Franklin schools has enough money in savings to make debt payments through the end of the year; but unless changes are made, the school district won’t be able to make the payments in 2014.
Now the school board must consider options, including restructuring debt and borrowing more money to ensure it can make
annual debt payments and pay for building upgrades, increases in medical costs and raises for employees.
The school district, which
borrowed more than $100 million to build a new high school and remodel the middle school nearly a decade ago, isn’t collecting enough money to pay all of its debt because of property tax caps that limit how much governments can collect in taxes.
For the past three years, the school district has made up for the shortfall by saving money typically spent replacing buses or upgrading buildings, executive director of finance Jeff Mercer said.
Debt payments are due in December and June. In December, Franklin needed to have about $6.9 million for the payments but had less than $4.6 million, Mercer said.