School Funding

"Apportionment" for school districts refers to the process of distributing state funding to individual school districts based on a formula that considers factors like student population, demographics, and special needs, essentially dividing up the state's education budget among all the districts according to a set criteria; in simpler terms, it's how the state allocates money to each school district based on their needs.

Staff attrition refers to the loss of employees through a natural process, such as retirement, resignation, elimination of a position, or other similar reasons. With attrition, an employer will not fill the vacancy left by the former employee.

A fund balance is a financial reserve for school districts. It is used to provide funds for unforeseen emergency situations, cash flow fluctuations, offset economic downturns and to help balance the budget when districts experience revenue shortfalls.

Washington state law does not require school district to maintain a minimum fund balance. However, RSD policy 6000, requests the district to maintain a 5% fund balance. With our current projected revenues that number should be close to $12 million.

Below is a year-by-year look our beginning/ending fund balance. In September 2024, it was projected we would end the year with a Fund Balance of almost $2.4 million, as long as reductions are made. Without any action, our ending fund balance would be approximately $438,558, as shown in yellow.

*Projected as long as reductions are made.

Levy Equalization, or Local Effort Assistance (LEA), helps districts in areas with lower property values generate adequate funding through state contributions. LEA ensures that districts with less property wealth can still provide essential programs and services.

Historically, the Tri-Cities has had a lower cost of living compared to other areas in Washington State. However, in recent years, property values have risen significantly, leading to a reduction in the amount of LEA provided to the Richland School District by the state. Until February 2026, when the district can ask voters to approve the Educational Programs & Operations (EP&O) levy, the district is unable to capture the full levy rate from new homes being built or from rising property values.

The state assumes an annual increase of 2-3% in home values, which is factored into the allowable amount the district can collect from taxpayers. This adjustment is intended to keep tax rates stable for local residents. However, if home values increase by more than the projected 2-3% annually, the LEA amount the district receives decreases. Once a levy is passed, the allowable amount to be collected is fixed, meaning the district cannot collect additional funds even if home values rise significantly.

Materials, Supplies and Operating Costs (MSOCs) are non-payroll related expenditures such as curriculum, insurance, licenses, and utilities. These costs for schools have risen dramatically, far outpacing the funding provided by the state. For instance, insurance costs for Washington school districts have surged by nearly 60% since 2020, with the state covering only a portion of these expenses. As a result, Richland School District has faced substantial out-of-pocket costs, spending $266,000 on insurance and utilities not covered by the state in the 2021-22 school year—a figure that climbed to $1.3 million by 2023-24. These rising costs have added significant pressure to the district’s already strained budget.

Regionalization is an adjustment in Washington State’s funding model designed to account for cost-of-living differences across districts. It provides percentage-based increases in funding for salaries to help districts attract and retain staff in higher-cost areas.

RSD was given 6% regionalization by the state in 2019-20. Since then, this amount has decreased by approximately one percent each school year. For 2023-24, RSD was only given 1.5%. We will not receive any regionalization funds for 2024-25.

The purpose of regionalization was to help fund salaries, so the yearly allocation was included in salary budgets. However, as the district faced a decline in regionalization funds, salaries were maintained at their original levels to prevent staff from experiencing pay cuts. As a result, a larger portion of salaries is now unfunded by the state.

Certificated Staff: employees who hold a teaching license or other credentials, such as teachers, counselors, nurses, specialists, etc.

Classified Staff: employees who are in support roles that do not require a teaching degree, such as paraeducators, bus drivers, custodians, secretaries, nutrition services, maintenance and operations staff.

Administration Staff: employees can be either certificated or classified and hold positions such as school principals, assistant principals, district directors, assistant directors, coordinators, and the superintendent.

Substitutes are an underfunded area for school districts in the State of Washington. The state only provides school districts with funding for FOUR teacher substitute days per year. There is NO funding from the state for substitutes costs for paraeducators and other classified staff (custodial, nutrition services, secretaries). 

Since the 2019-20 school year, funding gaps for substitutes have cost RSD almost $14 million.

Materials, Supplies and Operating Costs (MSOCs) are non-payroll related expenditures such as curriculum, insurance, licenses, and utilities. Higher operating costs mean actual expenses exceed state funding. The price of the things that schools need to support students has skyrocketed and RSD must pay for services to keep electricity running and the heat on, but with rising expenses and lagging state funding schools are forced to make cuts elsewhere in the budget.

Utilities: Since 2018, the average cost of electricity in the Western United States increased by 37%. The price of natural gas for heating increased by 62%. SOURCE: U.S. Bureau of Labor Statistics

Insurance: Just like a homeowner or a business, local school districts must carry insurance. Since 2020, the cost of insurance for Washington’s school districts has increased by nearly 60% (through 23-24). Costs continue to increase. The state only pays for a portion of the total cost, leaving the school district to foot the bill for more than $73.7 million in 2023-24 alone. SOURCE: Insurance company invoices from all school districts across the state.

Since the 2019-20 school year, funding gaps for MSOCs have cost RSD more than $46 million.

Special Education is an important and necessary support and a state and federal requirement. However, the state puts a cap on the percentage of students in a district covered by state and federal special education funding. This cap means that some districts with a high percentage of students who qualify for special education have to use local levy funds.

Although the Legislature raised the funding cap to 16% this year, that increase amounts to an investment of only $19.6 million for 2024-25. In the 2022-23 school year alone, special education expenses that were unfunded amounted to $529.8 million. SOURCES: WASA SOURCE | FISCAL SOURCE | WASHINGTON STATE STANDARD

Since the 2019-20 school year, funding gaps for Special Education have cost the district $13 million.

"Apportionment" for school districts refers to the process of distributing state funding to individual school districts based on a formula that considers factors like student population, demographics, and special needs, essentially dividing up the state's education budget among all the districts according to a set criteria; in simpler terms, it's how the state allocates money to each school district based on their needs.

Yes, many school districts across the state are making significant cuts to their staff, programs, and services because funding provided by the state is not enough to cover their basic education expenses. A handful of other school districts are in what is called binding conditions, meaning they cannot balance their budgets. This list of news articles (which is not all-inclusive) shows the vast number of school districts in challenging financial situations.

Yes, as Washington State’s operating budget has increased, the percentage dedicated to funding K-12 education has not kept up. Five years ago (immediately following changes to the way schools are funded by the state), about 52.4% of the state’s general fund budget was dedicated to K-12 education. Now, it’s down to about 43.1%, even though it is the state’s constitutional responsibility to provide adequate funding to support basic education services. Further, Washington ranks well below the national average for investment in K-12 education as a percentage of Gross State Product (the state’s output) at 3.11%. SOURCE: OSPI

Both short-term help and long-term solutions are needed to fix school funding challenges in Washington State.

In the short term, schools need:

• Full funding for student support programs and staff
• Full funding for the actual costs of special education
• Increase funding allocations for transportation, supplies, insurance, and other school operating expenses to match actual and rising costs.

In the long-term: 

The McCleary “Solution” must be reexamined to fix some of the structural issues and develop a school funding mechanism that recognizes the unique needs and differences of Washington’s 295 school districts. One size does not fit all.

This website, www.waschoolfunding.org, helps to put the scope of our state’s K-12 education challenges in context. This resource helps to clearly explain the issues creating financial pressure on K-12 school districts and the need for state funding allocations to reflect these increasing costs.