If you need anything else, please don t hesitate to ask.

January 5th, 2015 Dear Legislator: The 2015 Legislative Session will begin soon. Many people, including myself, think it could be one of the most challenging in decades. The reason? Education funding. It s a complicated topic, I know. I ve been dealing with it since the 1980s, and every day I learn something I didn t know yesterday. To give you a general understanding, I ve put together this small packet of information. It shows how education funding got to this point in terms of policy and through the courts as well as what can and should be done to ensure that we meet our constitutional responsibility and give all our children the opportunity to receive the education they deserve. I ve tried to be as brief as possible in this packet. I am a former legislator, and I know the amount of information I was given could be overwhelming at times. If you need anything else, please don t hesitate to ask. Thanks for your service to our state. I look forward to working with you. Sincerely, Randy I. Dorn State Superintendent of Public Instruction

Table of contents 1. Basic Education. A brief history (beginning in the 1970s) shows the origin and development of basic education and education funding. In addition, two RCWs 28A.150.200 and 28A.150.210 form the backbone of basic education by defining the programs that comprise basic education and the state s four learning goals. 2. Context. What does education look like in Washington State? Three charts show how Washington lags the national average in per- pupil funding and in pupil- teacher ratios, as well as how the achievement (opportunity) gap between underrepresented groups and white students continue to persist. 3. McCleary v. Washington. In January 2012, the State Supreme Court ruled that the state isn t meeting its Constitutional duty to fully fund basic education. Included are an overview of the ruling, a summary of the Court s ruling and subsequent orders and a timeline of McCleary- related events. 4. The plan. This document shows State Superintendent Dorn s plan which is aligned to many of the recommendations made by the Quality Education Council to fully fund basic education by 2017-18. 5. Initiative 1351. The November 2014 passage of the class- size initiative directly impacts education funding for McCleary. Included are the initiative s text, its fiscal impact and the amount of money needed to satisfy the initiative. 6. Budget Requests. State Superintendent Dorn s budget request of which spending to satisfy McCleary is the largest is included. 7. OSPI Request Legislation. Brief descriptions of legislation relating to: Assessments and Graduation Requirements, High School Dropout Prevention, Technology Literacy and the Teacher Principal Evaluation Program. 8. For more information. This includes additional state laws to consider, including links to House Bills 2261 and 2776, legal findings, and relevant studies relied upon by the Legislature. For additional information and a digital copy of this packet, please visit: http://bit.ly/session2015

A brief history of education funding in Washington state McCleary v. State of Washington is filed. Modern education funding began in 1976, when the Seattle School District sued the state. At the time, 65 districts (representing 40 percent of the student population) each recently had levies fail twice in a row. The State Supreme Court agreed with the district, ruling that the funding system in place at the time was neither ample nor stable. NCES* HB 1209 adds learning standards and improvement programs to basic education, shifting the focus from effort to results. The bill also creates a committee to study funding, but does not restructure funding. 12 16 1977 The original trial judge in Seattle v. State, Thurston County Superior Court Judge Robert Doran, tasks the Legislature with defining basic education. 38 38 The Levy Lid Act of 1977 caps the state levy lid at 10 percent. 2012 In McCleary v. State, the state Supreme Court writes: The State (is) consistently providing school districts with a level of resources that falls short of the actual costs of the basic education program. Recommendations made in ESHB 2261, if fully funded, would satisfy the Constitution. Gov. Chris Gregoire s Washington Learns committee issues its 10-year plan to redesign and reinvest in education. Again, no funding sources are recommended. 1993 38 The Basic Education Act of 1977 requires a certain minimum days of school per year and hours per day, and minimum ratios of certificated staff to students. It creates a basic education funding formula. The Basic Education Funding Task Force (known as the Grimm Commission) recommends a new funding formula based on the Prototypical School Model, which identifies the resources needed to operate a school of a particular size. It does not propose a funding source. 23 38 38 26 1987 38 The state levy lid is increased to 20 percent. 38 Quality 38 Counts* 38 29 38 38 2007 38 38 ESHB 2261creates the Quality Education Council. The QEC is responsible for recommending a new education funding formula. The bill also adds programs to basic education and adopts the Prototypical School Funding Model. But the bill doesn t identify funding sources or amounts. 1992 2006 28 1991 Gov. Booth Gardner creates the Governor s Council on Education Reform and Funding (GCERF). The council recommend a revision of the school funding formula by 1997-98 but doesn t identify a funding source for additional money. The state levy lid is increased to 24 percent. 1999 The Joint Task Force on Education Funding proposes a spending plan. It includes seven options for funding the plan but doesn t recommend any single option. 38 31 32 38 42 38 2009 The Legislature passes SSB 5953, which establishes the Commission on Student Learning. The Commission is 45 38 38 directed to develop and administersuperior the components of rules for the plaintiffs Court Judge John Erlick in McCleary v. State. Erlick writes, State funding is not * Rankings of Washington among all states and Washington, D.C., in per pupil funding, from the National Center education reform: clear challenging academic stanample, it is not stable, and it is not dependable. for Education Statistics and Education Week s Quality Counts. Quality Counts did not report data in 1999 and 2000. dards, standards-based assessmentshband other ways of 2776 creates a 2018 deadline for full funding. Data sources: National Center for Educational Statistics; Education Counts database; Diane Cippollone, Defining a Basic Education : Equity And Adequacy Litigation In The State Of Washington (1998) measuring student achievement and recommendations The state levy lid is increased to 28 percent. Photo credit: Washington State Archives for an accountability system to hold schools and school 1979-80 1984-85 1989-90 1994-95 1999-00 2004-05 districts responsible for results. 1993 The Legislature passes ESHB 1209, also known as the Basic Education Act of 1993. The bill made changes 41 3843 2010 2013 In response to the McCleary decision, the state Legislature increases basic education funding by $955 million. 38 2009-10 38

RCW 28A.150.200 Program of basic education. (1) The program of basic education established under this chapter is deemed by the legislature to comply with the requirements of Article IX, section 1 of the state Constitution, which states that "It is the paramount duty of the state to make ample provision for the education of all children residing within its borders, without distinction or preference on account of race, color, caste, or sex," and is adopted pursuant to Article IX, section 2 of the state Constitution, which states that "The legislature shall provide for a general and uniform system of public schools." (2) The legislature defines the program of basic education under this chapter as that which is necessary to provide the opportunity to develop the knowledge and skills necessary to meet the state- established high school graduation requirements that are intended to allow students to have the opportunity to graduate with a meaningful diploma that prepares them for postsecondary education, gainful employment, and citizenship. Basic education by necessity is an evolving program of instruction intended to reflect the changing educational opportunities that are needed to equip students for their role as productive citizens and includes the following: (a) The instructional program of basic education the minimum components of which are described in RCW 28A.150.220; (b) The program of education provided by chapter 28A.190 RCW for students in residential schools as defined by RCW 28A.190.020 and for juveniles in detention facilities as identified by RCW 28A.190.010; (c) The program of education provided by chapter 28A.193 RCW for individuals under the age of eighteen who are incarcerated in adult correctional facilities; and (d) Transportation and transportation services to and from school for eligible students as provided under RCW 28A.160.150 through 28A.160.180.

RCW 28A.150.210 Basic education Goals of school districts. A basic education is an evolving program of instruction that is intended to provide students with the opportunity to become responsible and respectful global citizens, to contribute to their economic well- being and that of their families and communities, to explore and understand different perspectives, and to enjoy productive and satisfying lives. Additionally, the state of Washington intends to provide for a public school system that is able to evolve and adapt in order to better focus on strengthening the educational achievement of all students, which includes high expectations for all students and gives all students the opportunity to achieve personal and academic success. To these ends, the goals of each school district, with the involvement of parents and community members, shall be to provide opportunities for every student to develop the knowledge and skills essential to: (1) Read with comprehension, write effectively, and communicate successfully in a variety of ways and settings and with a variety of audiences; (2) Know and apply the core concepts and principles of mathematics; social, physical, and life sciences; civics and history, including different cultures and participation in representative government; geography; arts; and health and fitness; (3) Think analytically, logically, and creatively, and to integrate technology literacy and fluency as well as different experiences and knowledge to form reasoned judgments and solve problems; and (4) Understand the importance of work and finance and how performance, effort, and decisions directly affect future career and educational opportunities.

