By Brenda Starkey
Chronicle staff

     OLYMPIA - A 2010 supplemental state operating proposed by the governor would eliminate virtually all of the education funding eligible for cuts, according to a special legislative update from the Washington State School Directors Association.
     The loss of levy equalization alone could mean hundreds of thousands of dollars to school districts in Okanogan and Ferry counties.
     For example, Brewster School District would lose $726,506 in levy equalization and Okanogan would lose $691,117.
     "At this point, we don't have enough information to determine the depth of cuts and effects to our district," Republic Superintendent Teena McDonald said. "There will be a lot of political maneuvering in the next month by the governor and members of the Legislature to find other potential revenue sources to lessen the impact of budget reductions.
     "It will probably be late January or early February before we know which direction the Legislature will go with the governor's next budget proposal," McDonald said.
     She said she would work closely with staff and community members to determine "how we deal with our new state budget," she said.
     Faced with forecasts of falling state revenues and increased costs because of increased mandatory expenditures and successful litigation against the state, the projected budget shortfall in 2010 is just under $2.6 billion, according to the WSSDA report.
     As required by law, the budget proposal submitted by Gov. Christine Gregoire on Dec. 9 is an "all cuts" budget, balanced using only current revenue, WSSDA said. It includes no new revenue proposals.
     Among the proposed cuts:
     - Local Effort Assistance, or levy equalization, would be eliminated in 2011.
     - Kindergarten through fourth-grade class size enhancement funding would be eliminated in the 2010-2011 school year.
     - The remaining portion of voter-approved Initiative 728 (student achievement) funds would be eliminated in the 2010-11 school year.
     - State funding for all-day kindergarten would be eliminated in the 2010-11 school year. (Not all districts fall under the all-day kindergarten funding program.)
     - The remaining state-funded learning improvement day for educator professional development would be eliminated in the 2010-11 school year.
     - Funding for the gifted, or highly capable, program would be eliminated.
     - The proposal would save $2.7 million in the last half of the 2009-2010 school year from reductions in various programs including current year funding for focused assistance, readiness to learn and Navigation 101.
     - The state Board of Education and the Professional Educator Standards Board each would take an approximate 2 percent administrative reduction.
     - Two kindergarten to 12th grade programs - alternative routes to certification and focused assistance - would be cut by half.
     - A series of smaller programs would be eliminated in the 2010-2011 school year.
     Gregoire singled out the levy equalization program as one she intends to restore in her second, revenue-enhanced budget proposal. She said she wants to restore the full 12 percent LEA match for all eligible districts and also enhance funding, up to an 18 percent match, for those poorest districts in the bottom quartile of the state.
     She also mentioned her plan to ask for an increase in the local levy lid. She gave few details, but apparently plans to ask for legislation to increase the levy lid temporarily to 36 percent for all districts, according to the report.
     That would allow districts to seek more in local levy funding.