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State auditors warn Washington’s school apportionment system is outdated and at risk; OSPI outlines modernization plan
Summary
A State Auditor’s Office performance audit found OSPI’s school apportionment software and supporting infrastructure (built on 2008-era technology) are outdated, have weak controls, and create the potential for funding errors; OSPI agreed a replacement is needed and described an IT-pool funded project and timeline.
The Joint Legislative Audit and Review Committee heard on June 3 that the State Auditor’s Office (SAO) found Washington’s K–12 apportionment system is built on outdated 2008-era infrastructure, lacks adequate internal controls, and is at high risk of errors and failures that could affect school funding.
"The system and the infrastructure that it sits on were outdated, unstable, inefficient, and at high risk of errors and failures," SAO auditor Sonia Singh said during the presentation. SAO staff said the suite of applications relies on eight feeder systems and a core apportionment engine, that failed backups have in some cases consumed storage and halted systems for days, and that the agency lacks comprehensive documentation of internal controls.
SAO described its limited testing of three school districts for the 2023–24 school year and reported the apportionment engine produced the expected calculations for those test cases. However, SAO also said it identified nine small discrepancies between some inputs in the agency’s model and the values described in state budget documents or statutes and estimated those discrepancies could be "in the neighborhood of, like, $78,000,000." Scott Frank, Director of Performance and IT Audit, cautioned the office’s testing was limited and that broader software, process, and staffing problems need to be addressed before the agency can assure future accuracy.
OSPI officials responding to the audit acknowledged the platform’s age and the need for a new system. "We requested funding in 2022," Chief Financial Officer TJ Kelly said, and noted the feasibility study completed in 2024 identified risk of catastrophic failure. Kelly added that the $16,000,000 noted in the presentation is allocated in the state IT pool and that OSPI must proceed through OCIO and OFM gating and contracting steps before funds are appropriated for specific gates.
OSPI Director of School Apportionment Sean Lewis disputed the characterization that the audit showed statutory noncompliance or major misallocations. He said the agency uses an administrative rule that rounds to three decimal places and that implementation choices (for example converting per-thousand rates to per-student values in the system) explain some differences SAO flagged. "There was no error. It is not a budget inconsistent with your statutes," Lewis said.
Legislators questioned SAO and OSPI about the sample size (three districts), whether smaller districts face higher proportional risk, and whether OSPI’s model informs budgeting. SAO told the committee its tests focused on repeatable calculations and that the three large districts chosen provided a variety of programs and variables for testing. OSPI explained the budget model is jointly used by legislative fiscal staff and is updated during the budget process; OSPI said the model is part of the budgeting workflow and that the agency receives ratios and inputs derived from those budget materials.
OSPI described an implementation plan for a new apportionment platform that will follow IT-pool gates, include procurement and contractor selection steps, and emphasize a stronger infrastructure to reduce manual workarounds; the agency expects the bulk of project spending in the 2027 fiscal year and maintenance thereafter. OSPI also told the committee it is adding at least one IT staffer to reduce long-term contractor reliance and is updating desk manuals and processes while preparing for a system transition.
A member of the public, Chloe Pruitt of Everett, urged swift implementation of the audit recommendations, saying the system’s fragility matters because it distributes funding affecting roughly 1,000,000 students and about $30,000,000,000 in biennial funding.
Next steps: SAO recommended that OSPI address immediate control and documentation gaps while proceeding with system replacement plans; OSPI said it is pursuing the IT-pool project and will seek required gate approvals. The committee adjourned and scheduled a full JLARC meeting for July 15.
