H-1239.3

HOUSE BILL 2026

ByRepresentatives Dufault, Corry, Mendoza, and Manjarrez

AN ACT Relating to the fairness in education funding act; amending RCW 28A.150.410, 28A.150.276, and 28A.300.0401; reenacting and amending RCW 28A.320.330; adding a new section to chapter 28A.150 RCW; creating new sections; repealing RCW 28A.150.412, 28A.150.413, 28A.320.245, 28A.500.010, 28A.500.015, 28A.500.040, 28A.500.060, 28A.500.900, 28A.505.240, 28A.545.010, 28A.545.020, 28A.545.030, 28A.545.040, 28A.545.050, 28A.545.060, 28A.545.070, 28A.545.080, 28A.545.090, 28A.545.100, 28A.545.110, 28A.545.120, 28A.545.130, 28A.545.140, 43.09.2856, 84.09.037, 84.52.053, and 84.52.0531; and providing a contingent effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

The legislature intends that every student, regardless of socioeconomic background or geographic location of residence within the state, should receive roughly equal priority and funding for the provision of education, as stated in the Washington state Constitution. Local levies, local capital funding, and local enrichment levies inherently favor schools in wealthy census tracts over those in high-poverty census tracts and should therefore be abolished and replaced with state funding that demonstrates to the public and to every public school student in the state that their education is valued, prioritized, and funded at the same level as every other public school and public school student in the state of Washington.

Sec. 2. RCW 28A.150.410 and 2022 c 109 s 7 are each amended to read as follows:

(1) ((Through the 2017-18 school year, the legislature shall establish for each school year in the appropriations act a statewide salary allocation schedule, for allocation purposes only, to be used to distribute funds for basic education certificated instructional staff salaries under RCW 28A.150.260.)) For the purposes of this section, the staff allocations for classroom teachers, teacher-librarians, counselors, and student health services staff under RCW 28A.150.260 are considered allocations for certificated instructional staff.

(2) ((Through the 2017-18 school year, salary allocations for state-funded basic education certificated instructional staff shall be calculated by the superintendent of public instruction by determining the district's average salary for certificated instructional staff, using the statewide salary allocation schedule and related documents, conditions, and limitations established by the omnibus appropriations act.

(5) By the 2018-19 school year))Until the 2025-26 school year, the minimum state allocation for salaries for certificated instructional staff in the basic education program must be increased to provide a statewide average allocation of $64,000 adjusted for inflation from the 2017-18 school year.

(((6) By the 2018-19 school year))(3) Until the 2025-26 school year, the minimum state allocation for salaries for certificated administrative staff in the basic education program must be increased to provide a statewide average allocation of $95,000 adjusted for inflation from the 2017-18 school year.

(((7) By the 2018-19 school year))(4) Until the 2025-26 school year, the minimum state allocation for salaries for classified staff in the basic education program must be increased to provide a statewide average allocation of $45,912 adjusted by inflation from the 2017-18 school year.

(((8) For school year 2018-19, a district's minimum state allocation for salaries is the greater of the district's 2017-18 state salary allocation, adjusted for inflation, or the district's allocation based on the state salary level specified in subsections (5) through (7) of this section, and as further specified in the omnibus appropriations act.

(9) Beginning with the 2018-19 school year))(5) Until the 2025-26 school year, state allocations for salaries for certificated instructional staff, certificated administrative staff, and classified staff must be adjusted for regional differences in the cost of hiring staff. Adjustments for regional differences must be specified in the omnibus appropriations act for each school year through at least school year 2022-23. ((For school years 2018-19 through school year 2022-23, the school district regionalization factors are based on the median single-family residential value of each school district and proximate school district median single-family residential value as described in RCW 28A.150.412))Beginning with the 2026-27 school year, all school districts will receive the same state salary allocations as prescribed in subsection (6) of this section for certificated instructional staff, certificated administrative staff, and classified staff with no regional adjustments.

