WSR 12-16-072

PROPOSED RULES

SUPERINTENDENT OF

PUBLIC INSTRUCTION

[ Filed July 31, 2012, 10:54 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 12-01-074.

Title of Rule and Other Identifying Information: Chapter 392-142 WAC, Transportation -- Replacement and depreciation allocation.

Hearing Location(s): Office of Superintendent of Public Instruction (OSPI), Brouillet Conference, 600 South Washington, Olympia, WA 98504-7200, on September 6, 2012, at 2:00 p.m.

Date of Intended Adoption: September 6, 2012.

Submit Written Comments to: Allan J. Jones, Director, OSPI, Student Transportation, P.O. Box 47200, Olympia, WA 98504-7200, e-mail allan.jones@k12.wa.us, fax (360) 586-6124, by August 31, 2012.

Assistance for Persons with Disabilities: Contact Wanda Griffin by August 31, 2012, TTY (360) 664-3631 or (360) 725-6132.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Technical corrections and reformatting of sections have been made to clarify the definitions, school bus categories, the calculation of the replacement system for school district-owned school buses, and the calculation of the depreciation system for contractor-owned school buses.

The primary change is to provide payment for school district-owned buses to be made in August instead of September.

Changes were also made to the sections explaining the use of the transportation vehicle fund and improper maintenance and operation of school buses.

Statutory Authority for Adoption: RCW 28A.150.290.

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

Name of Proponent: [OSPI], governmental.

Name of Agency Personnel Responsible for Drafting and Implementation: Allan J. Jones, OSPI, Student Transportation, (360) 725-6120; and Enforcement: JoLynn Berge, OSPI, Financial Resources and Governmental Relations, (360) 725-6300.

No small business economic impact statement has been prepared under chapter 19.85 RCW. Was not applicable.

A cost-benefit analysis is not required under RCW 34.05.328.

August [July] 31, 2012

Randy Dorn

State Superintendent

of Public Instruction

OTS-4870.1


AMENDATORY SECTION(Amending WSR 95-17-011, filed 8/4/95, effective 9/4/95)

WAC 392-142-005   Authority and purpose.   The authority for this chapter is RCW 28A.150.290 which authorizes the superintendent of public instruction to adopt rules and regulations for the proper administration of ((chapter 28A.160 RCW, which includes state depreciation and replacement payments for school buses as specified in)) RCW 28A.160.195 and 28A.160.200. The purpose of this chapter is to specify and implement the rules for the school bus depreciation and replacement systems.

[Statutory Authority: 1995 1st sp.s. c 10, RCW 28A.150.290 and chapter 28A.160 RCW as amended in ESSB 5408, section 1(6). 95-17-011, 392-142-005, filed 8/4/95, effective 9/4/95. Statutory Authority: 1990 c 33. 91-16-011 (Order 91-12), 392-142-005, filed 7/26/91, effective 8/26/91. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-005, filed 1/2/90, effective 2/2/90. Statutory Authority: RCW 28A.41.170. 83-22-031 (Order 83-16), 392-142-005, filed 10/26/83.]


AMENDATORY SECTION(Amending Order 21, filed 1/2/90, effective 2/2/90)

WAC 392-142-100   Definitions(( -- School bus)).   ((As used in this chapter, "school bus" means a vehicle:

(1) With a seating capacity of more than ten persons including the driver;

(2) Used for transportation of students to and from school or in connection with school activities; and

(3) That meets the requirement set forth in chapter 392-143 WAC (Transportation -- Specifications for school buses).)) For the purposes of this chapter, the following definitions apply:

(1) "Superintendent" means the superintendent of public instruction.

(2) "School district" means a public school district or educational service district.

(3) "School bus" means a vehicle:

(a) With a seating capacity of more than ten persons including the driver;

(b) Used for transportation of students to and from school or in connection with school activities; and

(c) That meets the requirements of the school bus specifications manual published by the superintendent.

(4) "Replacement system" is the reimbursement process used for school buses when a school district is the legal owner.

(5) "Depreciation system" is the reimbursement process used for contractor-owned school buses operated under a contract with a school district to provide regularly scheduled to-and-from student transportation services.

(6) "School bus categories" are defined annually by the superintendent, taking into account such factors as student capacity, fuel type, and special equipment.

(7) "System lifetime" means the minimum number of months that a category of school bus is expected to be in use as determined by the superintendent.

