Deer Valley Unified School District No. 97 has asked the state of Arizona for a $7 million advance to cover a cash shortfall caused by a delay in anticipated state aid.
The state has postponed a portion of aid due to local districts until fiscal 2013. Delays in annual school payments have been the norm in Arizona for several years as a method of dealing with low state tax revenues.
Without the funding the district would be unable to meet maintenance and operational expenses in May, according to officials.
Jim Migliorino, associate superintendent of fiscal services for the Deer Valley district, told school trustees last week that the request will more than likely be rejected by Arizona Department of Education officials.
Denial of the request will allow the district — which serves portions of Phoenix and Glendale — to tap a $15 million line of credit provided by the Maricopa County treasurer’s office, Migliorino said.
The line of credit from the county would be repaid as state aid or tax revenue comes in to the district, which issued $30 million of one-year tax anticipation notes in 2011. Migliorino said the notes cost the school district a total of $227,000 in interest and fees.
Voters approved a capital outlay override in December 2010 that allowed the district to increase its capital budget by up to $7.5 million through fiscal 2013. An election to extend the override is expected in November 2012.
The Deer Valley school district’s $214 million of outstanding general obligation debt is rated Aa2 by Moody’s Investors Service.