(((10)))(6) Beginning with the ((2023-24 school year and every four years thereafter, the minimum state salary allocations and school district regionalization factors for certificated instructional staff, certificated administrative staff, and classified staff must be reviewed and rebased, as provided under RCW 28A.150.412, to ensure that state salary allocations continue to align with staffing costs for the state's program of basic education))2026-27 school year, the minimum state allocation for salaries in the basic education program are as follows:

(c) For classified staff, $71,082 adjusted for inflation from the 2026-27 school year.

(((11)))(7) For the purposes of this section, "inflation" has the meaning provided in RCW 28A.400.205 for "inflationary adjustment index."

NEW SECTION.  Sec. 3. A new section is added to chapter 28A.150 RCW to read as follows:

(1) Beginning with the 2026 calendar year, the state must provide the following amounts to school districts, charter schools, and state-tribal education compact schools per average annual full-time equivalent enrollment adjusted for inflation from the 2026 calendar year:

(a) $1,550 per average annual full-time equivalent enrollment for enrichment funding. Funding provided under this subsection is subject to the restrictions of RCW 28A.150.276. School districts are not eligible to receive allocations under this subsection (1)(a) in any calendar year that they collect enrichment levies; and

(b) $1,000 per average annual full-time equivalent enrollment to support the construction, modernization, or remodeling of school facilities, which includes the purposes of RCW 28A.320.330(2) (f) and (g). School districts are not eligible to receive allocations under this subsection (1)(b) in any calendar year that they collect excess levies to support the construction, modernization, or remodeling of school facilities.

(2) The funding provided under this section is not part of the state's statutory program of basic education.

Sec. 4. RCW 28A.150.276 and 2018 c 266 s 301 are each amended to read as follows:

(1)(a) ((Beginning September 1, 2018, school))School districts may use ((local revenues))enrichment funding provided under section 3 of this act only for documented and demonstrated enrichment of the state's statutory program of basic education as authorized in subsection (2) of this section.

(b) Nothing in this section revises the definition or the state funding of the program of basic education under RCW 28A.150.220 and 28A.150.260.

(c) For purposes of this section, (("local revenues" means enrichment levies collected under RCW 84.52.053, local effort assistance funding received under chapter 28A.500 RCW))"enrichment funding" means funding received under section 3(1)(a) of this act, and other school district local revenues including, but not limited to, grants, donations, and state and federal payments in lieu of taxes, except that "((local revenues))enrichment funding" does not include other federal revenues, or local revenues that operate as an offset to the district's basic education allocation under RCW 28A.150.250.

(2)(a) Enrichment activities are permitted under this section if they provide supplementation beyond the state:

(i) Minimum instructional offerings of RCW 28A.150.220 or 28A.150.260;

(ii) Staffing ratios or program components of RCW 28A.150.260, including providing additional staff for class size reduction beyond class sizes allocated in the prototypical school model and additional staff beyond the staffing ratios allocated in the prototypical school formula;

(iii) Program components of RCW 28A.150.200, 28A.150.220, or 28A.150.260; or

(iv) Program of professional learning as defined by RCW 28A.415.430 beyond that allocated pursuant to RCW 28A.150.415.

(b) Permitted enrichment activities consist of:

(i) Extracurricular activities, extended school days, or an extended school year;

(ii) Additional course offerings beyond the minimum instructional program established in the state's statutory program of basic education;

(iii) Activities associated with early learning programs;

(iv) Any additional salary costs attributable to the provision or administration of the enrichment activities allowed under this subsection; and

(v) Additional activities or enhancements that the office of the superintendent of public instruction determines to be a documented and demonstrated enrichment of the state's statutory program of basic education under (a) of this subsection ((and for which the superintendent approves proposed expenditures during the preballot approval process required by RCW 84.52.053 and 28A.505.240)).