From the Plaintiff/Respondents 2012 Post- Budget McCleary filing (Oct. 17, 2012): C. This Court Should Not Condone The State's Failure By Sitting Silently On The Sidelines. 1. This isn't about faceless statistics. The hundreds of thousands of Washington children whose Constitutional right to an amply funded education continues to be violated every day are easy to dismiss as faceless statistics. But as one of the State Legislators who served on both Washington Learns and the Basic Education Finance Task Force summed up at trial, our State government's longtime violation of children's Constitutional rights is a tragedy rather than numbers and statistics - explaining that every day, every week, every month, every year that we delay means that additional students drop out, and additional students who don't drop out are left unable to meet the requirements of today's society. It's easy to talk about numbers. It's easy to talk about statistics. But when it comes right down to it, every kid we lose is something that is very, very real. The great tragedy of the State's long debate and delay is that we're not talking about numbers. We're talking about real world kids.

Statewide test results, 3rd-grade reading, 2008-14 Percentage of students meeting standard on statewide tests, by ethnic/racial subgroup Percent of students meeting standard 80 70 60 50 Asian White Hawaiian/ Pac. Islander Black Amer. Indian Hispanic 40 0 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Year Source: OSPI data

Achievement gap, 3rd-grade reading, statewide tests Percentage-point differences between white students and other groups of students, 2008-14 10.0 Asian Percentage-point difference 0.0-10.0 Hawaiian/ Pac. Islanders White -20.0 Amer. Indian Black -30.0 Hispanic 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Year Source: OSPI data

Achievement gap, 7th-grade math, statewide tests Percentage-point differences between white students and other groups of students, 2008-14 15.0 Asian Percentage-point difference 5.0-5.0-15.0-25.0-35.0 White Hawaiian/ Pac. Islanders Amer. Indian Black Hispanic 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Year Source: OSPI data

Graduation rates by other group, Class of 2013 100 80 All students: 76.0% Percent of students graduating 60 40 20 0 Special Ed Bilingual Low Income Title I Migrant Section 504 Homeless Foster Care Female Male Source: OSPI data

Graduation rates by ethnic/racial subgroup, Class of 2013 100 80 All students: 76.0% Percent of students graduating 60 40 20 0 American Indian Asian/ Pac. Islanders Asian Pacific Islanders Black Hispanic White Two or More Races A Source: OSPI data

Washington per-pupil expenditures Adjusted for cost of living Washington National average Supt. Dorn s plan: $15,966 (Would rank Wash. 6th nationally) 14,000 12,000 Rep. Hunter s plan: $12,071 (Would rank Wash. 23rd nationally) $11,864 Per-pupil expenditures 10,000 8,000 6,000 $7,376 $6,501 $6,779 $6,985 $7,119 $7,432 $7,688 $8,208 $8,722 $9,329 $9,145 $9,262 4,000 2,000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Years Source: Education Week s Quality Counts

Pupil-teacher ratios, Washington and U.S. average Washington National average 20.0 19.0 Pupil-teacher ratio 18.0 17.0 16.0 15.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Year Wa. rank 48 47 46 47 47 47 48 48 46 46 46 46 Source: National Center for Educational Statistics

HOT TOPIC McCleary v. State of Washington What was the McCleary decision? On January 5, 2012, the state Supreme Court issued McCleary v. State of Washington. In essence, the Court ruled that Washington was not adequately funding basic education. What is McCleary s history? In 2007, a lawsuit was filed by the Network for Excellence in Washington Schools on behalf of Matthew and Stephanie McCleary and their two children, and Robert and Patty Venema and their two children. The suit alleged that the state wasn t meeting its Constitutional duty. Article IX, Section 1, states that education is the paramount duty of the state. In February 2010, King County Superior Court Judge John Erlick ruled in favor of the plaintiffs. Why did the Supreme Court rule the way it did? In McCleary, the Supreme Court ruled that the state isn t meeting its paramount duty because, among other items, the state isn t fully funding transportation and staff salaries and benefits: If the State s funding formulas provide only a portion of what it actually costs a school to pay its teachers, get kids to school, and keep the lights on, then the legislature cannot maintain that it is fully funding basic education through its funding formulas. (McCleary v. State of Washington, p. 60) Because the state isn t providing enough money, school districts are starting to rely more and more on local levies. Levies, though, aren t stable sources of funding because voters can reject them. What is the remedy? In 2009, the Legislature created the Quality Education Council. The purpose of the 13-member council is to develop recommendations for the implementation of a new definition of basic education and for the financing necessary to support it. The QEC s plan, which the Supreme Court endorses, fully funds basic education by 2018 in three phases: Phase I: Full state funding of transportation; maintenance, supplies and operating costs; fullday kindergarten; and lower class size in grades K 3 (maximum 17 students per teacher) Phase II: Full state funding of the salaries of current educational staff Phase III: State funding for enhanced levels of educational staff and enhanced salaries For more information McCleary v. State of Washington Supreme Court opinion bit.ly/uelfwd Quality Education Council bit.ly/wsohwd The Office of Superintendent of Public Instruction is the primary agency charged with overseeing K 12 education in Washington state. Led by State School Superintendent Randy Dorn, OSPI works with the state s 295 school districts to administer basic education programs and implement education reform on behalf of more than one million public school students. www.k12.wa.us Published November 2014 Publication No. 14-0079

McCleary v. Washington timeline Washington state Constitution, Article IX: SECTION 1 PREAMBLE. It is the paramount duty of the state to make ample provision for the education of all children residing within its borders, without distinction or preference on account of race, color, caste, or sex. This is the only paramount duty our founders inscribed in our constitution. Washington state Supreme Court, McCleary order dated Jan. 9. 2014, p. 1 Jan. 11: McCleary v. Washington is filed by the Network for Excellence in Washington Schools on behalf of the McClearys, the Venemas and the children of each. The suit alleges that the state isn t meeting its Constitutional duty regarding amply funding education. 2007 2008 Feb. 4: Superior Court Judge John Erlick rules for the plaintiffs in McCleary v. State. Erlick writes, State funding is not ample, it is not stable, and it is not dependable. March: The state appeals Erlick s decision directly to the state Supreme Court. July 18: An order from the Supreme Court requires periodic reports from the state on progress in McCleary. Dec. 20: A Supreme Court order declares that the Article IX Committee s Sept. 17 report falls short... (I)t does not sufficiently indicate how full compliance will be achieved. Jan. 9: A Supreme Court order questions how much progress has been made; it requires a complete plan for full funding by April 30, 2014. 2009 2010 2011 2012 2013 Jan. 5: The state Supreme Court rules in favor of the plaintiffs, writing, (T)he State has not complied with its article IX, section 1 duty to make ample provision for the education of all children in Washington. Sept. 17: The Joint Select Committee on Article IX Litigation files its first report to the Supreme Court. Aug. 29: The Article IX Committee files its second report to the Supreme Court. April 30: The state delivers a report to the Supreme Court. While it mentions increases in basic education funding, the report does not include a plan for full funding. June 12: The Supreme Court issues a show cause order, requiring the state to show why it shouldn t be held in contempt after not producing a plan for full funding. 2014 Sept. 11: The Supreme Court holds the state in contempt but issues no sanctions. If in 2015 progress is made toward full funding, the contempt will be purged.

