More details from the Senate Majority’s education funding bill

The language behind the Senate Majority Coalition’s education funding plan has been released as SB 5607. On Saturday I wrote about the general aspects of the plan, based on the summaries provided by the Coalition. I read through the bill itself today and found more items of interest, plus some clarifications.

The new funding structure. The “basic per pupil guarantee” would be set at $10,000, which is “a level necessary to exceed the entire projected cost under current law” of state general apportionment, state levy equalization, state pupil transportation, and all local school district maintenance and operation (M&O) levies by about $126 million.

The “local effort levy” (see below) would be applied to the basic guarantee. Then, the state would provide the rest of the funds needed to get to $10,000. But the basic guarantee “must be increased by an amount necessary to ensure that the state contribution, which excludes the local effort levy, constitutes at least forty percent of the basic per pupil amount.”

The plan would provide additional funding on top of the $10,000 for specific types of students:

  • $7,500 for special education students,
  • $1,000 for transitional bilingual students (expected to generate $10 million more than current funding),
  • $2–5,000 for students in poverty (expected to generate $150 million more than current funding),
  • $1,000 for highly capable students (expected to double current funding),
  • $500 for career and technical education and skills center students (expected to double current funding),
  • $1,500 for homeless students (expected to generate $14 million),

If all this adds up to less than $12,500 per pupil, the state would make up the difference.

Local effort levy. In addition to the current state property tax (up to $3.60 per $1,000 of assessed value), the state would levy a permanent “local effort levy” on behalf of school districts ($1.80/$1,000). That rate could be reduced in the budget, and this bill specifies that it would be $0.45/$1,000 in CY 2018. The local effort levy would not be subject to the 101 percent growth limit. (For more on the property tax, see pages 2–4 of our McCleary report.)

Beginning July 1, 2019, whenever biennial revenues exceed those of the prior biennium, the increased revenues must first go toward the basic guarantee and then toward reducing the local effort levy rate, with the goal of reaching $1.25/$1,000.

For purposes of the constitutional 1 percent limit on property taxes, state levies would not be able to exceed $3.60+$1.80 per $1,000. It looks like the junior taxing districts would lose out here, if the total state levies exceed the current $3.60 limit (again, see our McCleary report for more on how the property tax is currently distributed). But the bill provides that if taxing districts are harmed by this, they could get payments from the state.

The local effort levy would be in place of the M&O excess levies that districts currently must get voter approval for. Thus, they would not be allowed to have M&O levies in 2019 (the current 28 percent levy limit would be maintained in 2018). In 2020, the maximum levy would be 10 percent. For M&O levies sent to voters, districts would have to describe what they would do with the funds, and they must have OSPI approval.

Other. In addition to repealing I-1351, the bill would also repeal I-732, which provides cost-of-living adjustments for teachers.

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