The Napa Valley Unified School District received the highest credit rating from Standard and Poor’s (S&P) Global Ratings for their 2020 Tax Revenue Anticipation Note, marking a significant improvement in the district’s financial health.
As a part of Goal Four of the district’s strategic plan, NVUSD is committed to Tactical Proactive and Efficient Asset Management and the improved credit rating allows the district to borrow money at lower rates, the district said in a news release this week.
All school districts issue some form of debt financing, primarily through selling bonds. In this particular case, NVUSD issued Tax Revenue Anticipation Notes (TRAN) to address short-term cash flow needs. Due to the healthy assessed property values in Napa County, the vast majority of revenues received by NVUSD come from property taxes twice a year.
As a result, NVUSD issues a TRAN annually to meet short term cash flow needs. Securing lower interest rates translates to less general fund liability and more budget dollars for educational programming.
“NVUSD”s commitment to implementing smart, proactive financial controls, including right sizing the District, improved our structural deficit and ultimately our credit rating,” said Rabinder (Rob) Mangewala, Assistant Superintendent, Business Services, in the release. “It is imperative that we effectively manage our financial health to protect and increase programming for our students.”
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