Evaluation policy and how it is determined in a major school district are examined, using a qualitative case study approach. Focus is on stimulating dialogue on these issues toward the development of a theory of the way evaluation and policy interact in a large school district. The experience of the Portland Public Schools (PPS) in Oregon in program evaluation is detailed. The superintendent and two key board members of the PPS were interviewed during the 1987-88 school year. The Curriculum Committee of the Board of Education became the locus of discussion about criteria for deciding what programs to evaluate. Analysis by this committee in conjunction with the Research and Evaluation Department eventually resulted in an evaluation notebook with criteria and the agenda for evaluation. For comparison purposes, a survey was conducted of 114 large school districts in the United States and Canada concerning their evaluation processes, with 69 districts responding. Drawing on all these sources, a model of the decision process was proposed and is represented by a diagram. A working theory of the relationships between evaluation and policy may eventually be developed from similar research. Three tables and seven flowcharts are presented. The PPS Budget Timeline for 1987-88 and December 1987 Survey results of 68 large school districts are appended. (SLD)