School District Faces Cash Flow Crisis Amid Rising Costs and Low State Funding

The Evergreen School District is facing significant financial challenges, as highlighted in the recent School Board meeting held on August 12, 2025. A key discussion centered around the district's cash flow issues, particularly the implications of dipping below a 5% fund balance. Financial officials warned that insufficient cash reserves could lead to borrowing from capital projects funds, which would incur interest and further strain the budget.

During the meeting, it was revealed that the district's state apportionment payments fluctuate significantly, with some months receiving as little as 5% of the total expected funding. This inconsistency complicates payroll and accounts payable, creating a precarious financial situation. The district ended June with only $4 million in cash flow, which is insufficient to cover monthly expenses that can reach up to $8 million.

The discussion also touched on the broader context of funding inadequacies, particularly in relation to substitute teacher costs. The district has been allocated $500,000 for substitutes over the past decade, while actual costs have soared to approximately $5 million annually. This disparity underscores the need for legislative advocacy to reform the funding model to better reflect current needs.

In response to these challenges, the district is considering various strategies, including potential supplemental levies to increase funding from taxpayers. However, the success of such measures is uncertain, as they typically require strong community support, which has been difficult to secure in the past.

The meeting concluded with a call for proactive measures to address these financial hurdles, emphasizing the importance of building a more sustainable fund balance to avoid future cash flow crises. As the district navigates these challenges, the implications for educational services and staffing remain a critical concern for the community.