2010annual report

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FROM THE PRESIDENT, THE EVERGREEN STATE COLLEGE

In 2010, Evergreen’s enrollment reached record highs, with more students than ever seeking admission to the college. Student retention is also increasing, especially among upper division students. We’ve seen substantial numbers of community college transfers and those unemployed taking “advantage” of a challenging job market to complete their education. Evergreen continues to score highly in student engagement.

Our work has been acknowledged by others on numerous occasions this year. In the Spring of 2010, Evergreen faculty and students were recognized for their habitat restoration efforts on the Nisqually River Delta when the Nisqually Land Trust received the national Spirit award from the organization Coastal America. This is just one example of the outstanding work that our students and faculty pursue in the spirit of public service. The Longhouse Education and Cultural Center, one of our dedicated public service centers on campus, has been honored with an award from the Smithsonian National Museum of the American Indian (page 9).

The transformation and renewal of the physical campus continues. The College Activities Building has undergone a complete renovation – you can read about it on page 5. We are also working on a new Sustainable Agriculture Lab at the Organic Farm that will significantly extend opportunities for students to learn about sustainable approaches in

the lab, as well as in the field. Our commitment to sustainability remains firm. Our ongoing work toward meeting our goal of ‘zero waste’ has been multi-faceted, involving academic programs, staff and public service centers. For instance, Residential and Dining Services continue to model sustainability for the campus, focusing on local food, waste diversion and sustainable living habits. We proudly celebrated an important milestone for our Master of Environmental Studies program, which is featured on page 3. I hope you’ll enjoy reading about our ever-increasing drive toward sustainability on campus and within our network of peers on pages 6 and 7.

As I’m sure you know, the sharp decline in state revenue in this budget cycle increases the importance of private fundraising for the college. In spite of the challenging environment, College Advancement and the Foundation Board of Governors have scored some major successes in the past year. Together we have done important work that will continue to move private giving forward in the future.

Finally, in the next year we will be planning a celebration to mark the 40th anniversary of Evergreen’s first graduating class in 1972, which will culminate in summer 2012. As extraordinary as it is to reflect on the ten years I have spent as President, it is even more humbling to think about the full history of the college. I continue to be astounded at Evergreen’s ability to weather myriad challenges while remaining committed to its founding vision: to provide an accessible interdisciplinary education. Together, we have much to be proud of. I am grateful for the continued opportunity to serve Evergreen and for the hard work and dedication of Evergreen’s faculty, staff and supporters.

Sincerely,

Thomas L. Purce President

Table of ConTenTs

2 evergreen HigHligHTs 2009-2010

18 audiTor’s reporT

19 ManageMenT’s disCussion and analysis

26 College finanCial sTaTeMenTs

30 foundaTion finanCial sTaTeMenTs

33 noTes To THe finanCial sTaTeMenTs

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Inaugural

—Nikki McClure ’91

More than 150 alumni, faculty and friends came on campus to support The Evergreen State College Foundation’s inaugural Art of Living

which raised more than $75,000 for student scholarships.

Billed as a “celebration of art, cuisine and community,” the event drew not only an enthusiastic crowd, but also donations of artwork from numerous local and regional artists—both established and emerging—including faculty, staff and alumni such as Cappy Thompson ’76, Nikki McClure ’91 and Tom Anderson ’73.

Auction items came from Evergreen supporters near and far, led by event co-chairs Sandy Desner ’76 and Jane Rushford. Among the treasures were the works of nearly 20 alumni artists, who generously contributed their pieces to benefit the college’s future students.

Attendees were able to bid on the artwork, as well as a variety of experiences such as travel packages and studio tours. In addition, they had the opportunity to make direct contributions to scholarships, which were then doubled by matching gifts from other Foundation donors.

Launched as an annual event, the first auction counted many sponsors among its supporters, including Heritage Bank, The Evergreen State College Alumni Board of Directors, Capital Medical Center, Seattle-based Platform Gallery, Batdorf & Bronson Coffee Roasters and The Evergreen State College Organic Farm. Hors d’ oeuvres and pastries were provided by local chefs and the four-course brunch featured locally grown organic ingredients.

former Mes director and emeritus faculty member Tom rainey praised the Mes program for its commitment to combining scientific, political, economic and ethical aspects in studying critical environmental issues facing the globe.

MES Celebrates 25 Years of Environmental Leadership

evergreen’s Master of Environmental Studies program recently commemorated its 25th anniversary at the 20th annual Rachel Carson Forum.

The event, held at the Longhouse, included the keynote address, “Becoming a Conservationist,” by veteran environmental educator and advocate Estella Leopold, the daughter of renowned ecologist Aldo Leopold. Billy Frank, an environmental leader, treaty rights activist and longtime chairman of the Northwest Indian Fisheries Commission, also addressed the forum. Other presentations included promoting political progress, composting and bike-pannier making demonstrations. During the MES celebration, former MES directors Oscar Soule, Tom Rainey and Ralph Murphy spoke, as did current director Martha Henderson.

The MES program accepted its first class in the fall of 1984. Students work toward earning a graduate degree in environmental studies, which integrates knowledge about environmental science and public policy. Evergreen’s program is unique among most environmental master’s programs, which typically emphasize either science or policy. The goal is to produce graduates who combine an interdisciplinary understanding of the social and natural sciences with the skills and wisdom to intelligently address environmental problems. The program has historically drawn students from around the country and the world, as well as from throughout the state. Since classes are offered in the evenings and on weekends, the MES program has made it possible for many full-time employees to earn a graduate degree.

MES alumni are employed in the public, private, and nonprofit sectors; while others continue their graduate study in related Ph.D. programs. In state government, for example, the program has placed alumni in the departments of agriculture, ecology, fish and wildlife, health, labor and industries, natural resources, and transportation.

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Center for Creative & Applied Media OpensFollowing an ambitious campaign, the college opened its new high-tech media hub, the Center for Creative & Applied Media (CCAM). Dedicated last spring, the CCAM replaces Evergreen’s 1970s-era television studio, which ceased operations in 2004, giving students and faculty professional multimedia tools to push the boundaries of animation, film and audio production.

Located on the first floor of the Daniel J. Evans Library, the modern, industry-compliant digital media facility combines professional grade equipment and computer support with an instruction- and collaboration-oriented studio environment. The 10,000 square-foot facility is fully equipped with a sound stage, multi-camera HD video studio, cable and Internet broadcasting facility, workshop space, surround-audio recording and mixing suite, and experimental-effects lab.

Since the CCAM went online, it has enhanced learning opportunities for media studies students, promoted media and technological literacy across the campus, and supported the college’s academic and administrative work. In addition, the facility allows for digital conversion, editing and storage of media documents for archival purposes.

As a resource for the entire Evergreen community, the CCAM is not only preparing graduates to enter media production fields, it is also providing students across a range of disciplines and practices with the analytical and evaluative skills required in the Information Age—and extending the college’s reach into the wider community in a way that integrates media, public service and virtual networking.

Thanks to the vision, involvement and financial support of Evergreen’s student body, the renovation of the College Activities Building is now complete.

Begun in 2009, the $21 million project incorporated a host of improvements and new features in the 38-year-old building. Collaboratively developed as an updated, expanded and more inviting space for the community, the renovation was designed to revitalize the existing CAB into an energy-efficient green building, with numerous innovations geared towards achieving gold certification in the Leadership in Energy and Environmental Design program of the U.S. Green Building Council (which is pending). These include solar hot water, composting toilets, native landscaping, rainwater harvesting, natural ventilation and on-site wastewater treatment.

Sweeping interior renovations added a new central staircase in the lobby and more space to the bookstore, conference services, KAOS radio station, student organization offices, the student newspaper and the bike shop. Campus dining facilities were expanded and upgraded and new areas for studying, holding meetings and socializing were added, as was the student-run Flaming Eggplant Café, formerly located in a small trailer on Red Square. The project added about 15,000 square feet to the 85,000-square-foot building. Pedestrian flow was improved to better connect the residential east campus to the academic west campus.

Materials were chosen for their durability and sustainability and include flooring, carpeting and countertops made from recycled content. Exterior modifications included colored tile and wood treatments covering the old concrete façade. The wood used in the project is Forest Stewardship Council certified to have come from responsibly managed forests. Nearly all construction debris was recycled.

This project was made possible by Evergreen students, who voted to launch the renovation, agreed to pay special student fees to fund about 75 percent of its cost, and participated in the design process with a majority vote within the college’s design committee. The DLR Group, the Seattle-based architecture firm that handled the renovation, said in a presentation about the project, “While public projects (particularly schools) entail a substantial amount of public interest and scrutiny, our team had never encountered this level of passion, commitment and long-term thinking amongst a student community.”

The CAB was built in 1972 and expanded to include a third floor in 1992. Ninety-five percent of the original structure was preserved in the renovation; the state contributed $4.9 million to address the existing facility’s preservation needs.

The new, improved CAB was reopened and dedicated in time to kick off the 2010-11 academic year. It better reflects Evergreen’s green culture and is a giant step toward achieving Evergreen’s goal of becoming carbon neutral by 2020.

CAB Renovation Completed

1.VisitorsgotthechancetoexperimentwithCCAMequipment.

2.LyndaWeinman‘76,wasrecognizedforhersignificantcontributiontotheCCAMbuildingbythenamingoftheLyndaLab,theCCAM’sexperimentaleffectslaboratory.

3.SeniorTommyThompsonexplainshisstopmotionanimationproject“HighStrung”toLyndaWeinman‘76,herLynda.comco-founderandhusbandBruceHeavinandPeterRandlette,Evergreen’sheadofelectronicmedia.

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Our Green Credentials Keep Building Evergreen continues to gain the national spotlight for helping to move the country towards a more sustainable future.

Just in time for the 40th anniversary of Earth Day, The Princeton Review selected Evergreen as one of the nation’s most environmentally responsible colleges. The education services company included the college in “The Princeton Review’s Guide to 286 Green Colleges,” a listing of schools with the highest ecological standards. Evergreen received the highest possible rating of 99, earning it a place on The Princeton Review’s 2010 “Green Rating Honor Roll,” along with 14 other schools.

Developed in partnership with the U.S. Green Building Council, the guide focuses solely on colleges and universities that have demonstrated an above average commitment to sustainability in terms of campus infrastructure, activities and initiatives.

Evergreen was also singled out by Sierra Magazine as one of America’s “coolest” schools for its efforts to address climate change. The college placed third in the 2010 ranking. Sierra, the flagship publication of the Sierra Club, introduced its annual list of what it calls “the most eco-enlightened U.S. colleges” in 2007. Evergreen has been on it every year since—each time in the top ten—earning praise for its trendsetting efforts to reduce waste, conserve energy and achieve climate neutrality, as well as its work to provide learning resources through its salmon-safe certified organic farm and sustainable living and food choice options.

In the area of environmental education, Evergreen received attention from The 2010 Fisk Guide to Colleges, which characterized it as the “Epicenter of all things green in the Pacific Northwest.” The guide included Evergreen in its shortlist of schools with “unusual strength” in undergraduate environmental studies, one of “today’s hottest interdisciplinary majors.”

Recognition that Evergreen is leading by example on sustainability comes at a time when nearly two-thirds of college applicants say a school’s commitment to environmental issues would influence their enrollment decision, according to a Princeton Review survey.

Evergreen Joins Pioneering Global Climate InitiativeIn a push for colleges to lead the way to energy sustainability, Evergreen was one of six academic institutions in the world invited to join the Climate Neutral Network (CN Net), an initiative of the United Nations Environment Programme (UNEP).

As vanguards of a global movement, the six schools are spearheading the initiative, which aims to promote action to de-carbonize the world’s economies and reduce the greenhouse gas emissions responsible for climate change.

Evergreen and its sister schools are considered pioneers in taking steps to reduce greenhouse emissions, green their campuses, and invest in low-carbon research and development.

According to UNEP Executive Director Achim Steiner, “The Climate Neutral Network was inspired by a simple idea that a transformation to a low, even zero emission future is a learning process. It is therefore fitting that universities from all over the world should join this global networking platform and help make the best knowledge on climate neutrality available to all.”