(8) "Eligible months" are defined as the number of months a school bus is eligible for reimbursement payments within a school year. If a newly acquired school bus is eligible for reimbursement, such eligibility is determined by the issue date of the school bus operation permit as defined in WAC 392-143-010(4). If the issue date is prior to the 15th of any month, eligibility begins with the first of the month; otherwise eligibility begins with the first of the following month. The total number of eligible months in all school years shall not be more than the system lifetime.

(9) A school bus is defined as "improperly maintained or operated" when it is unable to pass the Washington state patrol inspection process within ninety days of the date requested for presentation. The school district may request the superintendent for an additional ninety days to arrange for repairs to the school bus. Improper operation includes use of a school bus without a valid school bus operation permit issued by the superintendent.

(10) The "state school bus quote" means the annual sealed bid process used by the superintendent as authorized by RCW 28A.160.195 to establish prices for school districts to purchase school buses for a school year. School districts may purchase school buses from any school bus dealer's accepted bid.

(11) The "low price quote" means the lowest competitive price quote for each category of school bus received from school bus dealers in the state school bus quote. The low price quote is determined prior to the inclusion of any sales or use tax. Included in the low price quote are:

(a) Freight to the school district; and

(b) Cost associated with full payment within thirty days of delivery.

In the state school bus quote process, the superintendent may include options for school districts to purchase that are not included in the low price quote.

(12) "State-determined purchase price" is defined as the low price quote including any sales and use taxes at the highest rate that could be charged to any school district in the state by the school bus dealer submitting that quote.

(13) "Average price" is defined as the five-year average of the low price quote for each school bus category. The average price is determined using the current and four previous school years' state school bus quote.

(14) "System price" means the price used to calculate the payment in a given school year, as follows:

(a) For the replacement system, the system price for a school bus for all years except the final year is the average price. For the final year, the system price is the current state determined purchase price.

(b) For the depreciation system, the system price for a school bus for all years is the first year's state determined purchase price.

(15) "Total school bus replacement payments" means the sum of all replacement payments for a school bus for prior school years.

(16) "Assumed interest earnings" means the sum of interest which is assumed to be earned on money assumed to be available in the transportation vehicle fund from any prior replacement payments and any previous interest earnings for a school bus. The rate used to calculate assumed interest earnings shall be the average of the ninety-day treasury bill rate during the previous state fiscal year calculated on the basis of simple interest.

(17) The "salvage value" of a school bus is defined as twenty-five percent of the first year's state determined purchase price divided by the system lifetime in years.

[Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-100, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 04-08-116, filed 4/6/04, effective 5/7/04)

WAC 392-142-205   ((Determination of)) Assignment and changes to school bus categories ((by the superintendent of public instruction)).   ((The superintendent of public instruction, in consultation with the regional transportation coordinators of the educational service districts, shall annually establish a minimum number of school bus categories considering student capacity and type.)) To determine the average price for a school bus assigned to a category that was not defined in the previous four years, the superintendent shall assign the school bus to the most appropriate category. When a school bus category is no longer available or when the definition of a school bus category is changed, the superintendent shall place any school bus still eligible for reimbursement into the most appropriate existing category. The superintendent ((of public instruction will)) shall provide a public ((hearing)) meeting for interested parties prior to ((the adoption of)) any change in school bus categories.

[Statutory Authority: RCW 28A.150.290. 04-08-116, 392-142-205, filed 4/6/04, effective 5/7/04. Statutory Authority: 1995 1st sp.s. c 10, RCW 28A.150.290 and chapter 28A.160 RCW as amended in ESSB 5408, section 1(6). 95-17-011, 392-142-205, filed 8/4/95, effective 9/4/95. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-205, filed 1/2/90, effective 2/2/90.]


NEW SECTION
WAC 392-142-214   Alternative bid process.   School districts are not required to use the state school bus quote process to purchase a school bus. However, a school district using another process shall only be reimbursed for a school bus if the school district uses a lowest-price competitive bid process conducted in accordance with the requirements of RCW 28A.335.190. Regardless of purchase process, all school buses must meet the requirements established in the school bus specifications manual.

[]


AMENDATORY SECTION(Amending WSR 05-19-072, filed 9/16/05, effective 10/17/05)

WAC 392-142-225   Placement of used school buses on the state ((replacement or depreciation schedules)) reimbursement system.   A used school bus not previously on the reimbursement system shall be placed on the ((state replacement or depreciation schedule)) reimbursement system as if it had been issued a school bus operation permit on the first of September in the year of manufacture((, including an estimate by the superintendent of public instruction of:

(1) Prior school years total state replacement or depreciation payments;

(2) Assumed interest earnings (if purchased by a school district); and

(3) Salvage value (if purchased by a school district))). A used school bus previously on the reimbursement system shall be placed on the system using the original initial eligible month and assuming no break in eligible months. The superintendent shall calculate reimbursement for used school buses using the assumption that all possible prior system payments were paid along with any assumed interest earnings.

