School Districts' Bills Still Due, Despite No State Budget

The state budget is 57 days late, and counting, forcing school districts to come up with creative solutions to pay bills due immediately whether or not a spending plan is in place.

"School districts are always asked to pay their bills up front and here we go into the year once again without a budget," said the spokeswoman for the San Jose Unified School District, Karen Fuqua.

Her district has reserves it can tap, but other school systems face the real possibility of taking out short term loans that carry interest once state money comes in to pay off the debt.

The Berryessa Union School District in East San Jose is raiding accounts dedicated to capital improvements at school sites to make up for state money normally available at the start of the school year, said Superintendent Marc Liebman.

This week, state officials announced that a 90-day deferral of $2.5 billion in education funding would begin in September rather than October. Liebman said that delay would cost his district in interest lost by borrowing from itself.