WSR 03-02-053

PERMANENT RULES

SUPERINTENDENT OF

PUBLIC INSTRUCTION

[ Filed December 26, 2002, 11:17 a.m. ]

Date of Adoption: December 11, 2002.

Purpose: Legislative changes effective with the 2002-03 school year have eliminated all state funding for safety net resulting in significant policy changes. Three state funded categories of safety net have been eliminated: MOESR, percentage, and other factors. Provision for supplemental safety net funding has been added.

Citation of Existing Rules Affected by this Order: Repealing WAC 392-140-610, 392-140-613, 392-140-620, 392-140-625, 392-140-670 and 392-140-680; and amending WAC 392-140-600, 392-140-605, 392-140-609, 392-140-616, 392-140-626, 392-140-643, 392-140-656, 392-140-660, and 392-140-675.

Statutory Authority for Adoption: RCW 28A.150.290.

Other Authority: Section 507(7), chapter 309, Laws of 1999.

Adopted under notice filed as WSR 02-22-086 on November 5, 2002.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 5, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 5, Repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 10, Repealed 0.
Effective Date of Rule: Thirty-one days after filing.

Thomas J. Kelly

for Dr. Terry Bergeson

Superintendent of

Public Instruction

OTS-6004.2


AMENDATORY SECTION(Amending WSR 01-04-023, filed 1/30/01, effective 1/30/01)

WAC 392-140-600   Special education safety net -- Applicable provisions.   The provisions of WAC 392-140-600 through 392-140-685 apply to the determination of safety net allocations of ((state special education moneys and)) Individuals with Disabilities Education Act (IDEA) federal ((discretionary moneys)) funds for the ((2000-01)) 2002-03 school year and thereafter.

[Statutory Authority: RCW 28A.150.290. 01-04-023, 392-140-600, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290(2) and 1999 c 309 507(7). 00-03-015, 392-140-600, filed 1/7/00, effective 2/7/00. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-600, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending WSR 02-05-036, filed 2/12/02, effective 2/13/02)

WAC 392-140-605   Special education safety net -- Application type((s)), certification, worksheets.   Application for safety net funding shall be made on ((Form SPI 1381 - Maintenance or)) Form SPI 1381 - Certification published by the superintendent of public instruction as follows:

(1) School districts may make application for safety net funding ((on one or more of the four application types described below. Applications will be considered and awards made in the order shown until the district's eligibility is exhausted.

(a) Maintenance of effort (state revenue only) hereafter referred to as MOESR. State safety net funding may be requested when a district shows a MOESR loss calculated by the superintendent of public instruction pursuant to WAC 392-140-620.

(b) Students above the funded percentage hereafter referred to as percentage. State safety net funding may be requested if district's actual resident special education enrollment exceeds the district's funded resident special education enrollment, the district is implementing an ongoing plan of action to contain or eliminate any unnecessary, duplicative, or ineffective enrollment practices, and all available funding, including state, federal, and local if provided in the past, is insufficient to meet the expenditure level necessary for special education. State safety net funding may be requested by a school district with unfunded special education costs due to factors beyond the district's control and not attributable to district philosophy or service delivery style. The applicant district must meet the standards of WAC 392-140-613 and 392-140-625.

(c))) for high-cost individual student(s). ((A school district may submit applications for federal safety net funding for high-cost individual students meeting the standards in WAC 392-140-616.

(d) Factors other than students above the funded level or high-cost individual students hereafter referred to as other factors. State safety net funding may be requested by a school district with unfunded special education costs due to factors beyond the district's control and not attributable to district philosophy or service delivery style. The applicant district must meet standards of WAC 392-140-613 and 392-140-625.

(2))) The school district making application for safety net funding shall certify that:

(a) The district recognizes that differences in costs attributable to district philosophy, service delivery choice, or accounting practice are not a legitimate basis for safety net awards.

