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Gridlocked: Scranton schools latest to borrow to keep going despite impasse

Written by Emily Previti/Keystone Crossroads | Nov 5, 2015 12:15 PM
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Photo by Lindsay Lazarski/Keystone Crossroads

(SCRANTON) - A $14.3 million loan has pushed statewide school borrowing closer to the half-billion mark as the budget impasse rolls into its fifth month.

The Scranton Board of School Directors have voted to petition Lackawanna County Court of Common Pleas for approval to take on the debt, and immediately seek alternate financing via the district's financial consultants if the request's rejected.

Officials say they need the money to cover operating expenses, including $2.8 million for payroll every two weeks, in lieu of state funding and repayments due on a tax-anticipation note taken earlier this year. They'll pay about $60,000 in interest and fees, according to the Scranton-Times Tribune.

Scranton schools get more than half their revenue from state and federal (also delayed by the stalemate) sources, according to an analysis Pennsylvania Department of Education statistics

For the average Commonwealth school, it's nearly 40 percent; the range in 2012-13 was five percent to 86 percent, according the analysis showed.

Pennsylvania public school districts already had borrowed $431 million total as of last week.

Their plight figured prominently in a recent assessment by Moody's Investors Service declaring municipal borrowers in worse shape from the state budget impasse in Pennsylvania than in Illinois, where lawmakers passed a separate education funding bill to keep money flowing to schools.


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