SACO — The Saco City Council will vote later this month whether to allow the School Department to use $573,000 from the city’s unassigned fund balance to help fill a funding gap.

According to city policy, the city’s unnassigned fund balance should be no more than 10 percent of the city’s annual budget.

City Administrator Kevin Sutherland said the city has an 11.15 percent unassigned fund balance, or about $573,000 above the 10 percent threshold.

The School Department, through a contract, pays tuition to private school Thornton Academy to educate the city’s high school students.

The School Department had budgeted for 949 Thornton Academy students this school year. However, there are 42 more students than predicted, which leaves the School Department owing about $470,000 more than budgeted this year for tuition and associated costs.

In total, the School Department owes Thornton $900,000 over what it had budgeted to give to the school this year.

This includes a $232,000 payment carried over from last year.

The School Department last month enacted a budget freeze, which officials believe will cover about $300,000 of the shortfall.

The City Council on Monday night passed the first reading to allow the School Department to use $573,000 from the unassigned fund balance to help fund the shortfall.

The City Council will hold a final vote on the measure on Feb. 21.

— Staff Writer Liz Gotthelf can be contacted at 282-1535, ext. 325 or egotthelf@journaltribune.com.