Ohio state auditor Dave Yost last week put one local school district on fiscal watch status and removed another from fiscal emergency status after nearly 10 years.

Officials put the Liberty Local School District, located in Trumbull County, on fiscal watch after the system failed to submit an acceptable revised recovery plan to eliminate a projected $2.5 million budget deficit. The district’s recent fiscal records are also considered incomplete, the auditor said.

The move followed a May 17 request from the Ohio Department of Education asking that the Liberty district be placed on fiscal watch. The department first placed the district in the category of fiscal caution in January 2010 based on potential deficits in 2010 and 2011.

The school’s five-year forecast projected deficits in 2011 and 2012, though the auditor’s office described the district’s 2011 records as unauditable.

Within 60 days, Liberty school officials must submit a financial plan that addresses ongoing financial problems. If they fail to do so, Ohio will declare the district to be in a state of fiscal emergency, according to Yost’s office.

“In these difficult economic times, governments at every level must become more efficient with fewer tax dollars,” Yost said in a statement. “My office is ready to work with the Liberty Local Schools to bring them back to fiscal health.”

Last week, the state removed the East Cleveland City School District from fiscal emergency status after nearly a decade in the problematic category. The change came after the district met a number of criteria, including implementing an effective financial accounting and reporting system, eliminating all fiscal emergency conditions, meeting the goals of a financial recovery plan, and crafting a five-year forecast of its fiscal position.

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