Special education funding

AN ACT Relating to special education funding; amending RCW 1
28A.150.390 and 28A.150.392; creating a new section; and providing an 2
effective date. 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:4
NEW SECTION. Sec. 1. The legislature finds that students 5
receiving special education services are entitled, under both federal 6
and state law, to a free appropriate public education that enables 7
their full participation.8
The legislature finds that special education is part of the 9
state's statutory program of basic education that is deemed by the 10
legislature to implement Article IX, section 1 of the state 11
Constitution. 12
Sec. 2. RCW 28A.150.390 and 2024 c 229 s 1 are each amended to 13
read as follows: 14
(1) The superintendent of public instruction shall submit to each 15
regular session of the legislature during an odd-numbered year a 16
programmed budget request for special education programs for students 17
with disabilities. Funding for programs operated by local school 18
districts shall be on an excess cost basis from appropriations 19
provided by the legislature for special education programs for 20
S-0435.2
SENATE BILL 5263
State of Washington 69th Legislature 2025 Regular Session
By Senators Pedersen, Braun, Bateman, Chapman, Conway, Dhingra,
Frame, Krishnadasan, Liias, Nobles, Orwall, Salomon, Shewmake,
Stanford, Valdez, and C. Wilson
Read first time 01/14/25. Referred to Committee on Early Learning &
K-12 Education.
p. 1 SB 5263
students with disabilities and shall take account of state funds 1
accruing through RCW 28A.150.260 (4)(a), (5), (6), and (8) and 2
28A.150.415. 3
(2) The excess cost allocation to school districts shall be based 4
on the following: 5
(a) A district's annual average head count enrollment of students 6
ages three and four and those five year olds not yet enrolled in 7
kindergarten who are eligible for and receiving special education, 8
multiplied by the district's base allocation per full-time equivalent 9
student, multiplied by ((1.2)) 1.6381; 10
(b)(((i) Subject to the limitation in (b)(ii) of this subsection 11
(2), a)) A district's annual average enrollment of resident students 12
who are eligible for and receiving special education, excluding 13
students ages three and four and those five year olds not yet 14
enrolled in kindergarten, multiplied by the district's base 15
allocation per full-time equivalent student, multiplied by the 16
special education cost multiplier rate of((:17
(A) Beginning in the 2020-21 school year, either:18
(I) 1.0075 for students eligible for and receiving special 19
education and reported to be in the general education setting for 80 20
percent or more of the school day; or21
(II) 0.995 for students eligible for and receiving special 22
education and reported to be in the general education setting for 23
less than 80 percent of the school day;24
(B) Beginning in the 2023-24 school year, either:25
(I) 1.12 for students eligible for and receiving special 26
education and reported to be in the general education setting for 80 27
percent or more of the school day; or28
(II) 1.06 for students eligible for and receiving special 29
education and reported to be in the general education setting for 30
less than 80 percent of the school day.31
(ii) If the enrollment percent exceeds 16 percent, the excess 32
cost allocation calculated under (b)(i) of this subsection must be 33
adjusted by multiplying the allocation by 16 percent divided by the 34
enrollment percent)) 1.5289.35
(3) As used in this section((:36
(a) "Base)), "base allocation" means the total state allocation 37
to all schools in the district generated by the distribution formula 38
under RCW 28A.150.260 (4)(a), (5), (6), and (8) and the allocation 39
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under RCW 28A.150.415, to be divided by the district's full-time 1
equivalent enrollment. 2
(((b) "Basic education enrollment" means enrollment of resident 3
students including nonresident students enrolled under RCW 4
28A.225.225 and students from nonhigh districts enrolled under RCW 5
28A.225.210 and excluding students residing in another district 6
enrolled as part of an interdistrict cooperative program under RCW 7
28A.225.250.8
(c) "Enrollment percent" means the district's resident annual 9
average enrollment of students who are eligible for and receiving 10
special education, excluding students ages three and four and those 11
five year olds not yet enrolled in kindergarten and students enrolled 12
in institutional education programs, as a percent of the district's 13
annual average full-time equivalent basic education enrollment.))14
Sec. 3. RCW 28A.150.392 and 2024 c 127 s 2 are each amended to 15
read as follows: 16
(1)(a) To the extent necessary, funds shall be made available for 17
safety net awards for districts with demonstrated needs for special 18
education funding beyond the amounts provided through the special 19
education funding formula under RCW 28A.150.390. 20
(b) If the federal safety net awards based on the federal 21
eligibility threshold exceed the federal appropriation in any fiscal 22
year, then the superintendent shall expend all available federal 23
discretionary funds necessary to meet this need. 24
(2) Safety net funds shall be awarded by the state safety net 25
oversight committee subject to the following conditions and 26
limitations: 27
(a) The committee shall award additional funds for districts that 28
can convincingly demonstrate that all legitimate expenditures for 29
special education exceed all available revenues from state funding 30
formulas. When determining award eligibility and amounts (([,])), the 31
committee shall limit its review to relevant documentation that 32
illustrates adherence to award criteria. The committee shall not make 33
determinations regarding the content of individualized education 34
programs beyond confirming documented and quantified services and 35
evidence of corresponding expenditures for which a school district 36
seeks reimbursement. 37
(b) In the determination of need, the committee shall consider 38
additional available revenues from federal sources.39
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(c) Differences in program costs attributable to district 1
philosophy, service delivery choice, or accounting practices are not 2
a legitimate basis for safety net awards. 3
(d) In the determination of need, the committee shall require 4
that districts demonstrate that they are maximizing their eligibility 5
for all state revenues related to services for students eligible for 6
special education and all federal revenues from federal impact aid, 7
