Atlanta Public Schools may borrow up to $175 million to cover expenses because of delays in sending out Fulton County property tax bills.
The school board will consider a recommendation Monday from the district’s finance department to seek a short-term loan for up to $175 million. The district would have to repay the money by Dec. 31.
The loan would cost the district an additional estimated $620,000 in interest plus about $80,000 in related fees, according to school district documents posted Friday evening.
The school board on Monday will consider an initial step in the loan process to authorize the superintendent to advertise a bid to borrow the money. Also on Monday, the board will vote to set the school property millage rate.
A district spokesman did not answer questions asked Thursday by a reporter at The Atlanta Journal-Constitution about the likelihood of the district taking out such a loan, called a tax anticipation note.
The loan is a way for the school district to pay for its current operations before it receives tax revenue. The debt is paid off when taxes are collected.
If approved, this would be the third year in a row that APS has had to borrow money because of delays in the tax-collection process.
Last year, APS borrowed $100 million, costing the district roughly $400,000 in interest and fees, to pay for expenses as it awaited Fulton County tax revenue. Fulton County taxes make up a big portion of the APS budget.
This year, tax collection has been delayed again in Fulton County. For the second straight year, the county is going to court to get permission to collect taxes.
The tax collection has stalled this year because of the high number of appeals property owners have filed in response to soaring property assessments.
The county can’t collect taxes without a court order because the number and value of the appeals exceeds 8 percent of the total tax digest.
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