Trustees approve $12 million tax anticipation note to cover shortfall

The Cherokee County School District could borrow up to $12 million from future tax revenues so schools can operate in the fall.

The school board unanimously approved the multi-million dollar tax anticipation note at Monday's meeting. The short-term management tool allows districts to borrow money at a low interest rate until tax revenues are received in January.

This amount will be paid back next spring.

Virtually all 85 school districts statewide will likely participate in tax anticipation bond issues offered by the South Carolina Association of Governmental Organizations.

Cherokee County borrowed $10 million in tax anticipation notes this past year.

"The tax anticipation note has become something we have to do," district finance director Ben Childs said. "The amount goes up every year because of state funding cuts and the fact the state revenue comes in slower every year."

The school district will use the tax anticipation notes to cover cash shortfalls which occur later this fall.

At Monday's school board meeting, school trustees also agreed to take bids on purchasing a generator for the district office.

The generator will provide an emergency power source for the district's phone and computer systems. Initial costs estimates are $50,000.