(3) In addition to the limitations of subsections (1) and (2) of this section and of RCW 28A.400.200, permitted enrichment activities are subject to the following conditions and limitations:

(a) If a school district spends ((local revenues))enrichment funding for salary costs attributable to the administration of enrichment programs, the portion of administrator salaries attributable to that purpose may not exceed twenty-five percent of the total district expenditures for administrator salaries; and

(b) Supplemental contracts under RCW 28A.400.200 are subject to the limitations of this section.

(4) The superintendent of public instruction must adopt rules to implement this section.

Sec. 5. RCW 28A.300.0401 and 2011 c 140 s 3 are each amended to read as follows:

(1) The office of the superintendent of public instruction shall, where it is practicable to do so within available resources, prepare school district fiscal notes on proposed legislation that increases or decreases, or tends to increase or decrease, school district revenues or expenditures in a manner that uniquely affects school districts. Proposed legislation that uniquely affects school districts includes, but is not limited to, legislation that affects school districts' responsibilities as providers of educational services under this title((,))or as employers under chapter 41.59 RCW((, or as excess levy taxing authorities under RCW 84.52.053 and 84.52.0531)), but excludes proposed legislation that affects school districts only in the same manner that it affects other units of local government.

(2) Where practicable, the school district fiscal note shall show the fiscal impact of the proposed legislation on each school district. Where it is not practicable to do so, the school district fiscal note shall show the effect of the legislation on a range of representative school districts. The fiscal note must set forth any assumptions that were used in selecting the representative districts, along with any other assumptions made about the fiscal impact.

(3) School district fiscal notes prepared under this section are subject to coordination by the office of financial management under RCW 43.88A.020 and are otherwise subject to the requirements and procedures of chapter 43.88A RCW.

Sec. 6. RCW 28A.320.330 and 2023 c 474 s 8022 and 2023 c 402 s 1 are each reenacted and amended to read as follows:

School districts shall establish the following funds in addition to those provided elsewhere by law:

(1)(a) A general fund for the school district to account for all financial operations of the school district except those required to be accounted for in another fund.

(b) ((By the 2018-19 school year, a local))An enrichment revenue subfund of its general fund to account for the financial operations of a school district that are paid from ((local revenues))enrichment revenues provided under section 3(1)(a) of this act. The ((local)) revenues that must be deposited in the ((local))enrichment revenue subfund are enrichment ((levies and transportation vehicle levies collected under RCW 84.52.053, local effort assistance funding received under chapter 28A.500 RCW,))funding received under section 3(1)(a) of this act and other school district local revenues including, but not limited to, grants, donations, and state and federal payments in lieu of taxes, but do not include other federal revenues, or local revenues that operate as an offset to the district's basic education allocation under RCW 28A.150.250. School districts must track expenditures from this subfund separately to account for the expenditure of each of these streams of revenue by source, and must provide the supplemental expenditure schedule under (c) of this subsection((, and any other supplemental expenditure schedules required by the superintendent of public instruction or state auditor, for purposes of RCW 43.09.2856)).

(c) Beginning in the 2019-20 school year, the superintendent of public instruction must require school districts to provide a supplemental expenditure schedule by revenue source that identifies the amount expended by object for each of the following supplementary enrichment activities ((beyond the state funded amount)):

(i) Minimum instructional offerings under RCW 28A.150.220 or 28A.150.260 not otherwise included on other lines;

(ii) Staffing ratios or program components under RCW 28A.150.260, including providing additional staff for class size reduction beyond class sizes allocated in the prototypical school model and additional staff beyond the staffing ratios allocated in the prototypical school formula;

(iii) Program components under RCW 28A.150.200, 28A.150.220, or 28A.150.260, not otherwise included on other lines;

(iv) Program components to support students in the program of special education;

(v) Program components of professional learning, as defined by RCW 28A.415.430, beyond that allocated under RCW 28A.150.415;

(vi) Extracurricular activities;

(vii) Extended school days or an extended school year;

(viii) Additional course offerings beyond the minimum instructional program established in the state's statutory program of basic education;

(ix) Activities associated with early learning programs;

(x) Activities associated with providing the student transportation program;

(xi) Any additional salary costs attributable to the provision or administration of the enrichment activities allowed under RCW 28A.150.276;

(xii) Additional activities or enhancements that the office of the superintendent of public instruction determines to be a documented and demonstrated enrichment of the state's statutory program of basic education under RCW 28A.150.276; and

(xiii) All other costs not otherwise identified in other line items.

