Winchester Public Schools are set to run out of money in December.

The district’s superintendent told the State Board of Education Wednesday that the town’s finance director was arrested for financial fraud, and the municipal board is refusing to levy a new tax to pay the school district’s bills.

State law requires the 1,200-student district — one of the lowest-achieving in the state — to spend at least $19.9 million a year to operate its four schools. The state budget is slated to give the town $8.2 million for education-related costs this school year.

“The Board of Education will be able to make payroll … through November. In December though, the Town is projected to have a cash shortfall so that no dollars will go to pay the Board of Education bills. If that happens neither the Board of Education nor The Gilbert School will be able to make payroll and the schools will close,” Winchester Superintendent Thomas Danehy told the state board.

The superintendent is asking the state to intervene and provide the state with funding earlier than scheduled, a request the state board and education commissioner did not seem receptive to.

Aside from the department’s budget chief saying that the board doesn’t have the authority to forward money to the district, board members worried about setting a dangerous precedent.

“The problem will remain unsolved,” Education Commissioner Stefan Pryor said of the continued budget shortfall that the district would still face.

The “December crisis,” as the superintendent calls it, has also been brought to the attention of the governor’s budget chief. The education department’s chief financial officer told the state board that the governor’s budget office has said that Winchester’s looming shortfall needs to be resolved by raising local taxes.

While there has been no signal that the state will be bail out the district, the state board decided to launch an investigation in the district failing to meet their statutorily-required funding obligation of the schools. There is no timeline when that investigation will be completed.

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