Article
Bridging the gap: An efficient approach to short-term cash flow borrowing for Minnesota school districts
Jul 14, 2025 · Authored by Ryan Fetters, Lori Volz
In today’s evolving education funding environment, Minnesota school districts are facing increasing financial pressures. Declining enrollment, reduced federal support, and rising operational costs are creating new challenges for district leaders. One of the most pressing issues is the timing mismatch between when revenues are received and when expenses must be paid. These temporary cash flow gaps can disrupt operations and strain budgets.
To help districts navigate these challenges, the Minnesota Tax and Aid Anticipation Borrowing (MNTAAB) Program offers a reliable, cost-effective solution. Sponsored by the Minnesota School Boards Association (MSBA), MNTAAB provides pooled short-term borrowing designed specifically for Minnesota school districts. The program is supported by a team of experienced professionals consisting of Baker Tilly (Municipal Advisors), Piper Sandler (Underwriter), Kutak Rock LLP (Bond Counsel), and U.S. Bank (Trustee and Registrar).
Why MNTAAB?
MNTAAB is a streamlined borrowing option that helps districts manage short-term cash flow needs without the complexity and higher costs of stand-alone financing. By pooling participants, the program achieves economies of scale that may assist in lowering interest rates and issuance costs. This collaborative approach allows districts to access the capital markets more efficiently, regardless of size or borrowing amount.
The program is open to all Minnesota school districts and accommodates a wide range of borrowing needs. The minimum borrowing amount is $300,000, and proceeds can be reinvested to align with a district’s cash-flow schedule — allowing districts to earn interest until funds are needed.
Whether your district is preparing for seasonal expenses, awaiting delayed state aid, or simply planning ahead, MNTAAB offers a flexible and dependable financial bridge.
Key dates for fall 2025 participation
- Application deadline: Three weeks before your board meeting, no later than Aug. 27, 2025
- Board resolution window: Aug. 1 – Sept. 4, 2025
- Certificate sale date: Oct. 22, 2025
- Funds available: Nov. 6, 2025
- Repayment due: Sept. 3, 2026
- Maturity date: Sept. 10, 2026
Our team will work closely with each district to calculate eligible borrowing amounts based on both state and federal requirements. This includes ensuring compliance with Minnesota’s 75% aid limitation and federal cash-flow deficit rules.
Built-in expertise
The MNTAAB Program is more than just a financing tool — it’s a partnership. Baker Tilly, MSBA, Piper Sandler, Kutak Rock, and U.S. Bank bring decades of experience in public finance and school district operations. From application to funding and final repayment, our team is here to guide you in every step of the way.
We also offer support for reinvestment strategies, post-issuance compliance, and arbitrage rebate calculations.
Let’s work together
At Baker Tilly, we understand the unique financial challenges school districts face. Our goal is to help you maintain stability and flexibility, even in uncertain times. If your district anticipates a cash-flow shortfall or wants to explore the benefits of pooled borrowing, we encourage you to reach out to our schools team.