On January 5, 2012, the State Supreme Court ruled in McCleary v. Washington that Washington state is not amply funding basic education under the state Constitution. The indented text blocks below are quotes from the decision and subsequent orders written by the Court. Summary of McCleary v. Washington The Supreme Court in its own words Washington state Constitution, Article IX: SECTION 1 PREAMBLE. It is the paramount duty of the state to make ample provision for the education of all children residing within its borders, without distinction or preference on account of race, color, caste, or sex. The meaning of ample. The word ample in article IX, section 1 provides a broad constitutional guideline meaning fully, sufficient, and considerably more than just adequate. (McCleary v. Washington, p. 3) The meaning of basic education. The education required under article IX, section 1 consists of the opportunity to obtain the knowledge and skills described in Seattle School District, ESHB 1209, and the EALRs [Essential Academic Learning Requirements]. It does not reflect a right to a guaranteed educational outcome. (Ibid., p. 2-3) The state s funding formulas are inadequate. If the State s funding formulas provide only a portion of what it actually costs a school to pay its teachers, get kids to school, and keep the lights on, then the legislature cannot maintain that it is fully funding basic education through its funding formulas. (Ibid., p. 60) Reliance on local levies or federal funding is unconstitutional. The fact that local levy funds have been at least in part supporting the basic education program is inescapable..reliance on levy funding to finance basic education was unconstitutional 30 years ago.and it is unconstitutional now. (Ibid., p. 68)

Levy/Federal reliance unconstitutional (cont.) Similarly, we find it difficult to characterize federal funding of certain education programs as a regular and dependable tax source[], id. at 523, for purposes of satisfying the State s obligation. (Ibid., p. 56) Lack of revenue is not an excuse. To ensure that the legislature exercises its authority within constitutionally prescribed bounds, any reduction of programs or offerings from the basic education program must be accompanied by an educational policy rationale. That is, the legislature may not eliminate an offering from the basic education program for reasons unrelated to educational policy, such as fiscal crisis or mere expediency. (Ibid., p. 54) The State is not meeting its paramount duty. We affirm the trial court s declaratory ruling and hold that the State has not complied with its article IX, section 1 duty to make ample provision for the education of all children in Washington. (Ibid., p. 69) Full implementation of the HB 2261/QEC process is the solution. The legislature recently enacted a promising reform package under ESHB 2261, 61st Leg., Reg. Sess. (Wash. 2009), which if fully funded, will remedy deficiencies in the K- 12 funding system. (Ibid., p. 3) The Court will monitor progress until the 2018 deadline. The judiciary will retain jurisdiction over the case to help ensure progress in the State s plan to fully implement education reforms by 2018. (Ibid., p. 77-78) Periodic reports are due to the Court. The State shall file periodic reports in this case summarizing its actions taken towards implementing the reforms initiated by Laws of 2009, ch. 548 (ESHB 2261) and achieving compliance with Washington Constitution article IX, section 1. [T]he court's review [of the reports] will focus on whether the actions taken by the legislature show real and measurable progress toward achieving full compliance with article IX, section 1 by 2018. (Order dated July 18, 2012, p. 2) The state s first report showed little progress. The State's first report falls short [It] does not sufficiently indicate how full compliance with article IX, section 1 will be achieved. Indeed, since the passage of ESHB 2261 in 2009, significant cuts to education funding have been made. Some of these cuts have been partially restored, but the overall level of funding remains below the levels that have been declared constitutionally inadequate. (Order dated Dec. 20, 2012, p. 2-3)

A plan for full funding is essential. [T]here must in fact be a plan. Each day there is a delay risks another school year in which Washington children are denied the constitutionally adequate education that is the State's paramount duty to provide. (Ibid., p. 3) Requirements for the 2013 legislative session. [T]he report submitted at the conclusion of the 2013 legislative session must set out the State's plan in sufficient detail to allow progress to be measured according to periodic benchmarks between now and 2018. (Ibid., p. 3) The state s report in Aug. 2013 calculated an additional $982 million for basic education (a 6.7 percent increase above maintenance level funding). The increase in education funding for 2013-15 is not enough. Overall, the State's Report demonstrates that it understands what progress looks like, and it has taken some steps toward fulfilling its constitutional mandate. But, it cannot realistically claim to have made significant progress when its own analysis shows that it is not on target to implement ESHB 2261 and SHB 2776 by the 2017-18 school year. (Order dated Jan. 9, 2014, p. 6) The Court requires a complete plan for full funding by April 30, 2014. [T]he State shall submit, no later than April 30, 2014, a complete plan for fully implementing its program of basic education for each school year between now and the 2017-18 school year. (Ibid., p. 8) The state s report did not include a plan, prompting a show cause order from the Court. [T]he State is hereby summoned to appear before the Supreme Court to address why the State should not be held in contempt for violation of this Court's order dated January 9, 2014, that directed the State to submit by April 30, 2014, a complete plan for fully implementing its program of basic education for each school year between now and the 2017" 18 school year. (Show Cause order, June 12, 2014, p. 3) The state is in contempt. [T]he court unanimously finds the State in contempt for failing to comply with the court's January 9, 2014 order [T]he court will not presently impose sanctions or other remedial measures, and will provide the State the opportunity to purge the contempt during the 2015 legislative session by complying with the court's order. If the contempt is not purged by adjournment of the 2015 legislature, the court will reconvene and impose sanctions or other remedial measures. (Order dated Sept. 11, 2014, p. 4)

Plan to Fully Fund Basic Education by 2018 On January 5, 2012, the Supreme Court released McCleary, et. al. v. State of Washington, a historic case in education funding. The Court unanimously ruled that Washington isn t meeting its Constitutional duty: The State has failed to meet its duty under article IX, section 1 by consistently providing school districts with a level of resources that falls short of the actual costs of the basic education program. Two years later, in response to a report by the state Legislature detailing its progress on McCleary, the Court issued an order requiring a complete plan from the Legislature, by April 30, 2014, for fully implementing its program of basic education. The plan must: Include details for each school year between now and 2017-18; Address each of the areas of K- 12 education identified in ESHB 2261; Address the implementation plan of SHB 2776; and Include a phase- in schedule for fully funding each component of basic education. As the state superintendent, Randy Dorn oversees public K- 12 education. In that role he has consistently spoken about the need for ample basic education funding. This document represents Supt. Dorn s plan to meet the requirements outlined in McCleary. The Superintendent s plan can be divided into three main topics: 1. His implementation plan, including specific recommendations on staffing and compensation for each year until 2018; 2. Accountability systems, which include student testing, teacher evaluations and financial consistency; and 3. Other outstanding issues. Supt. Dorn s plan follows the staffing and compensation values proposed by the Quality Education Council, which was created by ESHB 2261. This plan does not include, however, a specific funding recommendation. In January 2014, Supt. Dorn addressed the issue by proposing a bill that in the event that full funding isn t achieved by Jan. 1, 2018 would have increased sales tax by one percent, increased the state property tax to $3.60 per $1,000 of assessed value and decreased local levy authority (the so- called levy swap ).

1. Plan for Full Funding of Basic Education The concept of basic education in Washington State was defined in the 1970s after a series of court cases. In McCleary, the Supreme Court affirmed those earlier cases, writing that the Judicial branch has the primary responsibility for interpreting article IX, section 1 (of the state Constitution) to give it meaning and legal effect. The Court explained that it defers to the legislature s chosen means of discharging its article IX, section 1 duty but retains jurisdiction over the case to help facilitate progress in the State s plan to fully implement the reforms by 2018. In providing background on McCleary, the Court cited four major basic education statutes: Basic Education Act of 1977: The Legislature broadly defines basic education and creates funding formulas based on staff- to- full- time- student ratios. HB 1209 (1993): The definition of basic education is updated with new learning goals and accountability that grew out of the Governor s Council on Education Reform and Funding. ESHB 2261 (2009): Basic education is further redefined (increasing instructional hours and providing for an opportunity to complete 24 credits for high school graduation; and adding to and from transportation, full- day kindergarten and highly capable programs). In addition, the funding system is fundamentally altered and now based on a prototypical school model. The model describes the resources needed to operate a school of a specific size using common terms. SHB 2776 (2010): Allocations for staff- to- student ratios are given for the prototypical school model. The staffing and compensation components of Supt. Dorn s plan provide annual details for each funding item outlined in ESHB 2261 and SHB 2776. It also includes a specific recommendation on how to transition away from the reliance on local levies. Finally, it recommends the creation of a new entity made up of representatives from both the legislative and executive branches of state government to oversee the implementation. Cost estimate calculations were done the same way the Legislature, the Office of Superintendent of Public Instruction and the Office of Financial Management estimate the costs of legislation. The calculations also are the same as those to the Supreme Court in McCleary. OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 2

