AN ACT Relating to excess school levies; reenacting and amending RCW 84.52.0531; creating a new section; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. Section 4, chapter 325, Laws of 1977 ex. sess. as last amended by section 1, chapter 168, Laws of 1981 and by section 10, chapter 264, Laws of 1981 and RCW 84.52.0531 are each reenacted and amended to read as follows:

The maximum dollar amount which may be levied by or for any school district for maintenance and operation support under the provisions of RCW 84.52.053 shall be as follows:

(1) For excess levies in ((~~1979~~)) 1985 for collection in ((~~1981, for excess levies in 1980 for collection in 1981~~)) 1986 and thereafter, the sum of:

(a) That amount equal to ten percent of each school district's prior year basic education allocation ((~~converted to one hundred percent of formula; plus~~

(b) That amount equal to each school district's prior year basic education allocation converted to one hundred percent of formula minus each school district's basic education allocation for such school year)); plus

((~~(c)~~)) (b) That amount equal to ten percent of each school district's prior year state allocation, exclusive of federal funds, for the following programs:

(i) Pupil transportation;

(ii) Handicapped education costs;

(iii) Gifted; and

(iv) Compensatory education, including but not limited to remediation assistance, bilingual education, and urban, rural, racial disadvantaged programs; plus

((~~(d)~~)) (c) In the case of nonhigh school districts only, an amount equal to the total estimated amount due by the nonhigh school district to high school districts pursuant to chapter 28A.44 RCW, as now or hereafter amended, for the school year during which collection of the levy is to commence, less the increase in the nonhigh school district's basic education allocation as computed pursuant to subsection ((~~(5)~~)) (4) of this section due to the inclusion of pupils participating in a program provided for in chapter 28A.44 RCW in such computation.

(2) Excess levies authorized under this section or under RCW 84.52.052 shall not be used directly or indirectly to increase the average salary or fringe benefits for certificated or classified personnel in any school district: PROVIDED, That any school district may expend excess levy funds to provide increases in salary and fringe benefits for classified or certificated personnel whose salary and fringe benefits are provided wholly from local school district excess levies in a percentage not to exceed the respective average percentage increases in the salary and fringe benefit levels for classified and certificated employees of the district funded with state appropriated funds: PROVIDED FURTHER, That those contracts which have been negotiated prior to July 1, 1977 by those school districts for such school year shall not be abrogated by this section. "Fringe benefits" for purposes of this subsection shall include:

(a) Employer retirement contributions, if applicable;

(b) Health and insurance payments including life, accident, disability, unemployment compensation, and workmen's compensation; and

(3) Any school district whose average base compensation for certificated or classified personnel respectively is below state-wide average base compensation level for certificated or classified personnel during the preceding school year, may collect and expend property taxes authorized by this section, or under RCW 84.52.052, for the purpose of increasing such district's average compensation for certificated or classified personnel as allowed in the latest applicable state operating budget. "Compensation", for purposes of this subsection, shall mean salary plus fringe benefits for classified and certificated personnel of a school district as allowed in the latest applicable state operating budget.

(4) For the purpose of this section, the basic education allocation shall be determined pursuant to RCW 28A.41.130, 28A.41.140, and 28A.41.145, as now or hereafter amended: PROVIDED, That when determining the basic education allocation under subsection (1) of this section, effective September 1, 1979, nonresident full time equivalent pupils who are participating in a program provided for in chapter 28A.44 RCW or in any other program pursuant to an interdistrict agreement shall be included in the enrollment of the resident district and excluded from the enrollment of the serving district.

Certificated personnel shall include those persons employed by a school district in a teaching, instructional, administrative or supervisory capacity and who hold positions as certificated personnel as defined under RCW 28A.01.130, as now or hereafter amended, and every school district superintendent, and any person hired in any manner to fill a position designated as, or which is in fact, that of deputy superintendent or assistant superintendent. Classified personnel shall include those persons employed by a school district other than certificated personnel as defined in this section in a capacity for which certification is not required.

