This is just a short blog highlighting some of the budget impact on TSD with the recent legislative session:
1.Broadens scope of capital fund money. ESHB 2140 allows districts to use capital funds for “infrastructure improvement and preventative maintenance.” Districts generally pay for a lot of building maintenance from the general fund. This change could be used to move some of those maintenance costs from the general fund to the capital fund, thereby leaving general funds available for other items. Of course, an argument could be made that this practice is beyond the scope of what taxpayers approved. With TSD needing to pass a levy in 2020, it will be interesting to see how this is handled by TSD.
2.Increases ability to collect voter approved levy funds. As noted in prior blogs, the McCleary fix limited TSD to collecting $1.50 per $1000 assessed property value, regardless of what the voters approved. SB 5313 allows districts to collect up to $2.50 per $1000 assessed value. The levy must be(or have been) approved by the citizens. TSD voters have approved a levy through the 2020 school year so it can collect the additional funds starting in 2020(no additional money will come in during 2019). TSD should receive somewhere around $3 million in early 2020, and another $3 million in late 2020. This is the most impactful change from the 2019 session.
3. SPED funding. The legislature acknowledge a shortfall in the SPED(Special Ed) funding and reworked the allocation formula. TSD will receive around $275,000 more than previously projected.
4.Hold Harmless. This was the most disappointing result for TSD. Hold Harmless provisions essentially corrected some inadequacies based upon funding in prior years. The legislature set aside about $50 million dollars to be distributed statewide to address some unintended consequences. The formula is pretty complicated, and calculated by OSPI. According to OSPI, TSD will get about $284K from the hold harmless funds. While the $284K will help, the original projections by legislative staff indicated TSD might get somewhere around $2.2 million. TSD was extremely disappointed, and surprised, that it is only receiving $284K. Notably, Olympia’s portion will be $3.4 million and North Thurston’s will be $2.8 million.
The legislative session provided some relief. However, with a budget that exceeds $80 million, the relief was much less than desired by TSD. After 3 to 4 years of surpluses where TSD bulked up the savings between $1-2 million a year, TSD has already taken about $4.5 million from its savings account to cover the 2018/19 shortfall. From the tenor at the most recent board meeting, there was no indication that the additional funds “solved” the budget issues continuously expressed by TSD. I get the impression that TSD is hoping to limit raiding the savings too much more this year(maybe $1-2 million or so) and get closer to break even during the 2019/20 school year.