Evergreen is engaging the local, regional and global community to demonstrate and enact clear policies to address the world-changing challenges of climate change through a range of strategies. The college already purchases 100 percent of its annual electricity usage from renewable energy sources; has replaced many of its gasoline and diesel vehicles with electric vehicles; and significantly reduced landfill waste by expanding its composting efforts, reducing paper use, initiating an electronic waste recycling program and raising student, staff and faculty awareness.

In addition, the college has a strong ecological agriculture program that works in conjunction with the Organic Farm and local farms throughout the region, promoting locally produced food designed to encourage consciousness of the role of food miles and agricultural inputs in climate change.

The five other founding schools in the CN Net are the College of the Atlantic in Maine, Middlebury College in Vermont, Malaga University in Spain; Tongji University in China, and the University of the West of England.

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Evergreen’s Longhouse Education and Cultural Center, the House of Welcome, held a grand reopening to celebrate the 2009 completion of its renovation and expansion. The open-house event, marked by music, dance and a potlatch ceremony, featured the dedication of two new art installations.

These pieces included etched glass doors leading to the patio, which were created by Makah artist John Goodwin (who signs his work by his ceremonial name, “Nytom”) and a cast concrete spindle whorl produced by Squaxin Island artists Andrea Wilbur-Sigo and her husband Steve Sigo. The whorl, in Welcome Hall, took the place of the fireplace, which was moved to a new covered patio outside to provide more gathering space inside the facility. The patio, part of the center’s 1,800-square-foot expansion, serves as an extra meeting place, as well as a carving area for artists.

With the additional space, the Longhouse now has a larger gallery and new program areas, which incorporate a workspace, conference room and art storage room. The former program office was converted into a student lounge. New video projectors and screens were also installed in the classrooms.

Since the Longhouse first opened as a public service center in 1995, the scope and reach of its work has grown substantially. It was established to promote indigenous arts and cultures by offering a variety of programs, cultural ceremonies, conferences, performances, art exhibits and community events. Originally, it focused on six local Puget Sound tribes and their artists. Today, Longhouse staff work with indigenous artists not only throughout the Pacific Northwest region but also nationally and with other Pacific Rim indigenous peoples.

Longhouse Expansion Celebrated

Evergreen was one of eight recipients in the nation to win a grant from the Smithsonian’s National Museum of the American Indian (NMAI) 2010 Visual and Expressive Arts Program. The award supported the exhibition, “It’s Complicated—Art about Home,” which brought together numerous works from contemporary Native American and First Nations artists.

Curated by Evergreen faculty member Lara Evans, the show was held at the Evergreen Gallery and explored the theme of home through the vision of nine Native artists, who each addressed it in very different ways and through various media, from computer and video art to painting and sculpture.

The NMAI awards support artists and cultural collaborations across the country. Recipients were selected by a panel of museum staff and outside experts in the contemporary art field. The exhibition was also made possible by support from The Evergreen State College Foundation, the President’s Diversity Fund, and the Longhouse Education and Cultural Center.

Evergreen Wins Smithsonian National Museum of the American Indian Award

KimowanMetchewaisGoodwill,118Avenue,Edmonton2010,Inkdyeandacrylicpaintonpaper,tape,42”x35”.

FeaturedintheEvergreenGallery’s“It’sComplicated—ArtaboutHome”exhibit.

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evergreen earns High scores for student engagementIn the 2009 National Survey of Student Engagement (NSSE), Evergreen proved once again that it is a frontrunner in promoting student success. Compared to students at most colleges and universities across the country, first-year and senior Greeners reported reading more, writing more, spending more time preparing for class, making more presentations, working on more collaborative projects, and engaging more actively with faculty and each other— all indicators of being highly engaged in their education.

The NSSE collects information at hundreds of four-year colleges and universities about student participation in programs and activities that the institutions provide for their learning and personal development. Through its annual student survey, The College Student Report, the group assesses the extent to which first-year and senior students engage in educational practices associated with high levels of learning and development.

Evergreen students who participated in the 2009 survey reported higher than average engagement in every benchmark category measured. These include level of academic challenge, active and collaborative learning, student-faculty interaction, enriching educational experiences, and supportive campus environment. Each school’s results are compared to those of peer institutions. More than 600 four-year colleges and universities took part in the survey.

Evergreen students have participated in the NSSE every year since it was launched in 2000. The college uses the survey results to evaluate and improve students’ educational experiences. The NSSE results have also been used to evaluate the best-performing schools—which include Evergreen—and learn what they do to promote student success, in an effort to respond to national concerns about improving the quality of undergraduate education.

Setting The Stage for Renowned Speakers

Evergreen welcomed a number of luminaries to speak on campus during the year. The Willi Unsoeld Seminar Series brought in Dan Mazur, the mountaineering expedition leader who abandoned his May 2006 bid to summit Mount Everest to help rescue Australian climber Lincoln Hall, who had been left for dead a day earlier. Mazur’s act of kindness caught the attention of media around the world and opened up discussions about the ethics of mountain climbing. His presentation focused on his personal experiences with mountain climbing’s physical, mental and ethical challenges.The annual Willi Unsoeld Seminar is a “living memorial” in honor of Evergreen founding faculty member Willi Unsoeld, who lost his life in anavalanche on Mt. Rainier in 1979.

Other speakers this year included consumer advocate Ralph Nader on the subject of health care in the United States; former U.S. Congresswoman Cynthia McKinney, whose talk was entitled, “Don’t Get Tired When Working for Justice”; journalist and “Democracy Now!” host Amy Goodman, who spoke about her newly published book, “Breaking the Sound Barrier”; and educator-activist Angela Davis, a keynote speaker at the 2010 Synergy Conference.

EvERGREEN’S sustainable prisons project Helps in oregon spotted frog recovery

evergreen partnered in the fall 2009 reintroduction of the endangered Oregon spotted frog to its native habitat in Pierce County, helping to bolster a dwindling species that was once widespread in the Puget

Sound area. More than 500 frogs were released into the wild after spending the first nine months of their lives in captive breeding programs at Seattle’s Woodland Park Zoo, the Oregon Zoo in Portland, and Cedar Creek Corrections Center near Olympia.

Inmates at Cedar Creek raised dozens of the amphibians, from eggs to tadpoles to juvenile frogs, through the Sustainable Prisons Project, a partnership between Evergreen and the Washington State Department of Corrections, which gives incarcerated men and women the chance to conduct ecological research and play important roles in conservation and advancing scientific knowledge. The inmates also took in a group of more than 60 frogs from the two participating zoos that were too small to be released initially and cared for them during the winter until their release the following spring.

The captive-reared frogs were set free in Dailman Lake on the Fort Lewis Military Reservation, an area chosen for its diverse wetlands—which are needed to sustain an Oregon spotted frog population—and relative isolation from human interference. All of the released frogs, which grow two to four inches long and weigh as much as three ounces in adulthood, were tagged and several were fitted with tiny microchips so researchers can track their whereabouts and monitor the success of the effort.

The Oregon spotted frog release is part of a five-year collaboration led by the Washington Department of Fish and Wildlife to preserve and increase the population of the species, which historically ranged from southeastern British Columbia to northeastern California. Loss of habitat, predation by introduced species and disease are believed to be responsible for the decline of the frogs, which now exist in the wild in fewer than 10 locations in Klickitat and Thurston counties. The recovery plan aims to establish a self-sustaining population of the species, which was listed as endangered by Washington state in 1997. The Cedar Creek effort has been lauded for the high survival rate of the frogs raised there, prompting frog researchers to expand the program at the minimum-security prison.

SPPSustainable Prisons Project

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nRyan Converse’shands,Evergreen’smosswoodshavebeen tranformedintoaworkofartenlivenedbyfantasticalbeingsandhis uniquevisionofthelandscape.

Thatvision,hesays,“isasynthesisofallmylearningatEvergreen.”AseniorwhohailsfromPullman,Wash.,Converseparlayedtheknowledgehegainedfromprogramscoveringcomparativemythology,aestheticphilosophy,storytellingandfilmtheoryintoamultimediaprojectdocumentingthenaturalsurroundingsofhishomeinOlympia.

WiththesupportofaFoundationActivityGrant,madepossiblebydonationstoEvergreen’sAnnualFund,hewasabletofinishashortfilmhedevelopedcalled“IntheValleyoftheLeafling.”Thefilm—whichwasshotinvariouslocationsoncampus—revealsamodernmythologyofplace,oneheconjuredfromtheCascadianwildernessofthesouthPugetSoundarea.

MythologyHis ownCreating MYThOLOGYCREATING

r

CamachoenteredEvergreenasarecipientoftheFirstPeoples’Scholarship,supportedbygiftstotheEvergreenAnnualFund,whichisgrantedtonewstudentswhohavedistinguishedthemselvesinawiderangeofareas,suchasacademicsandcommunityservice.ShewasalsoawardedNationalScienceFoundation(NSF)scholarshipsinbothherfirstandsecondyearsatthecollege.

StudyingscienceatEvergreenhasturnedouttobegratifyingforCamacho.“Thephysicsdepartmentherehasbeenreallygreat—andverydifferentfromwhatIexperiencedinhighschool,”shesays.“Ienjoythefactthatweexplorethefundamentalsofthesubjectinconjunctionwiththemoreadvancedapplications,aswellasthefactthatI’vebeenabletoattendconferenceswheretheexpertsinthefieldaremorethanwillingtositdownwithundergraduatesandmembersofthepublicandreallytalktothemaboutthesignificanceofwhatthey’reworkingon.”

Herscholarshipswereinstrumentalingivinghertheseopportunities,“TheFirstPeoples’Scholarshipwasalifesaverinmyfreshmanyear,”saysCamacho.“IthadbeentwoyearssinceI’dbeeninschoolandIwasunsurehowIwasgoingtoadjusttotheacademicswhilehavingtofindextrawaystomakeendsmeet.ThesamegoesfortheNSF,whichhasprovidedagreatsupportsystemasfarasbeingasciencestudentataliberalartscollege.It’spavedthewayforfutureresearchopportunitieswiththefacultyandconnectedmewithanumberofmentorsandadvisors.”

Withthesupportshehasreceived,Camachosaysshe’sonherwaytoattaininghergoal“ofeducatingthepublicaboutthewonderfulworldofmathematicsandscience.”She’snotsureyetwhethershe’llbecomea“mathematicsteacher,aneditorofScience News,asciencefictionwriterorapureresearcher.”Onethingiscertainthough:Allarewithintherealmofpossibility.

DuringherfirsttwoyearsatEvergreen,Guadalupe Camacho immersedherselfinmathandscienceprograms.SheevenattendedconferencesheldbytheAmericanPhysicalSociety,oneoftheworld’slargestprofessionalorganizationsforphysicists.

Italmostdidn’tturnoutthatway.

Camacho“wasbittenbythesciencefictionbugattheageof12,”whenshereadRobertJ.Sawyer’sFactoring Humanity,athrillerinvolvingawomanscientist,artificialintelligence,quantumphysics,mathematicalequationsandparalleluniverses.“Throughthatbook,”shesays,“Iwasintroducedtothewondrousrealmofpossibility.Shortlyafterfinishingit,Ipickedthephysicsandastronomyshelvesatthelibrarydry.”

Fromthenon,sheeagerlylookedforwardtotakingher“firstrealphysicsclass”inhersophomoreyearinhighschool.Thenshegotthere.“Iwascompletelythrownoff,”shesays.“Thebulkoftheclasswasspentanalyzingasketchofthesameballonvariousdegreesofinclinedplanes…Bythetimetheendoftheyearrolledaround,IhadalreadycometotheconclusionthatIjustwasn’tcutoutforthescientificcareerpath.”

Whilestillinhighschool,afascinationwiththeenvironmentledhertojointheYouthConservationCorpsatSanDiego’sCabrilloNationalMonument.HermentorthererecommendedherforafullscholarshiptoattendtheSouthernCaliforniaMinorityYouthEnvironmentalTrainingInstitute,whichshewon.Onceagain,sciencecalledouttoher.

