AN ACT Relating to education; amending RCW 28A.41.130, 28A.41.140, 28A.41.162, and 28A.58.095; reenacting and amending RCW 84.52.0531; creating a new section; and providing an effective date.

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

NEW SECTION. Sec. 1. The legislature finds that the funding system and reporting requirements that have evolved since the enactment of the Basic Education Act of 1977 and subsequent legislation and litigation have resulted in complex rules, regulations, and funding formulas and a reduction in local control for our school districts.

The legislature also finds that the requirements of the Basic Education Act are lacking in that they do not provide a guarantee of reasonable class size maximums for the students and teachers in our schools.

The legislature recognizes that the scheduled reductions in local school districts' excess levy authority will result in a loss of financial resources available to many school districts if legislative action is not taken.

It is the goal of the legislature to:

(1) Provide for an excellence program by focusing state resources on the classroom environment, increasing the level of state support for instructional personnel, and reducing average class size;

(2) Increase local control by giving local districts full managerial control over the noninstructional functions of the district;

(3) Replace grandfather levy funds and provide equal educational opportunity by increasing the number of state-funded classroom teachers for all districts;

(4) Reduce paperwork through simplification of the state funding formula and reporting requirements;

It is further the intent of the legislature that the changes in the distribution of state funds caused by this act shall not result in a loss of state funds for any school district, from the level currently provided as measured on a per pupil basis and adjusted for increases in costs.

Sec. 2. Section 2, chapter 46, Laws of 1973 as last amended by section 30, chapter 3, Laws of 1983 and RCW 28A.41.130 are each amended to read as follows:

From those funds made available by the legislature for the current use of the common schools, the superintendent of public instruction shall distribute annually as provided in RCW 28A.48.010 to each school district of the state operating a program approved by the state board of education an amount which, when combined with an appropriate portion of such locally available revenues, other than receipts from federal forest revenues distributed to school districts pursuant to RCW 28A.02.300 and 28A.02.310, as the superintendent of public instruction may deem appropriate for consideration in computing state equalization support, excluding excess property tax levies, will constitute a basic education allocation in dollars for each annual average full time equivalent student enrolled, based upon one full school year of one hundred eighty days, except that for kindergartens one full school year shall be one hundred eighty half days of instruction, or the equivalent as provided in RCW 28A.58.754, as now or hereafter amended.

The constitutional responsibility of the state to fully fund a program of basic education shall be ((~~considered to be~~)) fully ((~~funded~~)) met by those amounts of dollars appropriated by the legislature ((~~pursuant to RCW 28A.41.130 and 28A.41.140 to fund those program requirements identified in RCW 28A.58.754 in accordance with the formula and ratios provided in RCW 28A.41.140~~)) for the following: The basic education allocation in accordance with RCW 28A.41.140; pupil transportation in accordance with RCW 28A.41.160; programs for handicapped students in accordance with chapter 28A.13 RCW; programs for a transitional bilingual instruction program in accordance with RCW 28A.58.810; a remedial assistance program in accordance with RCW 28A.41.404; and such other programs as the legislature may determine by statute to be required by Article IX of the state Constitution.

Operation of a program approved by the state board of education, for the purposes of this section, shall include a finding that the ratio of ((~~students per~~)) classroom teachers to students in grades kindergarten through three is not ((~~greater~~)) less than the ratio of ((~~students per~~)) classroom teachers to students in grades four and above for such district((~~: PROVIDED, That~~)) and that the district ratio of classroom teachers per one thousand average annual full time equivalent students is not less than the following: For school year 1987-88, forty-three per thousand; for school year 1988-89, forty-four per thousand; for school year 1989-90, forty-five per thousand; for school year 1990-91 and thereafter, forty-six per thousand. For the purposes of this section, "classroom teacher" shall be defined as an instructional employee possessing at least a provisional certificate, but not necessarily employed as a certificated employee, whose primary duty is the daily educational instruction of students((~~: PROVIDED FURTHER, That~~)). The state board of education shall adopt rules and regulations to insure compliance with the student/teacher ratio provisions of this section, and such rules and regulations shall allow for exemptions for those special programs and/or school districts which may be deemed unable to practicably meet the student/teacher ratio requirements of this section by virtue of a small number of students((: PROVIDED, FURTHER, That these rules and regulations shall provide that any district that has a ratio of no greater than twenty-five students per classroom teacher in grades kindergarten through three shall be in conformance with this section)).

