The Atlanta Board of Education on Tuesday approved budget changes linked to a $4 million shortfall and agreed to borrow up to $100 million to solve immediate cash-flow problems.
The school board’s actions follow a summer of uncertainty after Fulton County mostly froze property values.
Atlanta Public Schools officials initially feared that decision would result in a $12 to $18 million budget shortfall, but the actual gap will be closer to $4 million based on the final tax digests from Fulton and DeKalb counties.
The better-than-expected number means the district can reinstate a 1.5 percent raise for teachers this school year and cancel two furlough days.
All employees had been slated for a raise, but other full-time workers will receive a one-time $500 payment instead.
The district will cut some funding for new initiatives and programs to make up the remaining budget hole.
The school board also agreed Tuesday to borrow up to $100 million — to be repaid by the end of December — through a tax anticipation note.
“This isn’t easy for APS to decide to do, but it is important that we take care of our schools and our programs and our staff,” Superintendent Meria Carstarphen told the board.
If the district borrows the full $100 million, it would cost APS an estimated additional $329,000 in interest plus $80,000 for legal fees and other associated costs.
The school board has considered the possibility of taking out a loan for several months amid delays in the assessment process, Carstarphen said. She said she also expects more taxpayer appeals.
“September in particular is going to be a very low point for us in cash flow, and it is essential that APS protects all of the organization,” she said.
The school district also took out a tax anticipation note last year.