[Statutory Authority: RCW 28A.150.290. 05-19-072, 392-142-225, filed 9/16/05, effective 10/17/05; 03-13-049, 392-142-225, filed 6/12/03, effective 7/13/03. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-225, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 05-19-072, filed 9/16/05, effective 10/17/05)

WAC 392-142-240   Calculation of ((annual state replacement payment for district-owned school buses)) replacement system payments.   ((The superintendent of public instruction shall)) To calculate ((each school district's annual state)) the replacement system payment for a school district-owned school ((buses as follows)) bus, the superintendent shall:

(1) ((For district-owned school buses issued a school bus operation permit prior to the fifteenth of any month of the current school year:

(a) Place each school bus in the appropriate school bus category set forth in WAC 392-142-155;

(b) Divide the system price by the useful lifetime in months as determined in (a) of this subsection; and

(c) Multiply the result obtained in (b) of this subsection by the number of months remaining in the school year.

(2) For school buses issued a school bus operation permit prior to the current school year:

(a) Place each school bus in the appropriate school bus category set forth in WAC 392-142-155;

(b) Divide the system price by the useful lifetime in months determined in (a) of this subsection;

(c) Multiply the result obtained in (b) of this subsection by the total number of months the school bus has been on the replacement schedule including the months for the current school year;

(d) Subtract from the result obtained in (c) of this subsection the total school bus replacement payments made in prior school years;

(e) Subtract from the result obtained in (c) of this subsection the assumed interest earnings; and

(f) Subtract from the result obtained in (e) of this subsection the salvage value of the school bus if the current school year is the final year of the vehicle's useful life.)) Assign the school bus to the appropriate category;

(2) Divide the current year system price by the system lifetime;

(3) Multiply by the total number of past and current year eligible months;

(4) Subtract the total amount of all school bus replacement payments made in prior school years (if any);

(5) Subtract the assumed interest earnings (if any); and

(6) Subtract the salvage value if the current school year is the final year of the school bus's system life.

[Statutory Authority: RCW 28A.150.290. 05-19-072, 392-142-240, filed 9/16/05, effective 10/17/05; 03-13-049, 392-142-240, filed 6/12/03, effective 7/13/03. Statutory Authority: 1995 1st sp.s. c 10, RCW 28A.150.290 and chapter 28A.160 RCW as amended in ESSB 5408, section 1(6). 95-17-011, 392-142-240, filed 8/4/95, effective 9/4/95. Statutory Authority: RCW 28A.150.290 and 28A.160-130-200. 93-13-083 (Order 93-10), 392-142-240, filed 6/18/93, effective 7/19/93. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-240, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 05-19-072, filed 9/16/05, effective 10/17/05)

WAC 392-142-245   Calculation of ((annual state)) depreciation system payments ((for contractor-owned school buses)).   ((The superintendent of public instruction shall)) To calculate ((each school district's state)) the depreciation system payment for a contractor-owned school ((buses as follows)) bus, the superintendent shall:

(1) ((For contractor-owned school buses issued a school bus operation permit prior to the fifteenth of the month of the current school year:

(a) Place each bus in the appropriate school bus category set forth in WAC 392-142-155;

(b) Divide the state determined purchase price by the useful lifetime in months determined in (a) of this subsection; and

(c) Multiply the result obtained in (b) of this subsection by the number of months remaining in the school year.

(2) For contractor-owned school buses issued a school bus operation permit in a prior school year:

(a) Place each school bus in the appropriate school bus category set forth in WAC 392-142-155;

(b) Divide the state-determined purchase price at the time the school bus was purchased by the useful lifetime in months for the appropriate school bus category set forth in WAC 392-142-155;

(c) Calculate the total number of months the bus is eligible for depreciation payment in the current school year; and

(d) Multiply the amount calculated in (b) of this subsection by the number of months calculated in (c) of this subsection.)) Assign the school bus to the appropriate category;

(2) Divide the first year state supported price by the system lifetime; and

(3) Multiply the result by the number of eligible months in the current school year.

