For the second year in a row, the Batavia school board has approved taking out a short-term loan, this time up to $8.5 million, to make sure it has enough cash on hand to pay expenses the last few months of the fiscal year.
The school board unanimously voted Tuesday to authorize the sale of tax-anticipation warrants April 11. The warrants will likely mature between June 23 and 27; the date will be set once the district knows Kane County's schedule for releasing property tax payments. The warrants will be paid off using those property taxes. The first installment of taxes usually arrives in late May.
The district expects to pay $15,333 in interest on the loan, and $7,500 in sales and legal fees.
According to a memo from Kris Monn, assistant superintendent for finance, cash reserves are expected to run low in late April. He still expects, however, that the 2013-14 budget will show a surplus of revenue over expenses when the fiscal year ends June 30.
Last year the district borrowed less money ($5 million), and borrowed it later (May 21) and for a shorter length of time.
Before 2013, the last time the district had done short-term borrowing was in 2006.
Monn said Thursday the district had increased its spending this fiscal year in anticipation of receiving more tax money in spring 2014 from the outlet mall in Aurora. The outlet mall and some nearby industrial property had been in a tax-increment financing district until the end of 2012, with the majority of the property taxes generated going to pay for work done to develop the mall and the businesses. The Batavia school district expects to receive about $6 million more annually due to the expiration of the TIF.