Philadelphia’s financially struggling public school system is borrowing $300 million to pay for expenses through the end of the school year.
The Philadelphia School Reform Commission said last week the bond sale was a necessary but expensive way for the district to meet its financial obligations as it works on a plan to close about 40 schools and cut labor costs in its $2.5 billion budget.
The Philadelphia Inquirer reports school officials found investors receptive to the borrowing, in part because of a new five-year plan and a state program guaranteeing creditors would be paid through state aid funds if the district doesn’t meet its obligations.
A version of this article appeared in the November 15, 2012 edition of Education Week as Troubled Phila. District Borrows for Expenses