(d) For any salary and related benefit costs identified in (c)(xi), (xii), and (xiii) of this subsection, the school district shall maintain a record describing how these expenditures are documented and demonstrated enrichment of the state's statutory program of basic education. ((School districts shall maintain these records until the state auditor has completed the audit under RCW 43.09.2856.))

(e) For school districts of the second class as defined ((by [in]))in RCW 28A.300.065, a depreciation subfund for the school district to reserve funds for future facility and equipment needs. Up to two percent of a second class school district's general fund may be deposited each fiscal year into the depreciation subfund for the purpose of preventative maintenance or emergency facility needs. The preventative maintenance must be necessary to realize the originally anticipated useful life of a building or facility and include: Exterior painting of facilities; replacement or renovation of roofing, exterior walls, windows, heating, air conditioning and ventilation systems, floor coverings in classrooms and common areas, and electrical and plumbing systems; and renovation of playfields, athletic facilities, and other district real property. School districts of the second class, subject to applicable public works bid limits, may use school district employees to perform preventative maintenance with moneys from the depreciation subfund, but moneys from the depreciation subfund may not be used for employee compensation that is unrelated to this subsection (1)(e).

(2) A capital projects fund shall be established for major capital purposes. All statutory references to a "building fund" shall mean the capital projects fund so established. Money to be deposited into the capital projects fund shall include, but not be limited to, bond proceeds, ((proceeds from excess levies authorized by RCW 84.52.053,)) state apportionment proceeds as authorized by RCW 28A.150.270 and section 3(1)(b) of this act, earnings from capital projects fund investments as authorized by RCW 28A.320.310 and 28A.320.320, and state forest revenues transferred pursuant to subsection (3) of this section.

Money derived from the sale of bonds, including interest earnings thereof, may only be used for those purposes described in RCW 28A.530.010, except that accrued interest paid for bonds shall be deposited in the debt service fund.

Money to be deposited into the capital projects fund shall include but not be limited to rental and lease proceeds as authorized by RCW 28A.335.060, and proceeds from the sale of real property as authorized by RCW 28A.335.130.

Money legally deposited into the capital projects fund from other sources may be used for the purposes described in RCW 28A.530.010, and for the purposes of:

(a) Major renovation and replacement of facilities and systems where periodical repairs are no longer economical or extend the useful life of the facility or system beyond its original planned useful life. Such renovation and replacement shall include, but shall not be limited to, major repairs, exterior painting of facilities, replacement and refurbishment of roofing, exterior walls, windows, heating and ventilating systems, floor covering in classrooms and public or common areas, and electrical and plumbing systems.

(b) Renovation and rehabilitation of playfields, athletic fields, and other district real property.

(c) The conduct of preliminary energy audits and energy audits of school district buildings. For the purpose of this section:

(i) "Preliminary energy audits" means a determination of the energy consumption characteristics of a building, including the size, type, rate of energy consumption, and major energy using systems of the building.

(ii) "Energy audit" means a survey of a building or complex which identifies the type, size, energy use level, and major energy using systems; which determines appropriate energy conservation maintenance or operating procedures and assesses any need for the acquisition and installation of energy conservation measures, including solar energy and renewable resource measures.

(iii) "Energy capital improvement" means the installation, or modification of the installation, of energy conservation measures in a building which measures are primarily intended to reduce energy consumption or allow the use of an alternative energy source.

