WSR 03-21-141

PROPOSED RULES

SUPERINTENDENT OF

PUBLIC INSTRUCTION

[ Filed October 21, 2003, 3:30 p.m. ]

     Original Notice.

     Preproposal statement of inquiry was filed as WSR 02-10-010.

     Title of Rule: Vocational indirect costs limits.

     Purpose: Implements a limit on indirect cost charges by a school district to vocational-secondary programs to 15% of the combined basic education and vocational enhancement allocations of state funds.

     Statutory Authority for Adoption: RCW 28A.150.290(1).

     Statute Being Implemented: Section 502(2) of ESSB 6387.

     Summary: These rules implement a 15% limit on the indirect expenditures to vocational-secondary programs. Additionally provision provides school districts the ability to carry over up to 10% of their revenues in excess of the vocational-secondary program expenditures and allowable indirects in the ensuing school year.

     Reasons Supporting Proposal: Rule revisions are needed to implement legislative changes limiting vocational indirect to 15%.

     Name of Agency Personnel Responsible for Drafting and Enforcement: Calvin Brodie, Office of Superintendent of Public Instruction, (360) 725-6301; and Implementation: Steve Shish, Office of Superintendent of Public Instruction, (360) 725-6307.

     Name of Proponent: Office of Superintendent of Public Instruction, governmental.

     Rule is not necessitated by federal law, federal or state court decision.

     Explanation of Rule, its Purpose, and Anticipated Effects: This rule implements a 15% limit on the allowable indirect expenditures for vocational-secondary programs and allows for a 10% carryover of any vocationally generated state moneys in excess of expenditures and allowable indirects.

     Proposal Changes the Following Existing Rules: Establishes a 15% limit on indirect expenses for state funded vocational programs.

     No small business economic impact statement has been prepared under chapter 19.85 RCW. Not applicable - no small business impact.

     RCW 34.05.328 does not apply to this rule adoption. The Superintendent of Public Instruction is not subject to RCW 34.05.328 per subsection (5)(a)(i). Additionally, this rule is not a significant legislative rule per subsection (5)(c)(iii).

     Hearing Location: Old Capitol Building, P.O. Box 47200, Room 152 (Wanamaker Room), Olympia, WA 98504-7200, on November 25, 2003, at 9:00 a.m.

     Assistance for Persons with Disabilities: Contact Ben Gravely by November 15, 2003, TDD (360) 664-3631 or (360) 725-6133.

     Submit Written Comments to: Legal Services, Office of Superintendent of Public Instruction, P.O. Box 47200, 600 South Washington Street, Olympia, WA 98504-7200, fax (360) 753-4201, by November 24, 2003.

     Date of Intended Adoption: November 26, 2003.

October 20, 2003

Dr. Terry Bergeson

Superintendent of

Public Instruction

OTS-5778.1

VOCATIONAL INDIRECT COST LIMIT
NEW SECTION
WAC 392-121-570   Vocational indirect cost limit -- Applicable code provisions -- Purpose -- Effective date.   (1) WAC 392-121-570 through 392-121-578 define the fifteen percent limit on indirect cost charges to school district state-funded vocational-secondary programs as required by the Biennial Operating Appropriations Act. These rules do not apply to federal vocational funding which is governed by federal policies.

     (2) The purpose of these sections is to assure that state allocations for vocational education are expended by school districts to support state vocational programs. The minimum levels defined here are not to be construed as recommended expenditure levels.

     (3) These sections are effective for the 2002-03 school year and thereafter.

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NEW SECTION
WAC 392-121-571   Vocational indirect cost limit -- Definitions.   As used in WAC 392-121-570 through 392-121-578:

     (1) "Program 31" means the vocational-basic-state program as defined in the Accounting Manual for Public School Districts in the State of Washington.

     (2) "Basic allocation for vocational students" means the amount of money generated by a school district's vocational full-time equivalent enrollment in the general apportionment formula using the state funding formula factors including the grade 4-12 staffing ratios without enhancement, and using the district's average certificated instructional staff mix factor for program 31 staff from the district's S-275 personnel report.

     (3) "Enhancement allocation for vocational students" means the additional money above the basic allocation for vocational students generated by a school district's vocational full-time equivalent enrollment as a result of the enhanced state vocational staffing ratio and enhanced nonemployee related cost allocation for vocational students. This enhancement shall be calculated using the district's average certificated instructional staff mix factor for program 31.

     (4) "Vocational running start allocation" means the amount generated in the general apportionment formula by a school district's running start students enrolled in vocational courses in a community or technical college pursuant to chapter 392-169 WAC.

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NEW SECTION
WAC 392-121-573   Vocational indirect cost limit -- Calculation of minimum program 31 expenditures.   Each school district's minimum program 31 expenditures equal the sum of the following amounts:

     (1) Eighty-five percent of the total basic and vocational enhancement allocations for vocational students;

     (2) Ninety-three percent of the vocational running start allocation; plus

     (3) Any carryover from the prior school year allowed under WAC 392-121-578.

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NEW SECTION
WAC 392-121-574   Vocational indirect cost limit -- Preliminary notice to school districts below the minimum expenditure level.   (1) After the close of the school year, and before December 31, the superintendent of public instruction shall compare each school district's program 31 expenditures for the school year as reported on the district's Report F-196 annual year end financial statements to the district's minimum program 31 expenditures.

     (2) If a district's program 31 expenditures are less than the minimum, then the superintendent shall notify the district of the results of the calculation including any potential recovery of state funding.

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NEW SECTION
WAC 392-121-576   Vocational indirect cost limit -- School district requests for review and adjustment.   (1) After receiving notice of the preliminary notice pursuant to WAC 392-121-574, and before the ensuing January 15, a school district may request review and adjustment to the superintendent's calculations. The request shall be in a form prescribed by the superintendent of public instruction and shall be signed by the school district superintendent or the superintendent's designee.

     (2) Grounds for review and adjustment include:

     (a) Errors in the calculation; or

     (b) Inaccurate school district data used in the calculation.

     (3) A district requesting review and adjustment due to inaccurate school district data shall submit corrected data pursuant to the superintendent's instructions.

     (4) The superintendent of public instruction shall correct any errors in the calculations or revise the school district data used in the calculations as appropriate.

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NEW SECTION
WAC 392-121-578   Vocational indirect cost limit -- Recovery of state allocations.   (1) At the time of the January apportionment calculations after the close of the school year, the superintendent of public instruction shall recalculate each school district's minimum direct expenditures.

     (2) If the district's program 31 expenditures are below the minimum program 31 expenditure amount, the district shall be allowed to carry over into the ensuing school year an amount equal to up to ten percent of the minimum expenditure amount excluding any carryover from the prior school year.

     (3) The superintendent of public instruction shall recover from the district's general apportionment allocation as a prior year adjustment an amount equal to the lesser of the district's enhancement allocation for vocational students or the following amount:

     (a) The district's minimum program 31 expenditures; minus

     (b) The district's program 31 expenditures plus any allowable carryover.

     (2) Recoveries made pursuant to this section shall be adjusted after the January apportionment calculation if revised enrollment, staff mix, or expenditure data submitted by the district and accepted by the superintendent of public instruction materially affects the district's recovery amount.

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     Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.

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