Expenditure categories and levels ESHB 2261 and SHB 2776 breaks down costs into eight categories. In 2014-15, funding for student transportation is fully funded. For each year until 2018, the state funding levels for the other seven categories are as follows: School year Expenditure category 2015-16 2016-17 2017-18 Early elementary class sizes $197,705,030 $431,971,930 $728,715,188 Later grades class sizes 152,377,454 345,212,696 527,356,311 Materials, Supplies & Oper. Costs 399,311,789 405,245,793 411,381,872 School/District support staff 360,415,667 718,885,504 1,078,501,720 Program hours 103,173,518 242,540,664 472,358,338 Professional development 105,901,790 237,026,250 398,792,466 Compensation 2,169,173,799 2,585,447,107 3,076,062,912 Grand total $3,488,059,048 $4,966,329,944 $6,693,168,806 Early elementary class size Many studies have shown the importance of low class sizes, especially in early grades and especially with students living in poverty. As required by HB 2261 and HB 2776, the plan phases in smaller class size in kindergarten through 3 rd grade. Classrooms with relatively high proportions of students receiving free and reduced- price meals will be given additional resources beginning in 2015-16. By 2017-18, the target for those classrooms will be 15 students per class. Full- day kindergarten, which was added as a part of basic education in ESHB 2261, is funded by the state for about 44 percent of kindergarten students in 2014-15. By 2017-18, state funding for full- day kindergarten will be provided for all students. Later elementary, middle and high school class sizes Increased learning expectations in general and increased high school course work standards in particular will require added effort by teachers in the later elementary, middle and high school years. For allocation purposes, the state assumes a class size in those grades of about 28 students. The plan phases in reductions to a class size of 25 by 2017-18. For classrooms with relatively high proportions of students receiving free and reduced- price meals, by 2017-18 the targets will be 22 students per class for grade four and 23 students per class in all other grades. Materials, supplies and operating costs Less than half (48 percent) of school building and district basic education materials, supplies and operational costs (MSOC) are funded by the state. The plan phases in full state support by 2015-16. School and districtwide support staff OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 3

Of course, teachers aren t the only staff in schools. Support staff includes guidance counselors, nurses, custodians and others. The plan increases allocations for support staff to the prototypical school models shown below. His plan fully funds this category by 2017-18: School level staffing per base enrollment Staff Type Elem (K- 6) Middle (7-8) High (9-12) Base Enrollment Student 400 432 600 Principals CAS 1.30 1.40 1.90 Current allocation 1.25 1.35 1.88 Teacher Librarians CIS 1.00 1.00 1.00 Current allocation 0.663 0.519 0.523 Guidance Counselors CIS 0.50 2.00 3.50 Current allocation 0.493 1.216 2.009 Health & Social Services School Nurses CIS 0.585 0.888 0.824 Current allocation 0.076 0.060 0.096 Social Workers CIS 0.311 0.088 0.127 Current allocation 0.042 0.006 0.015 Psychologists CIS 0.104 0.024 0.049 Current allocation 0.017 0.002 0.007 Teaching Assistants CLS 1.195 1.295 1.121 Current allocation 0.936 0.700 0.652 Office Support CLS 3.220 3.029 3.382 Current allocation 2.012 2.325 3.269 Custodians CLS 3.524 3.454 4.512 Current allocation 1.657 1.942 2.965 Student & Staff Safety CLS 0.099 0.506 0.723 Current allocation 0.079 0.092 0.141 Parent Involvement Coordinators CLS 0.676 0.676 0.676 Current allocation 0.0825 0 0 OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 4

Program hours ESHB 2261 requires an increase in instructional hours for three categorical programs. This plan calls for increases in staff to accommodate that requirement. Staff Type Hours per week Class size Student 15 Learning Assistance Program CIS 3.75 (K- 6) 1 5.00 (7-12) Current allocation 2.3975 Transitional Bilingual Program CIS 4.778 (K- 6) 6.00 (7-8) 8.00 (9-12) Current allocation 4.778 Highly Capable Program CIS 6.50 (K- 6) 3.10 (7-12) Current allocation 2.1590 1. Assumes class size of 6 students; other categorical program hourly recommendations assume a class size of 15. Professional development Teachers need professional development, in part to hone the skills they ve acquired, and in part to learn new skills. Currently, school days used to support professional development are not funded by the state. The plan phases in 10 state- funded professional development days per year by 2017-18. It also adds two new state funded resources: instructional coaches and teacher mentors. By 2017-18, full- time equivalent positions for instructional coaches would be funded, as would two hours per week with a mentor teacher for first- year and probationary teachers, 1.5 hours per week with a mentor teacher for second- year teachers and one hour per week with a mentor teacher for third- year teachers starting in 2017-18. Compensation Salary allocation levels are based on analysis and recommendations of the Compensation Work Group established in ESHB 2261. Group Current average state funded salary allocations Average actual/ market rates Instructional Staff $53,280 $61,498 Administrators $59,953 $103,028 Classified Staff $32,328 $36,971 The plan fully funds the salaries of basic education staff at market- rate levels by 2018. In the transition to full funding, state funds appropriated for reducing the funding gap to market rates will replace local funds that are currently used for salaries above the state salary allocation levels. Salary amounts paid by districts may exceed the state allocation up to 10 percent, which may be paid for by local levies. Cost estimates The following four pages show in detail Supt. Dorn s cost estimates for each funding item in the prototypical school. OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 5

Superintendent of Public Instruction's proposed implementation schedule Cost and value estimates OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 6

Cost and value estimates (cont d) OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 7

Cost and value estimates (cont d) OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 8

Cost and value estimates (cont d) OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 9

2. Accountability systems The primary legislation that established education reform and that redefined basic education and education funding (SB 1209, ESHB 2261 and SHB 2776) includes provisions for accountability systems for student learning. Implicit in those systems is the expectation of increased student learning, increased professional skills of teachers and further development of means to account for efficient and effective expenditure of state funding allocations. Supt. Dorn s basic education funding plan includes resources for an effective accountability system by dividing that system into three components: Student learning accountability Measuring student learning at the state level chiefly is accomplished through state tests: the Measurements of Student Progress, for students in grades 3-8, and the High School Proficiency Exam for students in grade 10. Since HB 1209 in 1993, the Legislature has increased the expectations of student learning from skills for all students to receive a high school diploma to skills necessary to be college and career ready. The newest version of student accountability measurement system, known as the Washington State Achievement Index a joint project between OPSI and the State Board of Education provides a snapshot of Washington s schools based on state test results. Teacher quality accountability For two decades, the evaluation system for teachers and principals didn t change. The ratings were simple: either satisfactory or unsatisfactory. A survey of the 2009-10 school year showed that 99.2 percent of teachers and 98.6 percent of principals were rated as satisfactory. The passage of E2SB 6696 in 2010 overhauled the evaluation system for teachers and principals. The new system serves two crucial purposes. It holds teachers and principals accountable while also providing a way for them to grow professionally. The bill s four most important points about the new system are: 1. Tiers: The new system will have four tiers, not two. 2. Criteria: It will describe effective teaching and leading developed by experts. 3. Provisional status (the time before a teacher achieves tenure): Three years (currently it is two). 4. Data: The new system requires evaluation data submitted to OSPI for all employee groups beginning in 2010-11; currently, data is not required to be submitted. Financial System Accountability In addition to students and teachers, accountability is also required financially. Added resources will mean added scrutiny to make sure those resources are properly spent. With that in mind, the plan calls for consistent financial accountability in the form, including compensation, where resources will be allocated and data collected by each school building. OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 10

