School district solvency

AN ACT Relating to maintaining the financial solvency of school 1
districts through limited real property sales approved by the 2
superintendent of public instruction; amending RCW 28A.335.120 and 3
28A.335.130; and adding a new section to chapter 28A.335 RCW.4
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:5
NEW SECTION. Sec. 1. A new section is added to chapter 28A.335 6
RCW to read as follows: 7
(1) The board of directors of a school district with an estimated 8
ending fund balance for the fiscal year equaling three percent or 9
less of its estimated total revenues for the same fiscal year may 10
request from the superintendent of public instruction authorization 11
to sell real property of the district. The superintendent of public 12
instruction, subject to the following conditions, may only grant the 13
authorization if the school district demonstrates to the satisfaction 14
of the superintendent of public instruction that: 15
(a) The sale is necessary to restore financial stability;16
(b) The sale is necessary to prevent adverse impacts to student 17
learning; and 18
(c) The proceeds from the sale will be used only for alleviating 19
or concluding the financial burdens that caused or significantly 20
H-2720.1
HOUSE BILL 2551
State of Washington 69th Legislature 2026 Regular Session
By Representatives Fey and Leavitt
Read first time 01/16/26. Referred to Committee on Education.
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contributed to inability of the school district to assure its 1
financial solvency. 2
(2) The office of the superintendent of public instruction shall 3
adopt rules to implement this section that include provisions to 4
ensure transparency and accountability, and to verify that the school 5
district's use of the proceeds from any sale of real property aligns 6
with the terms of the authorization. The rules required by this 7
section must also prohibit a school district from receiving an 8
authorization provided under this section or RCW 28A.335.135 more 9
than once during a five-year period. 10
(3) Nothing in this section exempts or shall be construed as 11
exempting school districts from complying with the applicable 12
requirements of RCW 8.16.170 when selling real property acquired 13
through condemnation under chapter 8.16 RCW. 14
Sec. 2. RCW 28A.335.120 and 2025 c 384 s 7 are each amended to 15
read as follows: 16
(1) The board of directors of any school district of this state 17
may: 18
(a) Sell for cash, at public or private sale, and convey by deed 19
all interest of the district in or to any of the real property of the 20
district which is no longer required for school purposes or which has 21
been authorized for sale as provided in RCW 28A.335.135 or section 1 22
of this act or by a financial oversight committee established under 23
RCW 28A.315.221; and 24
(b) Purchase real property for the purpose of locating thereon 25
and affixing thereto any house or houses and appurtenant buildings 26
removed from school sites owned by the district and sell for cash, at 27
public or private sale, and convey by deed all interest of the 28
district in or to such acquired and improved real property.29
(2) When the board of directors of any school district proposes a 30
sale of school district real property pursuant to this section and 31
the value of the property exceeds seventy thousand dollars, the board 32
shall publish a notice of its intention to sell the property. The 33
notice shall be published at least once each week during two 34
consecutive weeks in a legal newspaper with a general circulation in 35
the area in which the school district is located. The notice shall 36
describe the property to be sold and designate the place where and 37
the day and hour when a hearing will be held. The board shall hold a 38
public hearing upon the proposal to dispose of the school district 39
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property at the place and the day and hour fixed in the notice and 1
admit evidence offered for and against the propriety and advisability 2
of the proposed sale. 3
(3) The board of directors of any school district desiring to 4
sell surplus real property shall publish a notice in a newspaper of 5
general circulation in the school district. School districts shall 6
not sell the property for at least forty-five days following the 7
publication of the newspaper notice. 8
(4) Private schools shall have the same rights as any other 9
person or entity to submit bids for the purchase of surplus real 10
property and to have such bids considered along with all other bids.11
(5) Any sale of school district real property authorized pursuant 12
to this section shall be preceded by a market value appraisal by a 13
professionally designated real estate appraiser or a general real 14
estate appraiser certified under chapter 18.140 RCW selected by the 15
board of directors and no sale shall take place if the sale price 16
would be less than ninety percent of the appraisal made by the real 17
estate appraiser: PROVIDED, That if the property has been on the 18
market for one year or more the property may be reappraised and sold 19
for not less than seventy-five percent of the reappraised value with 20
the unanimous consent of the board. 21
(6) If in the judgment of the board of directors of any district 22
the sale of real property of the district not needed for school 23
purposes would be facilitated and greater value realized through use 24
of the services of licensed real estate brokers, a contract for such 25
services may be negotiated and concluded: PROVIDED, That the use of a 26
licensed real estate broker will not eliminate the obligation of the 27
board of directors to provide the notice described in this section: 28
PROVIDED FURTHER, That the fee or commissions charged for any broker 29
services shall not exceed seven percent of the resulting sale value 30
for a single parcel: PROVIDED FURTHER, That any professionally 31
designated real estate appraiser or a general real estate appraiser 32
certified under chapter 18.140 RCW selected by the board to appraise 33
the market value of a parcel of property to be sold may not be a 34
party to any contract with the school district to sell such parcel of 35
property for a period of three years after the appraisal.36
(7) If in the judgment of the board of directors of any district 37
the sale of real property of the district not needed for school 38
purposes would be facilitated and greater value realized through sale 39
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on contract terms, a real estate sales contract may be executed 1
between the district and buyer. 2
Sec. 3. RCW 28A.335.130 and 2025 c 384 s 6 are each amended to 3
read as follows: 4
The proceeds from any sale of school district real property by a 5
board of directors shall be deposited to the debt service fund and/or 6
the capital projects fund, except for: 7
(1) Amounts required to be expended for the costs associated with 8
the sale of such property, which moneys may be deposited into the 9
fund from which the expenditure was incurred; 10
(2) Amounts authorized by a financial oversight committee 11
established under RCW 28A.315.221 to be deposited into a different 12
fund; 13
(3) As provided in RCW 28A.335.240(1); ((or))14
(4) As provided in RCW 28A.335.135; or15
(5) As provided in section 1 of this act. 16
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