Under the worst-case scenario, the Carson City School District would be forced to cut $10.9 million from its budget in 2010, a number that one official described as "cataclysmic."
However, the district has managed to save $11.1 million in its ending-fund balance.
"Out of about 500 local governments, we're probably one of the 10 local governments in a position to weather this crisis," said trustee John McKenna. "We're in great shape compared to the rest of the state."
The question remains, however, whether the board should use those funds.
"It bothers me that we'd even consider spending all of our ending-fund balance," said trustee Norm Scoggin. "It concerns me that we would think of spending this whole
thing."
Bob Anderson, fiscal services director for the school district, spoke to the school board Tuesday night.
The board discussed Monday's special session of the Legislature to balance $340 million cuts to the state budget. As part of that solution, the state took a $160 million "line of credit" from the Local Government Investment Pool, into which the school district has about $15 million invested.
Instead of pulling its money from the pool, the district left it.
Trustee Bob Crowell applauded that decision.
"It's wise to become part of the solution," he said. "I think it's the absolute right thing to do to work together to get us out of this thing."
Anderson echoed the sentiment that the school district has a responsibility to the community at large.
He said if 34 percent were cut from every category of the budget, it would mean losing 303 employees.
"That's just not acceptable," he said. "You don't want to inflict unemployment on a struggling economy. My fund teachings would tell me that full employment in Carson City would create a velocity of the dollar that would possibly sling shot us out of this position."
He said Carson City has in past years lost several students to Lyon County where many families could find affordable housing. However, he pointed out that foreclosure rates there are now one in 30 homes because of subprime loans.
"A lot of young families went out there," he said. "They may find opportunity to be employed in Carson City. Their children would re-enroll in our district."
He suggested cutting the ending-fund balance in half and using half in 2010 and half in 2011.
"Let's use some of the funds we have struggled to put in the bank to outlive everybody else," he said.
He said it will not be an easy decision.
"It's cataclysmic," he said. "It's a catastrophe. You've got to dig really hard to find anything positive in the economic variables in the budget for fiscal year 2010."
Superintendent Richard Stokes said the choices they're faced with will change how the school district does business.
"We are obviously concerned " the budgeting conditions, as I understand them, are going to be drastic," Stokes said. "We're doing our best to position ourselves the best we can to keep the doors open and the lights on."
Stokes said the district will be seeking the public's advice in the future, both at a special meeting and on its Web site www.carsonschools.com.
However, trustee John McKenna said the board should wait until the governor announces specific dollar amounts before formulating a tentative budget.
"The school district has enough money to deal with reality when reality becomes known," he said. "To sit here and speculate, you don't have to decide that until April. I wouldn't take much of what we say here seriously.
The nation will survive, the state will survive, the school district will survive. We need to get back to the basics and do what's best for kids."
- Contact reporter Teri Vance at tvance@nevadaappeal.com or 881-1272.