Written by: Brad Buhrow
How has the pandemic affected equipment acquisitions by school systems across the U.S.?
Here at Baystone Government Finance, we’ve seen an increase in large acquisitions of technology equipment, especially for Chromebooks, other computers and distance learning software. More K-12 schools are also specifically asking for tax-exempt municipal leases to finance their spend.
If you think about it, both of these observations make sense.
Technology Financing Needs
Many school divisions anticipate a continuing need for remote learning. Some will begin their school year this way while others are preparing for a mix of remote and on-site learning. Schools that plan to open as usual will also want remote learning backup in the event that the coronavirus situation changes in their area.
Remote learning not only requires that all staff and students be equipped with computers, Internet access and the necessary hardware and software to make this happen; schools must also replace any antiquated technology that wasn’t up to the task last spring.
At the same time, municipalities are dealing with tighter budgets due to tax losses from the economic fallout of Covid-19. That’s a key reason why schools are taking advantage of the benefits of tax-exempt municipal leases when purchasing equipment. Municipal leases do not generally require upfront cash outlays, and they offer a lower cost alternative to traditional bond financing.
The trends we are seeing – increased technology acquisitions by schools and more requests for tax-exempt municipal leases to finance them – are in line with national reports we have been reading this summer from these and other sources.
- Recession Forces Spending Cuts on States, Cities Hit by Coronavirus– Education takes the brunt of reductions; governments have cut 1.5 million jobs since March, with more expected. (The Wall Street Journal)
- 5 Hurdles to Crafting a School District Budget Amid the COVID-19 Crisis – As districts hobble into a new fiscal year, superintendents and chief financial officers are still struggling. (Education Week)
- Schools Face a Funding Crunch — And Rising Technology Costs – School districts across the country are taking a hard look at their budgets. Some are laying off teachers or other staff. But technology costs are harder to cut. (NBC News)
- Amid Coronavirus, Educators Learn to Differentiate, Add Choice with Tech – A variety of online tools helped educators expand their approaches to lessons during shutdowns — and they plan to keep them in their toolkits. (Education Dive)
As a division of KS StateBank, Baystone Government Finance funds all kinds of equipment and vehicles – from buses to laptops – for school systems across the country. We work directly with schools and also in the background as funders for other equipment finance providers.
One of the most interesting conversations we’ve had recently is with a company that manufactures a unique air filtration system for medical facilities. The company says schools are also inquiring about the germ-filtration capabilities of their product. So, in addition to the many equipment types we already finance for schools, Baystone is exploring other ways we can support school safety for those students and staff who are returning to work during the pandemic.