Timberland Regional Library:
Anatomy of a Financial Crisis

The Scissors: Revenue vs. Expenditures

For years, revenue comfortably exceeded expenditures. In 2023, expenditures crossed above revenue for the first time. The gap has widened each year since. All data from TRL General Fund budget documents — the district's main operating account.

Y-axis begins at $20M to show meaningful variation in the $22M–$33M range. Shaded area = deficit (expenditures exceeding revenue). 2020 expenditures exclude a $5.6M one-time transfer to the Building Fund for the Mountain View library build (shown separately in Exhibit D).

What Leadership Said vs. What Happened

All quotes from public board meeting recordings, verified against the original video.

Fund Balance Collapse

TRL’s General Fund balance peaked at $13.2M in 2020, then fell sharply — first from a $5.6M transfer to the Building Fund (a board-approved transfer, not an operating loss), then from accelerating salary costs that outpaced revenue. By 2026 the General Fund had breached the board’s own 30% reserve policy.

TRL’s Fund Balance Management Policy requires the General Fund to start each year with a balance equal to 30% of budgeted revenues (policy text confirmed at Dec 30, 2025 board meeting). The red zone marks where the General Fund fell below this threshold. The 2027 projection reflects $2.2M in non-personnel cuts (Res 26-001, Feb 2026) but not the subsequent 61 layoffs; the open circle shows the original budget before any cuts. Note: the chart shows beginning balances (Jan 1), which is the metric TRL’s policy measures.

Where Each Revenue Dollar Goes

Where each revenue dollar goes. Salaries and benefits together are the structural ramp — from 70 cents of every dollar in 2017 to 77 cents in 2026. Building expenditures spiked when the Mountain View library build consumed 11 cents of every dollar in 2024. At the peak, only 18 cents remained for everything else — the compounding squeeze that explains the fund balance collapse in Exhibit C.

Each band shows that category as a percentage of General Fund revenue. Benefits include medical, dental, and retirement. The Building Fund is a separate fund, primarily financed by a $5.6M General Fund transfer in 2020; its expenditures are shown here for comparison. All data from TRL budget documents.

Fewer People, More Money

TRL's budgeted workforce shrank from 253 full-time-equivalent positions (FTE) in 2017 to 230 in 2026 — a 9% decline. During the same period, total salary expenditures grew 46%, from $11.7M to $17.1M. The entire salary increase was per-person cost growth, not headcount — new hires replaced turnover while total positions went down.

Both series indexed to 2017 = 0%. FTE from Position Inventory tables in each TRL Final Budget. Salaries from General Fund Expenditure tables.

The Structural Mismatch

Revenue is structurally capped by Washington's 1% property tax lid — a state law that limits annual levy increases to 1% regardless of inflation — and cannot keep pace with rising costs. Per-employee salary costs tracked Seattle-area inflation through approximately 2020, then began pulling ahead via job reclassifications (upgrading position titles and pay grades), executive raises, and union contract increases that moved frontline staff toward (but not to) peer pay levels. The growing gap between costs and revenue capacity is the crisis the district never addressed.

All indexed to 2017 = 100. CPI-U (Consumer Price Index) annual averages from BLS Series CUURS49DSA0 (Seattle-Tacoma-Bellevue). Salary per FTE = General Fund salary actuals / budgeted FTE from TRL Position Inventory (differs from Exhibit J's state-survey FTE, which produces a lower base). FTE declined from 253 (2017) to 229 (2025) — the entire salary increase was per-person cost growth, not headcount. CPI series: CUURS49DSA0 (2017–2020) spliced with CUUSA423SA0 (2021–2025) at identical overlap point (295.560).

The Revenue Option Never Pursued

TRL's levy rate has declined 46% since its 2014 peak and sits at less than half the statutory maximum. The last levy lid lift — a ballot measure asking voters to approve a higher rate — was attempted in 2009. At the current rate, the owner of a $400,000 home pays about $90 per year in library taxes. At the peer median rate of $0.42, that would be about $168.

TRL's 2026 rate: $0.224 — less than half the $0.50 maximum

Where the Raises Went

Executive compensation changes alongside frontline reductions.