Lawmakers pass levy bill, save school funding for 2017-18

OLYMPIA — Washington’s public school districts won’t be tumbling over the levy cliff as feared.

A bill cleared the House on Thursday and is headed to the governor to delay a cut in school levy rates for one year, ensuring districts can count on a critical stream of revenue as lawmakers sort out a long-term strategy for fully funding education.

It passed in the Senate on Wednesday night after Democratic and Republican members negotiated the final language.

Lawmakers have now resolved the situation, known as the levy cliff, and provided school districts with certainty they can collect and spend millions of dollars in voter-supported property taxes in the 2017-18 school year.

Edmonds schools Superintendent Kristine McDuffy said it would be a “huge relief” to no longer be worried about what might happen. She said the district was looking at the loss of 70 to 100 jobs without those dollars.

“It allows us to focus on our core work of planning for the remainder of this year and into the next,” she said.

Gov. Jay Inslee said Thursday he will sign the bill as soon as it is available.

The legislation “will give the certainty our educators need to plan for the upcoming year,” he said. “It will remove the anxiety that teachers and principals and superintendents and board members were having to labor under while this uncertainty existed.”

Rep. Mark Harmsworth, R-Mill Creek, supported the levy cliff measure as he did when the House passed an earlier version in January.

“We are fully aware of the situation (districts) are facing,” he said. “We want to take the pressure off them.”

It passed by margins of 87-10 in the House and 48-1 in the Senate.

House Minority Leader Dan Kristiansen, R-Snohomish, was one of the dissenters. While he understood the need to give leaders of 295 school districts peace of mind now, he said he is frustrated more hasn’t been done already to “stop this insanity of every year trying to solve the problem.”

“We want a long-term, sustainable solution so we never have to put our school districts in this situation again,” he said.

Superintendent of Public Instruction Chris Reykdal said the Legislature’s action is a positive step. He, too, pointed out how lawmakers have a heavier lift ahead to reach agreement on how to adequately fund public schools in line with the McCleary ruling by the Supreme Court.

The debate on whether to extend the levy cliff has consumed much attention in the first two months of the session due to the importance of the dollars.

For years the state has failed to cover the full cost of a basic education for Washington’s 1.1 million public school students. So school districts wind up using a big chunk of their local tax levies to plug the gap, much of which is for salaries of teachers, staff and administrators.

In 2010, lawmakers agreed to let districts, with voter approval, increase the levy rate while the Legislature figured out how to amply fund public schools. Under current law, the levy rates are supposed to roll back to the prior levels at the end of 2017.

In the meantime, the Supreme Court entered the picture when it ruled the state is violating the Constitution by underfunding schools. It gave the Legislature and governor until Sept. 1, 2018, to fix the situation and in the process end districts’ overreliance on levies. Extending the local levy rates will help in what lawmakers consider a transition year of funding.

Under Senate Bill 5023, the deadline for local levy collections at their current rate is extended one year to Jan. 1, 2019.

Meanwhile, beginning Jan. 1, 2018, school districts will need to stash all local levy dollars in a separate account from state and federal funds.

And, beginning next year, a district cannot put a maintenance and operation levy on the ballot until it provides a report to the office of the Superintendent of Public Instruction detailing the programs and activities to be funded with the money. The purpose of this new requirement is to ensure local tax dollars are not used for basic education.

These latter provisions reflect language in the Republican education funding plan passed by the Senate last month. Members of both parties said it will provide greater clarity on how local tax dollars are spent in schools.

“We fully acknowledge the need for transparency and accountability,” said Rep. Kristine Lytton, D-Anacortes, one of eight lawmakers involved in school funding negotiations.

Without an extension, school districts faced the collective loss of $358.3 million in 2018, according to a fiscal analysis prepared by legislative staff. Of the total, $250.8 million would be in local property tax dollars and $107.5 million would be from state coffers in the form of local effort assistance, also known as levy equalization.

Everett School District officials have estimated $3.3 million in levy receipts and another $500,000 in levy equalization were at risk for the school year, which runs from Sept. 1, 2017, to Aug. 31, 2018. When calibrated for the 2018 calendar year, the potential loss could reach $10.3 million, district officials said.

The Edmonds School District projected a loss of roughly $7 million in revenues for the next school year and almost $15 million over the course of 2018.

Jerry Cornfield: 360-352-8623;jcornfield@heraldnet.com. Twitter: @dospueblos.

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