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CFO: District faces multi‑year underfunding in MSOC and special education; staff to testify on state bills
Summary
Peninsula School District CFO presented December year‑to‑date budget data showing multi‑year shortfalls in materials/operations (MSOC) and special education and urged state action. The district plans to testify on proposed changes to special‑education safety‑net calculations (Senate Bill 5263 cited).
Peninsula School District Chief Financial Officer Ashley presented the district’s December year‑to‑date financials and a legislative update during the board meeting on Jan. 21, 2025, and told the board the district faces multi‑year underfunding that affects transportation, special education and other operating costs.
Ashley said the district has been underfunded for basic materials and operations (MSOC) by about $47 million over the last five years and underfunded in special education by about $20.5 million over the same period. She told the board monthly unfunded operating costs have grown and that the district was approaching “nearly $85,000 a month unfunded” for utilities and related MSOC costs. Ashley said liability insurance costs increased sharply nationwide and that the district now pays “just under $3,000,000 alone for liability insurance.”
The CFO said federal ESSER funds that bolstered recent budgets have run out and that January apportionment from the state will “true up” revenue estimates; she said some revenue increases for enrollment were already budgeted but that the district expects to see additional apportionment money arrive later in the fiscal year.
On special education, Ashley described recent state work to reduce underfunding but said the district still faced roughly $2.6 million of unfunded special‑education costs in the last school year. She outlined proposed state bills aimed at making safety‑net funding more accessible to districts; the transcript referenced Senate Bill 5263 as a preferred vehicle because it would allow a “single multiplier” that does not rely on the percentage of time a high‑needs student spends in general education before qualifying for additional safety‑net funds. According to the CFO, SB 5263 would allow a high‑needs student with costs 1.5 times a typical general‑education student to be eligible for safety‑net consideration regardless of inclusion minutes.
Ashley also discussed transportation funding and the district’s operational decisions to reduce routes and increase ride lengths in response to funding constraints. She told the board that while the district has taken steps to manage costs, the funding model remains strained and requires state attention.
On next steps, Ashley said district staff will testify on related bills during the legislative session and advocated for a set of priorities (MSOC, special education, transportation) that district associations identified statewide.
Why it matters: the CFO framed the shortfalls as structural and ongoing and said state legislative changes are required to close gaps that affect daily services and staffing decisions.
Direct quote: "Over the last 5 years we've been underfunded by just under $47,000,000," Ashley said, summarizing the materials and operations shortfall.
The district indicated a plan to file testimony and to press for SB 5263’s approach to the safety‑net multiplier, while also seeking more predictable quarterly distributions for high‑cost placements.
