Atlanta Public Schools, which borrowed $60 million this year to cover expenses while waiting to receive tax revenue, will be able to repay that loan six weeks early.
The school board authorized the loan, known as a tax-anticipation note, in August because delays in sending out Fulton County tax bills had caused a cash-flow problem for the school district.
The district needed to borrow the money to pay its normal operational expenses as it waited to collect school property taxes.
The loan must be repaid by Dec. 31, but the terms of the deal allowed the district to save nearly $158,000 in interest if it could repay the loan by Thursday.
Last week, Lisa Bracken, the district’s chief financial officer, announced APS had collected sufficient tax money to repay the loan by the earlier date.
Even with the early repayment, it cost the school district $330,933 to borrow the money, including interest and related fees.
This is the third consecutive year that delays in the Fulton County tax-collection process prompted the school district to take out a short-term loan.
The cost to APS for those three loans combined is about $968,000, Bracken said.
“To help avoid the need for TANs in the future, I still strongly recommend that the district work to grow fund balance; however, as previously discussed even a robust fund balance cannot prevent a cash-flow crisis if property bills are drastically delayed,” Bracken told board members last week.
Fulton County school officials also considered taking out a loan this year because of similar cash-flow concerns but ultimately determined that the district would be able to pay its expenses without borrowing money.
About the Author
Keep Reading
The Latest
Featured
