Mead School District ordered to pay $17M in hazing case — here’s who foots the bill

Spokane, WASH. — A jury has ordered the Mead School District to pay $17 million to the victims of a 2023 hazing incident, raising immediate questions from the public about whether taxpayers will bear the cost of the payout.

The verdict came Thursday, and viewers quickly raised concerns about whether the settlement would drain the district’s general fund. The short answer: not directly — but there could still be financial consequences down the road.

School districts carry insurance similar to what individuals and businesses use to cover property damage and other liabilities. Many districts, including Mead, also participate in what is known as a “risk pool” — a shared fund where multiple school districts contribute money to help manage the cost of expensive settlements or claims.

Mead is a member of the Schools Insurance Association of Washington, which includes 35 other school districts across the state. The association shared today that when a large claim occurs, the individual district involved pays a deductible, and the pool itself covers a portion of the loss.

When one school district in a risk pool faces a costly claim, the ripple effects can reach other member districts. Contribution amounts across the pool are likely to increase as a result.

The Anacortes School District offers a recent example. Anacortes belongs to a risk pool that includes most other districts in the state, including Spokane Public Schools. Following a large claim, Anacortes reported it will pay 45% more compared to last year for the type of insurance that covers these cases. Because that increase comes out of the district’s general budget, Anacortes was forced to make staff changes.

It remains unclear how the Mead lawsuit will ultimately affect the district’s budget.

The $17 million verdict is not the only legal challenge facing the district. Mead is also named in a federal lawsuit seeking an additional $50 million. It is not yet clear how that case may proceed or how it could further affect the district’s finances.