School budget oversight panel warns of multi‑million shortfall and calls for stricter controls

The School Budget Oversight Commission told the council that the Warwick School Department faces a significant budget challenge driven largely by weak internal controls and payroll reconciliation errors.

Ernie Almonte, the commission chair, said several iterations of budgets and unreconciled payroll listings led the commission and the new finance director to identify approximately $5 million in fiscal‑25 shortfalls and additional deficits for earlier years. "We found just give me one second...a payroll discrepancy that resulted in approximately $5,000,000 in additional compensation and related expenses that needed to be added to the fiscal 26 budget," Almonte said.

Vice chair Sherry Kuntz described the commission’s key findings: a lack of routine reconciliations between HR and payroll listings, weak tracking of grant‑funded positions that continued beyond grant expiration, and inadequate budget‑to‑actual reporting. She said the commission recommends stronger written policies, routine reconciliations, central grant tracking, and quarterly budget reporting to the council.

The commission recommended using one‑time resources (including a $2,000,000 withdrawal from an insurance reserve) to soften the immediate shortfall but said that relying on one‑time funding is not a long‑term solution. Commissioners urged a performance audit to examine class size, building utilization, and staffing levels tied to a declining student population.

What’s next: The commission will continue work on a five‑year plan and may recommend a targeted performance audit; council members asked for regular quarterly financial reports from the school finance director to improve oversight and early detection of variances.