Superintendent: state will defer part of June apportionment; district says it can cover shortfall but warns others may struggle

Superintendent Barr and district financial staff told the board on June 3 that the Washington State apportionment for June would be partially deferred into the next biennium and that the state had notified districts it could not complete full payments on schedule.

Ashley Murphy explained the situation to the board: "They owe us our apportionment payment for June, but they're $80,000,000 short on making the payments to school districts across Washington State," she said. Murphy said the state planned to pay some amount but that the full apportionment would be delayed and that the Department of Education/federal funding picture also remained unsettled.

Board and staff stressed that Peninsula School District has sufficient cash and fund balance to make payroll and pay obligations through the deferral, but Murphy warned that many neighboring districts lack the reserves to manage an unexpected apportionment delay. She described the common fiscal contingency for some districts—borrowing against capital funds or obtaining short-term non-voted debt to meet payroll—as costly and risky.

Superintendent Barr said district staff have been tracking state and federal funding volatility and urged continued fiscal prudence: "It is very important for school districts right now to be financially conservative and ensure they have money in the bank to pay each month's payroll," she said. District staff said they will report updated cash-flow analyses and any required budget adjustments to the board as more information becomes available.

No board action was required at the meeting; staff said they will monitor the state release schedule and return with specific fiscal updates.