Anoka-Hennepin School Board members June 28 unanimously adopted a
resolution for cash flow borrowing to the tune of some $59 million.
by Sue Austreng
Anoka-Hennepin School Board members June 28 unanimously adopted a resolution for cash flow borrowing to the tune of some $59 million.
In the process of drawing up a budget, the district’s financial team anticipates the delivery of state tax money and incorporates those dollars into the revenue line item of the school year’s budget.
Traditionally, 90 percent of the state money is delivered to school districts during the school year; 10 percent comes after the school year ends.
But a recent 70-30 tax shift in state aid payments made by legislators has reduced the district’s May through June payments.
Rather than receiving 90 percent of state aid before the end of the school year, the district received only 70 percent of its designated state aid; the remaining 30 percent will come during the summer months.
“We will be borrowing significantly more this year,” said District 11’s Chief Financial Officer Michelle Vargas when presenting the resolution for first reading June 14.
“This will not lower our bond rating,” Vargas said, revealing the silver lining on the cloud of cash flow borrowing.
“The cash flow borrowing will get us through the months when we’re short,” Vargas told board members before they cast their final cash flow borrowing votes June 28.
Short-term bonds will be purchased from Piper Jaffrey and Co. and will be used to pay day-to-day expenses like teachers’ salaries, building maintenance and janitorial expenses.
The resolution allowing cash flow borrowing states that bonds may be issued “not to exceed $59,355,200.”
Sue Austreng is at firstname.lastname@example.org