This bill modifies existing law by amending RCW 28A.150.390 and by adding a new section to chapter 28A.155 RCW. It defines key terms (including "base allocation," "basic education enrollment," "enrollment percent," and a multi-year "funded enrollment limit" schedule), specifies how excess cost allocations for special education are calculated when a district’s special education enrollment percent exceeds the funded limit, and requires the superintendent of public instruction to submit a programmed budget request for special education to each odd-numbered regular legislative session. The bill creates new procedural requirements: the Office of the Superintendent of Public Instruction (OSPI) must monitor districts and charter schools for overidentification or overprovision of special education, require corrective action plans when problems are found, and notify the state auditor. In the school year after such a determination, the state auditor must audit any district or charter school with a special education enrollment percent above 16% for compliance with the corrective action plan and Part B of IDEA. If the auditor finds corrective actions were not timely implemented, OSPI must reduce the district’s excess cost allocation by multiplying the allocation by 16% divided by the district’s actual enrollment percent (when that percent exceeds 16%). The bill affects OSPI, the state auditor, local school districts and charter schools, students eligible for and receiving special education (with some age exclusions), and certain categories of districts identified in other statutes. Important statutory and formula details referenced in this text (including full funding formulas, the content of cited RCW subsections, "safety net awards," and the prior full text of RCW 28A.150.390) are not included here, so full implementation and calculation details cannot be determined from these excerpts alone.

The bill increases state oversight of special education by requiring OSPI to monitor districts and charter schools for overidentification or overprovision, to impose corrective action plans, notify the state auditor when problems are found, and require follow-up audits. For local districts and charters that exceed the specified special education enrollment percentages, an auditor’s finding that corrective actions were not timely implemented will trigger an immediate reduction in that district’s excess cost allocation—scaled down by multiplying the allocation by 16% divided by the district’s special education enrollment percent—so districts with high special education percentages face a real risk of reduced state funding if they are found noncompliant and do not implement fixes. OSPI and the state auditor will take on new monitoring, reporting, and audit duties and the superintendent must submit a special education program budget request every odd-numbered year. The bill also phases up a “funded enrollment limit” from 16% to 17% over three years and then removes the cap beginning 2028–29 so that all eligible students generate excess cost allocations; this changes which students are counted for state allocations over time but the exact dollar impacts are unclear because the underlying funding formulas and related statutes referenced in the bill are not included here.