(b) The application complies with the respective safety net application standards of WAC ((392-140-610, 392-140-613, or)) 392-140-616;

(((b))) (c) The application provides true and complete information to the best of the school district's knowledge; ((and

(c))) (d) The district understands that safety net funding is not an entitlement, is subject to adjustment and recovery, may not be available in future years, ((state safety net funding must be expended in program 21 which impacts the amount that must be maintained for the federal maintenance of effort test, and federal safety net funding)) must be expended in program 24, and federal Medicaid has been billed for all services to eligible students;

(e) The district is making reasonable effort to provide appropriate services for students in need of special education using state funding generated by the basic education apportionment and special education funding formulas;

(f) The district's special education services are operated in a reasonably efficient manner;

(g) Indirect costs included for purposes of determining safety net allocations do not exceed the allowable percent for federal special education program plus one percent;

(h) Any available federal funding is insufficient to address the additional needs;

(i) The costs of any supplemental contracts are not included for purposes of determining safety net awards. Supplemental contracts are those contracts made pursuant to RCW 28A.400.200(4) excluding extended school year contracts (ESY) required by an IEP; and

(j) The costs of any summer school instruction are not included for purposes of making safety net determinations excluding extended school year contracts (ESY) required by an IEP.

(((3))) (2) Worksheet((s)) A shall be included with the application ((shall)) must demonstrate the need for safety net funding. Worksheet A is used to determine a maximum amount of eligibility for a school district. Award amounts may be less than the maximum amount of eligibility determined on Worksheet A. School districts are encouraged and may be required to submit additional information designed to assist the state oversight committee in analyzing the application.

(((a) MOESR applications pursuant to subsection (1)(a) of this section do not require any worksheets. Applications for MOESR shall include certification of standards and criteria described in WAC 392-140-610.

(b) Percentage applications pursuant to subsection (1)(b) of this section require completion of worksheet "A" described in WAC 392-140-625, certification of standards and criteria pursuant to WAC 392-140-613 and percentage application plan.

(c))) (3) All high-cost individual student applications shall include worksheets "A" and "C" and summary published in the safety net application, and certification of standards and criteria pursuant to WAC 392-140-616.

(((d) Other factors applications pursuant to subsection (1)(d) of this section require completion of application narrative, worksheet "A" described in WAC 392-140-625, and certification of standards and criteria described in WAC 392-140-613.)) (4) At the final meeting of the year, the state oversight committee may consider supplemental safety net funding needs of applicant districts that have exhausted their pool of high-cost individual students. This supplemental funding is limited to the remaining safety net funding available pursuant to WAC 392-140-660.

Districts making application for supplemental safety net funds shall convincingly demonstrate to the committee that their request for supplemental funding is not due to district philosophy, service delivery choice, or accounting practice.

[Statutory Authority: RCW 28A.150.290. 02-05-036, 392-140-605, filed 2/12/02, effective 2/13/02; 01-04-023, 392-140-605, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290(2) and 1999 c 309 507(7). 00-03-015, 392-140-605, filed 1/7/00, effective 2/7/00. Statutory Authority: RCW 28A.150.290 and 1997 c 149 507(8). 98-08-013 (Order 98-05), 392-140-605, filed 3/18/98, effective 4/18/98. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-605, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending WSR 02-05-036, filed 2/12/02, effective 2/13/02)

WAC 392-140-609   Special education safety net -- Standards and criteria -- Appropriate and properly and efficiently prepared and formulated IEPs.   Individualized education programs (IEPs) which are appropriate, properly and efficiently prepared and formulated are those IEPs that meet all of the following criteria:

(1) The IEPs comply with federal and state procedural requirements.

(2) The delivery of specially designed instruction identified on the IEP complies with state standards (regularly scheduled teaching or training activities provided or designed by special education qualified staff).

(3) ((Areas for)) The provision of special education services conforms with areas of need identified in the student's evaluation and/or reevaluation made pursuant to chapter 392-172 WAC ((392-172-111)).