(d) Those energy capital improvements which are identified as being cost-effective in the audits authorized by this section.

(e) Purchase or installation of additional major items of equipment and furniture: PROVIDED, That vehicles shall not be purchased with capital projects fund money.

(f)(i) Costs associated with implementing technology systems, facilities, and projects, including acquiring hardware, licensing software, and online applications and training related to the installation of the foregoing. However, the software or applications must be an integral part of the district's technology systems, facilities, or projects.

(ii) Costs associated with the application and modernization of technology systems for operations and instruction including, but not limited to, the ongoing fees for online applications, subscriptions, or software licenses, including upgrades and incidental services, and ongoing training related to the installation and integration of these products and services. However, to the extent the funds are used for the purpose under this subsection (2)(f)(ii), the school district shall transfer to the district's general fund the portion of the capital projects fund used for this purpose. The office of the superintendent of public instruction shall develop accounting guidelines for these transfers in accordance with internal revenue service regulations.

(g) Major equipment repair, painting of facilities, and other major preventative maintenance purposes. However, to the extent the funds are used for the purpose under this subsection (2)(g), the school district shall transfer to the district's general fund the portion of the capital projects fund used for this purpose. The office of the superintendent of public instruction shall develop accounting guidelines for these transfers in accordance with internal revenue service regulations. Based on the district's most recent two-year history of general fund maintenance expenditures, funds used for this purpose may not replace routine annual preventive maintenance expenditures made from the district's general fund.

(h) During the 2021-2023 fiscal biennium, renovation and replacement of facilities and systems, purchase or installation of items of equipment and furniture, including maintenance vehicles and machinery, and other preventative maintenance or infrastructure improvement purposes.

(i) During the 2023-2025 fiscal biennium, for moneys in the capital projects fund not attributable to capital levies, moving of equipment and furniture between buildings and warehouses for storage, moving of the content of teachers' classrooms between buildings, and furniture purchases, when these costs are due to the following activities: Construction, remodeling, replacement, temporary placement, consolidation, or directed transfer.

(3) A debt service fund to provide for tax proceeds, other revenues, and disbursements as authorized in chapter 39.44 RCW. State forestland revenues that are deposited in a school district's debt service fund pursuant to RCW 79.64.110 and to the extent not necessary for payment of debt service on school district bonds may be transferred by the school district into the district's capital projects fund.

(4) An associated student body fund as authorized by RCW 28A.325.030.

(5) Advance refunding bond funds and refunded bond funds to provide for the proceeds and disbursements as authorized in chapter 39.53 RCW.

(1) RCW 28A.150.412 (Basic education compensation allocations—Rebase and review—Revision of minimum allocations and regionalization factors—Regionalization factors—Definitions) and 2024 c 252 s 1, 2018 c 266 s 203, & 2017 3rd sp.s. c 13 s 104;

(2) RCW 28A.150.413 (Finding—Local levy authority—Local effort assistance—Value—Restriction) and 2017 3rd sp.s. c 13 s 208 & 2009 c 548 s 301;

(3) RCW 28A.320.245 (Responses to audit findings on use of local revenues—Policies—Hearings—Disciplinary actions) and 2017 3rd sp.s. c 13 s 504;

(4) RCW 28A.500.010 (Local effort assistance funding—Purpose—Not basic education) and 2017 3rd sp.s. c 13 s 205, 1999 c 317 s 1, 1997 c 259 s 4, 1993 c 410 s 1, (1993 c 465 s 2 expired December 31, 1995), 1992 c 49 s 2, & 1987 1st ex.s. c 2 s 102;

(5) RCW 28A.500.015 (Annual local effort assistance funding—Formulas—Not basic education) and 2022 c 108 s 4, 2019 c 410 s 1, 2018 c 266 s 303, & 2017 3rd sp.s. c 13 s 206;

(6) RCW 28A.500.040 (Distribution of funds) and 1999 c 317 s 4;

