Background: Prototypical School Funding Formula. In 2009 the Legislature adopted a statutory framework for a funding allocation model for public schools based on prototypical schools. The statute provides that the use of prototypical schools is intended to illustrate the level of resources needed to operate a school of a particular size with particular types and grade levels of students using commonly understood terms and inputs, such as class size, hours of instruction, and specified staff positions. Actual state funding allocations are adjusted from the school prototypes based on the actual number of students in each grade level at each school in the district.

In 2010 the Legislature adopted in statute funding values or amounts for each of the specified elements of the prototypical school funding framework based on recommendations from a technical workgroup. The adopted funding values were intended to reflect the level of state allocations provided at the time. Additionally, the Legislature specified four enhancements and set dates for the funds to be provided through the prototypical school allocation statute. The three enhancements that were specified that have not yet been fully implemented are the following:

increase the funding for materials, supplies, and operating costs (MSOC) to specific amounts by the 2015-16 school year;
reduce K–3 class size to 17 students by the 2017-18 school year; and
complete phase-in of full-day kindergarten statewide by the 2017-18 school year.

In 2014 the Legislature adopted in statute funding values to provide a minimum lab science class size enhancement for grades 9 through 12; an additional allocation for lab science maintenance, supplies, and operating costs for students in grades 9 through 12; and an increase in high school guidance counselors from 1.909 to 2.539 for each prototypical high school.

Initiative 1351. Washington State voters approved Initiative 1351 (I-1351) November 4, 2014. I-1351 amended the prototypical school funding formula to lower class sizes in all grades; provide enhanced class size reductions in high poverty schools; and increase the allocation of school-based and district-wide staff units in all categories. The initiative specified a phase-in schedule for the funding of the new prototypical schools funding formula of 50 percent of the costs in the first biennium and full implementation in school year 2018-19.

Summary of Substitute Bill: Legislative intent is provided to continue making changes to the program of basic education in areas where emerging research and evidence demonstrate that better and more efficient strategies are available to increase student outcomes.

The following changes are made to the basic education funding statute:

The 2014 changes are reenacted, which create a high school class-size factor for laboratory science, laboratory science MSOC for high school students, and increased high school guidance counselors;
K–3 class size allocation is maintained at 17.0 full-time equivalent students per teacher, with full implementation in school year 2017-18;

The exception is eliminated for school districts to divert funding for the class sizes provided in the act to other school-based personnel, if capital capacity prevents a school from providing the class sizes specified in the act, and demonstrated class size is limited to grades K–3;

Class size is restored in all other grades, career and technical education, and skills centers to the pre-initiative values;
Other building and district-level staff is restored to pre-initiative values with the exception of elementary parent involvement coordinators allocated at 0.0825 per prototypical school and middle school guidance counselors allocated at 1.216 per prototypical school;
The Learning Assistance Program funded hours per week is increased from 1.5156 to 2.3975;
The Highly Capable Program funded hours per week is increased from 2.1590 to 3.0. The percentage of students eligible for funding is increased from 2.314 percent to 3.0 percent;
Transitional support for English language learners who have recently tested out of the Transitional Bilingual Instructional Program (TBIP) is now provided for in basic education. This program provides 3.0 hours per week for these students for two years after testing out of the TBIP; and
The phase-in requirements for the act are modified to align with the phase-in of the initiative.

A referendum clause is included that directs the Secretary of State to submit this legislation to a vote of the people at the next general election, which is November 2015.

Staff Summary of Public Testimony on Original Bill: PRO: The initiative passed with a 40,000 vote gap. It is not affordable. Research allows us to make modifications to the prototypical schools funding model and I-1351. Lower class sizes in the earlier grades matter. The Legislature has the ability to send this initiative back to the voters. This gives the voters another opportunity to understand the obligation of the state for the initiative and the impact to the state's safety net programs.

CON: Basic education funding should be ample to provide all students with an opportunity to succeed in the public education system. The state has a constitutional obligation to fully fund teachers, nurses, teacher librarians, paraeducators, and other staff that effectively and efficiently run the schools. Instead of amending the initiative, we encourage you to fund it. Starting with lowering of high-poverty class size in the lower grades, where research shows clear evidence that it makes the biggest difference. However, focusing only on the lower grades does not address the opportunity gap for students upper grades; career and technical education programs; and science, technology, engineering, and mathematics classrooms; nor the wrap-around services students need.

OTHER: The Washington State Supreme court has found that the state's funding obligations go beyond what is provided for in SHB 2776 (2010), and the court has made clear funding for the prototypical school model will remedy the deficiencies. The funding values set forth in the Picus Odden report, which the basic education taskforce report relied on for their recommendations to create the framework for the prototypical school funding model in ESHB 2261 (2009), will remedy the deficiencies. The report's funding values are the basis for the funding values in I-1351. School districts are currently employing 22,000 educational staff providing basic education services to students today. The Legislature must make an educational policy rationale for making changes to the program of basic education and cannot simply reduce the program for financial reasons. It is what is educationally right, not fiscally expedient. You can send this bill back to the voters, but that does not mean that the Legislature is not bound from implementing the funding values from the Picus Odden report.

There is some emerging research showing teacher librarians' effect on student outcomes. The state has increased focus on third grade reading recently. Additional teacher librarians in the lower grades would support this effort. There are current inequities across the state in library quality. A high percentage of highly capable students drop out of school. The inclusion of full funding for highly capable students would show your intent to move forward on this issue. I-1351 does something the Legislature will have a hard time doing, which is funding classified employee services rather than relying on local levy funding. Thirty-eight percent of classified staffing and salaries are funded with local levies. The Washington Supreme court found an overreliance on local funds. Keeping classified staff values at the initiative level will keep the pressure on the Legislature to fund classified staff.

Persons Testifying: PRO: Amber Carter, Assn. of WA Business.

CON: Shawn Lewis, WA Education Assn.

OTHER: Ken Kanikeberg, Office of Superintendent of Public Instruction; Carolyn Logue, WA Library Media Assn.; Doug Nelson, Public School Employees, Service Employees International Union 1948; Donna Christensen, WA Coalition for Gifted Education.

Persons Signed in to Testify But Not Testifying: OTHER: Eden Mack, Seattle Council Parent Teacher Student Assn., WA State Parent Teacher Assn.