The state's 10 percent funding cut for schools will likely push the Pleasant Valley School District into deficit spending over the summer months.
The school board at its April meeting approved a resolution authorizing the district to borrow funds under the Iowa School Cash Anticipation Program (ISCAP).
The board approved a 5 percent increase in property taxes last month, but the impact on district revenues won't be felt until this fall.
"As has been discussed at previous board meetings, the district is projecting its General Fund cash balances to go into the negative (deficit) at some points during the July – October, 2010 time frame," district officials told the board. "The main reasons for this are the combination of the effects of the state 10 percent across-the-board cut for the 2010-11 fiscal year and the fact that school districts in Iowa do not receive state aid payments during the months of July and August and they do not receive their first large draw of property taxes for the fiscal year until October."
Under the ISCAP program, school districts can borrow money at a low cost (and in some cases at no cost), according to the board minutes.
