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Arlington board approves up to $3 million short-term loan to cover summer cash shortfall
Summary
The Arlington School District board approved a temporary interfund loan authorization of up to $3,000,000 from the capital projects fund to cover projected summer cash-flow shortfalls; district finance staff said receipts later in the fiscal year will repay the loan with interest.
The Arlington School District Board of Directors on Tuesday authorized a temporary interfund loan of up to $3,000,000 from the district's capital projects fund to cover projected cash shortfalls during the summer months.
Finance director Gina Zuttenhorst told the board the district expects low cash-flow months in June (and possibly mid-months in July and August) and projects that revenues arriving later in the fiscal year will make the capital fund whole after repayment with interest. "Our financial health starts with the positives," Zuttenhorst said, listing levy support, staff-ratio compliance and enrollment growth before describing constraints in special education, transportation and other areas.
Zuttenhorst reviewed the district's recent financial trends, including a dip in OSPI's financial-indicator score that the district has been rebuilding, and recounted a prior, fully repaid interfund loan of $1.5 million. The new resolution (No. 25-04) authorizes a cumulative short-term loan not to exceed $3,000,000; Zuttenhorst estimated interest on likely amounts at roughly $9,400. Board members heard that the capital projects fund currently has sufficient cash for its scheduled work and that the loan authority is precautionary.
Director Watts moved to approve Resolution 25-04; Director Knapp seconded. The motion passed on a roll-call vote with Directors Diamond, Kelly, Watts, Knapp and President Levesque voting in favor. The board recorded the loan authorization as a temporary, repayable measure; no additional cuts or new recurring expenditures were approved at the meeting.
Zuttenhorst said the district will continue multiyear work to rebuild fund balance and monitor federal funding changes that could affect future budgets. She also reminded the board that the 2023-24 state audit was complete with a clean opinion and that development of the 2025-26 budget is underway.
The authorization gives district finance staff the flexibility to manage year-end cash needs; the district will report back as required under board policy and state accounting rules.
