By Stephenie Steitzer
Enquirer contributor

COVINGTON - If Covington Independent School District officials cannot bring the district out of a $2 million deficit soon, the state could force the district to merge with Kenton County schools, Covington Superintendent Jack Moreland said Wednesday.

Mr. Moreland said he believes the state will work with Covington and four other schools in Kentucky that are also in the red before turning to this worst-case scenario.

"Given the current revenue picture statewide, I don't think the state is going to be anxious to force that," he said.

Mr. Moreland explained the school district's troubled financial situation to more than 100 Covington residents Wednesday night in an attempt to quell rumors.

The school district, which is the largest in Northern Kentucky, is trying to deal with a decline in state funding and additional expenses of about $1 million each year for state-required increases in teachers' salaries. The district's budget is about $26 million.

Mr. Moreland said he is bracing for another cut in state funding this spring because of an estimated $500 million state revenue shortfall in the next two years.

Mr. Moreland said he has tried to find creative ways to save money.

In October, the district saved about $360,000 by shifting 25 faculty and staff into various positions to avoid layoffs, though he said that might be necessary in the future.

He said he has also cut expenses in several areas, such as reducing the number of staff cell phones from 71 to 24.

"We're going to have to look at programs to do what we have to do, which is to balance the budget," he said.

District spokesman Bill Weathers said Mr. Moreland is not ready to make any specific program cuts yet, "but we're looking at everything."

Mr. Moreland said there have also been no formal discussions with the school board about raising property taxes, though that, too, could be necessary.

Mr. Moreland, who was a key figure in shaping Kentucky's 1990 education reform, was lured out of retirement two years ago to take over the beleaguered district that a state audit would soon classify as "deficient."

Karen Guttierrez contributed to this report.