Attheinstitute,shelearnedaboutthesciencebehindsomeofthemostpressingenvironmentalissues,whichreignitedherinterestinthediscipline.“IrealizedthenthatIwouldfacealifetimeofregretshouldIchoosetoturnawayfrommydreamofstudyingphysics,”shesays.

Hismaincharacters,acastofwhimsicalwoodlandcreatures,areembodiedbytheelaboratewearablesculptureshefabricatedfromclay,liquidlatex,fauxfurandothermaterials.Wildandwoolly,greenandleafy,theymovethroughaworldimbuedwithwhatConversecallshis“actofmythopoeia,”aself-createdsynthesisofvarioustraditionalarchetypes,imaginationandasenseofplace.“Thesewoodshavealotofmeaningforme,”hesays.“Thefilmwasawayformetoactivelyexploreandunderstandmyplacehere.”

Toproducethefilm,Converseassemblednotonlythehandcraftedmasksandcostumesthatspringtolifeonscreen,butalsoateamofadozenvolunteers—actors,musicians,photographersandothers—whocollaboratedontheproject,whichhescriptedandfilmedforhisMediaworksprogram.Hisactivitygranthelpedhimpurchasesomeofthematerialsheusedtoconstructthecreaturesandprops,aswellasbuyandprocessthe16mmfilmheshotforthe12-minutemovie.Thefinishedproductrepresentsnearlyayear’sworthofwork.Converse,whoisalwayssurroundedbycreativeprojectsinvariousstagesofcompletion,sayshecouldnothavecompletedthefilminthewayheenvisionedwithouttheactivitygrant.

“IntheValleyoftheLeafling”hasbeenshowntoaudiencesattheOlympiaFilmFestivalandinSeattle.Tocomplementthefilm,ConverseisproducinganaccompanyingnarrativephotobookthathehopeswillbepublishedbyanartspressinPortland.Boththefilmandthebookarepartofalargermultimediaprojecthehaschristened“TheGoldenAntler.”

ThisworkisthemanifestationofConverse’sartisticandacademicjourney,onewhichhesaysgavehimthetoolstonotonly“transformideasintomoretangibleobjects,”butalsoto“bringnewlayerstoideas.”Itisalsoaportalintohiscreativespirit,wherewildthingsemergefromsketchesinto3Dpiecesthataresetfreetoinspireothers.

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Supporting the Next GenerationEvergreenoccupiesaspecialplaceinMark Stephen Souder’slife.Heevennamedhiswebdesigncompany,Studio403,forhisD-dormroomnumber.“FormytwoyearsatEvergreen,thatwashome,”hesays.

SouderconsidershistimeatEvergreenastransformative.Consequently,hehasrepeatedlyextendedhimselftohelpotherstudentsatthecollegesothattheymighthavethesametypeoflife-changingeducationalexperienceashedid.

“IgivetoEvergreenbecauseIwasfortunateenoughtohaveafullridefrommyparents,”Soudersays.“It’smywayofmakingitalittleeasieronthenextgenerationsofstudents.Myfatherinstilledthespiritofgivingbymatchingallhischildren’scontributionstotheiralmamatersandwhencombinedwitheitherhiscorporatematch—orlatermycorporatematchfromMicrosoft—itmadegivingafinanciallyrewardingpropositionforallinvolved.”

NowaresidentofSeattle’sSouthParkneighborhood,Souderworksfromhomeasamarketingandbusinessdevelopmentconsultant.Fornearlyadecade,heworkedforMicrosoft,startingasatrafficcoordinatorwhenthecompanywasonlyafewyearsoldandadvancingthroughtherankstobecomeadirectmarketingmanageratatimewhenthenumberofemployeeshadmultipliedtenfold.Hiscareerhasincludedstintsasapublishingconsultant,aserialbusinessowner,aneditor,awriterandthepublisherofatrademagazineservingOregon’sfloralandnurseryindustry.

AtEvergreen,Souderconcentratedingraphicartsandbusinessadministration,whichhasservedhimwellwithfutureemployersandclients.“Whatthissaystothemis,‘He’screative,butwon’tgooverbudget,’”hesurmises.Thecollege’sevaluationprocessandseminarsalsohelped.AtMicrosoft,periodicemployeereviewswerean“almostidenticalcopy”ofEvergreen’snarrativeevaluations.And,hesays,“Theseminarstyleofteaching,whichpullsstudentsoutoftheirshellsandgetsthemdiscussingideas,projectsandproblemswiththeirpeersiswhatbusinessisaboutinthemodernage.”

Souderalsotravelsextensively,spendingaboutathirdofhistimesatisfyinghis“senseofwanderlust.”Hesaysasummerprogramhetookwhenhewasastudent,TheArtHistoryofRomeandGreece,didn’tintroducehimtointernationaltravel—thathappenedearlierwithhisfamily—but“ittaughtmetolookattheworldwithawiderlens.”

His2009MarkStephenSouderScholarshipforInformationDisseminationwenttoGenevieveLee(left)—atransferstudentlikeSouder—whoisstudyingeconomics,history,politicalscienceandasshesays,“socialmovementsastheypertaintotheultimatestruggleforjusticeandaworldthatplacestheutmostvalueonservingothers.”

LeeorganizeseventsconnectingimmigrantandallycommunitiesinOlympiatotheEvergreencampusthroughtheYouthandYoungAdultNetwork(YAYA)oftheNationalFarmWorkerMinistry.ShecreditstheSouderscholarshipwithgivingher“muchneededfinancialrelief.ItalsoprovidedmewithasenseoflegitimacythatIreallycanbeabringerofpositivechangetotheworld.”

ToSouder,Leehadthe“passionquotient”hehopesforineachrecipientofhisscholarship,whichisofferedannuallytoonestudentwho“demonstratesaninterestininformationdissemination…tocreateamoreequal,intelligentandcompassionatesociety.”

Taking a Critical look at the

Tomanypeoplearoundtheworld,theislandsoftheCaribbeanSeaareidyllictropicalplaygrounds,exoticdestinationsforvacationerstofindsun,beaches,pleasureandnativeauthenticity.FacultymemberTom Womeldorff seesthem

quitedifferently.

AsascholarofCaribbeanstudies—whoseinterestintheregionwassparkedbyaprogramhetookatEvergreeninthelate1970s—Womeldorffexaminestheregionthroughabroadinterdisciplinaryscope,takingintoconsiderationawholerangeofhistorical,cultural,economic,politicalandideologicalcontexts.

WiththehelpofaFoundationFacultyGrant,hespenta2010sabbaticalconductingon-the-groundresearchthathasenrichedhisteaching,helpedhimbuildtwonewprograms,andenabledhimtopassontohisstudentsadeeperandricherunderstandingoftheregionthatgoesfarbeyondprepackagedtouristexperiences.

Forfiveweeks,WomeldorfftraveledtoPuertoRico,Dominica,GuadeloupeandVirginGordaintheBritishVirginIslands.Hediscoveredthetransformativeworksofotherscholars,learnedaboutcurrentpoliticaldebatesandstudiedtheevolutionofCaribbeantourismgiventhecoloniallegacyoftheregion.

Lastfall,hebroughtthefruitsofhisresearchtoCaribbeanCulturalCrossings,aprogramhetaughtwhichexaminedthevariouspowersandforcesthatremadetheregioninthelate18thcenturyandcontinuetoshapeittothisday,fromthesugarplantationsoftheFrench,English,SpanishandDutchtomodernmigrationandglobalization.“Icouldnothavedevelopedsuchageographically,culturallyanddisciplinarilybroadapproachwithoutthesabbaticalexperience,”hesays.

Inthespring,hetaughtCaribbeanTourism:ACriticalAnalysis.Thisprogramcoveredthedevelopmentofthetravelindustryintheregion,focusinginparticularonitseconomicimpacts,theshapingofthetouristexperience,impactsonlocalpeople,changingWesternperceptionsoftheregionandthetourismmentality.

Womeldorff,whohastaughtatEvergreensince1992,creditstheFoundationFacultyGrantwithnotonlyallowinghimtodevelopmorefullyasascholarandupdatehisknowledge,butalsowithenablinghimtodomoreonhissabbaticalthanhecouldhaveotherwiseandhelpinghimtoshapehisteachingandbuilddifferentacademicprograms.

“ItwascrucialformydevelopmentasaCaribbeanStudiesscholar.IhavebeentransformedfromascholarofPuertoRicotoanascentscholaroftheCaribbean,ascholarintheEvergreensenseofcrossingmanymoreboundariesthanmostpeoplewhofocusontheCaribbean,”hesays.“IwasabletobroadenmyselfinawaythatchanneledintomyteachingatEvergreenandconnectedbacktothestudents.Thebiggestsignofthesuccessofmysabbatical,supportedbytheFoundation,wasthesuccessofmyfallandwinterprograms.TheyhavebeenthemostsuccessfulexperiencesI’vehadinteachingaboutothercultures.”

1. 16. 1. 17.

annual fund

Alumni $215,699

Parents $125,220

Friends $59,282

Faculty & Staff $12,316

Students $275

Foundations $17,750

Corporations $13,033

Total $443,575

ToTal giving by purpose Annual Fund $443,575

Unrestricted $75,960

Student Support $203,001

Faculty Support $2,208

Academic Programs $42,713

College Activities $411,975

Public Service Centers $55,848

Capital Projects $68,176

Gifts In-Kind $32,471

Total $1,335,927

ToTal giving by sourCe

Alumni $442,294

Parents $169,514

Friends $177,713

Faculty & Staff $33,988

Students $1,185

Foundations $390,125

Corporations $121,108

Total $1,335,927

33%

13%

13%

3%<1%

29%

9%

33%

31%

15%

49%

28%

13%

4%3%

3%<1%

6%

<1%3%

4%

5%2%

Despite continuing economic challenges and demands to do more with less, I am delighted by how much we have accomplished as a college, thanks to our good friends and allies. Working with colleagues across the college and throughout the wider community, we made positive strides on virtually every front,

building strong relationships with supporters, engaging alumni in meaningful programs, and creating numerous opportunities to celebrate Evergreen and our extraordinary students and faculty.

Among our fundraising highlights was a generous $500,000 gift, the largest pledge from a private donor in the history of the college. We launched a signature event, the Art of Living auction, which far exceeded our goal, to increase the visibility of our artistic community and raise additional funds for student support. Our donors boosted giving to our annual fund by more than 25 percent, generating an historic high in dollars raised for this program.

In the past year, we expanded partnerships with a wide range of individuals and organizations both on- and off-campus and we launched a successful initiative to bring more alumni speakers into the classroom. We continued developing our Alumni Entrepreneurs directory and established a new Alumni Authors directory to highlight the achievements of talented graduates and create networking opportunities for them.

I hope you’ll take a moment to read Ryan Converse’s story on page 12 and Guadalupe Camacho’s story on page 13. Both of these students were supported by gifts from private donors through the annual fund. For a donor’s perspective, see Mark Souder’s words on page 14 about why he supports scholarships at Evergreen. Together, these accounts show how private giving fosters life-changing opportunities not only for students but also for donors. As a result of their contributions, they realize that they are making a difference.

Thank you for helping us to support the dreams of our students and donors.

D. Lee Hoemann Vice President for College Advancement Executive Director, The Evergreen State College Foundation

Lee Hoemann

1. 18. 1. 19.

