[Filed October 3, 2018, 11:47 a.m.]

Preproposal statement of inquiry was filed as WSR 18-16-120.

Title of Rule and Other Identifying Information: WAC 392-121-415 Basic education allocation—Deductible revenues.

Hearing Location(s): On November 16, 2018, at 11:00 a.m., at the Office of Superintendent of Public Instruction, Brouillet Room, 600 South Washington Street, Olympia, WA 98501. Those planning to comment during the hearing should arrive by 11:00 a.m.

Date of Intended Adoption: November 20, 2018.

Submit Written Comments to: T. J. Kelly, P.O. Box 47200, Olympia, WA 98504, email thomas.kelly@k12.wa.us, fax 360-664-3683, 360-664-3631, by November 16, 2018.

Assistance for Persons with Disabilities: Contact Kristin Murphy, phone 360-725-6133, fax 360-754-4201, TTY 360-664-3631, email Kristin.murphy@k12.wa.us, by November 9, 2018.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: This proposed rule amendment would remove language that reduces state basic education apportionment payments by proceeds from the sale, rental or lease of stone, minerals, timber, forest products, other crops and matter, and improvements from or on tax title real property managed by a county pursuant to chapter 36.35 RCW.

Reasons Supporting Proposal: The proposed rule amendment would help ensure that local revenue does not offset costs of basic education as prescribed in EHB 2242 (2017). The change would also help ensure that there is equal treatment across all school districts with respect to defining deductible revenue related to forest land.

Statutory Authority for Adoption: RCW 28A.150.290, 28A.710.220.

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

Name of Agency Personnel Responsible for Drafting and Implementation: T. J. Kelly, 600 S.E. Washington, Olympia, WA, 360-725-6301; and Enforcement: Lisa Dawn-Fisher, 600 S.E. Washington, Olympia, WA, 360-725-6292.

A school district fiscal impact statement is not required under RCW 28A.305.135.

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

This rule proposal, or portions of the proposal, is exempt from requirements of the Regulatory Fairness Act because the proposal:

Is exempt under RCW 19.85.030.

Explanation of exemptions: No small business economic impact statement has been prepared under chapter 19.85 RCW. The proposed amendment does not have an impact on small business and therefore does not meet the requirements for a statement under RCW 19.85.030 (1) or (2).

State Superintendent

of Public Instruction

AMENDATORY SECTION(Amending WSR 18-10-025, filed 4/24/18, effective 5/25/18)

WAC 392-121-415Basic education allocation—Deductible revenues.

In addition to those funds appropriated by the legislature for basic education allocation purposes, the following locally available general fund revenues shall be included in the computation of the total annual basic education allocation of each school district or charter school pursuant to RCW 28A.150.250 and 28A.150.260 and shall be deducted from payments made pursuant to WAC 392-121-400:

(1) ((Proceeds from the sale, rental or lease of stone, minerals, timber, forest products, other crops and matter, and improvements from or on tax title real property managed by a county pursuant to chapter 36.35 RCW;

(2))) Federal in lieu of tax payments made pursuant to RCW 84.72.020; and

(((3)))(2) Proceeds from the sale of lumber, timber, and timber products on military reservations or facilities in accordance with U.S.C. §2665, Title 10, and P.L. 97-99.

(((4)))(3) Local in lieu of tax payments including but not limited to payments made pursuant to RCW 35.82.210, 35.83.040, and 79.19.110.

Otherwise deductible revenues from any of the foregoing sources received by a school district due solely to the district's levy of a capital projects fund or debt service fund excess tax levy shall constitute nongeneral fund revenues and shall not be deducted in the computation of the district's annual basic education allocation for that school year.