Tumwater School District officials told members of the public on Feb. 5 that the district faces a structural operating deficit of about $4,500,000 and will need ongoing reductions to restore its fund balance to the board’s 6% policy target.

At a public budget briefing, Kira Acker, Director of Budget Operations for Tumwater School District, outlined three options the superintendent presented to the board: cut roughly $4.5 million to balance the budget (option A); cut about $6.5 million to both balance the budget and rebuild cash reserves (option B); or cut about $8 million to $8.5 million to return the district immediately to the board’s 6% fund-balance minimum (option C). Acker said the board asked staff to work toward a mid-range approach and the district is currently planning cuts in the $6.5 million to $7 million range.

The board previously authorized an interfund loan to cover months when the general fund cash balance falls short. Acker told the meeting, “We will be paying the interfund loan back at the end of this fiscal year. So August 31, we'll have paid that back, and then we'll likely need to take that loan again, next year in 25-26,” and said the loan is intended to cover predictable cash‑flow shortfalls in February, March and June.

District leaders said the first phase of reductions — implemented via a Jan. 23 exhibit and resolution — targeted central office and support services and resulted in roughly 27 position reductions (about 23.1 full‑time‑equivalent), which the district estimates reduced costs by about $2,400,000 in round numbers. Of that amount, about $2.1 million was associated with staffing and roughly $300,000 reflected administrative pay reductions and a freeze on cost‑of‑living adjustments for nonrepresented staff and administrators.

Board members directed the superintendent to prioritize reductions “furthest from the classroom,” and district staff said a Feb. 13 regular meeting (moved from a work session because board action is expected) will include a resolution proposing school‑level reductions. Acker confirmed that paraprofessionals and other staff attached to school buildings will be included in that resolution; she said reductions affecting the Tumwater Education Association bargaining unit will also appear in the Feb. 13 materials.

District staff repeatedly emphasized that planned reductions are driven by affordability, not an assessment that positions were unnecessary. Officials said they will not knowingly violate existing individual education plans (IEPs) for special‑education students, but acknowledged that reductions to basic‑education staffing are likely to increase class sizes and will have consequences for services.

On funding alternatives, staff told attendees that bond measures cannot be used to support the general fund and require a 60% voter approval; bonds pay only for capital projects. The district identified the state’s levy lid (a statutory cap on local levy collections) as a constraint that prevents it from collecting the full amount voters have approved in some cases. Staff urged community advocacy at the state legislature to address funding gaps and cited statewide trends of similar reductions in other districts.

District leaders listed several non‑staff reductions and cost‑saving steps already under way, including a hiring freeze, reduced travel and professional development, scrutiny of curriculum purchases, fewer overtime hours where contractually permissible, and other material and operating cost cuts. They said the capital projects fund will be made whole for any capital‑to‑general fund transfers and that the general fund will pay interest to the capital projects fund as required by law.

Public input opportunities remain part of the budget process: staff said they intend to hold at least two public hearings on the 2025–26 budget, in addition to the Feb. 13 board meeting, and encouraged residents to review posted materials and participate in upcoming meetings.

Votes at a glance
- Interfund loan: Board previously authorized an interfund loan at an earlier board meeting to cover anticipated cash‑flow shortfalls this fiscal year; outcome: authorized (date not specified in briefing).
- Jan. 23 resolution (Exhibit 1): Implemented central‑office/support‑services reductions, ~27 positions (~23.1 FTE), estimated savings ~$2,400,000; outcome: implemented (posted by district).
- Feb. 13 resolution: Proposed school‑level staff reductions (includes paraprofessionals and TEA positions) and other school building staff; outcome: pending board action Feb. 13.

Why this matters
The district’s operating shortfall and near‑term cash shortages affect payroll and the timing of payments, forcing use of an interfund loan and a sequence of staff and non‑salary reductions that officials said will have direct effects on classrooms and services. The board’s policy target of a 6% fund balance frames the scale and speed of reductions staff said are necessary.

What’s next
The Board of Directors will consider school‑level reductions at its Feb. 13 meeting; the district will post exhibits and resolutions in advance and hold the regular public hearings required by state law during budget development for fiscal year 2025–26. Officials also plan ongoing communications and additional budget briefings for the public.