[Statutory Authority: RCW 28A.150.290. 05-19-072, 392-142-245, filed 9/16/05, effective 10/17/05; 03-13-049, 392-142-245, filed 6/12/03, effective 7/13/03. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-245, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 05-19-072, filed 9/16/05, effective 10/17/05)

WAC 392-142-250   Calculation and allocation ((of state replacement or depreciation payment)) schedule.   The superintendent ((of public instruction shall apportion school bus replacement or depreciation payments each school year calculated as follows:

(1) For school district-owned vehicles:

(a) The September apportionment payment for those school buses issued school bus operating permits in prior school years; or

(b) The first apportionment payment after the issuance of the school bus operating permit for school buses purchased in the current school year; or

(2) For contractor-owned vehicles: According to)) shall calculate annual school bus reimbursement payments for existing school buses by September 15th of each year. Calculation of reimbursement for a school bus entering the system during a school year shall be based on the number of remaining eligible months in the school year. The superintendent shall apportion school bus reimbursement payments as follows:

(1) Replacement system payments shall be distributed to school districts on the final business day of August of each year; and

(2) Depreciation system payments shall be distributed to school districts in accordance with the schedule set forth in RCW 28A.510.250.

[Statutory Authority: RCW 28A.150.290. 05-19-072, 392-142-250, filed 9/16/05, effective 10/17/05; 03-13-049, 392-142-250, filed 6/12/03, effective 7/13/03. Statutory Authority: 1990 c 33. 91-16-011 (Order 91-12), 392-142-250, filed 7/26/91, effective 8/26/91. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-250, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 10-02-088, filed 1/6/10, effective 2/6/10)

WAC 392-142-255   Deposit of payments in the transportation vehicle fund.   School districts shall deposit net proceeds for the rent, sale, ((or)) lease, or other disposition of school buses and replacement payments for school district-owned vehicles in the transportation vehicle fund. ((School districts shall not deposit school bus depreciation payments for contractor-owned vehicles)) Depreciation system payments are not required to be deposited in the transportation vehicle fund.

[Statutory Authority: RCW 28A.150.290. 10-02-088, 392-142-255, filed 1/6/10, effective 2/6/10; 05-19-072, 392-142-255, filed 9/16/05, effective 10/17/05; 03-13-049, 392-142-255, filed 6/12/03, effective 7/13/03. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-255, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 10-02-088, filed 1/6/10, effective 2/6/10)

WAC 392-142-260   Allowable uses of the transportation vehicle fund.   School districts shall only use money((s)) in the transportation vehicle fund for the following purposes:

(1) The purchase of school buses;

(2) Performing major repairs ((of)) to a school bus receiving prior approval by the superintendent ((of public instruction.

(3) The transfer of moneys from the transportation vehicle fund to the debt service fund exclusively for the payment of debt and interest incurred by the transportation vehicle fund shall not be considered to be a transfer of moneys from the transportation vehicle fund to any other fund within the meaning of RCW 28A.160.130)).

Funds may be transferred from the transportation vehicle fund to the debt service fund for the payment of debt and interest associated with purchase agreements for school buses, including lease purchase agreements.

[Statutory Authority: RCW 28A.150.290. 10-02-088, 392-142-260, filed 1/6/10, effective 2/6/10; 03-13-049, 392-142-260, filed 6/12/03, effective 7/13/03. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 91-23-071 (Order 25), 392-142-260, filed 11/19/91, effective 12/20/91. Statutory Authority: Chapter 28A.530 and HB 1224. 91-23-042 (Order 21), 392-142-260, filed 11/14/91, effective 12/15/91. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-260, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 08-19-016, filed 9/5/08, effective 10/6/08)

WAC 392-142-265   Improper maintenance and operation.   (((1) To the extent possible, school districts shall operate vehicles not less than the number of years of useful lifetime now, or hereafter, assigned to the category of vehicles by the superintendent of public instruction.

(2) A school bus that continues to possess a valid operation permit and operates its useful vehicle life shall be considered to be properly maintained in accordance with general accepted maintenance and operation standards. A school bus which does not operate its useful vehicle life shall be considered as not being properly maintained in accordance with generally accepted maintenance and operation standards unless proven otherwise by the school district. Prima facie evidence of such proof shall include unforeseen events which shorten the useful vehicle life, including but not limited to, fire, flood, explosion, storm, earthquake, or volcanic eruption.

