Very interesting article by Theresa Harrington: Mt. Diablo District is running out of cash .
Certainly worth a read, it seems the Superintendent's warning of a possible State takeover in the future may have some real merit beyond "just" the MDEA negotiating angle.
Theresa reports that MDUSD borrowed money this year in order to cover it's cash requirements in a loan called a "TRANS." From the Times article:
“If they had to do a mid-year TRANS and they’re running out of cash, that’s one of the most telling indicators that they’re in financial trouble,” Clark said. “A mid-year TRANS is very new. Short-term borrowing is common in the fall or spring, but to borrow at the end of the fiscal year is not a common event.”
The John Swett district, he said, is in even more dire straits.
Still, the Mt. Diablo district filed a “positive” certification with its second-interim budget through Jan. 31, which assumed approximately $9.8 million in 2009-10 and subsequent year reductions that require labor negotiations, according to a letter the Clark wrote to Board President Paul Strange in April.
“It is our understanding that these assumed reductions may not materialize due to little or no progress with negotiations,” Clark wrote. “Our office would question the district’s positive certification should the district fail to meet targeted reductions.”