APPLETON (NBC 26) — The Appleton Area School District is borrowing $35 million to cover costs this school year, with district leaders saying the move is a matter of timing rather than a budget shortfall.
The Appleton Board of Education approved the short-term borrowing plan to bridge a gap between when expenses begin and when state funding arrives.
"My understanding is we have the dollars, it's just timing. It's not the budget, it's just timing," school board member Edward Ruffolo said.
Schools begin paying for expenses like payroll and daily operations in July, but much of their state funding does not arrive until December or January.
Holly Burr, the district's executive director of finance, said the district no longer has enough reserves to cover that gap.
"Well because of short comings in state aid, state aid not keeping up with inflation, and things like that. This is the boat we're finding ourselves in, we don't have enough of those reserves to carry us from July to January," Burr said.
"A lot of districts across the state find themselves in this scenario," Burr said.
Those pressures were part of the reason the district asked voters to approve a $60 million operating referendum in April, aimed at addressing the funding shortfalls. However, that money will not be available to the district until 2027.
"We have the money owed to us, we just don't have it in time to pay our bills," Burr said.
Burr said the district plans to repay the borrowed funds in the spring. The short-term borrowing is expected to cost approximately $37,000 in interest.
It is not the first time the district has used this approach — Appleton took out a similar loan in 2019.
