I would get a copy of your district's 504 manual. It should be on the district website. Here is the verbiage from our district's manual re eligibility criteria. It's based on federal law so the same should apply to your daughter.
Students eligible for Section 504 accommodation plans must meet three criteria. The three criteria are (1) A mental or physical impairment, (2) which substantially limits, (3) one or more major life activities. It is important to understand that all three criteria must be present for a student to be eligible for a Section 504 accommodation plan. Equally important, this disability must be why the student cannot equally access or receive benefit from the school’s programs and services.
You should be able to argue that your DD's dyslexia substantially limits her ability to read therefore she cannot equally access the school's programs.
We went to our school after we did private testing and asked for a 504 in second grade. We had a similar response that didn't want to give her one and that she didn't need any more than what they were doing. I walked them through the qualifying criteria and then pointed out that I wanted them to document the accommodations that her teacher already had in place (no extra work for the teacher). We also pointed out that according to our report from the psychologist that DD should be given more time on CSAP/TCAP (I think that you are in CO too?). Our school did not argue with us about that one because they want the kids to score as high as possible.