March 11, 2011Board of TrusteesThe Evergreen State College2700 Evergreen Parkway NWOlympia, WA 98505 We have audited the accompanying financial statements of the business-type activities and the discretely presented component unit of The Evergreen State College, Thurston County, Washington, as of and for the years ended June 30, 2010 and 2009, which collectively comprise the College’s basic financial statements as listed in the table of contents. These financial statements are the responsibility of the College’s management. Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of The Evergreen State College Foundation, which represents 100 percent, of the assets, net assets and revenues of the aggregate discretely presented component unit. Those financial statements were audited by other auditors whose report thereon has been furnished to us, and our opinion, insofar as it relates to the amounts included for The Evergreen State College Foundation, is based on the report of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit and the report of the other auditors provide a reasonable basis for our opinions. As discussed in Note 1, the financial statements of The Evergreen State College are intended to present the financial position, and the changes in financial position and cash flows of only that portion of the business-type activities of the state of Washington that is attributable to the transactions of the College. They do not purport to, and do not, present fairly the financial position of the state of Washington as of June 30, 2010 and 2009, the changes in its financial position, or, where applicable, its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. In our opinion, based on our audit and the report of the other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the business-type activities and the discretely presented component unit of The Evergreen State College, Washington, as of June 30, 2010 and 2009, and the respective changes in financial position and cash flows thereof for the years then ended in conformity with accounting principles generally accepted in the United States of America. The management’s discussion and analysis is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Sincerely,

brian sonnTag, CgfM sTaTe audiTor

INDEPENDENT AUDITOR’S REPORT

Discussion

The following discussion and analysis provides an overview of the financial position and activities of The Evergreen State College (the College) for the fiscal year ended June 30, 2010 with comparative 2009 and 2008 financial information. This discussion has been prepared by management and should be read in conjunction with the financial statements and accompanying notes, which follow this section.

RepoRting entityThe Evergreen State College is one of six state-assisted public institutes of higher education in the state of Washington, providing baccalaureate and graduate educational programs to approximately 4,600 students. The College was established in 1967 and its primary purpose is to prepare individuals for successful contributions to society through their careers and in their leadership roles as citizens.

The College’s main campus is located in Olympia, Washington, a community of over 45,000 residents. The College also has operations in Tacoma and along the Olympic Peninsula on the Quinault Indian Reservation. The College is governed by an eight member Board of Trustees appointed by the governor of the state with the consent of the state Senate. One of the members is a full-time student of the College. By statute, the Board of Trustees has full control of the College and its property of various kinds, except as otherwise provided by law.

Using the Financial statementsThis report consists of three financial statements: the Statements of Net Assets, the Statements of Revenues, Expenses and Changes in Net Assets, and the Statements of Cash Flows. These financial statements have been prepared in accordance with Governmental Accounting Standards Board (GASB) Statement No, 34, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments, as amended by GASB Statement No. 35, Basic Financial Statements—and Management’s Discussion and Analysis—for Public Colleges and Universities.

Analysis

Management’sWashington State Auditor

Brian Sonntag

1. 20. 1. 21.

statements oF net assetsThe Statements of Net Assets provide information about the College’s financial position, and presents the College’s assets, liabilities, and net assets at year-end and includes all assets and liabilities of the College. A condensed comparison of the Statements of Net Assets as of June 30, 2010, 2009 and 2008, follows:

Current assets consist primarily of cash, investments, various accounts receivables and inventories. Very little change has occurred from 2009 to 2010, remaining consistent with prior years’ total. Capital assets increased by a net of $10 million from 2009 to 2010, this was almost entirely the result of the renovation of the College Activities Building (CAB), which is slated for completion in late 2010. This is discussed further in Note 10 to the financial statements. The decrease in “Other non-current assets” is the result of the spending of restricted assets held by the Office of the State Treasurer (OST) for the renovation of the CAB. These restricted assets originated from the sale of Certificates of Participation (COP) in June 2009. The College has a strong balance sheet with an increasing current ratio of more than 3.8, which is measured by dividing current assets over current liabilities, in addition, working capital, defined as current assets less current liabilities, shows increasing strength over the last several years.

Current liabilities include amounts payable to suppliers for goods and services, accrued payroll and related liabilities, bond debt; deposits held for others and deferred revenue. Current liabilities can fluctuate from year to year, depending on receipt of vendor invoices and timing of vendor payments, especially in the area of capital asset improvements. The increase in non-current liabilities from 2008 to 2009 is due to a $13.175 million note payable to be used to remodel the CAB, and this debt is to be serviced by a student assessed fee and other College revenue. This is discussed further in Note 10 to the financial statements.

sTaTeMenTs of neT asseTs (in thousands)

2010 2009 2008

asseTs

Current assets $ 51,306 $ 51,170 $ 43,743

Capital, net 167,162 157,265 143,885

Other non-current assets 5,119 10,412 5,045

Total assets 223,587 218,847 192,673 liabiliTies

Current liabilities 13,226 14,009 14,368

Other non-current liabilities 20,224 20,618 8,037

Total liabilities 33,450 34,627 22,405

neT asseTs $ 190,137 $ 184,220 $ 170,268

Net assets represent the difference between the College’s assets after liabilities are deducted. The College reports its net assets in four categories:

• invested in Capital assets (net of related debt) – The College’s total investment in property, plant, equipment, and infrastructure net of accumulated depreciation and outstanding debt obligations related to those capital assets.

• restricted net assets: • expendable – resources in which the College is legally or contractually obligated to spend in accordance with restrictions placed by donor and/or external parties that have placed time or purpose restrictions on the use of the asset. • non expendable – consists of funds in which the donor or external party has imposed the restriction that the corpus is not available for expenditures but for investment purposes only.

• unrestricted net assets – all other funds available to the institution for the general and educational obligations to meet current expenses for any lawful purpose.

Total net assets are reported in three categories; invested in capital assets, net of related debt; restricted net assets (nonexpendable and expendable); and unrestricted net assets. Total net assets increased by about $6 million during 2010 for a total of $190.1 million, the largest item would be invested in capital assets, net of related debt which totals $151.9 million, with an increase of about $5 million in unrestricted net assets was the result of prudent spending practices within the College’s Operating Fund and Summer School Program for 2010. Though not subject to external imposed stipulations, the College has designated the unrestricted net assets for various academic and administrative programs, in addition to auxiliary enterprises.

1. 22. 1. 23.

statements oF RevenUes, expenses and changes in net assetsThe Statements of Revenues, Expenses and Changes in Net Assets present the detail of the changes of total net assets for the College. The objective of the statements are to present the revenues received, both operating and non-operating, and the expenses paid by the College, along with any other revenue, expenses, gains and losses of the College.

Generally, operating revenues are revenues earned by the College in exchange for providing goods and services. Operating expenses are defined as expenses incurred in the normal operation of the College, including a provision for allowance of depreciation on property and equipment assets. The difference between operating revenues and operating expenses is the operating loss. The College will always be expected to show an operating loss since significant recurring revenues are shown as non-operating revenues as required by the Governmental Accounting Standards Board (GASB), the rule setting body for accounting standards for the College. A summary of the College’s Statements of Revenues, Expenses and Changes in Net Assets for the Years Ended June 30, 2010, 2009 and 2008, follows:

sTaTeMenTs of revenues, eXpenses and CHanges in neT asseTs (in thousands)

2010 2009 2008

Operating revenues $ 58,191 $ 55,020 $ 51,835

Operating expenses 93,639 93,482 89,938

Net operating loss (35,448) (38,462) (38,103)

Non-operating revenues 36,263 39,815 40,624

Non-operating expenses 924 346 372

Gain (loss) before other revenues (109) 1,007 2,149

Other revenues and expenses 6,026 12,945 18,695

Increase net assets 5,917 13,952 20,844

Net assets beginning of year 184,220 170,268 149,424

Net assets end of year $ 190,137 $ 184,220 $ 170,268

diveRsiFied RevenUe soURcesThe College, while having a diversified revenue base, continues to see reductions in state operating appropriations, both in actual dollars and in terms of percentages, the amount of state support decreased in 2010 by over $5 million from the 2009 levels, a decrease of 17% from year to year, this is being made up, in large part, by double digit increases in tuition charged to students. In addition, for 2010, the $25.6 million received in state operating appropriations included a one time $2.366 million appropriation in 2010 coming indirectly through the Federal government via the American Recovery and Reinvestment Act (ARRA) of 2009. No such Federal appropriation is being provided in 2011. Starting in 2009, for the first time ever, tuition revenues were the single largest source of revenue for the College, surpassing state operating appropriations. This trend continues in 2010 as tuition represents 38% of revenue where as state operating appropriations has slipped to just 23%. To illustrate the change, in 2009 and 2008, the amount of state support coming from operating appropriations was at 28% and 29%, respectively. The major source of operating revenue for the College is student tuition and fees, at 38%, as shown in the pie chart below. The major source of non-operating revenue consists of state appropriations, 23% for operating and 5% for capital. In addition to the 5% capital appropriations noted above, over $2.35 million, approximately 85% of the investment income is associated with revenues earned from The Normal School Permanent Fund, which derives its corpus from the sale of state lands and timber, and is used for capital related purposes. This is discussed in greater detail in Note 3 to the financial statements.

1. 24. 1. 25.

capital impRovementsThe College spent $16.6 million for capital related purposes in 2010; this was more than a 10% decrease from $19 million spent in 2009. In 2010, several capital projects are winding down; including the CAB remodel is nearing completion having spent over $12 million in 2010. The level of capital spending should continue fall in the future as capital projects will be tempered by state budget

In 2010, the College’s total operating expenses essentially remained flat, although many individual components had some significant changes within different areas, Employee benefits expense increased by more than $1.5 million from 2009 to 2010, which was primarily the result of increased costs for the College’s (employer) portion of employee medical insurance premiums. In addition The Evergreen State College Retirement Plan expense amortization increased from $214,000 in 2009 to $580,000 in 2010. The level of scholarship and fellowship expense increased by more than $2.2 million which was primarily the result of increased awards provided to students under the Federal Pell grant program. On the other hand, salaries and wages remained static from 2009 to 2010. Offsetting the increases noted above were significant decreases in amounts spent on supplies and materials, purchased services and utility expenses. These reductions are not surprising given State directives restricting travel and the purchase of other goods and services. An area that does need mentioning is the College is a national leader in the area of sustainability, with a goal of being carbon neutral by the year 2020, and a strong focus on recycling and reducing its energy consumption. The College’s efforts in this area resulted in utilities expenses decreasing by some 17%, through investment in more energy efficient equipment, along with a strong push to increase conservation working with staff and students to accomplish this feat according to Director of Facilities, Paul Smith.

As shown in the chart below, salaries and benefits continue to make up the majority of operating expenses, at 62%. The remaining operating expenses are comprised of scholarships and fellowships (13%), supplies and materials, purchased services and utilities (18%), and depreciation (7%).

2010 eXpenses by obJeCT

shortfalls. Capital projects that are in the works include the Arts Annex renovation and Communications building design.

economic FactoRs that Will aFFect the FUtUReThe state’s economy continues to struggle with budget shortfalls and the state has seen a drop in tax revenue collections. This has resulted in reductions in the amount of operating funds appropriated by the state legislature to the College and other state agencies for the current 09/11 biennium (two year period ending June 30, 2011). For the 09/11 biennium, even with more than $2.3 million of Federal stimulus funds, the College will have reduced state operating appropriations of more than $11 million compared to the 07/09 biennium, a reduction of 18%. To mitigate these cuts the Legislature authorized the state’s institutions of higher education to allow for significant increases in tuition charged to students which has caused tuition revenues to grow to be the largest source of funding for the College operating budget. This trend will continue into fiscal year 2011 as we continue to require students to pay for a greater share of their educational expenses due to the continued economic recession. In response to the reduction in state funding the College is increasing resident undergraduate tuition by 14% and non-resident undergraduate and resident graduate tuition by 5% in each year of the 09/11 biennium. There is a likelihood of further funding reductions if state tax revenue collections continue to decline.

Further, starting in 2011 and perhaps beyond, the state legislature instructed the College to fund a larger portion of its facilities operations from its share of earnings from the Normal School Permanent Fund. This requirement will essentially deplete most of the resources from the College’s share of this fund by the end of 2011. This fund had been used as a funding revenue source for capital spending, whether in the area of repairs and maintenance or capital improvements. The source of revenue for this Normal School Permanent fund comes from the sales of timber and state lands and interest earnings on this fund and from a portion of each tuition dollar collected. The estimated amount of spending from the Normal School Permanent for its facilities operations is expected to be over $3 million in 2011 which will greatly reduce the resources available resource for future capital improvements. This matter could have a detrimental impact on the College as its current enrollment is strong and is close to the capacity both in terms of physical plant and faculty staffing. In order to accommodate addition future enrollment growth there will need to be greater investment in both instructional budgets and in physical plant investment.

