S. Putnam approves $2.8 million loan

Monday, October 15, 2007

The South Putnam School Board voted 5-0 Wednesday to allow administrators to take out a $2.8 million temporary loan to help resolve "cash flow issues."

The district will use the money as an advance on its December property tax draw, since the school usually begins to run out of cash to pay its bills as the year nears its end, said South Putnam Superintendent Bruce Bernhardt.

This is a common practice for school districts in the area because they aren't big enough to keep cash on hand in between their two property tax payouts -- one in June and one in December. These issues are exacerbated by frequent delays from the state, as well. Also, the loan will be paid back in full when the district gets its tax money, he added.

The $2.8 million loan, which the district will take out with Old National Bank, carries an interest rate of 3.999 percent, though administrators will draw on it on only an as-needed basis and likely won't use the entire amount, Berhardt said.

The school board also unanimously voted to allow all of its employees to pay into a district-approved annuity program. Previously, only employees who worked 20 hours or more had access to it, Bernhardt said.

The board also voted to add more than 100 pieces of old equipment, mostly used computers and peripherals, to its surplus inventory.

The South Putnam School Board regularly meets at 7 p.m. on the third Monday of each month at Central Elementary. The meetings are open to the public.

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  • I've said it before and will say it again, the voters need to replace the entire South Putnam School Board and the administrators, too. Seems they still believe there is a bottomless pit of money out there for their use. Get back to teaching!

    -- Posted by River Rat on Tue, Oct 16, 2007, at 8:55 AM
  • River Rat's comments are typical of the continued knee-jerk reactions

    to every South Putnam board action reported by the Banner. The fact is that

    the school system receives its tax revenues AFTER operating

    expenses for each six-month period have already been incurred. The corporation

    must have funds to operate, and the lag time necessitates these temporary loans.

    This information is freely attainable by attending school board meetings or

    actually reading the accompanying Banner article and not just the headline.

    Apparently, it is easier or more comforting to lash out at the SP administrators

    than to gain a true understanding of the situation.

    South Putnam is not alone in having to perform these financial gymnastics, as

    visits to the web sites of other local and rural schools will attest. This

    situation is a consequence of the current educational and tax systems under which

    we operate and cannot honestly be blamed on any one school system.

    This topic has rendered a lot of disjointed noses, and most of them are still pointing

    in the wrong direction.

    -- Posted by Balding Eagle on Tue, Oct 16, 2007, at 11:24 AM
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