medicaid, and the individuals with disabilities education act-Part B 8
and appropriate special projects. Awards associated with (e) and (f) 9
of this subsection shall not exceed the total of a district's 10
specific determination of need. 11
(e) The committee shall then consider the extraordinary high cost 12
needs of one or more individual students eligible for and receiving 13
special education. Differences in costs attributable to district 14
philosophy, service delivery choice, or accounting practices are not 15
a legitimate basis for safety net awards. 16
(f) Using criteria developed by the committee, the committee 17
shall then consider extraordinary costs associated with communities 18
that draw a larger number of families with children in need of 19
special education services, which may include consideration of 20
proximity to group homes, military bases, and regional hospitals. 21
Safety net awards under this subsection (2)(f) shall be adjusted to 22
reflect amounts awarded under (e) of this subsection.23
(g) The committee shall then consider the extraordinary high cost 24
needs of one or more individual students eligible for and receiving 25
special education served in residential schools, programs for 26
juveniles under the department of corrections, and programs for 27
juveniles operated by city and county jails to the extent they are 28
providing a secondary program of education. 29
(h) The maximum allowable indirect cost for calculating safety 30
net eligibility may not exceed the federal restricted indirect cost 31
rate for the district plus one percent. 32
(i) Safety net awards shall be adjusted based on the percent of 33
potential medicaid eligible students billed as calculated by the 34
superintendent of public instruction in accordance with chapter 318, 35
Laws of 1999. 36
(j) Safety net awards must be adjusted for any unresolved audit 37
findings or exceptions related to special education funding. Safety 38
net awards may only be adjusted for errors in safety net applications 39
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or individualized education programs that materially affect the 1
demonstration of need. 2
(3) The superintendent of public instruction shall adopt such 3
rules and procedures as are necessary to administer the special 4
education funding and safety net award process. By December 1, 2018, 5
the superintendent shall review and revise the rules to achieve full 6
and complete implementation of the requirements of this subsection 7
and subsection (4) of this section including revisions to rules that 8
provide additional flexibility to access community impact awards. 9
Before revising any standards, procedures, or rules, the 10
superintendent shall consult with the office of financial management 11
and the fiscal committees of the legislature. In adopting and 12
revising the rules, the superintendent shall ensure the application 13
process to access safety net funding is streamlined, timelines for 14
submission are not in conflict, feedback to school districts is 15
timely and provides sufficient information to allow school districts 16
to understand how to correct any deficiencies in a safety net 17
application, and that there is consistency between awards approved by 18
school district and by application period. The office of the 19
superintendent of public instruction shall also provide technical 20
assistance to school districts in preparing and submitting special 21
education safety net applications. 22
(4)(a) On an annual basis, the superintendent shall survey 23
districts regarding their satisfaction with the safety net process 24
and consider feedback from districts to improve the safety net 25
process. Each year by December 1st, the superintendent shall prepare 26
and submit a report to the office of financial management and the 27
appropriate policy and fiscal committees of the legislature that 28
summarizes the survey results and those changes made to the safety 29
net process as a result of the school district feedback.30
(b) By December 1, 2024, the office of the superintendent of 31
public instruction must develop a survey requesting specific feedback 32
on the safety net application process from school districts with 33
3,000 or fewer students. The survey must include, at a minimum, 34
questions regarding the average amount of time school district staff 35
spend gathering safety net application data, filling out application 36
forms, and correcting application deficiencies. The survey must also 37
include questions to help identify which application components are 38
the most challenging and time consuming for school districts to 39
complete. By December 1, 2025, the office of the superintendent of 40
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public instruction must use this feedback to implement a simplified, 1
standardized safety net application for all school districts that 2
reduces barriers to safety net funding. 3
(5) The safety net oversight committee appointed by the 4
superintendent of public instruction shall consist of:5
(a) One staff member from the office of the superintendent of 6
public instruction; 7
(b) Staff of the office of the state auditor who shall be 8
nonvoting members of the committee; and 9
(c) One or more representatives from school districts or 10
educational service districts knowledgeable of special education 11
programs and funding. 12
(6)(((a))) Beginning in the ((2019-20)) 2025-26 school year, a 13
high-need student is eligible for safety net awards from state 14
funding under subsection (2)(e) and (g) of this section if the 15
student's individualized education program costs exceed ((two and 16
three-tenths)) 1.5 times the average per-pupil expenditure as defined 17
in Title 20 U.S.C. Sec. 7801, the every student succeeds act of 18
2015((.19
(b) Beginning in the 2023-24 school year, a high-need student is 20
eligible for safety net awards from state funding under subsection 21
(2)(e) and (g) of this section if the student's individualized 22
education program costs exceed:23
(i) 2 times the average per-pupil expenditure, for school 24
districts with fewer than 1,000 full-time equivalent students;25
(ii) 2.2 times the average per-pupil expenditure, for school 26
districts with 1,000 or more full-time equivalent students.27
(c) For purposes of (b) of this subsection, "average per-pupil 28
expenditure" has the same meaning as in 20 U.S.C. Sec. 7801, the 29
every student succeeds act of 2015, and excludes )), excluding safety 30
net funding provided in this section. 31
NEW SECTION. Sec. 4. This act takes effect September 1, 2025.32
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