HB 2691
In CommitteeHouse
Schools/cash flow schedule
Adjusting the state apportionment schedule to schools to mitigate cash flow issues.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill revises the monthly schedule for distributing state school funding to smooth cash flow for school districts. It adjusts the percentage of annual funds paid each month, increases some later payments, and removes an outdated provision from 2011.
- Revises the monthly apportionment schedule for state school funding, adjusting the percentage of annual funds distributed each month from September through August.
- Increases the March apportionment from 9% to 10%, and May from 5% to 6%, while reducing July from 12.5% to 10% to smooth cash flow.
- Maintains the existing emergency advance provision allowing school districts to request up to 10% of their annual apportionment early, with repayment deducted from future payments.
- Removes the 2011-era provision that reduced the June payment by $128 million and added a separate July 1 payment — this provision is no longer in effect.
- Applies the revised schedule to the 2026–27 school year, beginning September 1, 2026.
Who is affected
- School districts — School districts receive monthly funding from the state based on a revised schedule; some may receive more in earlier months and less later in the year, which could help with managing cash flow during peak spending periods.
- Educational service districts — Educational service districts (ESDs) receive state apportionments on behalf of their member school districts and may adjust payments based on emergency fund requests.
- Office of the Superintendent of Public Instruction — The Office of the Superintendent of Public Instruction (OSPI) administers the revised monthly apportionment schedule and evaluates emergency fund requests from school districts.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (3)
Shifting funds from July to earlier months (especially March and May) better aligns with typical school district budget cycles—many districts incur peak expenses in spring for curriculum, staffing, and facility prep for fall—reducing the need for short-term borrowing and interest costs.
Local GovernmentPeopleRef: Sec. 1 (revised schedule: March +1%, May +1%, July –2.5%)Maintaining the emergency advance option allows districts facing unexpected shortfalls (e.g., enrollment volatility, facility emergencies) to access up to 10% of annual funding early—this buffers against cash flow shocks without requiring new legislation or emergency appropriations.
Local GovernmentPeopleRef: Sec. 1 (emergency advance provision retained at up to 10%)The revised schedule reduces the pronounced July spike (from 12.5% to 10%) and spreads funds more evenly across the year, which may reduce volatility in district-level budgeting and improve financial forecasting accuracy—especially helpful for smaller districts with limited finance staff.
Local GovernmentLean peopleRef: Sec. 1 (overall schedule smoothing: more even monthly distribution)
Potential Concerns (3)
Reduced July funding may strain districts with high summer activity (e.g., summer school, facility maintenance), potentially forcing some to delay critical spending or draw more heavily on emergency reserves—though the emergency advance provision remains available.
Local GovernmentRef: Sec. 1 (July apportionment reduced from 12.5% to 10%)While intended to smooth cash flow, the reallocation of funds from July to March and May may not align with actual district spending patterns—many districts front-load spending in fall and have peak payroll and supply costs in Q1, so increased March funding may not reduce borrowing as intended.
Local GovernmentRef: Sec. 1 (March increased from 9% to 10%, May from 5% to 6%)The removal of the 2011 provision eliminates a one-time fiscal adjustment that was specific to a single year; its removal has no ongoing fiscal impact, so this change is largely administrative and does not meaningfully improve or worsen cash flow for districts going forward.
Local GovernmentRef: Sec. 1 (removal of 2011 June $128M reduction and July 1 extra payment)
Who Is Most Affected
School districts—especially smaller or cash-constrained ones—may benefit from more predictable cash flow, reducing reliance on short-term borrowing and interest costs. However, districts with large summer programs may face temporary pressure due to reduced July funding.
Educational Service Districts (ESDs) will administer the revised apportionments to their member districts; they may see increased requests for emergency advances but no net change in total funding, so operational impact is minimal.
OSPI gains no new authority but retains its role in approving emergency advances; implementation burden is unchanged, and no new resources are required.
Local taxpayers may indirectly benefit if districts reduce borrowing costs and avoid property tax levies for operational cash flow—but this bill does not affect levy authority or debt service, so impact is minimal and speculative.
Teachers and staff are unlikely to be directly affected, but improved district cash flow could marginally reduce risk of delayed payroll or supply shortages—though this is highly unlikely under current funding stability.