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ROYAL OAK, Mich. - Banking on property sales to pay for capital projects has not turned out well for Royal Oak Public Schools, which will borrow $5 million to make ends meet this year, according to the Royal Oak Mirror.
Voters in the district approved a $60 million bond project in 2005 which, coupled with anticipated multi-million dollar property sales, was intended to pay for building improvements, the Mirror reported. When the latest sales didn't pan out, the district borrowed from its general fund balance to pay contractors.
Now there is a shortfall in the general fund budget, according to the Mirror, leading the district to borrow from the Michigan Municipal Bond Authority for the first time since 1993. The district still intends to sell two former elementary school properties, the Mirror said.
SOURCE:
The Mirror, "School district acts fast before running out of cash," Nov. 23, 2008
FURTHER READING:
Michigan Education Report, "Schools for sale," Aug. 15, 2007
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