Finance Director Karen Casey told the Port Angeles School District board that changes from the last legislative session remove the prior 16% cap on special education allocations and the tiered model based on time in general education. “The new model removes the 16% cap. It also removes that tiered system,” Casey said, explaining how the district’s special education funding and local spending responsibilities will change for 2025–26.

Under the new model presented by staff, the district’s special education allocation for 2025–26 is shown at about $10.2 million compared with roughly $9.0 million the prior year; Karen Casey said that the increase represents a slightly higher share of state and federal revenue earmarked for special education. She also said the district previously covered costs that exceeded state allocation with levy dollars and that the new rules limit the ability to use levy funds to cover those costs; as a result, basic‑education apportionment will now be used to pay special‑education costs and the levy will need to cover other basic‑education overages.

Casey described historical context: in 2024–25, 17.8% of students kindergarten through age 22 received special education services and, if preschool enrollment is included, that rate rises to about 20% — preschool funding was not included in the K–22 allocation. She told the board the district has a pattern of special education costs exceeding the allocation in prior years and that the funding model change alters which local sources must be tapped when state/federal funding does not fully cover costs.

The discussion was framed as an informational presentation; no policy vote occurred. Board members were told staff will monitor fiscal impacts and reflect them in the levy spending plan and future budgets. Karen Casey identified the MTSS grant (final year, about $300,000), Title II and Title IV federal funds (slightly reduced but still expected), and a new Indian Education grant as elements of the revenue picture that interact with special education funding.

District leaders cautioned that the shift in funding flows increases pressure on the district’s basic‑education budget and levy planning and said they will continue to report updates to the board as enrollment and final allocations become certain.