3. Remaining issues Local funds used for basic education A central issue continues to be the use of local property tax revenues, through maintenance and operation (M&O) levies, to fund basic education. State courts have consistently held (Seattle v. Washington, 1977; McCleary v. Washington, 2012) that that practice violates the state constitution's requirement of a general and uniform means to provide a basic education for all resident school children. The plan assumes the state will replace local funds currently being expended on state basic education costs with state funds by 2018. In return, the local property taxes used for state purposes will be phased out. The simplest way to achieve this is to lower the levy rate in proportion to the additional revenues that districts are receiving. As local levies are reduced, the current 28 percent levy lid will be lowered, as will the levy lid for grandfathered districts that are currently authorized to have a levy percentage that exceeds 28 percent. The plan proposes a 15 percent lid on local levies, with districts having the ability to pay staff salary amounts up to 10 percent above the state allocation. Additionally levy equalization funds will be reduced to a maximum of 7.5 percent. Salary Compliance The state is responsible for fully funding the salaries of staff performing basic education activities. Once the state adequately funds basic education salary allocations, a 10 percent limit should be put into place that limits locally funded salary enhancements. This addresses the fact that local school districts may have unique circumstances that lead to difficulties recruiting and retaining staff. Capital Class sizes assumed in the plan will require additional classrooms/school buildings. That could include new or remodeled buildings (e.g., to satisfy requirements for all- day kindergarten, lower class sizes or science labs). His plan assumes 100 percent state funding of buildings built to state standards if the new building is required by McCleary. Implementation management Every element of this plan has the potential for unanticipated issues. With that in mind, the plan establishes a successor to the Quality Education Council established in ESHB 2261. The Basic Education Oversight Committee (BEOC) would meet up to 12 times per year to specifically address the phase in of full support for K- 12 basic education. The Committee will have a professional staff with assistance from OSPI, OFM and non- partisan legislative staff. Membership would include the chairs of the policy and fiscal committees of the House and Senate, OSPI, the Governor and the chair of the State Board of Education. A second committee, the OSPI District Operations Committee (DOC), would collect implementation information about the increases in state resources from school districts. Membership of the DOC includes a representative sample by size of the state's school districts. The DOC would provide reports, on a regular basis as determined by OSPI, to the BEOC on the status of implementation of the increased state revenues associated with this plan. OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION 11

Office of Financial Management: Initiative 1351 Overview and Fiscal Impact Initiative 1351 (I-1351) will not increase or decrease state revenues. State expenditures will increase through distributions to local school districts by an estimated $4.7 billion through 2019 based on changes to the statutory funding formulas for K-12 class sizes and staffing levels, and through increases in state levy equalization payments directed by current law. Under current law, I-1351 will increase school districts authority to levy additional property taxes. It is unknown if districts would exercise this authority, but it could generate up to an estimated $1.9 billion in additional local revenues through 2019. General Assumptions The effective date for section 1, the intent section, and section 3, the phase-in schedule, is December 4, 2014. The effective date for section 2, which changes staffing formulas for basic education, is September 1, 2018. State estimates are described using the state s fiscal year of July 1 through June 30. For example, state fiscal year 2015 is July 1, 2014, to June 30, 2015. School district estimates are described using the school fiscal year of September 1 through August 31. For example, school year 2014 15 is September 1, 2014, to August 31, 2015. I-1351 has no fiscal impact on school year 2014 15 or on state fiscal year 2015. Due to current law, the changes in I-1351 will have the effect of increasing local levy authority and levy equalization payments. Changes to local levy authority are described on a calendar-year basis. The Office of Financial Management assumes the school year 2014 15 funding formulas continue into the future, except where stated. Public school enrollment is forecast to grow annually between now and 2019. This fiscal impact statement incorporates higher student enrollments for its calculations as forecast by the Washington State Caseload Forecast Council. State and local salaries will increase annually by the Initiative 732 cost-of-living adjustment as forecast by the Washington State Economic and Revenue Forecast Council. Pension rates are as adopted by the state Select Committee on Pension Policy, July 2014. Enrollment in high-poverty schools is projected by using free and reduced-price lunch eligibility for the 2013 14 school year. Chapter 236, Laws of 2010 (Substitute House Bill 2776), requires the state s funding formulas to support class sizes of 17 for kindergarten through grade three (K-3) and 100 percent enrollment in state-funded, full-day kindergarten by school year 2017 18. Since current law does not specify what additional funding will be put into class size or full-day kindergarten for the 2015 17 biennium, baseline K-3 class sizes and full-day kindergarten enrollment are assumed to be the same as for school year 2014 15. State Revenues I-1351 does not increase or decrease state revenue collections. State Expenditures As shown in Table 1, state expenditures will increase by $4.7 billion through 2019 due to: 1. The phase-in schedule and changes to state formulas, affecting the number of teachers and staff funded to meet the smaller class size and other conditions of the initiative. Page 1

2. Increases in state levy equalization payments. Table 1: Summary of State Expenditures Under I-1351 Dollars in Millions (rounded to 10 millions) State Fiscal Years Component 2015* 2016 2017 2018 2019 TOTAL Phase-in changes to state funding formulas $0 $890 $1,090 $890 $1,620 $4,490 Higher levy equalization payments $0 $0 $60 $80 $70 $210 TOTAL $0 $890 $1,150 $970 $1,690 $4,700 *The requirements of I-1351 do not start until after fiscal year 2015 is completed. I-1351 new staffing formulas are not fully implemented until midway through the 2017 19 biennium. Full biennial costs are projected to be $3.8 billion for the 2019 21 biennium. 2015 17 Biennium I-1351, section 3(1) requires that [f]or the 2015 17 biennium, funding allocations shall be no less than fifty percent of the difference between the funding necessary to support the numerical values under RCW 28A.150.260 as of September 1, 2013, and the funding necessary to support the numerical values under I- 1351, section 2, effective September 1, 2018. The fiscal impact of this section is $2 billion for the 2015 17 biennium. The 2015 17 biennium refers to school years 2015 16 and 2016 17. Using updated enrollments, salaries and benefits for the 2015 16 and 2016 17 school years, the fiscal impact was calculated by finding, for the respective school years: 1. The cost of the changes to state staffing formulas in I-1351, section 2 2. The cost of the state staffing formulas in place as of September 1, 2013 3. The difference in costs between the two formulas, by school year 4. The amount of that difference divided by half 5. That amount adjusted from a school fiscal year to the state fiscal year schedule I-1351 places priority for additional funding provided during the 2015 17 biennium for the highest-poverty schools and school districts. For the purpose of this estimate, it is assumed the state will appropriate the minimum amounts stated in I-1351. 2017 19 Biennium I-1351 requires that by the end of the 2017 19 biennium, funding allocations be no less than the funding necessary to support the formulas stated in the initiative at that time. The fiscal impact of this section is $2.7 billion for the 2017 19 biennium. The 2017 19 biennium refers to school years 2017 18 and 2018 19. It is assumed the funding required by I- 1351 in the 2015 17 biennium will continue for school year 2017 18 and that the initiative will be fully implemented in school year 2018 19. Page 2

