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In the aggregate, the states selected for this guide: 1) demonstrated the most intensive levels of assistance and 2) effectively implemented practices in existence to date across the nation. During the February 2008 advisory group meeting, the following characteristics of strong policies (by category) were identified as considerations for site selection. As noted earlier in the methodology, the four categories of assistance described below were collapsed prior to data collection into three primary categories (with the third becoming a subset of the second). The fourth category also was broadened to include district provision of facilities to charter schools whether mandated or not.
Characteristics of Policies That the Report's Advisory Group Considers Most Facilitative
Policy Category 1: Direct cash assistance available for charter school facilities
Per-pupil expenditure for facilities is high enough to adequately cover loan or lease expenses (based on current levels of such assistance offered across the nation, a minimum threshold at or around $1,000 is considered exemplary).
Total facilities aid per pupil is not a flat allocation (i.e., a constant appropriation divided by the number of students, where the denominator changes from year to year but the appropriation does not increase), but rather
adjusts annually to accommodate growth in student enrollment (i.e., a stable source per pupil); and
is pegged to local real estate market (e.g., percentage of lease rather than a capped amount).
All charter schools (start-up and established) have access to the facilities aid.
Eligible use for the facilities aid is flexible.
Policy Category 2: Ability to borrow money within the state
State serves as issuer of tax-exempt bonds that finance charter facilities, allows schools to issue their own bonds, or allows them to develop arrangements with small or local issuers that offer additional tax benefits.
State offers loan programs for charters or allows them to access existing programs for traditional schools at low interest cost.
States offer credit enhancement instruments that fully or partially guarantee charter school facilities debt. Forms include:
Offering a moral obligation on charter school bonds, meaning that issuers have the right to request that states (or cities) appropriate funds to make good on defaulting bonds;
Offering general obligation bonds that are backed by the full faith and credit of a government entity; and
Providing an intercept mechanism so that the state funding can be captured by lenders in the event that there is a loan default.
States could give grants to intermediaries (e.g., community development finance institutions), which could, in turn, offer charters loans as well as organizational capacity on real estate or finance; or similar to the federal model demonstrated by grants made to intermediaries by the U.S. Department of Education through the Credit Enhancement for Charter School Facilities Program, states could give grants to intermediaries which could, in turn, use those funds to leverage private funds to offer charter schools loans as well as organizational capacity and other technical assistance on real estate/finance.
Policy Category 3: Participation of charter schools in Qualified Zone Academy Bonds
The U.S. Department of Treasury gives state education agencies authority to determine how to distribute their QZAB tax credit allocations to high-poverty schools. State guidelines can therefore help charters gain access to QZABs by making them eligible or giving them priority for these allocations.
Private partners advocate on behalf of charters to help them gain access to QZABs.
Policy Category 4: Mandated provision of district facilities to charter schools
Law requires districts to offer vacant facilities to charters at no cost, low cost, or a negotiated rate.
Proactive local leadership is often important to make it happen.
States with lots of charters (in percentage terms) housed in district facilities are farthest along in this category.