(7) RCW 28A.500.060 (Condensed compliance reports—Second-class districts) and 2011 c 45 s 34;

(8) RCW 28A.500.900 (Effective date—1999 c 317) and 1999 c 317 s 5;

(9) RCW 28A.505.240 (Enrichment levy spending plans—Preballot approval—Revised spending plan for voter-approved levies) and 2018 c 266 s 304 & 2017 3rd sp.s. c 13 s 204;

(10) RCW 28A.545.010 (School district divisions—High and nonhigh) and 1983 c 3 s 31 & 1969 ex.s. c 223 s 28A.44.045;

(11) RCW 28A.545.020 (Reimbursement not a tuition charge) and 1983 c 3 s 32 & 1969 ex.s. c 223 s 28A.44.095;

(12) RCW 28A.545.030 (Purposes) and 2020 c 225 s 1, 2017 3rd sp.s. c 13 s 1001, 1990 c 33 s 488, & 1981 c 264 s 1;

(13) RCW 28A.545.040 ("Student residing in a nonhigh school district" defined) and 2010 c 99 s 7, 1995 c 77 s 25, 1990 c 33 s 489, & 1981 c 264 s 2;

(14) RCW 28A.545.050 (Amounts due from nonhigh districts) and 1985 c 341 s 11 & 1981 c 264 s 3;

(15) RCW 28A.545.060 (Enrollment data for computation of amounts due) and 1990 c 33 s 490 & 1981 c 264 s 4;

(16) RCW 28A.545.070 (Superintendent's annual determination of estimated amount due—Process) and 2020 c 225 s 3, 2017 3rd sp.s. c 13 s 1002, 1990 c 33 s 491, & 1981 c 264 s 5;

(17) RCW 28A.545.080 (Estimated amount due paid in May and November installments) and 1990 c 33 s 492 & 1981 c 264 s 6;

(18) RCW 28A.545.090 (Assessing nonhigh school lesser amount—Notice of) and 1990 c 33 s 493 & 1981 c 264 s 7;

(19) RCW 28A.545.100 (Amount due reflects cost of education and transportation of students) and 1995 c 77 s 26, 1990 c 33 s 494, 1983 1st ex.s. c 61 s 7, & 1981 c 264 s 8;

(20) RCW 28A.545.110 (Rules to effect purposes and implement provisions) and 1990 c 33 s 495 & 1981 c 264 s 9;

(21) RCW 28A.545.120 (New programs or grades—Approval—Rules) and 2010 c 99 s 8 & 2006 c 263 s 325;

(22) RCW 28A.545.130 (Condensed compliance reports—Second-class districts) and 2011 c 45 s 44;

(23) RCW 28A.545.140 (Annual data reports) and 2020 c 225 s 2;

(24) RCW 43.09.2856 (School district audits—School district compliance with RCW 28A.150.276 and 28A.505.240—Report of findings) and 2019 c 410 s 4, (2019 c 387 s 5 expired December 1, 2021), 2018 c 266 s 406, & 2017 3rd sp.s. c 13 s 503;

(25) RCW 84.09.037 (School district boundary changes) and 2006 c 263 s 615, 1990 c 33 s 597, & 1987 c 100 s 3;

(26) RCW 84.52.053 (Levies by school districts authorized—When—Procedure) and 2018 c 266 s 306, 2017 3rd sp.s. c 13 s 201, 2012 c 186 s 18, 2010 c 237 s 4, 2009 c 460 s 2, 2007 c 129 s 3, 1997 c 260 s 1, 1994 c 116 s 1, 1987 1st ex.s. c 2 s 103, 1986 c 133 s 1, & 1977 ex.s. c 325 s 3; and

(27) RCW 84.52.0531 (Enrichment levies by school districts—Maximum dollar amount—Enrichment levy expenditure plan approval—Rules—Deposit of funds) and 2022 c 108 s 3.

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