The state will need to provide $1.3 billion more in the 2017 19 biennium to implement the requirements of Chapter 236, Laws of 2010 (SHB 2776) in school year 2017 18. However, this amount is separate from the fiscal impact of I-1351, as these class sizes and enrollments are already authorized under state law. Consistent with current law, it is assumed that as of school year 2017 18, the state will provide funding for class sizes of 17 for grades K-3 and funding to support full-day kindergarten for all kindergarten students statewide. Basic Education Formula Changes Effective September 1, 2018 (school year 2018 19) I-1351, section 2 amends RCW 28A.150.260, the state s basic education formulas for general student class size and school staffing, effective September 1, 2018. It lowers the class-size ratios and increases staffing for both school-based and district-wide staff. This will increase the state general student rate provided to districts. And because I-1351 increases the state general rate, it will also increase the state s funding for special education. Schools now receiving a small school factor will receive more funding through the funding formula and, consequently, will receive less funding under the small school factor. Table 2 is a summary of the staffing changes under I-1351. It shows, for school year 2018 19, the new statefunded staff positions and their cost. These projections assume that class sizes of 17 for grades K-3 will have already been implemented under current law in school year 2017 18. All other costs compare the staffing formulas authorized for school year 2014 15. Table 2: New Staff and Related Costs for Implementing I-1351 on Sept. 1, 2018^ School Year 2018 19 Class Size/Position New State-Funded Staff Positions New State Expenditures New School District Expenditures Staff full-time equivalent employees Dollars in millions (rounded to 10 millions) Additional teachers to meet class-size changes 7,453 $510 $590 Additional school-based staff 10,674* $810 $980 Additional district/central staff 7,434** $370 $450 Special education funds~ $140 $170 Reduction in small school factor -237 $(20) $(20) ^Changes refer to I-1351 compared to continuing school year 2014 15 apportioned formula, with the exception of K- 3 class size of 17 and statewide full-day kindergarten, which are scheduled to be implemented by school year 2017 18, pursuant to Chapter 236, Laws of 2010. As of Sept. 1, 2013, these class sizes were authorized under RCW 28A.150.220, though they were not funded as of Sept. 1, 2013. ~Special education is distributed as a percentage of the general student rate. The state formula does not allocate staffing positions for special education. * Revised from 17,081 to 10,674 on October 30, 2014. ** Revised from 1,027 to 7,434 on October 30, 2014. New School District Expenditures is inclusive of New State Expenditures. NOTE: Once current law (Chapter 236, Laws of 2010) is implemented, the state will fund 7,396 additional teachers and 909 other staff to meet class sizes of 17 for K-3. Page 3

Increase of Levy Equalization Payments to District As state formula funding increases under I-1351, under current law, so does districts local levy authority and state levy equalization payments. Table 3 shows the impact from I-1351 on state levy equalization payments. Table 3: State Levy Equalization Payments Dollars in Millions (rounded to 10 millions) State Fiscal Years 2015 2016 2017 2018 2019 TOTAL Cost n/a n/a $60 $80 $70 $210 Local Revenues Revenue received from the state I-1351 increases revenues districts receive from the state by $4.7 billion over five years. Table 4 summarizes the district revenues received from the state. (Please see the state expenditure information and Table 1 for an explanation of how district revenues received from the state will increase under I-1351.) NOTE: This funding is received on a school-year basis, which is different from the state fiscal year. As a result, the figures in Table 1 and Table 4 may not match. Table 4: Estimated School District Revenues from State Funds Dollars in Millions (rounded to 10 millions) School Years 2014 15 2015 16 2016 17 2017 18 2018 19 TOTAL State formulas n/a $1,110 $1,100 $850 $1,810 $4,870 State levy n/a $60 $80 $70 $210 equalization TOTAL STATE FUNDS n/a $1,110 $1,160 $930 $1,880 $5,080 Revenues from school district property tax levies Since I-1351 increases the state K-12 funding to districts under RCW 84.52.0531(3), it also increases local levy authority. It is unknown how many districts will exercise this authority. Further, voters must approve school district levies and school boards must annually certify the amount of property taxes to be collected. However, districts opting to exercise this authority could generate up to an additional $1.9 billion in local revenue from higher property taxes over the next five years. Table 5 shows, on a calendar-year basis, the statewide increase of local levy authority under I-1351. Page 4

Local levy authority Table 5: Estimated School District Levy Authority Increases Dollars in Millions (rounded to 10 millions) Calendar Years 2015 2016 2017 2018 2019 TOTAL n/a n/a $750 $660 $520 $1,930 Local Expenditures I-1351 increases school district expenditures by $6.0 billion over five years. See Table 6 for detail by school year. I-1351 requires that state funding for class-size reduction be provided only to the extent districts document they are meeting the funded class-size reductions under the initiative. However, districts with facility needs that prevent them from reducing class sizes may use the funding for school-based personnel who provide direct services to students. It is unknown how many districts will apply for this exemption. It is also unknown what mix of school-based personnel would be employed, such as instructional aides, counselors, principals, etc., instead of classroom teachers. For the purpose of this cost estimate, it is assumed districts will staff for the class sizes stated in I-1351. I-1351 s staffing directive does not apply to the school-based or district-based staffing allocations. It is unknown how districts will spend this funding. For the purpose of this cost estimate, it is assumed districts will staff to the formulas provided in the initiative. It is assumed districts will fully spend the allocations received for special education, career and technical education and skill centers on those programs, consistent with current program requirements. It is also assumed that districts will maintain statewide average salary rates as provided in school year 2013 14. Local school district average salaries are higher than funding apportioned by the state. Table 6: Estimated School District Expenditures Dollars in Millions (rounded to 10 millions) School Years 2014 15 2015 16 2016 17 2017 18 2018 19 TOTAL Expenditures $0 $1,320 $1,380 $1,100 $2,240 $6,040 Facility Costs and Impacts on State and Local Capital Budgets I-1351 does not mandate an increase in state or local capital facilities. It is unknown how districts will implement I-1351 or how it will affect their facility choices. Districts may propose a bond measure to build new facilities or remodel existing facilities. All bonds are subject to voter approval. Some voter-approved bonds may be eligible for state construction assistance. Page 5

Dorn s 2015-17 budget requests The following are summaries of the major requests that will be made by the Office of Superintendent of Public Instruction during the 2015 Legislature. Fully Fund Basic Education Superintendent Dorn requests $7.2 billion in the 2015-17 biennium to make progress towards achieving full state funding of basic education by 2018. In McCleary v. Washington, the state Supreme Court decision requires the state to fulfill its Constitutional requirement to make ample provision for the education of all children in Washington. In order to make real and measurable progress toward achieving full compliance with Article IX, section 1 by 2018, Superintendent Dorn requests, as per the provisional discussion and recommendations of the Quality Education Council (QEC) and The Compensation Technical Working Group (CTWG), $2.7 billion in FY16 and $4.5 billion in FY17 to fund basic education. This proposal phases in the full funding values in a linear fashion over the next three years to comply with the 2018 school year time line as required by the McCleary Supreme Court Decision to: Lower K- 12 class sizes Fully fund full day kindergarten Increase allocations for school based and districtwide staff Provide increased instructional hours per week for categorical programs Implement the compensation recommendations as proposed by the CTWG. Background It is the paramount duty of the state to make ample provision for the education of all children residing within its borders, without distinction or preference on account of race, color, caste, or sex. Article IX, Washington State Constitution In the years after the Supreme Court s Seattle School District ruling the legislature has conducted more than 15 studies to address the school financing concerns for public schools. These studies and others over the last 30 years have all come to the same conclusion, basic education in Washington State is not fully funded. The Supreme Court ruled in McCleary that the state hasn t met its obligation under Article IX. The court references a promising reform package under ESHB 2261 (2009), which includes fully funding full day kindergarten, reducing class sizes, increasing allocations for other school- and district- based staffing, and funding MSOC at the level adopted by the QEC. Additionally the Court has identified salaries as a significant area of underfunding by the State, in fact noting that the use of levy funds for basic education compensation is unconstitutional. Superintendent Dorn requests incremental funding necessary to reach full funding as determined by the QEC and CTWG by 2017-18. Recommendation: FY16 - $2.7 billion FY17 - $4.5 billion 15-17 Total - $7.2 billion The QEC and CTWG has provisionally discussed and/or recommended funding goals for 2018. Dorn s proposal moves those goals forward in a linear fashion over the next three school years in order to comply with the 2018 time line.

