The financially strapped Winston-Salem/Forsyth County Schools will ask the Board of Education on Tuesday for approval to borrow up to $6 million from the district’s Child Nutrition Program.
Moore
The no-interest loan would draw from the program’s unspent funds and not impact how students are fed and what they pay for meals, a district spokeswoman said Monday. Winston-Salem/Forsyth County Schools would be required to repay what it borrows within five years, according to an agreement to be presented to the board at its Tuesday meeting.
The loan is aimed at helping the district chip away at a $32 million deficit for the fiscal year that ends June 30.
The Child Nutrition Program operates independent of the district budget and is supported primarily by federal funds disbursed on a per-meal basis – determined by whether they are free, reduced or full price – and student payments, with the state contributing a small amount to subsidize breakfast for qualifying students.
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State law requires school lunch programs to maintain a fund balance equal to what it would cost to operate for two months.
Forsyth’s program has enough of a cushion to make the loan without falling below that threshold, the district said. As of March 1, the fund balance was a little more than $11 million.
The initial allocation will be $4 million but could rise to $6 million. Board members would be asked to approve a future budget amendment if the district wants more than $4 million.
Tuesday’s meeting comes less than a week after Forsyth County commissioners refused the school system’s request for a one-time payment of $32.1 million to cover its budget shortfall for the current fiscal year.
The district’s overspending led to the retirements of Superintendent Tricia McManus and CFO Tommy Kranz. Tuesday’s meeting will be the first for Interim Superintendent Catty Moore, who will provide an update on the district’s efforts to balance its books by the end of the month.
The school system also will ask for authority Tuesday to tap nearly $5.4 million in reserve funds to help narrow its financial gap, according to the meeting agenda.
John Deem is an award-winning journalist with more than three decades of experience covering topics ranging from community development to climate change. He is an Ohio native but has lived more than half his life in the Carolinas. Write to him and [email protected].
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