1. 26. 1. 27.

the eveRgReen state college statements oF net assets

JUne 30, 2010 and 2009

see accompanying notes to the financial statements.

2010 2009

operating revenues

Student tuition and fees $ 42,898,816 $ 39,595,520

Less scholarship discounts and allowances (11,110,649) (8,167,446)

Auxiliary enterprise sales, net 8,809,755 8,953,533

State and local grants and contracts 7,960,729 7,077,178

Federal grants and contracts 4,688,789 3,549,019

Nongovernmental grants and contracts 2,970,224 2,445,928

Other operating revenue 1,149,426 832,657

Sales and services of educational activities 752,840 667,682

Interest on loans to students 71,572 66,528

Total operating revenues 58,191,502 55,020,599

operating expenses

Salaries and wages 43,924,504 44,118,105

Benefits 13,243,440 11,692,330

Scholarships and fellowships 12,597,874 10,315,942

Supplies and materials 9,355,208 12,856,644

Depreciation 6,736,214 5,640,482

Purchased services 4,975,727 5,479,079

Utilities 2,806,432 3,379,381

Total operating expenses 93,639,399 93,481,963

operating loss (35,447,897) (38,461,364)

non-operating revenues (expenses)

State appropriations 25,605,000 30,665,000

Federal Pell grant revenue 7,884,264 5,486,663

Investment income, gains and losses 2,773,726 3,663,261

Interest on indebtedness (923,860) (345,955)

net non-operating revenues 35,339,130 39,468,969

Income (loss) before other revenues, expenses, gains or losses (108,767) 1,007,605

Capital appropriations 6,025,548 12,944,828

increase in net assets 5,916,781 13,952,433

net assets

Net assets, beginning of year 184,220,188 170,267,755

net assets, end of year $ 190,136,969 $ 184,220,188

the eveRgReen state college

statements oF RevenUes, expenses and changes in net assets

FoR the yeaRs ended JUne 30, 2010 and 2009

see accompanying notes to the financial statements.

CollegeFinancial

Statements 2010 2009

assetsCurrent assets

Cash and cash equivalents $ 29,834,888 $ 18,700,503 Short-term investments 6,020,728 15,001,435 Due from State Treasurer 2,740,238 1,609,187 Funds held with State Treasurer 5,446,655 4,189,685 Accounts receivable, net 2,738,334 2,609,048 Assets restricted for capital spending 3,248,682 7,717,128 Student loan receivables, net 741,376 881,150 Inventories 534,641 461,895

Total current assets 51,305,542 51,170,031

non-Current assetsEndowment investments 1,384,808 1,284,846 Student loan receivables, net 3,640,769 3,881,560 Bond discounts and issue costs, net of amortization 93,413 99,375 Assets restricted for capital spending — 5,146,602 Capital assets, net of depreciation 167,162,167 157,264,635

Total non-current assets 172,281,157 167,677,018

Total assets 223,586,699 218,847,049

liabilitiesCurrent liabilities

Accounts payable and accrued expenses 5,564,607 6,368,629 Deferred revenues 4,208,419 4,085,917 Deposits payable 609,648 631,538 Compensated absences 2,003,281 2,117,694 Current portion of bonds and notes payable 840,000 805,000

Total current liabilities 13,225,955 14,008,778

non-Current liabilitiesCompensated absences 754,775 789,083 Deferred compensation 20,000 120,000 Net pension obligations 1,414,000 834,000 Long-term portion of bonds and notes payable 18,035,000 18,875,000

Total non-current liabilities 20,223,775 20,618,083

Total liabilities 33,449,730 34,626,861

net assetsInvested in capital assets, net of related debt 151,629,262 150,547,740 Restricted for:

Nonexpendable:Scholarships and professorships 2,202,973 2,215,136

Expendable:Loans 5,158,932 5,215,763 Endowment earnings 195,239 123,753 Other 35,796 118,430

Unrestricted 30,914,767 25,999,366

Total net assets $ 190,136,969 $ 184,220,188

1. 28. 1. 29.

2010 2009

Cash flows from operating activities

Student tuition and fees $ 40,244,569 $ 36,752,844

Grants and contracts 15,645,519 13,070,292

Sales and services of educational activities 752,840 667,682

Auxiliary enterprise sales 8,809,755 8,953,533

Payments to employees (56,836,665) (56,308,473)

Payment to vendors (17,845,279) (20,953,488)

Payment for scholarships and fellowships (19,481,387) (15,016,952)

net cash used by operating activities (28,710,648) (32,834,562)

Cash flows from noncapital financing activities

State appropriations 25,605,000 30,665,000

Direct lending receipts 21,342,632 20,932,373

Direct lending disbursements (21,368,409) (20,930,540)

Agency fund receipts 1,044,930 1,193,261

Agency fund disbursements (1,207,825) (1,381,524)

Federal Pell grant receipts 7,884,264 5,486,663

net cash provided by noncapital financing activities 33,300,592 35,965,233

Cash flows from capital and related financing activities

Capital appropriations 4,891,010 13,967,620

Certificate of participation proceeds 9,653,603 —

Purchase of capital assets (16,633,746) (19,024,363)

Principal paid on capital debt (805,000) (355,000)

Interest paid (923,860) (345,955)

net cash used by capital and related financing activities (3,817,993) (5,757,698)

Cash flows from investing activities

Purchase of investments (6,020,728) (15,001,435)

Proceeds from sales and maturities of investments 15,001,435 12,500,000

Income from investments 1,381,727 3,561,526

net cash provided by investing activities 10,362,434 1,060,091

increase (decrease) in cash and cash equivalents 11,134,385 (1,566,936)

Cash and cash equivalents at the beginning of the year 18,700,503 20,267,439

Cash and cash equivalents at the end of the year $ 29,834,888 $ 18,700,503

reconciliation of operating loss to net Cash used by operating activities

2010 2009

operating loss $ (35,447,897) $ (38,461,364)

Adjustment to reconcile operating loss to net cash used by operating activities:

Depreciation expense 6,736,214 5,640,482

Certificate of participation issuance costs — 313,119

Loss on fixed asset disposal — 4,018

Changes in assets and liabilities:

Accounts receivable (129,286) 158,333

Loans receivable 380,565 (213,528)

Inventory (72,746) 130,403

Bond discount and issue costs 5,962 5,963

Accounts payable and accrued expenses (184,072) (191,758)

Deferred compensation (100,000) —

Deferred revenues 122,502 (115,025)

Deposits (21,890) (105,205)

net cash used by operating activities $ (28,710,648) $ (32,834,562)

noncash transactions:

Purchase of endowment investments (792,547) (771,939)

Proceeds from sales and maturities of endowment investments 795,166 758,693

Certificate of Participation net proceeds — 12,861,881

Retirement plan required contribution expense (580,000) (214,000)

the eveRgReen state college

statements oF cash FloWs

FoR the yeaRs ended JUne 30, 2010 and 2009

the eveRgReen state college

statements oF cash FloWs

FoR the yeaRs ended JUne 30, 2010 and 2009

see accompanying notes to the financial statements. see accompanying notes to the financial statements.

1. 30. 1. 31.

the eveRgReen state college FoUndation

statements oF Financial position

JUne 30, 2010 and 2009(component unit)

2010 2009

CurrenT asseTs

Cash and Cash Equivalents $ 743,286 $ 1,019,809

Unconditional promises to give, current 244,670 306,812

Other receivables (due from College) 28,239 —

Total Current assets 1,016,195 1,326,621

oTHer asseTs

Investments 5,686,553 5,326,053

Long-term unconditional promises to give, net 222,100 175,833

Total other assets 5,908,653 5,501,886

Total assets $ 6,924,848 $ 6,828,507

CurrenT liabiliTies

Accounts Payable $ 2,323 $ 13,252

Payable to College — 300,345

Payable to employees 2,499 —

Total Current liabilities 4,822 313,597

annuiTy payMenT liabiliTy 14,383 38,521

Total liabilities 19,205 352,118

neT asseTs

Unrestricted 1,138,182 1,098,643

Temporarily Restricted 2,672,992 2,654,954

Permanently Restricted 3,094,469 2,722,792

Total net assets 6,905,643 6,476,389

Total liabilities and net assets $ 6,924,848 $ 6,828,507

Unrestricted TemporarilyRestricted

PermanentlyRestricted

2010 Totals

2009 Totals

supporT and revenues

Gifts and contributions $ 480,152 $ 507,244 $ 371,677 $ 1,359,073 $ 1,657,512

In-kind support from College 910,450

— — 910,450 972,158

Investment income 10,595 373,959

— 384,554 (1,723,563)Change in value of split-interest agreement

— 15,912

— 15,912 (6,114)

Gift fees 38,732

—

— 38,732 39,070

Net assets released from restrictions 879,077 (879,077) — — —

Total support and revenues

2,319,006

18,038

371,677

2,708,721

939,063

eXpenses

Program services:

Grants and scholarships 1,000,179

—

— 1,000,179 1,118,547

Other College support 305,303 — — 305,303 584,471

Total program services 1,305,482

—

— 1,305,482 1,703,018

Support Services:

Management and General 327,729

—

— 327,729 339,034

Fundraising 646,256 — — 646,256 695,622

Total support services 973,985

—

— 973,985 1,034,656

Total expenses

2,279,467

—

—

2,279,467

2,737,674

increase (decrease) in net assets

39,539

18,038

371,677

429,254

(1,798,611)

neT asseTs

Beginning of year 1,098,643 2,654,954 2,722,792 6,476,389 8,275,000

Ending Net Assets $ 1,138,182 $ 2,672,992 $ 3,094,469 $ 6,905,643 $ 6,476,389

the eveRgReen state college FoUndation

statements oF activities and changes in net assets

FoR the yeaRs ended JUne 30, 2010 and 2009

FoundationFinancial

Statements

The accompanying notes are an integral part of these financial statements. The accompanying notes are an integral part of these financial statements.

1. 32. 1. 33.

2010 2009

CasH flows froM operaTing aCTiviTies

Change in net assets $ 429,254 $ (1,798,611)

Adjustments to reconcile change in net assets to net

cash provided by operating activities:

Contributions restricted for long term purposes (371,677) (97,142)

Donated marketable securities (25,189) (7,503)

Unrealized (gains) losses on investments and change in value

of split interest agreements (234,219) 2,008,450

(Increase) decrease in unconditional promises to give 15,875 (125,225)

(Increase) decrease in other receivables (28,239) 32

Increase (decrease) in accounts payable (10,929) (8,993)

Increase (decrease) in payable to College (297,846) (308,389)

net cash used by operating activities (522,970) (337,381)

CasH flows froM invesTing aCTiviTies

Proceeds from sale of marketable securities 24,654 2,533,820

Reinvested interest and dividend income (141,659) (266,274)

Purchases of investments — (2,250,040)

net cash provided (used) by investing activities (117,005) 17,506

CasH flows froM finanCing aCTiviTies

Contributions restricted for long-term purposes 371,677 97,142

Payment of annuity obligations (8,225) (8,225)

net cash provided by financing activities 363,452 88,917

net decrease in cash and cash equivalents (276,523) (230,958)

CasH and CasH eQuivalenTs

Beginning of year 1,019,809 1,250,767

end of year $ 743,286 $ 1,019,809

suppleMenTal disClosure of CasH flows

Noncash investing and financing activities:

Contributions received-marketable securities $ 25,189 $ 7,503

financial reporting entityThe Evergreen State College (the College) is a

comprehensive institution of higher education

offering baccalaureate and master’s degrees.

