Tacoma Public Schools, Washington's third-largest district, serving approximately 28,000 students, declared a financial emergency in early 2024, per TPS budget documents. Its general fund reserves are depleted. The structural deficit between what the district costs to run and what it receives reached approximately $40 million for the 2024-25 school year.
To address the deficit, the district eliminated 38 administrative positions and identified $9.5 million in reductions to its overall staffing budget, according to the district's published budget FAQ. Further cuts are under discussion for FY2026. Source: tacomaschools.org/departments/businessandfinance/budget/frequently-asked-questions
This story should be read as a funding-accountability explainer until the current TPS and OSPI packet is attached. The documented question is how Washington and federal funding formulas affect local classrooms.
The McCleary Ruling and What It Actually Changed
In 2012, the Washington State Supreme Court ruled in McCleary v. State of Washington that the state was failing its constitutional duty to amply fund basic education. The ruling set off years of legislative response. In 2017, the Legislature passed a sweeping education funding reform package designed to fix the problem.
Part of that reform was a "levy swap": the state would increase its per-student funding allocation, and in exchange, local school districts would be capped in how much they could raise through voter-approved property tax levies. The idea was that districts that had been supplementing state underfunding with local levies would no longer need to, because the state money would cover it.
For Tacoma, the levy cap cut local revenue authority from approximately $70 million per year to approximately $38 million, a $32 million reduction, per OSPI and TPS budget documents. The state funding increase was supposed to offset that.
It didn't. The new state formula calculates allocations based on statewide average costs. Tacoma's students cost more to educate than average: the district qualifies for the federal Community Eligibility Provision, which provides universal free meals to all students based on high concentrated poverty, and it has a high proportion of English language learners and students experiencing homelessness. The cost of serving that population is above the state's funding model baseline.
The result is a structural gap that reached $40 million for the 2024-25 school year, per TPS budget documents, which the district has been filling by drawing down reserves. The reserves are now gone.
The Federal Promise That's Been Broken Since 1975
When Congress passed the Education for All Handicapped Children Act in 1975, later reauthorized as the Individuals with Disabilities Education Act, it committed to paying up to 40 percent of the national average per-pupil expenditure for students served under the law. Source: IDEA, 20 U.S.C. Chapter 33. That number was not aspirational. It was written into the statute.
It has never been reached. In recent federal budget cycles, IDEA Part B grants to states have covered approximately 13 to 14 percent of the per-pupil cost, less than a third of the statutory commitment, per CRS and NEA IDEA funding analyses. For Tacoma, with a higher-than-average proportion of students with identified disabilities, English language learners, and students experiencing homelessness, the federal shortfall translates directly into positions that cannot be funded, services that cannot be delivered, and class sizes that cannot be controlled.
Tacoma's structural deficit, which reached $40 million in 2024-25, is not a local management failure, per TPS budget documents. It is the accumulated result of a state formula that was designed assuming federal partnership and a federal partner that has not delivered at the statutory level. The levy swap that cut TPS's local revenue authority was built on the assumption that state and federal funding would be adequate. The state underfunded. The federal government underfunded. The district absorbed the gap until the reserves were gone.
A representative for WA-10 can use every appropriations cycle to push IDEA funding toward its statutory target. The ask is not new policy: it is Congress keeping a fifty-year-old promise it made when it decided that educating students with disabilities was a federal responsibility. That decision was made. The funding commitment was written into law. The money was not sent.