State Auditor Mary Taylor has placed Federal Hocking Local School District into a fiscal watch because the district failed to complete a financial plan to minimize a growing debt that is predicted to reach $1.8 million next fiscal year.
A district receives a financial status of fiscal watch when it has a debt that is 8 percent to 15 percent of the general operating funds for the district, no levies in place to alleviate the debt or the auditor's office determines the status is necessary to prevent further financial problems, according to Ohio Revised Code.
Federal Hocking must create a financial plan to reduce the debt in the next 60 days, or the district will be placed in fiscal emergency at the end of 120 days, said Emily Frazee, deputy press secretary for the auditor's office.
Although the district will try to prepare a financial plan in the next 60 days, treasurer Bruce Steenrod said a fiscal emergency is very likely at this point.
A fiscal emergency would allow the district to access future property tax revenue from the Ohio Department of Education to fund basic operations G
Steenrod said.
The district also has a meeting with the auditor's office in April for more suggestions on how to avoid a fiscal emergency and reduce the debt, Steenrod said.
The district can escape fiscal watch if it receives a clean audit, has no major accounting errors and develops a financially sound five-year budget, Frazee said.
Facts about Fiscal Statuses
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