The College is an agency of the state of

Washington, and is governed by an eight-member

Board of Trustees appointed by the Governor and

confirmed by the state Senate.

financial statement presentationThe financial statements of the College for the

years ended June 30, 2010 and 2009 have been

prepared in conformity with generally accepted

accounting principles (GAAP). The Governmental

Accounting Standards Board (GASB) is the

accepted accounting standard setting body

for establishing governmental accounting and

financial reporting principles. These financial

statements have been prepared in accordance

with GASB Statement No. 35, Basic Financial

Statements and Management’s Discussion and

Analysis for Public Colleges and Universities, and

GASBS No. 37 and No. 38.

The Governmental Accounting Standards Board

(GASB) issued Statement No. 39, Determining

Whether Certain Organizations are Component

Units, which amended GASB 14, The Financial

Reporting Entity. This provides additional

guidance to determine whether certain

organizations are component units for which the

primary government is not financially accountable

but should be reported based on the nature and

significance of their relationship with the

primary government.

Under GASB Statement No. 39 criteria,

The Evergreen State College Foundation is

considered a legally separate component unit

of the College and is discretely presented in

the College’s financial statements. During the

fiscal year ended June 30, 2010, the Foundation

distributed almost $1 million to the College for

restricted and unrestricted purposes. Intra-entity

transactions and balances between the College

and the Foundation are not eliminated for financial

statement presentation.

basis of accountingFor financial reporting purposes, the College

is considered as a special purpose government

engaged in business type activities. Accordingly,

the College’s financial statements have been

presented using the economic resources

measurement focus and the accrual basis

of accounting. Under the accrual basis of

accounting, revenues are recognized when

earned, and expenses are recorded when an

obligation has been incurred. Grants and similar

items are recognized as revenue as soon as all

eligibility requirements imposed by the provider

have been met.

The College reports capital assets net of

accumulated depreciation, and reports

depreciation expense in the Statements of

Revenues, Expenses, and Changes in Net Assets.

In addition, the College does not apply any

Financial Accounting Standards Board (FASB)

pronouncements issued after November 30, 1989.

new accounting pronouncements, effective July 1, 2009The Governmental Accounting Standards Board

has issued Statement No. 58, Accounting and

Financial Reporting for Chapter 9 Bankruptcies,

effective for the year ended June 30, 2010.

The objective of this Statement is to provide

accounting and financial reporting guidance for

governments that have petitioned for protection

from creditors by filing for bankruptcy under

Chapter 9 of the United States Bankruptcy Code. It

requires governments to remeasure liabilities that

are adjusted in bankruptcy when the bankruptcy

court confirms (that is, approves) a new payment

plan. This statement is not applicable to the

College as it pertains only to municipalities, and

not state governments or their state agencies.

the eveRgReen state college FoUndation

statements oF cash FloWs

FoR the yeaRs ended JUne 30, 2010 and 2009

The accompanying notes are an integral part of these financial statements.

Notes to the Financial Statements June 30, 2010

NOTE 1. SuMMARy OF SIGNIFICANT

ACCOuNTING POLICIES

1. 34. 1. 35.

The Governmental Accounting Standards Board has issued Statement No. 53, Accounting and Financial

Reporting for Derivative Instruments, effective for the year ended June 30, 2010. This Statement

addresses the recognition, measurement, and disclosure of information regarding derivative instruments

entered into by state and local governments. Derivative instruments are often complex financial

arrangements used by governments to manage specific risks or to make investments. By entering

into these arrangements, governments receive and make payments based on market prices without

actually entering into the related financial or commodity transactions. Derivative instruments associated

with changing financial and commodity prices result in changing cash flows and fair values that can

be used as effective risk management or investment tools. Derivative instruments, however, also can

expose governments to significant risks and liabilities. Common types of derivative instruments used by

governments include interest rate and commodity swaps, interest rate locks, options (caps, floors, and

collars), swaptions, forward contracts, and futures contracts. The College has no disclosures resulting from

this new pronouncement.

The Governmental Accounting Standards Board has issued Statement No. 51, Accounting and Financial

Reporting for Intangible Assets, effective for the year ended June 30, 2010. This Statement requires

that all intangible assets not specifically excluded by its scope provisions be classified as capital assets.

Accordingly, existing authoritative guidance related to the accounting and financial reporting for

capital assets should be applied to these intangible assets, as applicable. This Statement also provides

authoritative guidance that specifically addresses the nature of these intangible assets. Such guidance

should be applied in addition to the existing authoritative guidance for capital assets. This statement

requires disclosure by the College, as the College is currently in the process of implementing an estimated

$1.4 million software upgrade for Human Resource Management System module. At June 30, 2010

approximately $370,000 of these costs are capitalized and included in the Construction in Progress

account. Estimated completion of this project is anticipated in early calendar year 2011.

Capital assetsLand, buildings, equipment, and library resources are

stated at cost or, if acquired by gift, at fair market value

at the date of the gift. Additions, replacements, major

repairs, and renovations are capitalized.

The capitalization threshold for intangibles, such as

computer software is $1 million, a $100,000 or greater

threshold for buildings and infrastructure, and $5,000

or greater for equipment. The purchase of land is

capitalized regardless of cost. Depreciation is computed

using the straight-line method over the estimated useful

lives of the assets, generally 15 to 50 years for building

components, 20 to 50 years for infrastructure and land

improvements, 15 years for library resources and 5 to 7

years for equipment.

deferred revenueDeferred revenues occur when funds have been

collected in advance of an event, such as advance

ticket sales, summer quarter tuition, and unspent cash

advances on certain grants.

Compensated absencesCollege employees accrue annual leave at rates

based on length of service and sick leave at the rate

of one day (8 hours) per month. Both are recorded as

liabilities. Employees are entitled to either the present

value of 25% of his/her unused sick leave balance upon

retirement or 25% of his/her net accumulation for the

year in which it exceeds 480 hours.

scholarship discounts and allowancesStudent tuition and fee revenues, and certain other

revenues from students, are reported net of scholarship

discounts and allowances in the Statements of Revenues,

Expenses and Changes in Net Assets. Scholarship

discounts and allowances are the difference between the

stated charge for goods and services provided by the

College, and the amount that is paid by students and/or

third parties making payments on the students’ behalf.

Certain governmental grants, such as Pell grants, and

other Federal, State or non-governmental programs are

recorded as either operating or non-operating revenues

in the College’s financial statements. To the extent that

revenues from such programs are used to satisfy tuition

and fees and other student charges, the College has

recorded a scholarship discount and allowance.

state appropriationsThe state of Washington appropriates funds to the

College on both an annual and biennial basis. These

revenues are reported as non-operating revenues on

the Statements of Revenues, Expenses, and Changes

in Net Assets, and recognized as such when the related

expenses are incurred.

operating revenues/expensesOperating revenues consist of tuition and fees, grants

and contracts, sales and service of educational activities

and auxiliary enterprise revenues. Operating expenses

include salaries, wages, fringe benefits, utilities, supplies

and materials, purchased services, and depreciation. All

other revenue and expenses of the College are reported

as non-operating revenues and expenses including state

general appropriations, Federal Pell grant revenues,

investment income and interest expense.

net assetsThe College’s net assets are classified as follows:

• Invested in Capital Assets, Net of Related Debt:

This represents the College’s total investment in

capital assets, less accumulated depreciation, and

net of outstanding debt obligations related to

capital assets.

• Restricted Net Assets – Nonexpendable: This consists of endowment and similar type

funds in which the donor or other outside sources

have stipulated, as a condition of the gift, that

the principal is to be maintained by inviolate and

in perpetuity, and invested for the purpose of

present and future income, which may be either

expended, or added to principal.

• Restricted Net Assets – Expendable: Include resources that the College is obligated to

spend in accordance with restrictions imposed by

external third parties.

• Unrestricted Net Assets: Net assets which are

not subject to externally imposed restrictions, but

which may be designated for specific purposes by

management, or the Board of Trustees.

Tax exemption The College is a tax-exempt organization under the

provisions of Section 115(a) of the Internal Revenue

Code and is exempt from federal income taxes on

related income. The Foundation is exempt from

income taxes under Section 501(c) (3) of the Internal

Revenue Code.

violationsThe College does not have any material violations of

finance-related legal or contractual provisions.

reclassificationsCertain reclassifications not affecting total net assets

have been made to the 2009 amounts in order to

conform to 2010 presentation.

Cash and Cash equivalentsFor the purposes of the statements of cash flow,

the College considers all highly liquid investments

with an original maturity of 90 days or less to be

cash equivalents. Funds invested through the

State Treasurer’s Local Government Investment

Pool are also considered cash equivalents.

Cash in the investment portfolio is not included

in cash and cash equivalents as it is held for

investing purposes.

investmentsThe College implemented GASB 40, Deposit and

Investment Risk Disclosure, which changes the

disclosure requirement related to investment risk

and which is discussed further in Note 2.

accounts receivableAccounts receivable consist of tuition and fee

charges to students and auxiliary enterprise

services provided to students, faculty and staff.

Receivables also include amounts due from the

federal, state and local governments, or private

sources, in connection with reimbursement

of allowable expenditures made pursuant to

the College’s grants and contracts. Accounts

receivable is recorded net of estimated

uncollectible amount.

inventoriesInventories consist primarily of merchandise and

consumables held by auxiliary and internal service

departments. They are valued at cost using the

first in, first out method.

1. 36. 1. 37.

NOTE 2. CASH AND INVESTMENTS

Cash and cash equivalents include bank demand deposits, an overnight

sweep account, petty cash held at the College and unit shares in the Local

Government Investment Pool. Except for petty cash held at the College,

all others are covered by the Federal Deposit Insurance Corporation

(FDIC) or by collateral held in a multiple financial institution collateral pool

administered by the Washington Public Deposit Protection Commission

(PDPC).

Investments are stated at market value. They consist of time certificates

of deposit in addition to investments in equities. Time certificates

of deposit have repurchase agreements with the respective financial

institutions; investments in equities are subject to loss of all 100% of the

balance of investments.

GASB Statement No. 40 requires certain disclosures of investments that have

fair values that are highly sensitive to changes in interest rates. The College’s

policy is to invest in short-term financial instruments with an original maturity

of 12 months or less, this in order to maintain the goal of liquidity.

The College, through its investment policy, where applicable, manages its

exposure to custodial credit risk, credit risk, concentration of credit risk,

interest rate risk and foreign currency risk.

investment Maturities

Investments Fair value One year or less 1-5 years 6-10 years 10+ years

Operating Funds

Time certificate of deposits $ 6,020,728 $ 6,020,728 $ — $ — $ —

Endowment funds

Bonds 765,567 157,590 170,518 232,835 204,624

Equities 619,241 N/A N/A N/A N/A

Total investments $ 7,405,536

June 30, 2010 June 30, 2009

Cash on hand $ 14,490 $ 15,240

Bank demand and time deposits 1,706,658 399,547

Local government investment pool 28,113,740 18,285,716

Total cash and cash equivalents $ 29,834,888 $ 18,700,503

interest rate riskThe College manages its exposure to interest rate changes

by limiting the duration of investments and structuring the

maturities of investments to mature at various points in the

year. No investment may exceed 12 months.

Concentration of Credit riskThe College’s Time Certificates of Deposit are insured

through either the Federal Deposit Insurance Corporation or

by collateral held in a multiple financial institution collateral

pool administered by the PDPC. The Endowment fund

investment policy allows for the investments in equities of

domestic publicly listed corporations on national exchanges.

NOTE 3. FuNDS WITH STATE TREASuRER

Funds with the State Treasurer represent the College’s

share of net earnings of the Normal School Permanent

Fund as well as tuition distribution, reduced by

expenditures for capital projects and debt service over

the years in addition to monies held for the sale of

College license plates. The Normal School Permanent

Fund, established under RCW 43.79.160 is a permanent

endowment fund, which derives its corpus from the

sale of state lands and timber. The Washington

State Investment Board manages the investing

activities of the fund and the State Department of

Natural Resources manages the sale of state lands

and timber. Interest earned from the investments is

either reinvested or used exclusively for the benefits

of Central Washington University, Eastern Washington

University, The Evergreen State College and Western

Washington University.

