Settlement allows St. Louis schools to borrow deseg money

ST. LOUIS -- The St. Louis Public Schools can borrow almost $50 million in desegregation funds to use for operations during its current budget crunch after reaching a settlement with the NAACP, which had originally objected to the plan.

Attorneys from the schools and the National Association for the Advancement of Colored People signed the agreement Thursday in federal court, allowing the district to borrow up to $49.5 million between now and next June. The district will be required to pay back 17 percent of the funds each year from 2005 to 2009 and the remaining 15 percent in 2010.

Darnetta Clinkscale, president of the St. Louis Board of Education, said the settlement "removes a cloud over the first day of school."

"Given the financial crisis we have been facing, without this money we would have had to start closing down the system -- and not opening school," Clinkscale said.

Interim superintendent William Roberti had struck a deal with Missouri Attorney General Jay Nixon, under which the state would not stop the district from borrowing the desegregation money to pay its bills. The management team attempting a turnaround of the district has said the district has a $43.5 million shortfall.

The NAACP tried to block the schools from borrowing desegregation funds, saying the money was designed to build new schools in the city.

Clinkscale said the settlement "provides additional assurance that this money will ultimately be used for construction of schools and classrooms."

The settlement also requires the school board to hold a public session to answer questions from lawyer for the NAACP and the original plaintiffs. The schools must also provide financial information to the attorneys each year.