Clark County school officials now estimate a potential district-level budget shortfall due to unexpected expenses is about $11 million — $9 million less than they had calculated it to be last week. 

That amount represents less than 1 percent of the district’s $4 billion budget, interim Superintendent Brenda Larsen-Mitchell said at a Thursday school board meeting. The district’s recently revealed budget issues prompted a high-level firing and scrutiny at the highest levels of state government.

Officials said if the district plugs up that hole in its district-level budget with some of its approximately $152 million in unassigned funds, its new ending fund balance will be above 4 percent of its general fund revenue, more than its 2 percent target. 

“I think that we're going to end up in a really great position at the end of all this,” said Chief Strategy Officer Kellie Kowal-Paul. 

In addition to the deficit at the district level, some individual schools experienced budget issues due to errors that led them to receiving less funding than they need to cover significant new teacher salary raises, as well as inaccuracies in allocations of additional funding designated for students considered to be “at risk.” Deputy Superintendent Melissa Gutierrez said schools that experienced significant difficulties balancing their budgets were able to request and receive support from the district. 

Thursday was the first time the Clark County School Board and district leaders publicly discussed the budget issues at the district level and at individual schools that came to light last month and were identified during its regularly scheduled year-end close-out accounting process. The news, which prompted the termination of the district’s chief financial officer, led Republican Gov. Joe Lombardo to call for state audits into the district’s potential budget deficit. State Superintendent of Public Instruction Jhone Ebert also sent a letter to the district’s interim superintendent asking for more information on the situation. 

In her response, Larsen-Mitchell attributed the district-level budget hole due to unanticipated expenses for litigation and cybersecurity. 

On Thursday, Larsen-Mitchell told the school board the district had budgeted $30 million for litigation, but its actual costs were higher by about $23 million. She said cybersecurity costs came out to about $15 million. She couldn’t immediately answer how much the district had budgeted for its cybersecurity needs. 

Some schools have made cuts to personnel and programming in response to the budget issues at the school level or have had to cover their deficit using funds unspent from previous school years. 

CCSD schools have a total of $363 million in unspent funds that are, in part, due to staffing vacancies. The unspent amount at each school, which they can keep in reserve and be spent in future school years, can vary. 

“There were some schools clearly that didn't have a lot of money, but then there were some schools who had a lot of money,” said Trustee Lola Brooks, who isn’t running for re-election. “I think it's very important that people understand that's the purpose of the carryover funds. If you do get into a financial bind, you need to be able to cover it.”

A proposal for a $50,000 review of the district’s finance operations by the Council of Great City Schools, a coalition of large school districts of which CCSD is a part, failed in a 3-3 vote with Board President Evelyn Garcia Morales, Vice President Irene Bustamante Adams and Brooks in favor of the review and Trustees Linda Cavazos, Brenda Zamora and Lisa Guzman against it.

The resignation of Trustee Katie Williams in September — after an investigation revealed she no longer lived in the district she was elected to represent — left the board with an even number of members.

Some community members, including local teachers union leader Vicki Kreidel, opposed the review, citing potential conflicts of interest, and opposed spending additional money on an audit while the district is in a budget deficit and schools are having to make cuts. 

Larsen-Mitchell and former Superintendent Jesus Jara have received leadership training from the council and have been consultants for the school board. 

Brooks and Bustamante Adams said they welcomed the council looking under the district’s hood. Brooks added that it's unlikely that the district will be able to find another vendor with the council’s level of expertise and price. 

A second proposal, to reallocate funds previously allocated for the council to do the review, failed in a 3-3 vote. 

This story was updated at 11:40 p.m. on 10/10/24 to update the estimated budget deficit amount.