State delay sours district’s good report
Published 9:09 am Tuesday, December 13, 2011
Austin Public Schools is back in black budget-wise this year, but that could change by next summer.
The Austin Public School board heard the district’s annual financial review results Monday night. While the district grew its overall unreserved general budget to $7.1 million, the state legislature’s recent $700 million state aid payment delay, which passed earlier this year, will force the district into cash flow problems by April or May, according to district officials.
The 2010 budget shift called for giving 70 percent of a district’s total annual budget to schools and then paying off the remainder over the next two years. This year’s shift, passed by the Legislature to balance Minnesota’s budget, calls for 60 percent during the first year with the rest paid off in subsequent years. School districts will still get the same revenue, but a district’s cash flow will be negatively affected.
That’s going to happen to Austin, according to Stotts. He said the district currently projects between $4 and $6 million was used in cash flow, but the district won’t have enough revenue in its coffers by the summer to cover constant expenditures. Austin approved a line of credit for short-term borrowing earlier this year and hasn’t had to borrow money to balance its budget, according to Stotts.