Four years removed from nearly being taken over by the county, the Berkeley Unified School District received welcomed news from Standard & Poor’s.
The Wall Street rating agency rated the district’s debt offering SP-1+, the highest rating for its category.
“This means we’re back on good financial footing and it’s amazing considering where we were a few years ago,” said Deputy Superintendent Eric Smith.
Like many districts, the BUSD must borrow money to meet payroll while waiting to receive local property tax dollars.
In years when the Alameda County Board of Education did not approve the district’s budget because of high deficits, the district had to borrow the money against other district funds, Smith said.
By issuing a tax secured note, the district can borrow tax free and then re-invest the funds in securities that gain interest. Smith expected the district to net $100,000 in interest income from the transactions.