If a school district's basic education program fails to meet the basic education requirements enumerated in ((~~RCW 28A.41.130, 28A.41.140 and 28A.58.754~~)) this title, the state board of education shall require the superintendent of public instruction to withhold state funds in whole or in part for the basic education allocation until program compliance is assured: PROVIDED, That the state board of education may waive this requirement in the event of substantial lack of classroom space.

((~~This section shall be effective September 1, 1982.~~))

Sec. 3. Section 14, chapter 244, Laws of 1969 ex. sess. as last amended by section 1, chapter 229, Laws of 1983 and RCW 28A.41.140 are each amended to read as follows:

The basic education allocation for each annual average full time equivalent student shall be determined in accordance with the following procedures:

The governor shall and the superintendent of public instruction may recommend to the legislature a formula based on a ratio of students to instructional staff for the distribution of a basic education allocation for each annual average full time equivalent student enrolled in a common school. The distribution formula shall have the primary objective of equalizing educational opportunities and shall provide appropriate recognition of the following costs among the various districts within the state:

(1) ((~~Certificated~~)) Instructional staff and their related costs;

(2) ((~~Classified~~)) Noninstructional staff and their related costs;

(3) Nonsalary costs;

(4) Extraordinary costs of remote and necessary schools and small high schools; and

(5) The attendance of students pursuant to RCW 28A.58.075 and 28A.58.245, each as now or hereafter amended, who do not reside within the servicing school district.

For the purposes of this section, RCW 28A.41.130, and 28A.58.095, "instructional staff" means classroom teachers, and other certificated staff having direct instructional contact with students.

"Noninstructional staff" means classified staff and certificated staff not assigned direct instructional duties.

This formula for distribution of basic education funds shall be reviewed biennially by the superintendent and governor. The recommended formula shall be subject to approval, amendment or rejection by the legislature. In the event the legislature rejects the distribution formula recommended by the governor, without adopting a new distribution formula, the distribution formula for the previous school year shall remain in effect.

Commencing with the ((~~1980-81~~)) 1986-87 school year, the formula adopted by the legislature shall reflect a ratio of not less than ((~~fifty certificated personnel~~)) forty-seven instructional staff to one thousand annual average full time equivalent students and ((one classified person to three certificated personnel. In the event the legislature rejects the distribution formula recommended by the governor, without adopting a new distribution formula, the distribution formula for the previous school year shall remain in effect: PROVIDED, That)) in addition shall reflect a noninstructional staff and nonsalary cost allocation expressed in dollars per average annual full time equivalent student. The formula shall ensure that no district receives fewer dollars on a comparable enrollment basis than was received during the 1985-86 school year improved by appropriate inflation factors. The instructional staff component of the formula shall provide sufficient funds to employ such staff for not less than one hundred eighty days. Commencing with the 1987-88 school year the formula adopted by the legislature shall reflect an increase in the ratio of instructional staff to one thousand annual average full time equivalent students of one staff per school year until a ratio of fifty to one thousand is attained no later than the 1989-90 school year. The distribution formula developed pursuant to this section shall be for state apportionment and equalization purposes only and shall not be construed as mandating specific operational functions of local school districts other than the instructional staff to student ratios specified in this section and those program requirements identified in RCW 28A.58.754.

The enrollment of any district shall be the annual average number of full time equivalent students and part time students as provided in RCW 28A.41.145, as now or hereafter amended, enrolled on the first school day of each month. The definition of full time equivalent student shall be determined by rules and regulations of the superintendent of public instruction: PROVIDED, That the definition shall be included as part of the superintendent's biennial budget request: PROVIDED, FURTHER, That any revision of the present definition shall not take effect until approved by the house appropriations committee and the senate ways and means committee: PROVIDED, FURTHER, That the office of financial management shall make a monthly review of the superintendent's reported full time equivalent students in the common schools in conjunction with RCW 43.62.050.

