A couple of the valves on my 2000 GS500E are out of spec and at least 1 of the shims is already down to a 200. So what does one do when they get to the smallest shim? I assume there is some sort of painfully complicated job to be done that "resets" the valve clearances? (replace the valves?) 

How many miles are on the engine?  Easiest fix would probably be to get a replacement engine or head.

Valves do stretch over time, all you need to do is to grind a few thou off the end of the valve. Probably a good time to re cut or reseat  the valves at the same time.

@bombsquad83: Replace the engine?? I could probably buy another bike for the cost of doing that.

@bmf: Is that something that I should try doing myself? Or something that I should talk to my local bike shop about?

Any machine shop can do it you want a smooth job at the right angle.,  but head will have to come off.

You can usually find a complete and functional head for around $200. It might be easier to replace than repair.

I bought new one to fix the buggered exhaust bolts on my old but being an anal retentive I then fixed the old as a spare. The new head tells me it is much happier in Montreal than it was in Texas

No new engine is necessary.
Some dealers can install new shims.
If not, they can install new cylinder heads.

You didn't answer how many miles are on the engine.  If there are over 100,000 miles on it, then I would replace it due to wear on components like timing chains, piston rings, bearings, etc. that will catch up with you sooner than later.  If there are more like 60,000 on it, then replacing the head as bluesmudge mentioned would be the most cost effective.

You can always have the shims ground down by a local machinist, any auto place or production shop can do it.This is the easiest, cheapest thing to do.
I would say you could run those shims down at least until they no longer sit higher than the lip on the bucket, maybe further since the point of contact with the cam is so small.

Thanks for the advice so far. Here is a little more information (including how many miles are on it):

It is a 2000 GS500E. It's my first bike (had it about a year now) and I have learned more and more that the previous owner was an idiot.

The bike only has about 27,000 miles on it (I know... too early to be having this issue, right?). It ran great for quite some time after I bought it and then started showing symptoms of needing a valve adjustment.

At the moment it is in my garage and my goal is to get the valves back in spec, clean the carbs, and do an oil change before getting back on the road with it.

I have a very limited budget to get it into better shape (and it has to happen now while I'm on summer break because I use it every day during the semester to get to college).

I am reasonably capable and more than willing to learn, so I hope to mostly put in hours rather than dollars here. 

I would suspect that 27k milage figure.  Did my first shim change on my 97 bought new at about 40k miles and on my 02 at about 30k miles.  My 97 was down to a 215 minimum shim at 80k miles and I was pondering what to do, considering grinding off the valve stem w/o dissasembly or grinding down a shim, and before I did the bike was totalled and replaced by the 02.  Not a good solution.   

I had considered that the 27K was not accurate, but now reading your post I am fairly sure it isn't.

So I guess at this point my only questions is: what can/should I do to get the valve clearances back in spec?
Grind down valve stems?
Grind down valve shims?
etc?

Any advice would be greatly appreciated.

If you have run out of adjustment your valve seats are worn to their service limit.

2 options......

A) You take it to a shop, they replace the valve seats and recut the faces.
B) You find and fit a used head

Grinding valves and shims (if you think that is a good idea)  alleviates the problem but doesn't solve it. Think about it,......... your gap might be ok now but the seats are still worn! 

Suzuki quote service limits for a reason. I cant say what will happen if you go beyond them but  Suzuki know far more than me and if they are suggesting its a bad idea......that's good enough for me 

If my 97 with the 215 shim hadn't been wrecked and replaced I would have gone to smaller shims most likely and got another 10-20k miles out of it.  The 215 is the smallest Suzuki made for the GSs but there are aftermarket ones down to 200.  With the broken K&L shims some have had damaging their engines I'm glad I didn't, best to use Suzuki shims only and grind them down.

No idea where you are at with your engine that probably has more miles than indicated or at least the head does.  A compression check both cold and hot would give some idea and be a good place to start.  Can you turn the buckets with your finger with  the cam lobe turned away?

Im really trying not to sound like an ahole, please keep that in mind. After re-reading this thread, your original post is pretty vague. Exactly how many valves are out of spec? Exhaust only? Also, you said at least one is down to a 200, that tells me you either measured one or could read the etching on it. Jack says 215 minimum for factory parts, so you either have aftermarket, or previously ground shims.
If the only problem is exhaust, the seat wear was most likely caused by a lean condition for a long period of time. If you want to go budget, have the shims ground again (if <200 clears the bucket, or you like to gamble), then clean the carbs or richen up the mixture if the bike is modified. You might get a lot more life out of it before the seats need redone, or replacement of the head.

Quote from: W201028 on June 21, 2015, 06:59:19 PM......................If the only problem is exhaust, the seat wear was most likely caused by a lean condition for a long period of time................

I've always attributed the receeding of the exhaust valves into the seats on the GSs to be due to the factory setting of .001-.003" (.03-.08mm) being too tight for exhaust valves, not enough cooling seat time.  One exhaust valve running at .002-.003" all the way required only one shim change and the other running at .001" a good deal of the time required repeated shim changes and was down to a min 215 shim at 80k miles on my 97 GS.

When the 02 GS started the same pattern at about 30k miles I increased my exhaust valve clearances to .003-.005" and after a couple changes they went 40-50k miles between shim changes on their way to 100k miles.

http://img.photobucket.com/albums/v443/jcp8832/GSvalvelogs_zps7kdr1yyh.jpg

The carbs remained untouched on both bikes for their entire lives.  Factory jets and settings all the way.

Wow jack, that log is excellent. It certainly looks like you logged more miles with a 3 or 4 thou gap between shim changes on the 02 than the 97 with factory tolerance. I assumed that suzuki set the tolerance so tight in an effort to gain all the power they could at higher rpm. Did you ever feel that the 02 was slightly down on power near the top after running 3-4?

Sorry for being so vague in my OP.

3 of the valve clearances are out of spec (all low)

Current shim sizes:
L Exhaust: 240
R Exhaust: 200 (Etched 200, so must be after market)
L Intake: 265
R Intake: Don't remember, but this one is in-spec

I don't have the valve cover off right now, I will try to get into it tomorrow if I have time. I don't believe I could turn the buckets (except on the valve that is in-spec).

Thanks again for all the help so far.

Tough call there, if you find you cant turn the buckets, theres a good chance you have negative lash, meaning the valve is not closing the whole way. This wears valves and seats, especially exhaust side. I had one of my exhaust like this at about 16k, it was about .001" open if I remember. I ground the shims and took a chance, hoping it would run good without replacing valves and seats. Been about 6k miles since then, runs nice but definitely lacking some high rpm power. Next time the valves get tight, it will be reseat time for me.
My advice is consider the options and your funds; grinding shims or valve stems will get you back into running order cheapest, but its more of a band aid. If the 200 shim doesnt sit higher than the top lips of the bucket, I dont know If I would grind it. Best choice there might be to take some off the stem and go up to a bigger, hopefully suzuki shim.
Im not sure the cost of new or reground valve seats, might be cheaper to get a known good head. There is always the option of grinding the seats yourself, but if you dont have much metal working experience this might not be the best choice. You could always check the valve seating area with dykem, find out if they did indeed burn to the point that they will not seal with the seats. If so, then try to lap them in a bit with some valve grinding compound, and see if you can get them all to seal decently. They wont have the "proper" angles for smoothest flow and seal, but backyard mechanics (like myself) have been building motors like this for years.
I just went through this with my old v8 ford, as I didnt want to put any more money into it than absolutely necessary. Runs great right now, but I dont drive it much or rely on it to get to work.