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Milan Area Schools warns of state budget delay, prepares to borrow to cover payroll and operations
Summary
With Michigan lawmakers still negotiating the school-aid budget, Milan Area Schools officials warned Sept. 24 that the district may need short-term loans to cover payroll and basic operations if state aid is delayed past Oct. 10.
Milan Area Schools officials told the board Sept. 24 they are preparing to borrow funds and supply legal documents to lenders if the state does not deliver a school-aid budget in time to provide October state aid.
The board heard a financial update from Ms. Hendricks, who said the district has modeled cash flow and could be unable to make the Nov. 15 payroll if no state payment or other revenues arrive and the district does not borrow. "I don't think we can make payroll in November," Ms. Hendricks said during the meeting.
Superintendent Patrick McMahon (identified in meeting materials as superintendent McMahon) and board members described contingency steps already under way: engaging the district law firm to prepare loan documents, contacting banks about lines of credit or…
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