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WashingtonSB 54122025-2026 Regular SessionSenate

Providing temporary interfund loans for school districts.

Sponsored By: June Robinson (Democratic)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 1 benefits, 0 costs, 2 mixed.

Short-term loans for struggling school districts

Beginning July 27, 2025, Washington school districts in binding financial conditions or enhanced oversight can borrow from their capital projects fund. These interest-free loans must be repaid in full within one calendar year and cannot harm capital fund projects or purposes. Fiscal year 2024 loans tied to COVID-19 financial disruption can last up to two years. The school board must approve a resolution listing the amount, funds involved, repayment source, and repayment schedule. Districts under enhanced oversight also need their special administrator’s approval. District financial reports, including monthly board reports, must disclose outstanding loan balances. This authority is not a routine budget-balancing tool.

Struggling school districts can sell property

Beginning July 27, 2025, districts in binding financial conditions can seek state approval to sell district real estate. Approval requires showing that the sale is needed to restore financial stability and prevent harm to student learning. Proceeds must address financial burdens that caused or significantly contributed to those conditions, or fund an authorized temporary interfund loan. A district can receive this approval only once every 10 years. Boards can sell property authorized through this process or by an oversight committee, beyond property no longer needed for schools. Parcels worth more than $70,000 require notice published weekly for two consecutive weeks, a public hearing, and at least 45 days after publication before sale. Sales generally require at least 90% of appraised value. After one year on the market, unanimous board approval permits sale for at least 75% of a new appraisal. Broker fees are capped at 7% per parcel. Boards must use a certified appraiser, who cannot join a purchase contract for that parcel for three years after appraisal.

Struggling school districts face stronger oversight

Beginning July 27, 2025, the state superintendent must form an oversight committee for districts meeting a new trigger. The trigger is two consecutive years in binding financial conditions without a satisfactory financial plan. For districts under enhanced oversight, the committee can direct sales of real estate or other assets. It can choose which fund receives the proceeds, including funds other than debt service or capital projects. A special administrator can approve authorized temporary interfund loans. Enhanced oversight also allows required approval or limits on contracts and personnel actions; actions taken without required approval are void.

Sponsors & Cosponsors

Sponsor

  • June Robinson

    Democratic • Senate

Cosponsors

  • Mike Chapman

    Democratic • Senate

  • Rebecca Saldaña

    Democratic • Senate

  • T'wina Nobles

    Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 119 • No: 75

Senate vote • 4/17/2025

Final Passage as Amended by the House

Yes: 29 • No: 20

House vote • 4/14/2025

Final Passage as Amended by the House

Yes: 60 • No: 36 • Other: 2

Senate vote • 3/11/2025

3rd Reading & Final Passage

Yes: 30 • No: 19

Actions Timeline

  1. Effective date 7/27/2025.

    5/20/2025Senate

  2. Chapter 384, 2025 Laws.

    5/20/2025Senate

  3. Governor signed.

    5/20/2025legislature

  4. Delivered to Governor.

    4/23/2025legislature

  5. Speaker signed.

    4/22/2025legislature

  6. President signed.

    4/19/2025legislature

  7. Passed final passage; yeas, 29; nays, 20; absent, 0; excused, 0.

    4/17/2025Senate

  8. Senate concurred in House amendments.

    4/17/2025House

  9. Third reading, passed; yeas, 60; nays, 36; absent, 0; excused, 2.

    4/14/2025Senate

  10. Rules suspended. Placed on Third Reading.

    4/14/2025Senate

  11. Committee amendment(s) adopted as amended.

    4/14/2025Senate

  12. Rules Committee relieved of further consideration. Placed on second reading.

    4/10/2025Senate

  13. Referred to Rules 2 Review.

    4/2/2025Senate

  14. Minority; do not pass.

    3/31/2025Senate

  15. ED - Majority; do pass with amendment(s).

    3/31/2025Senate

  16. ED - Executive action taken by committee.

    3/31/2025Senate

  17. First reading, referred to Education.

    3/13/2025Senate

  18. Third reading, passed; yeas, 30; nays, 19; absent, 0; excused, 0.

    3/11/2025Senate

  19. Rules suspended. Placed on Third Reading.

    3/11/2025Senate

  20. 1st substitute bill substituted.

    3/11/2025Senate

  21. Placed on second reading by Rules Committee.

    3/7/2025Senate

  22. Passed to Rules Committee for second reading.

    2/13/2025Senate

  23. EDU - Majority; 1st substitute bill be substituted, do pass.

    2/12/2025Senate

  24. Minority; do not pass.

    2/12/2025Senate

  25. First reading, referred to Early Learning & K-12 Education.

    1/22/2025Senate

Bill Text

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