MONROE — Monroe Local Schools, placed under fiscal emergency last month by the state, may be forced to reduce its workforce to state minimums, said the head of the committee charged with balancing its budget.

Mike Watson, chairman of the financial planning and supervision commission, said he understands there’s “a lot of frustration” in the Monroe community because of the district’s financial situation, but he suggested “let’s do what it takes to be back on path and go forward.”

The district - facing a debt of more than $5 million - earlier eliminated 19 positions for the 2013 fiscal year.

Watson indicted the only way out of the financial crisis is to place a levy on the ballot - possibly as soon as August - and make significant staff cuts. But he said it’s too early to tell how many staff positions would have to be eliminated.

“I have no idea,” said Watson, a retired school treasurer who has chaired five of these committees around the state, including the Little Miami district. He said staff was cut in Little Miami and voters passed a levy that has allowed the district to move out of “emergency” status.

He said the commission — comprised of community members and officials from the Ohio Department of Education — is in the “fact-finding stage.” It has met twice and the next meeting will be at 2 p.m. July 5 in the Monroe cafeteria.

By state law, the group has until Sept. 27 to create a financial recovery plan and submit it to the state.

The Monroe district is staffed by about 60 non-certified personnel, 132 teaching personnel and 13 administrative employees for the 2,344 students, Cahall said. The state requires one teacher per 25 students, according to the Ohio Department of Education.

Watson said the committee will have to determine how much the staff cuts would save the district, and how many staff positions can be eliminated to keep the district “legal.”

Monroe faces a $2.2 million general fund debt and a $3.1 million legacy debt, which was caused by misspending of a bond retirement fund dating back to 2005, said treasurer Holly Cahall.

The state auditor has allowed the district to pay back the $3.1 million owed to the bond fund over a five-year period, she said.

Cahill, hired in November 2011, said to the committee and about 10 residents Wednesday afternoon that the five-year financial forecast calls for the district to fall deeper in debt every year without a levy and staff cuts.

She said the district will have a negative cash balance of $85,679 in the 2012 fiscal year, and more than $2 million in 2013, $5 million in 2014, $6.9 million in 2015 and $9.3 million in 2016.

She said a levy must pass and cuts must be made for the financial “survival of the district.”

Contact this reporter at (513) 705-2842 or rmccrabb@coxohio.com.