Local School Enrichment Levies.
Local enrichment levies can be approved by voters within a school district as a property tax for enrichment beyond the state's statutory program of basic education. Enrichment levy collections are capped for school districts at the lesser of $2.50 per $1,000 of assessed property value in the district, or $2,500 per pupil adjusted for inflation ($3,149.69 in 2024) for school districts with less than 40,000 students. School districts with 40,000 or more students, subject to a per-pupil limit, are allowed to collect up to $3,000 per pupil adjusted for inflation ($3,779.63 in 2024). The inflation measure used is the consumer price index for all urban consumers, Seattle area (Seattle CPI).
Local Effort Assistance.
The state provides additional Local Effort Assistance (LEA) funding to school districts that would not generate an enrichment levy of at least $1,550 per student based on prior year enrollment when levying at a rate of $1.50 per $1,000 of assessed value. An eligible school district's maximum LEA is the difference between the district's per-pupil levy amount based on a rate of $1.50 per $1,000 of assessed value and $1,550 per student multiplied by the district's prior year enrollment. The $1,550 per student limit, also known as the state LEA threshold, is adjusted annually by the Seattle CPI.
Enrichment Levies.
Beginning in the 2026 calendar year (CY), a school district's maximum per-pupil limit for enrichment levy purposes is increased as follows:
Local Effort Assistance.
The inflation factor used to calculate LEA is changed from the Seattle CPI to the implicit price deflator for the previous calendar year using the official current base, compiled by the Bureau of Economic Analysis, United States Department of Commerce.
Improving Equity in Kindergarten Through Grade 12 Funding.
The Superintendent of Public Instruction (SPI) is required to convene a kindergarten through grade 12 (K-12) funding equity workgroup to analyze options for revising K-12 funding formulas and revenue sources to be responsive to students' needs, including economic, demographic, and geographic differences. The SPI is authorized to contract with higher education and public, nonpartisan research entities to support the workgroup's analysis. The SPI may determine the composition and meeting frequency of the workgroup, provided that it includes representation from education and community partners that are demographically and geographically diverse and groups representing educators, school and district administrators, labor unions, families, students, community partners who support groups disproportionately impacted by inequities, the Department or Revenue (DOR), and legislators.
The workgroup's analysis must address:
The SPI must use the workgroup's analysis to consider options for revising school funding formulas. By November 1, 2025, and annually thereafter, the SPI must report progress and any proposed options to the fiscal and education committees of the Legislature, which must include options that address:
The DOR must provide relevant data and analysis to the SPI to support the requirement.
The statute establishing the workgroup expires December 1, 2027.
(In support) This is a fix to the state's inability to keep up with rising costs. The agreement around McCleary v. State of Washington was to remove the cap on property taxes, but it was only a four-year fix, with the understanding that the Legislature would come back and continue working on ways to keep education funding stable. This bill passes the privilege of making decisions down to the local governments, and local governments are directly accountable to their voters. This will help maintain critical public services such as roads and schools. Local jurisdictions are managing their budgets but are unable to meet basic needs. This will help local public servants and provide the ability to fund services wanted and needed by residents. This will not triple property taxes. The growth in revenue being tied to population growth and revenue will allow for modest changes in services. The revenue growth limit continually challenges state and local governments struggling to keep up with paying for services. This provides a local option to consider needs of local communities. The compounding effect of this limit over time has kneecapped local governments. Some counties do not take the full limit factor, but having the option to do so is good. The gap between funding and needs continues to widen and this bill aligns levy policy with modern costs. Zip codes should not determine educational success. Counties in particular are limited with revenue tools; they do not have tools like the state or cities do. Because of these limitations, services are limited. This is not a tripling of the property tax at all. Each 1 percent increase in property tax is about $6 per year, which is by no means a tripling.
(Opposed) Washington is bad for businesses and housing affordability. Businesses play a key role in taxation in the state. This bill goes too far in increasing costs for businesses. There are other options for locals to increase taxes, such as sales taxes. Families cannot afford homes in the state as it is, and property taxes will affect the ability to qualify for mortgages. Voters have supported the property tax limit multiple times. This will tax people out of their homes. This bill fails to address the wasteful spending of the government. Thousands of people are against this. School funding in this state is not good, and this bill does not improve it. Local small businesses will be directly impacted by this, especially the hospitality industry. This bill will derail the real estate industry. This will cripple Washingtonians who want to live here. This proposal will not improve special education funding. Despite high levels of funding, educational performance has not improved.
(Other) Adjustments to property tax and education funding should not be combined in one bill. The Legislature should consider these policies separately.
(In support) Representative Steve Bergquist, prime sponsor; Traci Buxton, Mayor, City of Des Moines and President, Sound Cities Association; Amy Ockerlander, Mayor, City of Duvall and President, Assoc. of WA Cities; Candice Bock, Association of Washington Cities; Hunter George, Washington Recreation and Park Association; Clifford Traisman, Bellevue, Highline, Northshore, and Seattle Public School Districts; Megan Dunn, Snohomish County; Simone Boe, Washington Education Association; Kristina Walker, Councilmember, City of Tacoma; Michael Lilliquist, City of Bellingham, Representative Ward 6; Nigel Herbig, Mayor, City of Kenmore; Pierce County Executive Ryan Mello, Pierce County Executive; Benton County Commissioner Jerome Delvin, Benton County; Christine Twiss, SEIU 925, Health Room Assistant; Emily Willard, SEIU 925 and investigator, King Co DPD; Adam Aguilera, WEA member; Kim Harless, City of Vancouver, Councilmember; Jennifer Gregerson, City of Everett; James Trefry, General Counsel, Washington State Council of County and City Employees, AFSCME, Council 2; Nora Burnes, ESD 105 Schools Coalition; and Trevor Greene, Yakima School District Superintendent.
More than 20 persons signed in. Please contact the House Public Records Office at https://leg.wa.gov/public-records-requests/ or call (360) 786-0926.