(5) Any district ((~~which is qualified to exceed the maximum dollar amount permitted under subsection (1) of this section during calendar year 1982~~)) is authorized to exceed the levy limitations imposed by subsection (1) for taxes to be collected during calendar years ((~~1983~~)) 1985 through ((~~1990~~)) 1992 as follows:

(a) ((~~The dollar amount of levy qualification for taxes to be collected in 1983 shall be the same as the maximum qualification for 1982.~~

(b) For every district which qualifies to exceed the limitations in subsection (1) of this section during calendar year 1982, a "base year levy percentage" shall be established. This levy percentage shall be equal to the percent a district's levy qualification during calendar year 1982 is of the prior 1980-81 school fiscal year's basic education allocation and state allocation for categorical programs)) For excess levies to be collected in calendar years 1986 and 1987, a base year levy percentage shall be established. The base year levy percentage shall be equal to the greater of: (i) The district's actual levy percentage for calendar year 1985, (ii) the average levy percentage for all school district levies in the state in calendar year 1985, or (iii) the average levy percentage for all school district levies in the educational service district of the district in calendar year 1985.

((~~(c)~~)) (b) The base year levy percentage established in (a) of this subsection shall be reduced in even increments beginning in calendar year ((~~1984~~)) 1988. The incremental reduction shall equal ((~~one-seventh~~)) one-fifth of the percentage points the base year levy percentage exceeds the amount authorized in subsection (1) of this section.

((~~(d)~~)) (c) For excess levies to be collected in calendar year ((~~1990~~)) 1992, the maximum dollar amount which may be levied by or for any school district shall not exceed the amount authorized in subsection (1) of this section. The provisions of this subsection shall not apply to excess levies to be collected after calendar year ((~~1990~~)) 1992.

(6) ((For the purpose of subsection (1) of this section, the superintendent of public instruction may grant local school districts authority to exceed the levy limitations imposed by said subsections: PROVIDED, That said limitations can only be exceeded by an amount that will insure local school districts the ability to raise a total excess levy dollar amount per annual average full time equivalent student which when combined with the basic education allocation is equal to but does not exceed one hundred and six percent for levies to be collected in 1980 and thereafter of the previous school year's comparable dollars per annual average full time equivalent student: PROVIDED FURTHER, That for levies to be collected in 1980 and thereafter any school district receiving authority to exceed the levy limitation and whose enrollment is declining at a rate of at least four percent, or three hundred full time equivalent students, whichever is less, from the immediately preceding school year, may, in addition to the increase above, further increase its levy by an amount equal to fifty percent of the enrollment decline multiplied by the previous school year's comparable dollars per annual full time equivalent student. The provisions of this subsection (6) shall only apply to excess levies for collection prior to calendar year 1983.

~~(7)~~)) The superintendent of public instruction shall develop rules and regulations and inform school districts of the pertinent data necessary to carry out the provisions of this section.

NEW SECTION. Sec. 2. A select committee to study the school funding system with specific emphasis on excess levies and methods of equalizing the ability of districts to generate funds based on the use of the excess levy is established. The committee shall have the following composition: (1) One member from each political party of the senate, appointed by the president of the senate; (2) one member from each political party of the house of representatives, appointed by the speaker of the house of representatives; (3) one member representing the office of the superintendent of public instruction, selected by the superintendent of public instruction; (4) one member representing the office of financial management, selected by the director of the office of financial management; (5) one member representing school directors, appointed jointly by the president of the senate and the speaker of the house of representatives; (6) one member representing school administrators appointed jointly by the president of the senate and the speaker of the house of representatives; (7) one member representing teachers, appointed jointly by the president of the senate and the speaker of the house of representatives; and (8) two members representing business and labor organizations interested in and knowledgeable about education issues, appointed jointly by the president of the senate and the speaker of the house of representatives. The nonlegislative members of the committee shall elect from among themselves one member to serve as chairman. The committee shall report its findings and recommendations to a joint meeting of the ways and means committees and the education committees of the house of representatives and the senate no later than January 30, 1987.

NEW SECTION. Sec. 3. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 4. This act is necessary for the immediate preservation of the public peace, health, and safety, the support of the state government and its existing public institutions, and shall take effect immediately.