Topeka ? State legislators who are hungry for ways to stretch tax dollars in the current budget crisis received a report Monday that said merging school districts could produce savings.

But those consolidations also could cause problems, according to the report by the Legislative Division of Post Audit.

The audit was neutral on whether the state should require districts to consolidate.

Because of slumping tax revenue, state officials cut the budget by $1 billion last year, and are now facing another $400 million revenue shortfall.

Many lawmakers see potential to save tax dollars by merging some of the state’s 293 school districts.

Auditors agreed. “The analyses we performed in this audit showed that reorganizing the system so there are fewer school districts has the potential to significantly reduce the cost of the system overall,” the audit said.

The report developed two consolidation scenarios. In one, the number of districts would be reduced to 266, and in the other, districts with fewer than 1,600 students would be merged, reducing the number of districts to 152.

The proposals would save $18 million and $138 million, respectively, the audit said.

But those savings would come with a cost. More students would have to be transported and travel longer distances, and some districts would need new buildings. Many districts would lose more money in state funding than they would save by reducing operating expenditures, the report said.

“Equally significant issues would need to be addressed before any widespread reorganization could happen, including the impact on students, individual districts and local communities,” the audit said. The audit added that any potential for cost savings from consolidation “should be viewed as a long-term investment.”

Deputy Education Commissioner Dale Dennis said most of the report’s findings have been well-known to legislators. There are financial incentives for districts to consolidate voluntarily and, Dennis said, “The Legislature has been hesitant to mandate this (consolidation) in the past.”

Sen. Terry Bruce, R-Hutchinson, who is chairman of the Legislative Post Audit Committee, said it was politically difficult to force districts to merge.

“We’re just not going to see a huge consolidation effort that we saw in the 1960s,” he said.