Pine River-Backus School District will be able to cover their costs, this spring, while the state delays nearly $900,000 in state aid payments to the district.
Minnesota law allows delaying state aid in order to help the state maintain cash flow and avoid short-term borrowing.
Estimates are that 231 of the 337 school districts in Minnesota will be affected by the payment delays slated for March 15, March 30 and April 15.
The payments should be restored to the district on May 30.
The delays will affect districts, like Pine River-Backus, that have healthy fund balances. The delays are limited to districts exceeding $700 per pupil unit. PR-B has an unreserved fund balance of $2,041 per pupil unit.
Affected districts will need to find a way to maintain cash flow while the state withholds funding.
Options could vary from covering costs with existing liquid assets, cashing out other investments early, to borrowing money.
PR-B has some certificates of deposit that have reached maturity, according to Business Manager Jolene Bengtson.
They will use the money from the CDs to help cover expenses and will hold off in investing in any new CDs for the time being. Those funds are "money we've been responsibly managing for a long time," said Superintendent Cathy Bettino.
Bengtson said that as a result of the anticipated delays they will be doing some creative budgeting in the next few months, but will be OK.
"At least we're positioned to make some changes without borrowing," Bettino said. "We are managing our funds to make them work for us."
The state's aid payment delays do not affect the federal stimulus funding that schools receive through the American Recovery and Reinvestment Act.
