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As the coronavirus pandemic continues to impact K-12 instruction, many parents, teachers, and students still struggle to navigate education in the time of COVID. Some are back on campus and many more are doing online or hybrid teaching and learning. One thing is certain: We are cheered by visualizing the excitement everyone (including parents) will feel when it’s safe for students to return to school en masse.

This painful episode clearly demonstrates that school facilities aren’t just buildings. They are the heart and home of every education community. The Charter School Facility Center is committed to providing resources to guide charters schools seeking their own home.

Welcome to this edition of the FRED (Facilities, Real Estate and Design) newsletter, as we continue to follow developments in the charter school facility space and education policy, even in the pandemic.

Reopening Resources

For charter schools that are still planning for the day when kids come bouncing in the door, Brooklyn Lab Charter School assembled a best-practice toolkit Facilities Planning in the Era of COVID-19, in partnership with the Urban Projects Collaborative. It’s filled with adaptable strategies for preventing and containing the spread of COVID and processes for continually improving the physical school facility to best serve students during this pandemic.

The Local Initiatives Support Corporation (LISC) built on that guide with a recorded webinar, which we summarized here. Learn key processes and procedures, and get realistic guidance about how schools can most safely reopen.

District and Charter Schools Bond Together in Colorado

Last Tuesday’s election was a win-win for everyone if you lived in Durango, Colorado. The voters approved a $90 million bond issue that provides for funding for traditional district schools and public charter schools.

As we highlighted before the election, this could be a model for other school districts seeking common ground. Three charter schools will receive $2.5 million each from the bond proceeds. No protests were reported.

Minnesota School District Seizes Charter-Leased Building

After a newly consolidated school district in Minnesota decided it wanted to open a new high school, it found a perfect location: a facility the district leased to a charter school academy through 2023. The perfectly enforceable leasewhich included an option for renewaldidn’t slow the Rock Ridge School Board a bit. Mid-summer, it sued East Range Academy of Technology and Science (East Range) under eminent domain, and won. Not only did it win, but the deciding judge also ruled that the school district could do a “quick take” and seize the property in a matter of weeks.

East Range then sued to stop the district from demolishing its bus garage, with the buses still inside of it. The parties ultimately settled, with the district agreeing to pay East Range a lump sum of $260,000 and allowing East Range to occupy the building for one more year. In exchange, East Range agreed not to bring any future lawsuits that would delay construction of the new district school. The case graphically demonstrates charter schools’ precarious position when they do not own the buildings they occupy.

Education Board in North Carolina Ensures No Charter School in Vacant Building

The Warren County Board of Education (BOE) in North Carolina, with several options for disposing of an unneeded facility, took extra steps to ensure it didn’t fall into the hands of a charter school. Instead of leasing it, selling it at public auction, or demolishing it and selling the land, the BOE voted to turn over the elementary school to the board of county commissioners. But the gift came with a caveat: the county board could never give or lease the facility to a charter school.

The decision was made over pleas from the community for the board to take any other course to save the school.

Finally, a Facilities Win in Oklahoma

After years of setbacks, Tulsa Honor Academy (THA) charter school finally has a permanent high school building. Since 2015, facility expansion has been a huge hurdle for THA, which is sponsored by Tulsa Public Schools. From its start with 92 fifth-graders, THA has grown to 680 students from 5th-10th grades.

Last March, THA finalized a contract to lease the former PennWell building with help from donors, including the George Kaiser Family Foundation, which also agreed to hold the property title to reduce any risk for the school. At more than 117,000 square feet, the building is more than large enough to handle the high school’s anticipated capacity of 500 students.

With additional fundraising for more renovations, the facility is large enough to house the middle school in the future. The building is located in the school’s target area of east Tulsa, which reportedly has one of the highest poverty rates in Oklahoma.

Markets: High Demand for Charter School’s First Verified Social Bonds

The Equitable Facilities Fund announced that the first verified Social Bonds for US primary and secondary education recently closed. It’s worth noting the Social Bonds offering saw high investor demand with $1.2 billion from 33 discrete investors, bringing new investors to the charter school market. The A-rated, 30-year maturity was priced at 2.18%.

This comes on the heels of two self-designated education Social Bonds. Look for more Social Bonds in the charter school market.

Toolkit on Charter Schools and Refinancing

Financing a charter school facility is challenging enough. Refinancing a charter school facility is often a larger project and has more consequences because long term debt can last for 30 years or more. However, a favorable refinancing can allow a school to save money and redirect valuable resources to teaching and learning for the next 30 years. 

Thanks to support from Bluum in Idaho, we prepared this Charter School Facility Refinancing Guide and Toolkit to help schools address the right considerations and ensure refinancing in a timely manner on terms that will best foster a school’s long-term academic and financial success.

Resources on Smart Charter School Financing

Charter school operators need to know if state policies have been enacted that can help offset the cost of leasing, purchasing, and maintaining the facility they need. We did the leg work to pull together all of those policies in one place, and make sense of them, because they vary widely from place to place. The Facility Canter’s paper conducts an in-depth review of state per pupil facility funding, finding that states provide $500 million of charter school facility funding each year to try and help cover the more than $3 billion charters annually spend on facility payments.

Taking it a step further, we did an in-depth review of general state funding for all school facilities, both district schools and charters schools. Spoiler alert: charter schools only received $68 million out of $2 billion.

Beyond funding, some states provide guarantees to help reduce borrowing costs. Our credit enhancement report outlines the different ways states provide guarantees and the impact of these guarantees.

Join the Public Charter School Facilities group on LinkedIn for in-the-moment updates on publications.

The Charter School Facility Center is an initiative of the National Alliance of Public Charter Schools to create a more equitable landscape for charter school facilities through innovative solutions, improved policies, and building local capacity by training charter school operators. We thank the U.S. Department of Education for initial funding for this effort. For more information, please visit our website or email us at facilitycenter@publiccharters.org.