Other) The support and advocacy of the sponsors is appreciated. While the choices are difficult in the current budget environment, additional steps to remove the enrollment cap and lower the safety net threshold would be a better and more comprehensive approach. A recent report from the Joint Legislative Audit and Review Committee highlighted a growing funding gap that districts are having to fill with local funds due to insufficient state funding. The lack of funding forces districts to borrow from other needs, regardless of the source used. There need to also be a focus on recruitment and retention of the special education workforce. Special education should be fully funded. It is a moral, ethical, and legal obligation. Without investments now, the need will grow.
(In support) Representative Monica Jurado Stonier, prime sponsor; Jeff Snell, Vancouver Public Schools, Vancouver, WA; Monique Dugaw, ESD 112 Region; Trevor Greene, Yakima School District; Martin Turney, Issaquah School District; Mike Stewart, Boyer Children's Clinic; and Erin McKee, Issaquah School District and AWSP.