(4) The state oversight committee determines:

(a) There are no unresolved state audit examination issues related to special education which are material in nature;

(b) There are no unresolved state child count verification issues which are material in nature; and

(c) All corrections to state enrollment reporting, required for resolution of (a) and (b) of this subsection, are completed.

[Statutory Authority: RCW 28A.150.290. 02-05-036, 392-140-609, filed 2/12/02, effective 2/13/02; 01-04-023, 392-140-609, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-609, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending WSR 02-05-036, filed 2/12/02, effective 2/13/02)

WAC 392-140-616   Special education safety net -- Standards -- High-cost individual student applications.   For districts requesting safety net funding to meet the extraordinary needs of an eligible high-cost individual special education student, the district shall demonstrate at a minimum that:

(1) The IEP for the eligible special education student is appropriate, and properly and efficiently prepared and formulated.

(2) All of the following criteria apply to the high-cost individual student:

(a) Costs eligible for safety net consideration must be direct expenditures for services required in the IEP.

(b) In order to deliver appropriate special education to the student, the district must be providing services which incur additional costs which exceed available district annual average per-pupil revenues, including state, federal and local revenues, by ((seven thousand three hundred fifty-eight dollars for the 2001-02 school year)) the published threshold. The threshold amount shall be adjusted annually thereafter based upon the increase in base salary and NERCs as budgeted in the Biennial Operating Appropriations Act and published in the safety net application. This threshold amount shall be adjusted pro rata for students not counted or expected to be counted for special education services on all eight enrollment count dates (October through May). For example, for a student served and reported for only six of the eight count dates, the threshold amount shall be reduced to three-quarters of the full amount. The state safety net oversight committee may set a lower threshold for small school districts.

(c) The total cost of educational services must exceed any carryover of federal flow-through special education funding as of August 31 of the prior school year.

(d) The cost of providing special education services, as directed in the IEP, for this student would be detrimental to the school district's ability to provide necessary services to the other students being provided special education in the district.

(3) The state safety net oversight committee shall adapt the high cost individual student application as appropriate for applications prepared by the Washington state school for the blind and the Washington state school for the deaf.

[Statutory Authority: RCW 28A.150.290. 02-05-036, 392-140-616, filed 2/12/02, effective 2/13/02; 01-04-023, 392-140-616, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290 and 1997 c 149 507(8). 98-08-013 (Order 98-05), 392-140-616, filed 3/18/98, effective 4/18/98. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-616, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending WSR 01-04-023, filed 1/30/01, effective 1/30/01)

WAC 392-140-626   Special education safety net -- Worksheet A -- Demonstration of need.   Applications for ((percentage,)) high-cost individual students((, and other factors)) shall demonstrate district financial need as follows:

(1) Application worksheet "A" shall demonstrate a fiscal need in excess of:

(a) ((The district's maximum eligibility for MOESR;

(b))) Any previous safety net awards for the current school year; and

(((c))) (b) All other available revenue for special education, including all carryover of federal special education revenue.

(2) Awards shall not exceed the amount of need demonstrated on the worksheet "A."

(3) Worksheets submitted with safety net applications are to reflect the state adopted excess cost method of accounting, consistently applied for both years presented.

(4) The safety net oversight committee may revise the district's worksheet "A" submitted for errors or omissions.

(5) The school district shall provide ((additional)) clarifying information as requested by the state oversight committee.

(6) After the close of the school year, the safety net oversight committee may review the worksheet "A" used to determine need for a district's award against the actual final school year enrollments, revenues, and expenditures reported by the district. Based upon the results of this review:

(a) The safety net allocation for the school year may be adjusted or recovered; or

(b) If the committee finds that a portion of the safety net allocation was not needed to balance revenues and expenditures, the committee may consider that portion of the allocation available to meet the needs of the ensuing school year.

[Statutory Authority: RCW 28A.150.290. 01-04-023, 392-140-626, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290(2) and 1999 c 309 507(7). 00-03-015, 392-140-626, filed 1/7/00, effective 2/7/00.]


