In Texas, a financially troubled school district must submit a plan of action to the Texas Education Agency (TEA) for improving its financial situation without harming the quality of education delivered. If things get worse, TEA assigns a financial monitor to advise the district on overcoming its financial problems and to determine if further sanctions are necessary. If financial conditions continue to worsen, TEA sends a Master, who has authority to overrule the superintendent and the board. District options for bringing costs under control include reducing personnel; contracting out for transportation, food, and custodial services; increasing efforts to collect taxes or recover delinquent taxes; raising the tax rate; and increasing the average daily attendance, the main factor in determining state aid levels. In extreme cases, the district may opt to divest itself of high school or all secondary grade levels. Nearby wealthy districts can be solicited to purchase weighted average daily attendance or to consolidate tax bases with the struggling district. If there are no wealthy districts nearby, help cannot be solicited. Voluntary consolidation or annexation can be accomplished with approval from voters in both districts. Districts in grave financial condition will be dissolved and ordered to be annexed to an adjoining district. In either consolidation or annexation, the receiving district receives special funds to assist in the handling of the inherited deficit. This paper recounts a small district's journey through this process to forced annexation and gives recommendations to districts in similar circumstances. (TD)