Danger zone for deferrals?
More delayed payments may push districts over edge
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For three consecutive years, the Legislature has added billions of dollars in IOUs to K-12 schools and community colleges. They did so on the assumption – which school districts share, for the most part – that payments deferred are better than payments denied: straight budget cuts.
But how much is too much? What is the tipping point for deferrals, when school districts can no longer carry the state’s burden, when they can no longer borrow externally, and budget deferrals become straight budget cuts – when, at the extreme, districts that can no longer meet payroll will turn to the state to bail them out?
That’s a question that legislators must consider this week, as they weigh the consequences