Certificated staff shall include those persons employed by a school district in a teaching, instructional, educational staff associate, learning resources specialist, administrative or supervisory capacity and who hold positions as certificated employees 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: PROVIDED, That in exceptional cases, people of unusual competence but without certification may teach students so long as a certificated person exercises general supervision: PROVIDED, FURTHER, That the hiring of such noncertificated people shall not occur during a labor dispute and such noncertificated people shall not be hired to replace certificated employees during a labor dispute. Each annual average full time equivalent certificated classroom teacher's direct classroom contact hours shall average at least twenty-five hours per week. Direct classroom contact hours shall be exclusive of time required to be spent for preparation, conferences, or any other nonclassroom instruction duties. Up to two hundred minutes per week may be deducted from the twenty-five contact hour requirement, at the discretion of the school district board of directors, to accommodate authorized teacher/parent-guardian conferences, recess, passing time between classes, and informal instructional activity. Implementing rules to be adopted by the state board of education pursuant to RCW 28A.58.754(6) shall provide that compliance with the direct contact hour requirement shall be based upon teachers' normally assigned weekly instructional schedules, as assigned by the district administration. Additional record-keeping by classroom teachers as a means of accounting for contact hours shall not be required.

Sec. 4. Section 7, chapter 359, Laws of 1977 ex. sess. as amended by section 1, chapter 24, Laws of 1982 1st ex. sess. and RCW 28A.41.162 are each amended to read as follows:

In addition to those state funds provided to school districts ((for basic education, the legislature shall appropriate funds for pupil transportation, in accordance with this chapter, and for programs for handicapped students, in accordance with chapter 28A.13 RCW.)) in accordance with RCW 28A.41.130, the legislature may appropriate funds to be distributed to school districts for population factors such as urban costs, enrollment fluctuations and for special programs, including but not limited to, vocational-technical institutes, ((~~compensatory programs, bilingual education,~~)) urban, rural, racial and disadvantaged programs, programs for gifted students, and other special programs.

Sec. 5. Section 2, chapter 16, Laws of 1981 as last amended by section 1, chapter 245, Laws of 1984 and RCW 28A.58.095 are each amended to read as follows:

(1) Except as provided in subsection (2) of this section, every school district board of directors shall fix, alter, allow, and order paid salaries and compensation for all district employees.

((No)) (2) The maximum salary and compensation a school district board of directors may ((~~grant salary and compensation increases from any fund source whatsoever in excess of~~)) fix for instructional staff shall not exceed the amount ((~~and/or percentage as may be provided for employees as~~)) set forth in the state operating appropriations act in effect at the time the compensation is payable. ((No school district administrative group or administrative bargaining unit, or other nonbargaining unit employees as defined in RCW 41.59.020(4), and 41.56.030 may receive a total annual salary and compensation increase in excess of the amount and/or percentage as set forth in the state operating appropriations act.

(2) Increases in school district employee fringe benefit contributions by school districts shall be included for purposes of determining salary and compensation increases under this section if contributions to fringe benefits provided by a district exceed or, by virtue of the increase, will exceed the amount provided for fringe benefits in the state operating appropriations act in effect at the time the compensation is payable.

~~(3) For purposes of this section, salary and compensation shall not include the following:~~

~~(a) Payment for unused leave for illness or injury under RCW 28A.58.096, (b) Employer contributions for the following employee fringe benefits:~~

~~(i) Old Age Survivors Insurance~~

~~(ii) Workers' Compensation~~

~~(iii) Unemployment Compensation~~

~~(iv) Retirement benefits under the Washington State Retirement System.~~

(4) Provisions of any contract in force on March 20, 1981 which conflict with requirements of this section shall continue in effect until contract expiration. After expiration, any new contract executed between the parties shall be consistent with this section.

~~(5)~~)) However, school boards may by separate contract pay supplemental salaries and compensation to instructional staff for additional days of work beyond one hundred eighty days or additional duties, which separate contracts shall not be the constitutional responsibility of the state.

(3) The superintendent of public instruction shall ensure compliance with this section and shall adopt rules under chapter 34.04 RCW for that purpose. ((~~The superintendent shall monitor the salary and compensation increases provided to employees and administrators by school districts.~~))

Sec. 6. 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 for collection in 1981,~~)) For excess levies in 1980 for collection in 1981 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) 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) 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) 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~~

~~(c) Employer social security contributions.~~

(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)~~)) (3) 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 through 1990 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.

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

(d) For excess levies to be collected in calendar year 1990, 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.

((~~(6)~~)) (4) 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)~~)) (4) shall only apply to excess levies for collection prior to calendar year 1983.

((~~(7)~~)) (5) 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. 7. This act shall take effect September 1, 1986.