SB 6247 — Concerning school district financial management.

ENGROSSEDS-4063.1 SUBSTITUTE SENATE BILL 6247 State of Washington 69th Legislature 2026 Regular Session By Senate Early Learning & K-12 Education (originally sponsored by Senators Dozier, Lovick, and Schoesler)Schoesler READRead FIRSTfirst TIMEtime 02/04/26.01/20/26.

Referred to Committee on Early Learning & K-12 Education.

and adding a new section to chapter 28A.400 RCW;RCW.

creating a new section;

and providing an effective date.

(1) Assist the school districts in preparation of their budgets, as provided in chapter 28A.505 RCW((.)), and provide additional budget oversight and supports to school districts that are in binding conditions or showing indicators of financial distress, as provided in section 2 of this act;

1 ESSBSB 6247 (4) Carry out the duties and issue orders creating new school districts and transfers of territory as provided in chapter 28A.315 RCW((.));

(1) If, when reviewing a school district budget under RCW 28A.505.070, an educational service district determines that a school district's reserved fund balance has decreased significantly from the previous school year or identifies any other indicators of financial distress, the educational service district must provide financial supportoversight for the following school year to help identify irregular expenditures or budgeting behaviors that may be negatively affecting the district's financial health.

Financial support must include educational service districts meeting regularly with the school district superintendent, business manager, and school board chair to create mid-year action plans and plan for budget assumptions for the upcoming year to address indicators of financial distress and improve the district's financial position.

and (b) AttendDetermine schoolif boardirregular meetings,expenditures whenor pertinentacts budgetof informationfinancial ismalfeasance, onmisfeasance, theor agenda,nonfeasance tohave providecontributed budgetto guidancethe anddistrict's statusfinancial updates.distress.

If suspected acts of malfeasance, misfeasance, or nonfeasance are identified, the educational service district must report the acts to the state auditor for transmittal to the office of the attorney general under RCW 43.09.260;

and (c) Attend all school board meetings while the district is in binding conditions to provide budget guidance and status updates.

(4) If, at any point, an educational service district employee knows or reasonably suspects a school board director, superintendent, financial manager, or other administrator has engaged or is engaging in malfeasance, misfeasance, or nonfeasance, or has otherwise p.

2 ESSB 6247 violated the provisions of RCW 28A.505.150, the employee must report that suspicion to the state auditor and the state attorney general's office.

The employee must also report the suspicion to the school district board of directors, unless a school director is suspected of being involved in the wrongdoing.

This duty to report applies even if the employee believes the actions were not done with malintent.

(5) By January 1, 2027, the office of the superintendent of public instruction must establish, by rule, a definition of "financial distress" that includes measurable indicators that can be identified by educational service districts.

The office of the superintendent of public instruction must notify each educational service district when the definition is adopted and any time the definition is updated.

(1)p. Except as provided otherwise by this subsection (1), beginning with the ((2022)) 2027 calendar year, each member of a board of directors shall complete a governance training program once per term of elected office.

2 SB 6247 (1) Except as provided otherwise by this subsection (1), beginning with the ((2022)) 2027 calendar year, each member of a board of directors shall complete a governance training program once per term of elected office.

(a) Training aligned with the cultural competency, diversity, equity, and inclusion standards for school director governance developed under RCW 28A.345.115 and provided by the Washington state school directors' association((.association ((.

and (b) FundingFinancial andmanagement finance training provided by the Washington state school directors' association pursuant to section 4 of this act.

(1) The Washington state school directors' association shall identify or develop and periodically update governance training programs that address the fundamentals of district budgeting, accounting, and financial health.

(2) Beginning with the 2027 calendar year, the Washington state school directors' association shall provide the governance training program identified or developed under subsection (1) of this section at the frequency necessary for school directors to meet the requirement in RCW 28A.343.100.

(3) Upon request of an educational service district providing support and oversight under section 2 of this act, the governance training program identified or developed under subsection (1) of this section must be made available to school superintendents and school district administrators responsible for developing a school district budget and monitoring the financial health of the school district.

3 ESSBSB 6247 (1)Sec. The Washington state school directors' association shall develop and provide a training program on school district funding and finance for all members of school district boards of directors.

The training must be available for school district boards of directors within one year of the effective date of this section.

(2) The training program must enhance school directors' understanding of:

(a) State and local funding structures;

(b) Budgeting practices;

and (c) Fiscal accountability requirements applicable to school districts.

(3)(a) All individuals serving as school directors on the effective date of this section must complete the training within two years of the effective date of this section.

(b) All individuals elected or appointed as school directors after the effective date of this section must complete the training at least once during the first two years of the director's term of office.

(c) School directors are strongly encouraged to renew or retake the training at least once during each term of office to remain current with changes in state and local funding laws and fiscal accountability standards.

(4) School directors may not be charged any fee for attendance and must be compensated for participating in the training under this section.

Compensation may only be paid from locally collected excess levy funds available for that purpose and may not cause the state to incur any present or future funding obligation.

(5) Upon request of an educational service district providing support under section 2 of this act, the governance training program developed under this section must be made available to school superintendents and school district administrators responsible for developing a school district budget and monitoring the financial health of the school district.

Sec.

Total budgeted expenditures for each fund as adopted in the budget of a school district shall constitute the appropriations of the district for the ensuing fiscal year and the board of directors shall be limited in the incurring of expenditures to the grand total p.of such appropriations.

4 ESSB 6247 of such appropriations.