CYPRESS : Schools Could Lose as Much as $2.3 Million

In a “worst-case scenario,” the Cypress School District could lose about $2.3 million because of the county’s bankruptcy, Supt. William D. Eller has informed school board members.

In a briefing to school board members at their meeting Tuesday night, Eller said the district undoubtedly will lose some money this year because of the county’s financial situation, even in a “best case” situation.

The “worst case” situation, he said, would involve the district’s losing 27% of the $6.6 million it has deposited in the county pool, plus loss of up to $525,000 in anticipated interest and $50,000 in attorney fees. That total loss would be about $2.3 million.

The “best case” situation would involve the district’s losing just the interest income and attorney fees, Eller said.

In an interview, Eller reprised his presentation to the school board, saying “there is a general understanding that (the school district) will lose interest that we otherwise would have gained.”

He said that while it is still unclear how much interest the district will lose from the bankrupt county pool, Eller said it is likely to be around $200,000 to $300,000 and possibly as high as $525,000.

“The interest is not necessary to continue (current school) operations, but we will have to make cuts to make up for that money,” Eller said. He added that the cuts, yet to be determined, will have to be made before June 30, the end of the current fiscal year.

Eller said the board voted “to reaffirm three (financial) priorities: first, employee salaries; second, employee benefits, and third, maintenance of relationship with our vendors.”