(3) If a district fails to follow generally accepted standards of maintenance and operation or, if a district disposes of a bus prior to the end of its useful life time, the superintendent of public instruction shall discontinue reimbursement system payments, including adjusting the amount of the current year payment to be the final payment by:

(a) Determining the total number of months the bus operated;

(b) Dividing the number of months the bus operated by the "useful life" of the bus, in months. Multiply the result by the "state-determined purchase price" for the current year, than subtract previous "total school bus replacement payments," "assumed interest earnings," and the "salvage value.")) (1) If a school bus is otherwise eligible for reimbursement payments and is determined to have been improperly maintained or operated, the superintendent shall discontinue reimbursement system payments effective the first of the month following the initial determination. The superintendent shall use the following process for any future payments:

(a) For school buses that are restored to operational condition, the superintendent shall:

(i) Return the school bus to the reimbursement system effective the first of the month following the date of the Washington state patrol inspection; and

(ii) Not provide reimbursement for any months the school bus was determined to have been improperly maintained or operated. However, such months shall be included as eligible months in the calculation of the system lifetime of the vehicle.

(b) For school buses that the school district disposes of without returning the vehicle to operational condition, the superintendent shall:

(i) Divide the total number of eligible months by the system life;

(ii) Multiplying the result by the current state-determined purchase price;

(iii) Subtract the total of all previous school bus replacement payments;

(iv) Subtract the total assumed interest earnings; and

(v) Subtract the salvage value.

(2) Such factors as fire, flood, explosion, storm, earthquake, or volcanic eruption shall not result in a school bus being determined to have been improperly maintained or operated. However, reimbursement payments shall be discontinued effective the first of the month following any such occurrence. Any future payments shall be calculated using the procedures listed in subsection (1) of this section. The superintendent shall assume any such school bus will be returned to service until such time as the school district disposes of the school bus.

(3) If a school district disposes of a school bus prior to the end of its useful lifetime, the superintendent shall discontinue reimbursement system payments as of the month of the sale of the school bus and adjust any final payment using the process in subsection (1) of this section.

(4) If a school district operates a school bus without an operation permit, the superintendent shall not provide reimbursement for that time period. However, any such months shall be included as eligible months in the calculation of the system lifetime of the vehicle.

[Statutory Authority: RCW 28A.150.290. 08-19-016, 392-142-265, filed 9/5/08, effective 10/6/08; 05-19-072, 392-142-265, filed 9/16/05, effective 10/17/05. Statutory Authority: 1995 1st sp.s. c 10, RCW 28A.150.290 and chapter 28A.160 RCW as amended in ESSB 5408, section 1(6). 95-17-011, 392-142-265, filed 8/4/95, effective 9/4/95. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-265, filed 1/2/90, effective 2/2/90.]


AMENDATORY SECTION(Amending WSR 03-13-049, filed 6/12/03, effective 7/13/03)

WAC 392-142-270   Disposition of school buses.   ((Each)) When a school district sells or otherwise disposes of a school bus, the school district shall notify the superintendent ((of public instruction of the disposition of a school bus on SPI Form 1020)) within thirty days ((of this action)) using SPI Form 1020B.

[Statutory Authority: RCW 28A.150.290. 03-13-049, 392-142-270, filed 6/12/03, effective 7/13/03. Statutory Authority: RCW 28A.41.170 and 28A.41.540. 90-02-077 (Order 21), 392-142-270, filed 1/2/90, effective 2/2/90.]


REPEALER

     The following sections of the Washington Administrative Code are repealed:
WAC 392-142-010 Purpose.
WAC 392-142-075 Definition -- School year.
WAC 392-142-080 Definition -- Current school year.
WAC 392-142-085 Definition -- Prior school year.
WAC 392-142-095 Definition -- State supported competitive specifications.
WAC 392-142-105 Definition -- District-owned school bus.
WAC 392-142-110 Definition -- Contractor-owned school bus.
WAC 392-142-125 Definition -- Student capacity.
WAC 392-142-145 Definition -- Useful life.
WAC 392-142-155 Definition -- School bus categories.
WAC 392-142-160 Definition -- Vendor bid proposal.
WAC 392-142-162 Definition -- Competitive price quote.
WAC 392-142-163 Definition -- School bus dealer.
WAC 392-142-165 Definition -- State-determined purchase price.
WAC 392-142-171 Definition -- System price.
WAC 392-142-172 Definition -- Average price.
WAC 392-142-180 Definition -- Total school bus replacement payments.
WAC 392-142-185 Definition -- Assumed interest earnings.
WAC 392-142-190 Definition -- Salvage value.
WAC 392-142-195 Definition -- SPI Form 1020.
WAC 392-142-210 State-determined purchase prices by the superintendent of public instruction.
WAC 392-142-212 Obtaining competitive price quotes.
WAC 392-142-213 Purchase of school buses by school districts.
WAC 392-142-231 Calculation of system price.

Washington State Code Reviser's Office