CTE and Skill Center Funding Superintendent Dorn requests $170 million is the 2015-17 biennium to create alignment between CTE program funding and allowable expenditures, more adequately fund CTE and Skill Center MSOC based on actual costs above basic education, and lower class sizes in these programs as part of the McCleary decision. Costs associated with this request are driven by six adjustments to the current funding structure and/or values. Allocating for librarians, councilors, nurses, social workers, and psychologists for all students, including CTE students (no allocation is provided for this currently). Total biennial cost - $20.7 million. Eliminating the allocation for principals for CTE programs (basic education allocation only should be provided). Total biennial cost ($0.7 million.) Fund a CTE director specific to the CTE programs separate from the principal allocation. Total biennial cost - $14.8 million. Revise MSOC allocations for CTE students, and base CTE and Skill Center program allocations on actual costs over and above general education MSOC costs. Link the general education MSOC allocations to the CTE and Skill Center allocations through a multiplier. Total biennial cost - $68.9 million. Lower CTE class size to 19.0 and Skill Center class size to 16.0. The reduction of class size is phased in over three school years achieving 19.0 and 16.0 in the 2017-18 school year. Total biennial cost - $65.7 million. Provide $250,000 per school year to fund grants for equipment and curriculum startup costs for new programs. Total biennial cost - $0.45 million. Background The 2013-15 biennial budget charged OSPI with reviewing Career and Technical Education (CTE) and Skill Center programs funding enhancement formulas, expenditure accounting systems, and reporting. The review was to include recommendations for revising the funding formulas, including the possibility of conversion to a model that enhances basic education rates, potential revisions to the accounting systems, and recommendations for improving data reporting and transparency. Recommendation: FY16 - $65 Million FY17 - $105 Million 15-17 Total - $170 Million These recommendations are in response to the directive of the state legislature as described above. Implementing these recommendations will allow OSPI and the legislature to obtain clearer data with respect to allocations provide for these programs and how they are being utilized. OSPI Contact: JoLynn Berge (360)- 725-6301 As of November 18, 2014 p. 2

Technology Literacy Superintendent Dorn is requesting $139 million per biennium to ensure that all students have access to adequate technology supports. This package will ensure that all students will have an opportunity to achieve technology literacy and fluency and OSPI expects that within two years, the number of districts that assess technology literacy and fluency will increase to 295 or 100% of all districts. Background Districts ability to fund necessary technology hardware and software varies, and is largely dependent on their success with passing local levies and bonds. While the state currently allocates roughly $89 per pupil for technology materials, supplies and operating costs (MSOC) those districts that are able to pass levies and bonds report spending upwards of $200 (per FTE) on student technology to ensure that their schools can meet current technology requirements associated with curriculum integration and administering statewide assessments. School districts are required to provide a full program of basic education consistent with the state learning goals and encompassing of all subjects. More than half of districts report that they currently do not assess student progress in technology literacy and fluency. As a result, there is a large inequity between districts and sometimes even within districts in the opportunities students are provided. In the time since the state adopting a full funding amount for MSOC, the landscape surrounding student technology has changed. The state has adopted new assessments that are intended to be administered electronically which has increased per student technology costs to districts. With the state s adoption of the Common Core State Standards (CCSS), it is necessary to update educational technology standards to more intentionally connect with the CCSS, as well as to integrate the language and student scoring rubrics from Smarter Balanced Performance Tasks. This package includes funding for one Educational Technology Standards Program Manager to update existing education technology standards and to support ongoing implementation efforts. Recommendation: FY15 - $61 million FY17 - $78 million 15-17 Total - $139 million In order to ensure that all students have an opportunity to achieve technology literacy and fluency, and that districts are supported as they work to implement state educational technology (EdTech) standards and assessments, the Superintendent proposes a three pronged solution: 1. Modify state statute to require the use of educational technology (EdTech) assessments or other strategies to provide teachers with a measure of a student s level of technology literacy and fluency. 2. Increase the MSOC allocation for technology to reflect the level of spending of those districts whose technology infrastructure is more adequately funded by local levies and bonds 3. Fund staff support at the state level to update EdTech learning standards to align with the CCSS and to support the ongoing implementation by districts of technology- enabled learning opportunities. OSPI Contact: JoLynn Berge (360)- 725-6301 As of November 18, 2014 p. 3

Dropout Prevention Superintendent Dorn requests $31.7 million to support districts efforts to keep students engaged through graduation and increase the state s graduation rate. During the past 10 years, Washington State public schools have seen an increased focus by the stat on providing support for high- quality instructional practice, more accurate assessments, and more responsive academic interventions. In spite of these foundational efforts, the state s graduation rate has remained relatively stagnant, hovering around 76% for the past three years. In order to achieve the goal of college and career readiness for all students districts need additional resources to implement comprehensive guidance and counseling programs, provide targeted interventions to at- risk youth like the Jobs for Americas Graduates program, and to continue to build their capacity to use data to inform student achievement plans. Background By the end of the 2012-13 school year 10,305 students in the class of 2013 had dropped. This equates to roughly 2,576 students each year. There are multiple factors that contribute to youth dropping out of school including: lack of food or shelter, loss of a parent due to incarceration, death, or military deployment, unsafe and unprepared school and communities, early pregnancy or other physical health issues, and substance abuse or mental health challenges. Federal and state funding for these services have been significantly cut over the last few years. The consequences of not graduating from high school are serious for both individuals and society as a whole. $10,500 per year can be saved for every dropout that is prevented. According to the 2012 Healthy Youth Survey more than 45% of 10th grade students reported they felt current coursework was not important to later in life, 52% were not looking forward to their future and only 25% reported having a caring adult in their lives they could turn to for support. Students cannot achieve without basic life skills. Life skills cannot be developed without the security granted by basic health and safety needs. Recommendation: FY16 - $14,559,000 FY17 - $17,171,000 15-17 Total - $31,730,000 Superintendent Dorn requests funding to: 1. Provide grants to districts to establish or expand comprehensive guidance and counseling programs. 2. Develop an electronic tool through ESDs to house and modernize student s e- portfolios for their High School and Beyond Plans. 3. Provide grants to districts to establish or expand Jobs for Washington Graduates programs for students at- risk of dropping out of high school. 4. Provide ongoing statewide professional development opportunities for staff implementing Career Guidance Washington and Jobs for Washington Graduates programs. 5. Establish more sophisticated integrated aggregate data reporting capabilities to support districts efforts to use data to inform their student support and achievement strategies. OSPI Contact: JoLynn Berge (360)- 725-6301 As of November 18, 2014 p. 4

Statewide Professional Learning Support System Superintendent Dorn requests $10.9 million to build a strong, accessible, and equitable educator professional learning system. Multiple indicators show a need for a stronger infrastructure to assist in preparing students for success in the 21 st Century: Reading / Literacy: - While the percent of Washington State 8 th graders scoring below basic on the National Assessment of - Educational Progress (NAEP) for reading has decreased since 2008, by the time students leave high school reading proficiency decreases. ACT outcome data show only 51% of tested students are ready for college- level reading. - The percentage of job applicants lacking reading skills as measured by employer- administered tests has doubled in four years (Center for Workforce Preparation, 2002). Math / Science: - Only 25% of students entering kindergarten demonstrate skills typical of 5-6 year olds entering kindergarten (WaKIDS, 2014) - Between 4 th and 8 th grades, the percent of students scoring below basic on the NAEP for mathematic has increased. - By 2020 jobs in STEM areas that require some sort of post- secondary education are expected to grow by over 20% (Georgetown Center for Education and the Workplace, 2013) Background In 2007, the Legislature recognized the critical need to build the state s infrastructure in mathematics and science by funding math and science coordinators as a component of our state s education reform system. In 2013 the Legislature supported this same model by funding K- 4 Literacy Coordinators in each region. With only one Coordinator per ESD region (and less for grades 5-12 in ELA), there is disparity within each region and across the state regarding access to professional learning support for educators. New State Learning Standards for English language Arts (ELA) and Math will be assessed this year and represent new expectations for focus, depth, and integration of content within and across subject areas. New State Learning Standards for Science also call for more intentional integration of content starting in kindergarten. Since 2013 OSPI and the Association of ESDs have developed a statewide Fellows Network for ELA and Math to build teacher capacity to more actively support CCSS transitions. Science is expected to be added in 2015-16. Recommendation: FY15 - $5,498,676 FY16 - $5,498,676 15-17 Total - $10,997,352 Superintendent Dorn requests funding to build statewide capacity to support educator professional learning including: o o 1.0 FTE each of ELA (secondary), mathematics (elementary), and science (elementary) coordinator in each of the nine ESDs; and Funds to continue to build capacity among 300+ ELA, math, and science teacher leaders through the statewide Fellows Network (funds for substitute costs only). OSPI Contact: JoLynn Berge (360)- 725-6301 As of November 18, 2014 p. 5

