Highlights from the new education funding proposal

[Update 3:49pm -- Legislative language has now been released -- see here.]

As Mary noted yesterday, the Senate Majority Coalition has released its education funding plan. This comes after the Republicans on the Education Funding Task Force offered only “guiding principles,” and the EFTF could not agree on recommendations to the Legislature. (For background on all of this, see our 2016 report on McCleary.)

The new plan seems pretty much fully-formed, but we’re only working off two summary documents—bill language has not yet been made available (although the Senate Ways and Means Committee is having a hearing on the plan on Monday). Based on the information available, the plan includes many substantial changes to the way education is funded and organized in Washington.

Some highlights:

  • Instead of funding a prototypical school, the plan would provide a minimum of $12,500 per student (plus funds for students with unique needs, e.g., special education). The state would contribute at least 40 percent of the $12,500.
  • There would be a levy swap. Existing maintenance and operations (M&O) levies (which currently average $2.54/$1,000) would be replaced with a permanent “local effort levy” in the amount of $1.80/$1,000 of assessed value. This levy would be a state tax not subject to voter approval (which is one of the problems the McCleary case finds with the current system). The state would provide additional funds when needed to reach $12,500 per student. Austin Jenkins reports that in 2017, the state property tax is $1.90/$1,000—the $1.80 would be on top of that, for a total of $3.70/$1,000. As we described in our McCleary report, there is a constitutional 1 percent limit on regular property taxes (or $10/$1,000). Of that $10, $3.60 is allocated to the state and the rest is divvied up among local districts and special purposes.
  • M&O levies would be subject to a 10 percent levy lid in 2020. (That is, districts would only be able to levy 10 percent of their state and federal revenues. The current levy lid is 28 percent, and is scheduled to drop to 24 percent in 2018.) Districts would have to account for these local revenues and what they pay for separately from state funds. The state auditor would regularly audit districts to ensure local levies are not funding basic education.
  • The plan would eliminate the current salary allocation model. The only restrictions on how teachers would be paid are that beginning teacher pay would increase from $35,700 to $45,000, districts would only be able to spend 80 percent of their budgets on compensation, and salary increases would not be allowed based on non-subject area advanced degrees.
  • I-1351 would be repealed.

Melissa Santos writes, “The state levy would raise about $2 billion per year, while getting rid of about $2.4 billion collected annually in local school district levies.” Meanwhile,

Districts whose tax base isn’t big enough to reach that minimum under the statewide flat rate of $1.80 per $1,000 in assessed value would receive additional payments from the state to make up the difference, [Sen. John] Braun said. Those payments would cost the state about $1.4 billion every two years, which Braun said the state could pay without implementing new taxes.

We’ll have to watch the biennial budget proposals to see how that would pencil out.

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