PORTSMOUTH — The School Committee is expected to move closer tonight to suing the town under the provisions of the Caruolo Act to recover a portion of the $1.1 million in revenue cut by voters at the Financial Town Meeting in August.

While there will be discussion, it’s not at all certain the committee will vote on the controversial issue, says Sylvia Wedge, the committee president.

Wedge said she would prefer delaying the vote long enough for two newly elected members of the committee to be sworn in.

The School Committee has until next Monday to notify the state Office of Municipal Affairs of its plan to balance its budget in the wake of the town meeting, Finance Director David P. Faucher said yesterday.

But the committee could also request an extension of the deadline, he said.

The two new members, Republicans Michael Buddemeyer and Jamie R. B. Heaney, are expected to oppose any legal action.

Democrats, on the other hand, have four of the seven votes on the committee – enough to swing the decision in favor of legal action.

Heaney said yesterday he will attend tonight’s meeting and plans to “voice concern about filing lawsuit that will cost the town $200,000.”

Consultant Walter Edge Jr. estimates that the potential cost of protracted litigation could be $200,000, and said that legal expenses would be less if the Town Council and School Committee negotiate a settlement.

Edge and Thomas Sweeney, principals in B & E Consulting, say the School Department is $770,000 short of the finances it needs to meet all its legal obligations during the current fiscal year.

But Edge has estimated that a judge would authorize no more than $458,000 in additional financing, forcing the town to make up the rest by draining reserve accounts set aside for the schools.

Democrats on the committee have said they believe a Caruolo complaint is the only way they can secure enough money to meet the school district’s legal obligations.

In the absence of a lawsuit, Heaney was asked where he would reduce spending to both balance the budget and meet all the School Department’s obligations as required by law.

“I don’t have any plans as of this moment,” Heaney said, but he said he would have more to say when he takes his seat on the committee.

No date for swearing in newly elected local officials has yet been set, in light of a request for a recount filed by Mark J. Katzman, a first-time Democratic candidate for Town Council.

Katzman lost by 23 votes, and edged out by Republican incumbent Peter J. McIntyre, 3,466 to 3,443.

Katzman said in a statement last week that in light of the extremely narrow margin, he felt he owed it to his supporters to seek the recount.

In addition to machine and mail-in ballots already recorded, 12 provisional ballots will figure in the recount, according to Madeleine M. Pencak, registrar of voters.

Town Clerk Kathleen Viera-Beaudoin said the state Board of Elections has not yet scheduled Portsmouth for a recount, which must occur before the Board of Canvassers certifies the election and local office-holders are sworn in.

The Town Charter says the swearing-in must occur the Monday after certification, Viera-Beaudoin said yesterday.

That date could be next Monday, Nov. 20, or the following Monday, Nov. 27, she said.

Meanwhile, there is little disagreement about another item on the tonight’s School Committee agenda in which Schools Supt. Susan F. Lusi recommends that the School Department seek proposals for a program audit.

Unlike the recent review by Bacon & Edge, which determined only that the School Department could not meet its legal and contractual obligations with its $31.4 million budget, the program audit will determine how efficiently the schools spend their money.

At its last meeting Oct. 30, the Town Council voted to encourage the School Committee to seek a program audit by an independent agency other than Bacon & Edge.

Councilman Leonard B. Katzman said at the time that if the School Committee goes forward, the town will come up with the money to pay for the review, because it will benefit the schools as well as taxpayers.

Edge estimated the cost of the program audit at about $125,000, warning that it is a double-edged sword, because it could find that that the School Department is underfinanced. Faucher has indicated that town has a total of about $112,000 that could be used toward a program audit, including $32,000 from the council’s contingency fund and $80,000 earmarked for planning.