The Office of Public Charter School Financing and Support (OPCSFS) has a range of financial tools to help public charter schools meet facility needs. The majority of OPCSFS products and support is in the form of “gap financing” for public charter school facility projects which are primarily supported by leveraging the facilities allowance to secure private financing and other sources. The OPCSFS offers the following products to provide the supplemental capital that may be necessary to allow public charter schools to secure appropriate facilities through new construction, acquisition and/or rehabilitation and thus deliver a rigorous and rich education to their students:
- Credit Enhancement Revolving Fund: The Credit Enhancement (CE) Revolving Fund is authorized by Section 603 (e)(3)(C)(iii) of the Student Loan Marketing Association Reorganization Act of 1996 (20 U.S.C. 1155(e)(3)(C)(iii)) and approved in accordance with D.C. Official Code§2-301.05a (Supp. 2007). The Credit Enhancement Revolving Fund provides enhanced credit, lease guarantees, and access to financial assistance to eligible public charter schools for the acquisition, renovation, and/or construction of school facilities.
- Direct Loan Fund: The Direct Loan (DL) program was funded initially by the District of Columbia 2003 Appropriations Act to structure and provide loans to District of Columbia public charter schools for the purpose of construction, acquisition, renovation, and and/or maintenance of public charter school facilities.
Additional capital allocations were appropriated to the Direct Loan Funds and the Credit Enhancement Fund during the period fiscal years (FY) 2001-11. In FY 2012 and FY 2015, the Direct Loan fund was awarded additional amount of funds under the Scholarships for Opportunity and Results Act. As of April 2016 the available DL Fund balance is $9,928,455 million and the available CE Fund balance is $8,488,019 million.
The Office of Public Charter School Financing and Support helps finance public charter school facility projects that:
- Create appropriate, safe, and economically efficient environments for the provision of high quality public education;
- Provide “gap financing” for public charter school facility projects which are primarily supported by leveraging the facilities allowance to secure private financing and/or other financing sources; and
- Improve the District’s education outcomes by financing the development and expansion of high quality public charter school facilities through the construction and/or renovation of:
- Former District of Columba public schools (DCPS) occupied by public charter schools, or
- ”Commercial market” facilities to be occupied by public charter schools in the District of Columbia.
Since inception, the Credit Enhancement Program has provided over $32.5 million of support to 38 public charter schools, leveraging over $354.4 million in additional funding for school facilities. The Direct Loan Program has disbursed close to $53 million in direct loans to 36 public charter schools, leveraging over $325 million additional funding for school facilities.
Examples of transactions that the OPCSFS facilitated include:
- $2MM Direct Loan to the Charter School Incubator Initiative to support the leasehold improvements (33,310 square feet) for phase one of the renovation of the Gibbs School located at 500 19th St. NE. This incubator site will house Monument Academy Public Charter School. The total project is cost $10.3MM and OSSE’s sub-loan leveraged $8.2MM in senior debt.
- $1.6MM Direct Loan to District of Columbia Scholars Public Charter School to finance the renovation of 73,000 square feet at the Shadd Elementary School Campus at 5601 East Capitol St. NE. The total project cost reached $17.5MM and OPCSFS’s sub-loan leveraged a total of $14.1MM in senior debt. 667 new student seats were created.
- $1MM to Mamie D. Lee LLC to support $24.2MM in debt for the renovation of a 80,500 square foot school building at 110 Gallatin St. NE., creating a permanent school for Bridges Public Charter School and Briya Public Charter School. The total project cost was $32.2MM and 325 new student seats were created
The OPCSFS performs a rigorous analysis and underwriting for each prospective project in order to efficiently and responsibly deploy capital to promote the growth of high-performing public charter schools. Pursuant to the legislation, Public Charter School Fund Credit Committee, an independent loan committee, is responsible for approving any transactions funded from the Credit Enhancement Revolving Fund, Direct Loan Fund, and may also review requests for other OPCSFS administered programs supporting charter school financing as established by the Mayor and Council of the District of Columbia, or the Congress. The independent loan committee is comprised of five members; three members are appointed by the Mayor of the District of Columbia and two are appointed by the DC Public Charter School Board.