Washington Kindergarten Inventory of Developing Skills (WaKIDS) Implementation Grants Superintendent Dorn requests $1,492,200 to provide additional support to schools through implementation grants for the assessment component of the Washington Kindergarten Inventory of Developing Skills (WaKIDS). RCW 28A.655.080 requires all state- funded full- day kindergarten programs to administer WaKIDS at the beginning of the school year to all students enrolled, and states that to the extent funds are available, additional support in the form of implementation grants shall be offered to schools on a schedule to be determined by the Office of [the] Superintendent of Public Instruction, in consultation with the Department of Early Learning. Background In 2007, the legislature passed SB 5841 in response to recommendations by the Washington Learns Commission. The bill funded voluntary full- day kindergarten for 10% of students in the 2007-08 school year, beginning with schools with the highest percentage of students living in poverty. Currently, the state provides funding for full- day kindergarten for 43.45% of students in the 2013-14 and 2014-15 school years. The state- funded, full- day kindergartens are located in 177 school districts and 491 schools; all are participating in the 2014-15 implementation of WaKIDS. Volunteers bring participation to 205 districts and 650 schools. WaKIDS is a kindergarten transition process for: o Welcoming students and their families to kindergarten (Family Connection) o Assessing students strengths (Whole Child Assessment) o Engaging early learning and kindergarten professionals and parents in a conversation about the characteristics of children s development and learning to enable them to be more successful in school (Early Learning Collaboration) To date the legislature has not provided state- funded implementation grants for teachers in their first two years of implementing WaKIDS. OSPI was able to secure one- time, privately- sourced funds for noncompetitive implementation grants in 2013-14. No implementation grants are available to districts for the 2014-15 school year. Implementation grants have a significant impact on the effectiveness of conducting the WaKIDS assessment by providing districts with a means of supporting their teachers to observe and document students strengths over a seven to eight week period. Recommendation: FY16 - $524,700 FY17 - $967,500 15-17 Total - $1,492,200 Provide $300 per teacher to districts for teachers in their first two years of implementing WaKIDS. OSPI Contact: JoLynn Berge (360)- 725-6301 As of November 18, 2014 p. 6

Seattle Children s Hospital - Education Department Superintendent Dorn requests an appropriation of $931,378 in the 2015-17 biennium to fund the Education Department of Seattle Children s Hospital (SCH). Each year, more than 1,300 students are referred to the Education Department for evaluations, instruction and transitional services prior to discharge. Staff salaries within the Education Department of SCH are currently funded the same level as when the program received its most recent increase in state funding (1993). This package would fund the standing number of certificated teachers (5.43 FTE) and classified aides (2.1 FTE), but at current (2013-14) CIS and CLS salary and benefit rates, for a total increase of $250,000 per biennium. Average annual FTE student enrollment has increased over the past five school years at a rate of 2.9 students per year. Based on current Seattle School District average per pupil allocations, these students should drive $6,307.52 in additional funding per school year. Background Funding for the SCH Education Department, which is under the purview of Seattle Public Schools, was initially appropriated in the 1985-87 biennium and has not been increased since 1993. SCH is the regional medical center that provides services, including education, for children in the following units: Special Education & At- Risk Program: During the 2012-13 school year, 390 children and youths, or roughly 29% of the total number of patients referred to the Education Department, for either enrollment or consultation, were participating in either special education or early intervention programs prior to being admitted at Seattle Children s Hospital. Rehabilitation Unit Education Program: Services for these children are carefully integrated into a comprehensive rehabilitation treatment plan that includes individualized evaluations, weekly goals and objectives, curricular selection and re- integration of the child into his/her community. Inpatient Psychiatric Unit (IPU) Diagnostic Classroom Programs: This program serves over 800 students each year admitted for an acute care evaluation on the Inpatient Psychiatric Unit (IPU) at Children s for diagnostic clarification, medication evaluation, and behavior stabilization. School- Age Services on the Seattle Cancer Care Unit (SCCU) and general medical units: These students are typically receiving treatment services from General Medicine, Surgery, Seattle Cancer Care Alliance, Neuro- Oncology, or Pulmonary care professionals. - - The resident district does not receive any funding for these students. Seattle School Districts do not receive any other basic education funding for these students. Recommendation: FY15 - $413,946 FY17 - $517,432 15-17 Total - $931,378 The funding in this package will allow the Education Department of SCH to continue providing evaluation, instruction and transitional services to more than 1,300 hospitalized students each year. OSPI Contact: JoLynn Berge (360)- 725-6301 As of November 18, 2014 p. 7

2015 Budget requests A summary of budget requests for the 2015-17 biennium. Title Description Superintendent Dorn provides an implementation plan to fully fund basic Basic Education Funding/McCleary education by 2018. This includes funding K- 3 class sizes of 17:1, FDK, Basic Education Funding/Career and Technical Education Technology Literacy Dropout/ Graduation Rate Improvements Professional Learning WaKIDS Implementation Grants compensation for K- 12 staff, and funding lower class sizes for Grades 4-12, as well as other necessary districtwide and school staff. MSOC is already statutorily required to be fully funded in school year 2015-16, so no implementation plan is needed for this component. Superintendent Dorn requests funding in the 15-17 biennium to provide adequate basic education funding to CTE and Skill Center programs. This includes funding lower class sizes for CTE and Skill Centers, a CTE director unit be included in the prototypical model, and revising MSOC for CTE and Skill Center programs based on actual expenditures. To ensure that all students have access to adequate technology supports the Superintendent requests funds to increase per pupil funding for materials, supplies and operating costs to $200 and to provide additional support from OSPI s EdTech staff to districts in their efforts to teach EdTech learning standards. Request $7,200,000,000 $169,800,000 $138,999,246 To keep students engaged through graduation and lower that state s dropout rate the Superintendent is requesting funds to help districts implement comprehensive guidance and counseling programs, effective interventions and supports for at risk youth like the Jobs for Washington Graduates program, and to equip OSPI with the capacity to use data to analyze and compare the success of districts implementation of these programs designed to serve our most vulnerable students. $31,730,000 Superintendent Dorn requests $10.9 million to build a strong, accessible, and equitable educator professional learning system. $10,997,352 Implementation grants for teachers giving the WaKIDS assessment for the first time. $300 per teacher to fund release time, equipment, or other identified needs. Seattle Children s Staffed by certificated teachers and classified aides, this department Hospital Education provides developmental/educational assessments and instruction to children in general and special education programs, participates in treatment Dept. $1,492,200 $931,378 planning and facilitates educational transition at discharge. Other requests include Bus Depreciation System, agency support (student information and customer support, data privacy), CTE course equivalency and fee increases for E- Certification.

OFFICE OF SUPERINTENDENT OF PUBLIC INSTRUCTION Request Legislation - 2015 Session Governmental Relations Title Eliminate Graduation Assessment TPEP/Waiver Dropout Prevention Educational Technology Description Includes revision of existing statutes involving graduation requirements. Substantive changes to RCW 28A.655 would be required, as well as to OSPI WACs. HSPE and EOC exams, measuring minimum proficiency, would be eliminated. In accordance with state learning goals, Smarter Balanced tests would be used to effectively identify whether students are college and career ready. Specifies that state test scores must be used for the evaluation of teachers who teach tested subjects and grades and for principals evaluations, and changes the year at which evaluation results can begin to be included in evaluations used in making personnel decisions from 2015-16 to 2016-17. Enables districts to implement: comprehensive guidance and counseling programs, effective interventions and supports for at risk youth like the Jobs for Washington Graduates program, and will provide OSPI with the capacity to use data to analyze and compare the success of districts implementation of these programs designed to serve our most vulnerable students. Ensures that all students have an opportunity to achieve technology literacy and fluency by: modifying state statute to require the use of EdTech assessments, increasing the MSOC allocation for technology and funding staff support at the state level to update EdTech learning standards to align with the CCSS and to support the ongoing implementation by districts of technology-enabled learning opportunities.