MANATEE -- Superintendent Rick Mills said Thursday the Manatee County School District will not have the reserves required by law at the end of the fiscal year in June.
Mills estimates if the school district continues to spend what is budgeted over the next two months it will have only about $100,000 left in its account -- $6.6 million short of 2.2 percent minimum fund balance the state requires.
"We were shooting to have a fund balance of $6.7 million to meet the 2.2 percent fund balance, but we had to make up too much ground," Mills said. "Estimates show that we will have slight positive of up to $100,000, projecting we will spend everything in the budget. We can still make adjustments but we won't get that $6.7 million."
Mills said the district will soon have to notify the state it is not meeting the required fund balance.
The district has not met the state-required reserve, meant to be a safety net for emergencies, three years in a row. Mills started his recent tenure confident the $3.4 million deficit left by former Superintendent Tim McGonegal could be balanced quickly, but his outlook has grown less optimistic after studying the budget in depth.
"I knew it was going to be tough, but I have been asking where we are going to be," said school board member Bob Gause.
Gause said he had discussed the possibility of school closures with McGonegal and Mills. He hopes information from other school districts that have closed schools will help guide their decision.
"We have to keep in mind that if we close an under-capacity school, we would need a practical place for those students to go," Gause said. "That doesn't mean it can't happen, but it's not simple."
Gause said the school board needs to be willing to look at the possibility of school closures.
"We need to look at all options that are available to us," he said.
March budget reports reveal that more than $4 million in planned attrition savings would not be realized.
"This added to our dilemma," Mills said. "There is too much effecting the fund balance and too little time."
In December 2012, unbudgeted item expenses topped $7 million. Some of the overrun was trimmed through greater visibility and management, Mills said, and he does consider the district fiscally healthier, even though there is still a big deficit.
Mills wants all spending not required or necessary for the health and safety of the students to be eliminated.
Mills said he will send out a reduced spending notice within the next couple weeks.
"We will look into just doing the essentials for the rest of year," Mills said.
Mills wants to discontinue any spending not legally required for the students as a way to reduce expenses.
Important countermeasures put in place the last two months include Position Control, Mills said, which is a software program used to manage payroll for all district employees. Inefficient software forced finance staff to enter numbers manually the past couple years.
Systems analyst Elizabeth Goins was made aware of "bugs" in the manual entry in July 2011, and was still asking about the reinstallation of Position Control this January.
Finance manager Sheina Runions said in an e-mail to Goins that the system they were using in place of Position Control made benefit calculations errors she had to manually adjust.
"I was able to get the numbers I needed by playing with the percentages," Runions said.
The funding crunch has not been easy for principals and department heads. According to an email from Runions, some people became "quite creative in trying to hide budgets and move money to inaffected [sic] areas," when notified of budget cuts last month.
"We need to be tight in our communications," chief financial officer Michael Boyer said in response.
School board chairwoman Karen Carpenter said that while she is not fully informed about Thursday's projection, she is aware of the urgency of getting the reserves in order.
"We are still under pressure, and we are all trying to stay informed," school board chairwoman Karen Carpenter said.
Erica Earl, education reporter, can be reached at 941-745-7081