1. 38. 1. 39.

NOTE 4. ACCOuNTS AND STuDENT LOANS RECEIVABLE

Accounts receivable consists of tuition and fee charges to students and

auxiliary enterprise services provided to students, faculty and staff. It also

includes amounts due from the federal, state and local governments

or private sources in connection with reimbursements of allowable

expenditures made according to sponsored agreements.

accounts receivable at June 30 consisted of the following:

2010 2009

Student tuition and fees $ 1,314,757 $ 1,152,771

Federal, state and private grants 457,191 854,520

State appropriation receivable 2,740,238 1,609,187

Auxiliary enterprises 899,477 666,771

Other operating activities 212,468 113,108

Subtotal 5,624,131 4,396,357

Allowance for uncollectibles (145,559) (178,122)

Net accounts receivable $ 5,478,572 $ 4,218,235

In addition to the above, the Office of State Treasurer (OST) is holding

net proceeds from the sale of notes totaling $3,248,682 at June 30, 2010

for the College, which is discussed in further detail in Note 10. These

note proceeds are restricted for reimbursement of costs associated with

the remodel of the College Activities Building (CAB) and are held in an

account with the State’s Local Government Investment Pool (LGIP), which

earns interest at current market rates.

loans receivable at June 30 consisted primarily of student loan funds as follows:

2010 2009

Perkins loans $ 4,140,431 $ 4,348,680

Other loans 256,033 420,230

Subtotal 4,396,464 4,768,910

Allowance for uncollectibles (14,319) (6,200)

Net student loans receivable $ 4,382,145 $ 4,762,710

NOTE 5. INVENTORIES

inventories consist of the following:

inventories June 30, 2010 June 30, 2009

Enterprise funds $ 386,398 $ 324,004

Working capital funds 148,243 137,891

Total inventory $ 534,641 $ 461,895

NOTE 6. CAPITAL ASSETS

Capital asset activity for the year ended June 30, 2010 is summarized as follows:

BalanceJune 30, 2009

Additions/Transfers

Retirements

BalanceJune 30, 2010

non-depreciable assets

Land $ 4,997,751 $ — $ — $ 4,997,751

Construction in progress 4,903,478 15,353,394 3,206,113 17,050,759

Total non-depreciable assets 9,901,229 15,353,394 3,206,113 22,048,510

depreciable assets

Infrastructure

14,478,190

—

—

14,478,190

Buildings

174,757,868

3,340,938

—

178,098,806

Furniture, fixtures and equipment

17,980,036

836,614

25,131

18,791,519

Library resources 18,209,016 308,913 — 18,517,929

Total depreciable assets 225,425,110 4,486,465 25,131 229,886,444

less accumulated depreciation

Infrastructure

7,770,861

436,477

—

8,207,338

Buildings

45,219,282

4,451,119

—

49,670,401

Furniture, fixtures and equipment

10,183,777

1,374,133

25,131

11,532,779

Library resources 14,887,784 474,485 — 15,362,269

Total accumulated depreciation 78,061,704 6,736,214 25,131 84,772,787

net capital assets $157,264,635 $13,103,645 $ 3,206,113 $167,162,167

1. 40. 1. 41.

NOTE 7. ACCRuED LEAVE LIABILITIES

At termination of employment, employees

may receive cash payments for all

accumulated vacation and compensatory time.

Employees who retire get 25% of the value

of their accumulated sick leave credited to a

Voluntary Employees’ Beneficiary Association

(VEBA) account, which can be used for future

medical expenses and insurance purposes.

The amounts of unpaid vacation and

compensatory time accumulated by College

employees are accrued when incurred.

Capital asset activity for the year ended June 30, 2009 is summarized as follows:

BalanceJune 30, 2008

Additions/Transfers

Retirements

BalanceJune 30, 2009

non-depreciable assets

Land $ 4,997,751 $ — $ — $ 4,997,751

Construction in progress 18,527,993 11,637,699 25,262,214 4,903,478

Total non-depreciable assets 23,525,744 11,637,699 25,262,214 9,901,229

depreciable assets

Infrastructure

13,907,415 570,775

—

14,478,190

Buildings

145,964,130 28,793,738

—

174,757,868

Furniture, fixtures and equipment

15,686,292 2,953,765

660,021

17,980,036

Library resources 17,878,416 330,600 — 18,209,016

Total depreciable assets 193,436,253 32,648,878 660,021 225,425,110

less accumulated depreciation

Infrastructure

7,374,156 396,705

—

7,770,861

Buildings

41,565,900 3,653,382 —

45,219,282

Furniture, fixtures and equipment

9,716,367 1,123,413

656,003

10,183,777

Library resources 14,420,802 466,982 — 14,887,784

Total accumulated depreciation 73,077,225 5,640,482 656,003 78,061,704

net capital assets $143,884,772 $38,646,095 $25,266,232 $157,264,635

NOTE 8. LONG–TERM LIABILITIES

following are changes in long-term liabilities for the years ended June 30, 2010 and 2009:

BalanceJune 30, 2009

Additions

Reductions

BalanceJune 30, 2010

CurrentPortion

Long-TermPortion

Accrued leave liabilities $ 2,906,777 $ 3,348,220 $ 3,496,941 $ 2,758,056 $ 2,003,281 $ 754,775

Deferred compensation

120,000

—

100,000

20,000

—

20,000

Certificate of Participation

13,175,000

—

435,000

12,740,000

460,000

12,280,000

Pension liability

834,000

580,000

—

1,414,000

—

1,414,000

Bonds payable 6,505,000 — 370,000 6,135,000 380,000 5,755,000

Total $ 23,540,777 $ 3,928,220 $ 4,401,941 $ 23,067,056 $ 2,843,281 $ 20,223,775

BalanceJune 30, 2008

BalanceJune 30, 2009

CurrentPortion

Long-Term

Portion

Additions Retirements

Accrued leave liabilities $3,618,815 $2,117,694 $2,829,732 $2,906,777 $2,117,694 $ 789,083

Deferred compensation

120,000

—

—

120,000

—

120,000

Certificate of Participation

—

13,175,000

—

13,175,000

435,000

12,740,000

Pension liability

620,000

214,000

—

834,000

—

834,000

Bonds payable 6,860,000 — 355,000 6,505,000 370,000 6,135,000

Total $ 11,218,815 $15,506,694 $ 3,184,732 $ 23,540,777 $ 2,922,694 $ 20,618,083

The sick leave liability is recorded as an

actuarial estimate of one-fourth the total

balance on the payroll records. The

accrued vacation leave totaled $2,003,281

and $2,117,694 at June 30, 2010 and 2009,

respectively and accrued sick leave totaled

$754,775 and $789,083 at June 30, 2010 and

2009, respectively.

1. 42. 1. 43.

NOTE 9. BONDS PAyABLE

In March 2006, the College sold $7,550,000 in Housing Revenue Bonds, with interest rates ranging from 3.75% to 4.25%. Proceeds of the bond issue

went to refund the outstanding Housing Series 1994 Revenue Bonds, and the remaining proceeds are being used to construct a Housing Administration

Building, and to remodel and refurbish existing housing structures.

for the year ended June 30, 2010:

Interest Rate Original Issue BalanceJune 30, 2010

BalanceJune 30, 2009

System revenue bonds

Series 2006 3.75% to 4.25% $7,550,000 $6,135,000 $6,505,000

debt service requirements

The scheduled maturities of system revenue bonds are as follows:

Fiscal Year Principal Interest Total

2011 $ 380,000 $ 243,144 $ 623,144

2012 395,000 228,894 623,894

2013 410,000 214,081 624,081

2014 425,000 198,706 623,706

2015 445,000 182,769 627,769

2016-2020 1,740,000 687,206 2,427,206

2021-2025 1,910,000 338,050 2,248,050

2026 430,000 18,275 448,275

Total $ 6,135,000 $ 2,111,125 $ 8,246,125

NOTE 10. NOTES PAyABLE

In June 2009, the College obtained financing in order to renovate and remodel the College Activities Building (CAB) through certificates of participation,

issued by the Washington Office of State Treasurer (OST) in the amount of $13,175,000. The interest rate charged is approximately 5%. The College’s

debt service requirements for this note agreement for the next five years and thereafter are as follows:

Fiscal Year Principal Interest Total

2011 $ 460,000 $ 586,330 $ 1,046,330

2012 475,000 571,380 1,046,380

2013 490,000 555,943 1,045,943

2014 505,000 540,997 1,045,997

2015 525,000 524,080 1,049,080

2016-2020 2,940,000 2,297,222 5,237,222

2021-2025 3,670,000 1,564,195 5,234,195

2026-2029 3,675,000 513,860 4,188,860

Total $ 12,740,000 $ 7,154,007 $ 19,894,007

The OST has notified the College that Internal Revenue Code regulations on arbitrage for these notes are for an 18 month period.

The College is in compliance with these Arbitrage regulations as of June 30, 2010.

NOTE 11. LEASE OBLIGATIONS

The College has an operating lease rental for the Tacoma program building, along with several photocopier-operating leases.

Operating lease payments for the next five years are as follows:

2011 $ 577,793

2012 72,828

2013 2,441

$ 653,062

Total operating lease expenses were $940,971 and $928,581 in 2010 and 2009, respectively.

NOTE 12. COMMITMENTS

Encumbrances for current funds carried forward totaled $2,378,744 and $3,271,625 at June 30, 2010 and 2009, respectively. The College does not

encumber construction contracts. Remaining construction commitments totaled $4,703,764 and $18,297,431 at June 30, 2010

and 2009, respectively.

NOTE 13. OPERATING ExPENSES By FuNCTION

Operating expenses by functional classification for the years ended June 30, 2010 and 2009 are summarized as follows:

2010 2009

Instruction $ 29,740,177 $ 29,322,017

Scholarship and aid 12,597,874 10,315,942

Auxiliary enterprises 10,559,994 10,392,394

Operation and maintenance 9,639,627 11,741,660

Institutional support 9,268,373 9,565,196

Academic support 7,084,776 7,429,958

Depreciation 6,736,214 5,640,482

Student services 5,487,353 6,010,911

Public service 2,349,395 2,928,235

Research 175,616 135,168

Total operating expenses $ 93,639,399 $ 93,481,963

1. 44. 1. 45.

NOTE 14. CONTINGENCIES AND RISk MANAGEMENT Amounts received and expended by the College under various federal

and state programs are subject to audit by governmental agencies. In

the opinion of management, audit adjustments, if any, will not have a

significant effect on the financial position of the College.

The College is a party to various litigations and other claims in the

ordinary course of business. In the opinion of management, the ultimate

resolution of these matters will not have a significant effect on the financial

position of the College.

The College participates in the State of Washington risk management

self-insurance program. Premiums are based on actuarially determined

projections. The College assumes its potential liability and property losses

for all properties except for Housing, which were acquired with proceeds

of bond issues where the bond agreement requires the College to carry

insurance on Housing property.

In accordance with State policy, the College self-insures unemployment

compensation for all employees. The College is on a pay-as-you-go

basis, in which claims are paid in the period incurred. Unemployment

compensation claims paid by the College were $231,949 and $104,498 for

2010 and 2009, respectively.

NOTE 15. OTHER POST EMPLOyMENT BENEFITS (OPEB)

The Governmental Accounting Standards Board (GASB) has issued

Statement No. 45, Accounting and Financial Reporting by Employers for

Postemployment Benefits Other Than Pensions, effective for the year

ending June 30, 2008. This pronouncement requires the recording of the

accumulated liability for retiree health care and life insurance costs, which

for the State of Washington (State), as a whole, has been recorded in the

State’s Comprehensive Annual Financial Report (CAFR).

Health care and life insurance programs for employees of the State are

administered by the Washington State Health Care Authority (HCA). The

HCA calculates the premium amounts each year that are sufficient to fund

the statewide health and life insurance programs on a pay as you go basis.

These costs are passed through to individual state agencies based upon

active employee headcount; the agencies pay the premiums for active

employees to the HCA. The agencies may also charge employees for

certain higher cost options elected by the employee.