AMENDATORY SECTION(Amending Order 96-15, filed 9/18/96, effective 10/19/96)

WAC 392-140-643   Special education safety net -- Definition -- State oversight committee -- Procedures.   (1) The state oversight committee will review applications as deemed necessary by the superintendent of public instruction pursuant to WAC 392-140-608.

(2) All applications received by the state oversight committee will be reviewed for completeness by the state oversight committee manager or designee. If applications are not complete, they will be returned to the submitting school district.

(3) The state oversight committee manager will forward to the committee members copies of the applications in a timely manner.

(4) The state oversight committee manager will be responsible for presenting each application for consideration to the committee.

(5) Committee members shall question and discuss the application content for completeness, accuracy, and understanding of the reason(s) for the applicant's need for safety net funding.

(6) The committee may request that a submitting school district provide ((additional)) clarifying information.

(7) Committee members will individually indicate their agreement or disagreement with the action of the committee pursuant to WAC 392-140-646.

(8) A majority vote by the committee members will be sufficient to determine the committee action.

(9) The state oversight committee manager will ensure that notes are taken which summarize the questions and discussion related to each application. A decision summary for each application shall include the amount of the initial request, funding adjustments recommended by the committee, the amount of any award to be made, and the reasons for and against the action taken by the committee.

(10) Committee members shall each sign the decision summary.

(11) The state oversight committee manager, on behalf of the committee, will notify the applicant school district in writing of the determination of the committee. The school district will be provided a copy of the decision summary.

(12) All applications received by the state oversight committee will be retained by the superintendent of public instruction for use in the evaluation of the safety net funding process and to provide the superintendent of public instruction with information with which to make future decisions regarding the safety net process.

[Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-643, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending Order 98-05, filed 3/18/98, effective 4/18/98)

WAC 392-140-656   Special education safety net -- Request for review and reconsideration of an action.   An applicant district may request review and reconsideration of an action of the state oversight committee made pursuant to WAC 392-140-646.

(1) The district shall make the request in writing to the superintendent of public instruction within thirty days of the date that the state oversight committee's written determination notice is sent to the district pursuant to WAC 392-140-643(11).

(2) The applicant district shall request reconsideration of the state oversight committee's action on one or more of the following grounds:

(a) The action was outside the statutory authority of the committee;

(b) The action failed to follow prescribed procedures;

(c) The action erroneously interpreted or applied the law;

(d) The action was not supported by substantial evidence; or

(e) The action was inconsistent with the agency rules regarding safety net funding.

(3) If the superintendent of public instruction finds grounds for reconsideration pursuant to subsection (2) of this section, the superintendent shall request reconsideration of the action by the state oversight committee. The superintendent's request shall state the grounds for reconsideration supported by the facts considered by the superintendent.

[Statutory Authority: RCW 28A.150.290 and 1997 c 149 507(8). 98-08-013 (Order 98-05), 392-140-656, filed 3/18/98, effective 4/18/98. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-656, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending WSR 01-04-023, filed 1/30/01, effective 1/30/01)

WAC 392-140-660   Special education safety net -- Approved application -- Special education safety net allocations.   ((The total amount allocated to school districts may not exceed the authorized appropriation.))

(1) The special education safety net allocation for an individual district shall be the smaller of:

(a) The amount requested by the school district; or

(b) The amount authorized by the state oversight committee.

(2) ((If the district requests and the oversight committee approves the "full" allocation permitted by a state formula, then the allocation shall be adjusted periodically during the year and again in January after the close of the school year to reflect the amount determined under the formula.

(3) Special education safety net allocations of state moneys for percentage and other factors applicants under WAC 392-140-605 (1)(b) and (d) shall be prorated if total year-to-date state allocations for all safety net applications under WAC 392-140-605 (1)(a), (b), and (d) exceed the authorized appropriation for that school year.

(4))) Special education safety net allocations for high-cost individual students under WAC 392-140-605 (1)(((c))) shall use appropriated federal moneys. If safety net awards to meet the extraordinary needs of one or more individual special education students exceed the general fund -- federal appropriation, the superintendent shall expend all available federal discretionary funds necessary to meet this need. ((General fund -- state funds shall not be expended for this purpose.))

