State takes over schools’ finances
Published 12:00 am Thursday, July 15, 2010
MONTGOMERY(AP) — The state school board has voted to take over the finances of the Coosa and Sumter County school systems, the first such interventions by the state since 2001.
The systems, without a big enough tax base to raise local revenues, have been struggling to pay bills after two years of cuts in state funding. Coosa school officials were turned down when they sought an additional loan from a local bank.
By intervening, the state can assist the systems in borrowing money and taking other steps to manage its finances.
Craig Pouncey, assistant state superintendent for administrative and financial services, said Tuesday that many systems have been put in financial jeopardy by spending cuts that have been ordered during the school year due to a downturn in revenues.
Five of Alabama’s 132 systems — Choctaw, Coosa, Marengo, Perry and Tuscaloosa — are currently borrowing money to meet their monthly payroll. Pouncey said another 25 expect to have to borrow within the next month or so.