State retirees may elect coverage through state health and life insurance

plans, for which they pay less than the full cost of the benefits, based on

their age and other demographic factors.

The health care premiums for active employees, which are paid

by the agency during employees’ working careers, subsidize the

“underpayments” of retirees.

An actuarial study performed by the Washington Office of the State

Actuary calculated that the total OPEB obligation of the State of

Washington at January 1, 2009 was $3.8 billion and that the 2010 annual

cost was $349 million. The Actuary calculated the OPEB obligation based

on individual State employee data, including age, retirement eligibility,

and length of service. The probability of an employee of a given age

and length of service retiring and receiving OPEB benefits is based on

statewide historical data.

The Actuary’s allocation of the overall statewide liability related to the

College was approximately $19.8 million, and the annual allocated

estimated cost to the College is about $2.1 million. This estimated

expense represents the amortization of the liability for fiscal year 2010 plus

the current expense for active employees. This amount is not included in

the College’s financial statements.

The College was billed and paid approximately $6.4 million in 2010 and

$4.8 million in 2009 for active and retiree healthcare expenses.

NOTE 16. DEFERRED COMPENSATION

The College, through the state of Washington, offers its employees

a deferred compensation plan created under Internal Revenue Code

Section 457. The plan, available to all State employees, permits

individuals to defer a portion of their salary until future years. The state of

Washington administers the plan on behalf of the College’s employees.

The deferred compensation is not available to employees until

termination, retirement or unforeseeable financial emergency.

NOTE 17. RETIREMENT PLANS

The College offers three contributory pension plans, which cover eligible faculty, staff and administrative

employees: The Washington State Public Employees’ Retirement System (PERS) and the Law Enforcement

Officers’ and Firefighters’ Retirement System (LEOFF) are multiple-employer, defined benefit, public

retirement systems administered by the state of Washington, Department of Retirement Systems (DRS),

as established in the Revised Code of Washington (RCW) chapter 41.50. The Evergreen State College

Retirement Plan (TESCRP) is a defined contribution plan for the faculty and some exempt staff, with

supplemental payment, when required.

For 2010, the payroll for the College’s employees was $14,362,755 for PERS, $536,827 for LEOFF and

$23,323,051 for TESCRP. Total covered payroll for 2010 was $38,222,633.

For 2009, the payroll for the College’s employees was $14,587,028 for PERS, $515,083, for LEOFF and

$23,877,937 for TESCRP. Total covered payroll for 2009 was $38,980,048.

PERS ANd LEOFF PLANS

plan descriptionsPERS and LEOFF are multiple-employer, defined benefit pension plans

administered by the State of Washington, Department of Retirement

Systems (DRS).

PERS Plan I

This plan provides retirement and disability benefits, and minimum

benefits increase beginning at any age, with 30 years of service, or at

age 55, with 25 years of service, or at age 60 with five years of service to

eligible members hired prior to October 1, 1977.

PERS Plan II

These plans provide retirement and disability benefits, and a cost-of-living

allowance, beginning at age 65 with five years of service, or actuarially

reduced benefit beginning at age 55 with 20 years of service to eligible

members hired on or after October 1, 1977.

LEOFF Plan II

This plan provides retirement and disability benefits, and a cost-of-living

allowance, beginning at age 53 with five years of service, or actuarially

reduced benefit beginning at age 50 with 20 years of service to eligible

members hired on or after October 1, 1977.

PERS Plan III

This plan is a hybrid defined benefit and defined contribution plan.

College contributions fund the defined benefit component, providing

retirement and disability. In addition, PERS III has a defined contribution

component, which is fully funded by employee contributions. PERS

defined benefit plan benefits are vested after an employee completes five

years of eligible service. Information regarding the plan descriptions and

benefit provisions is included in a Comprehensive Annual Financial Report

publicly available from the Washington State Retirement Systems, P.O.

Box 48380, Olympia, WA 98504.

1. 46. 1. 47.

FuNdING POLICY

Each biennium, the Office of the State Actuary, using funding methods prescribed

by statute, determine the actuarially required contribution rates for PERS and LEOFF

plans, except where employee contribution rates are set by statute. All employers

are required to contribute at the level established by state law. The contribution

rates were as follows:

pers and leoff 2010 Contribution rates

plan Member College

PERS I 6.00% 5.29%

PERS II 3.89% 5.29%

PERS III Various 5.29%

LEOFF II 8.45% 8.61%

pers and leoff 2009 Contribution rates

plan Member College

PERS I 6.00% 8.31%

PERS II 5.45% 8.31%

PERS III Various 8.31%

LEOFF II 8.83% 8.99%

The actuarial assumptions include an investment rate of return of 5% and

projected salary increases ranging from 2% to 4%. The following reflects the

activity in the Net Pension Obligation (NPO) for the years ended June 30, 2010

and 2009:

balance as of June 30, 2008 $ 620,000

2009 Annual Required Contribution 214,000

2009 Payments to Beneficiaries —

balance as of June 30, 2009 834,000

2010 Annual Required Contribution 580,000

2010 Payments to Beneficiaries —

balance as of June 30, 2010 $ 1,414,000

The College reports the NPO as a long-term liability.

The plan is a defined contribution

plan administered by the College

and covers most faculty and exempt

staff. Contributions to the plan are

invested in annuity contracts or mutual

fund accounts offered by the Teachers

Insurance and Annuity Association

and College Retirement Equities Fund

(TIAA-CREF). Benefits from fund

sponsors are available upon separation

or retirement at the member’s option.

Employees have, at all times, a 100%

vested interest in their accumulations.

Employee contribution rates, which are

based on age, range from 5% to 10%.

The College matches the employee

contributions. Employer and employee

contributions for the years ended June

30, 2010 and 2009 were $1,937,991 and

$1,917,076, respectively.

The benefit goal is 2% of the average

annual salary for each year of full-time

service up to a maximum of 25 years.

However, if the participant does not

elect to make the 10% contribution after

age 50, the benefit goal is 1.5% for each

year of full-time service for the years

in which the lower contribution was

selected. No significant changes were

made in the faculty benefit provisions

for the year ended June 30, 2010.

The plan has a supplemental payment

plan component which guarantees a

minimum retirement benefit based

upon a one-time calculation at each

employee’s retirement date. The

College makes direct payments to

qualifying retirees when the retirement

benefits provided by the fund sponsors

do not meet the benefit goals.

The supplemental component

of the TESCRP is financed on a

pay-as-you-go basis.

The College received an actuarial

evaluation of the supplemental

component of the TESCRP for fiscal

year 2010. The previous evaluation

was performed in 2007. The Unfunded

Actuarial accrued Liability (UAL)

calculated as of July 1, 2009 and

2007 was $4,286,000 and $1,413,000,

respectively, and is amortized over a

14.5-year period. The Annual Required

Contribution (ARC) of $580,000 consists

of amortization of the UAL ($326,000)

and normal, or current, cost ($240,000).

The UAL and ARC were established

using the entry age normal cost method.

ThE EvERGREEN STATE COLLEGE RETIREMENT PLAN

plan description

1. 48.

NOTE 18. PLEDGED REVENuES

The Governmental Accounting Standards Board (GASB) has issued Statement No. 48, Sales and Pledges of Receivables and Future Revenues and

Intra-Entity Transfers of Assets and Future Revenues. The College has pledged specific revenues, net of operating expenses, to repay principal and

interest of revenue bonds. The following is a schedule of the pledged revenue and related debt:

source of revenue pledged

Current year revenues

pledged (net)

Current year debt service

Total future revenues pledged

description of debt purpose of debt

Term of Commitment

Student housing rentals $ 586,424 $ 622,394 $ 8,246,125

2006 housing bonds issue

Remodel/renovate student housing 2026

NOTE 19. SEGMENT INFORMATION

The College operates residence halls “Residential Services” located on the College campus. Revenue bonds are issued from time to time to build or

remodel facilities. Residential Services pledges net revenues to cover the costs of debt service for the bonds, therefore, for accounting purposes, the

Residential Services is a segment of the College. Presented below are condensed financial statements for Residential Services as reviewed by The State

Auditor’s Office (SAO) as of and for the years ended June 30, 2010 and 2009.

June 30, 2010 June 30, 2009

Condensed statements of net assets

Assets

Current assets $ 1,817,442 $ 1,831,429

Noncurrent assets 13,912,910 14,005,947

Total assets 15,730,352 15,837,376

Liabilities

Current liabilities 731,176 799,914

Noncurrent liabilities 5,770,567 6,150,705

Total liabilities 6,501,743 6,950,619

Net assets

Invested in capital assets, net of related debt 7,777,910 7,500,947

Unrestricted 1,450,699 1,385,810

Total net assets $ 9,228,609 $ 8,886,757

Condensed statements of revenues,

expenses and Changes in net assets

Operating revenues $ 4,263,817 $ 4,195,328

Operating expenses 3,677,393 3,408,813

Net operating income 586,424 786,515

Non-operating revenues (expenses) (244,572) (187,545)

Changes in net assets 341,852 598,970

Total net assets beginning of year 8,886,757 8,287,787

Total net assets, end of year $ 9,228,609 $ 8,886,757

Condensed statements of Cash flows

Net cash flows provided by operating activities $ 1,471,194 $ 1,331,592

Net cash flows used by capital financing activities (1,476,127) (2,982,145)

Net cash flows provided by investing activities 7,822 78,349

Net increase (decrease) in cash 2,889 (1,572,204)

Cash beginning of year 1,640,576 3,212,780

Cash end of year $ 1,643,465 $ 1,640,576

adMinisTraTionThomas l. purceEd.D.,IdahoStateUniversityPresident

Kenneth d.TabbuttPh.D.,DartmouthCollegeInterim Provost and Academic Vice President

arthur a. CostantinoPh.D.,PennsylvaniaStateUniversityVice President for Student Affairs

d. lee HoemannB.A.,MontanaStateUniversity Vice President for College Advancement Executive Director, The Evergreen State College Foundation

John a. Hurley, Jr. Ed.D.,SeattleUniversityVice President for Finance and Administration

THe evergreen sTaTe College foundaTion board of governors

Christina Koons ’81, Chair Seattle

Craig Chance ’81, vice Chair Olympia

paul goldberg ’91, secretary Seattle

ralph bietz, Treasurer Olympia

deborah barnett ’88 Olympia

Maia bellon ’91 Tumwater

sophie bilezikian Scarsdale,N.Y.

sandy desner ’76 Olympia

young Harvill ’76 HalfMoonBay,Calif.

Joyce irvine ’79 Seattle

glen r. Kriekenbeck ’89Seattle

glenn landram Olympia

lara littlefield ’99 Seattle

rick oldenburg ’07 GigHarbor

lyle Quasim Puyallup

sarah Hyman rumbaugh Mes ’93 Tacoma

Jane rushford Olympia

william stevens ’74 PortLudlow

James l. ThisOlympia

Kevin francis Olympia,FacultyRep.

Tina Kuckkahn-Miller Olympia,StaffRep.

Kristin Hayden, ex-officioSeattleBoardofTrusteesRep.

aluMni assoCiaTion board of direCTorsandrea Coker-anderson ’87, Mpa ’07Olympia

richard dunn ’02 SanFrancisco,Calif.

Melody edgington ’09 Olympia

erik fabian ’00 Brooklyn,NY

Jane fisher ’79, Mpa ’01Olympia

scott Morgan Mpa ’09 Olympia

Maggie oldenburg ’08 GigHarbor

richard (rick) oldenburg ’08 GigHarbor

Jamia s. Thomas ’04 Tacoma

dorian waller ’05, Mpa ’09 Olympia

ronald wilkins ’06 Sumner

board of TrusTeesCarver gayton (Chair) Seattle

paul winters (Chair) Vancouver

Keith Kessler (vice Chair)Hoquiam

anne proffitt (secretary)Freeland

irene gonzales Spokane

dixon Mcreynolds (student Trustee)Olympia

Kristin Hayden Seattle

denny Heck ’73 Olympia

1. 50.