[Statutory Authority: RCW 28A.150.290. 01-04-023, 392-140-660, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290(2) and 1999 c 309 507(7). 00-03-015, 392-140-660, filed 1/7/00, effective 2/7/00. Statutory Authority: RCW 28A.150.290 and 1997 c 149 507(8). 98-08-013 (Order 98-05), 392-140-660, filed 3/18/98, effective 4/18/98. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-660, filed 9/18/96, effective 10/19/96.]


AMENDATORY SECTION(Amending WSR 01-04-023, filed 1/30/01, effective 1/30/01)

WAC 392-140-675   Special education safety net -- Adjustments to special education safety net allocations.   Safety net allocations may be adjusted as follows:

(1) For those districts not maximizing Medicaid billing for special education students under RCW 74.09.5255, special education safety net allocations shall be reduced by the estimated potential additional incentive payments for the school year if the district maximized Medicaid incentive payments. Potential additional incentive payments shall be estimated by the superintendent of public instruction based on the district's percent of Medicaid eligible students billed and a statewide average incentive payment per student determined by the superintendent in October of the school year. The average incentive payment per student shall be determined using the prior school year's statewide Medicaid billing data assuming fifty percent incentive payments for all school districts. The superintendent of public instruction shall update Medicaid billing adjustments to safety net allocations periodically during the school year and again in January following the close of the school year.

(2) Special education safety net allocations for a school district may be adjusted to reflect changes in factors for which additional or revised information becomes available after the awarding of the initial safety net allocation. This means:

(a) ((MOESR awards for the "full" amount shall be increased, reduced, or nullified when a recalculation pursuant to WAC 392-140-620 results in a change in the amount previously calculated pursuant to WAC 392-140-620.

(b) Percentage awards for the full amount under WAC 392-140-605 (1)(b) shall be increased, reduced, or nullified when the district's enrollment or state funding factors change.

(c) Percentage and other factors)) High-cost awards may be reduced or nullified when the school district's actual revenues and expenditures for the school year differ significantly from the estimates on which the initial safety net award was based.

(((d))) (b) A school district's safety net award may be adjusted by the safety net oversight committee based on the results of the review conducted by the special education program audit team pursuant to WAC 392-140-630.

(((3) Allocations of state moneys under WAC 392-140-605 (1)(b) and (d) shall be prorated if total state allocations for all safety net applications under WAC 392-140-605 (1)(a), (b), and (d) exceed the authorized appropriation for that school year. Allocations shall be restored to full funding if additional appropriation authority becomes available.))

[Statutory Authority: RCW 28A.150.290. 01-04-023, 392-140-675, filed 1/30/01, effective 1/30/01. Statutory Authority: RCW 28A.150.290(2) and 1999 c 309 507(7). 00-03-015, 392-140-675, filed 1/7/00, effective 2/7/00. Statutory Authority: RCW 28A.150.290 and 1997 c 149 507(8). 98-08-013 (Order 98-05), 392-140-675, filed 3/18/98, effective 4/18/98. Statutory Authority: RCW 28A.150.290 and 1995 2nd sp.s. c 18 as modified by 1996 c 283. 96-19-095 (Order 96-15), 392-140-675, filed 9/18/96, effective 10/19/96.]


REPEALER

     The following sections of the Washington Administrative Code are repealed:
WAC 392-140-610 Special education safety net -- Standards -- MOESR applications.
WAC 392-140-613 Special education safety net -- Standards and criteria -- Percentage and other factors applications.
WAC 392-140-620 Special education safety net -- Calculation of MOESR.
WAC 392-140-625 Special education safety net -- Demonstration of percentage and other factors.
WAC 392-140-670 Special education safety net -- Distribution of state moneys.
WAC 392-140-680 Special education safety net -- Recovery of state allocations to school districts.

Washington State Code Reviser's Office