Leasing a facility is a significant decision for any school, with far-reaching implications for its financial stability, operational efficiency, and long-term growth prospects. The terms negotiated in a lease agreement can shape the school’s ability to fulfill its mission, accommodate its students, and adapt to changing needs over time. That’s why it’s essential for school leaders to approach lease negotiations with diligence, foresight, and a clear understanding of their objectives.

Here’s what to keep in mind.

1. Understand Lease Terms and Responsibilities

It’s essential to gain a thorough understanding of the terms and responsibilities outlined in your agreement. From rent details to property conditions and tenant rights, ensure that every aspect of the lease is clearly defined and aligned with your school’s needs and objectives.

2. Consider the Total Cost

When evaluating lease agreements, it’s essential to look beyond the surface-level costs and consider the total cost of occupancy over the lease term. Be sure to factor in expenses such as property taxes, insurance, and maintenance costs. This will help you make informed decisions and avoid unexpected financial burdens down the road.

3. Negotiate Favorable Terms

Negotiating favorable lease terms requires a combination of preparation, communication, and negotiation skills. During negotiations, proactively identify your needs and advocate for your school’s interests. Whether it’s seeking lower rent rates, flexible lease terms, or additional tenant benefits, be assertive yet collaborative in your approach to securing favorable terms.

4. Address Legal and Regulatory Compliance

Lease agreements often involve complex legal and regulatory considerations that require careful attention and expertise. Consult legal professionals to ensure your lease agreement complies with all relevant laws and regulations.

5. Plan for Future Growth and Expansion

Lease negotiations offer an opportunity for schools to plan for future growth and expansion. Negotiate lease terms that accommodate your school’s evolving needs and aspirations—whether it’s securing options for lease renewal, expansion rights, or early termination clauses, anticipate future scenarios and negotiate terms that provide the ability to grow and expand.

Lease negotiations are a critical aspect of school facility management. With careful planning, effective communication, and strategic negotiation tactics, schools can secure lease agreements that support their mission and vision for the future.

About the Author

With her wealth of experience and expertise in real estate, Mary is dedicated to providing exceptional service and value to schools as Senior Portfolio Manager at Grow Schools. Mary has followed in her father’s footsteps and built her entire career in the field of real estate—she embarked on this path after completing her bachelor’s degree in Accounting and Finance (Commerce) at the University College Dublin, specializing in development and asset services.

Tuesday Tips: Construction Projects and Negotiating Your Lease

In Tuesday Tips episode 34, Michael Soh and Mary Dillon joined us to discuss construction projects and lease negotiations. Hear tips from Michael Soh and Mary Dillon on how to manage your building, including how to:

5 Key Features of a Charter School Budget

According to an article from The Center for Education Reform, 42% of charter school closures are due to funding. It’s well known that charter schools face unique financial challenges, so it’s important to get ahead of these issues as schools grow. Making sure your school has the money to meet operational costs, pay teachers and staff […]

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Buy Your School

The Charter School Facility Financing Guide provides information about the school building marketplace, the planning process, and the four primary funding structures. You’ll come away ready to balance your school’s plans for growth with budget realities.

Get the Guide

In this session, Jon Dahlberg joined Michael Barber to discuss how to get into the right school building. They discussed charter alignment, strategic planning, rising costs, and staying mission-focused.

Join the experts as they answer all your questions live on Tuesdays on YouTube at 10am PT / 12pm CT / 1pm ET. Charter School Capital – YouTube

Read Full Transcript :

Michael Barber (00:20):

Welcome to Tuesday Tips. We are back live with our new season. If you’re not familiar with Tuesday Tips, we’re here every Tuesday on our YouTube channel talking all things and topics and challenges for school leaders. My name is Michael Barber and I am joined by my colleague Jon Dahlberg. Jon is our VP of Business Development and Facilities. So we aptly had him come join us as we kick off this next season of Tuesday, tips to come talk about how school leaders can access money for facilities, which has been a hot topic over the last few months and continues to be one of the biggest challenges that school leaders face. So Jon first wanna say thank you for joining us and say hi.

Jon Dahlberg (01:06):

Well, Michael, thank you for having me. I look forward, to talking with you today. So thank you.

Michael Barber (01:11):

Yeah, we’re really pleased to have you. You have, I think, one of the deepest knowledge bases for school leaders to tap into when it comes to accessing money for their school facilities and getting into their forever homes. So I’m really pleased to have you on and join us for this first episode. I want to ask a couple of questions, but I also want to invite anyone who’s joining us today. If you’re on YouTube, if you’re on the app, we have a little comment section underneath. Feel free to ask your questions there. And if you’re on desktop, a desktop, that comment section is right below Jon and i’s beautiful faces. So feel free to pop any questions into that chat box that you may have, and we will be more than happy to answer them. But I’ve got a couple teed up that I want to ask Jon. You know, one of the biggest challenges that school leaders face, Jon, is how school leaders can gain autonomy of their school buildings. And I would just love for you, you know,, to work on that question for me and talk through that question is how can school leaders gain autonomy. And if you’ve got an example, I would love to hear one.

Jon Dahlberg (02:17):

Yeah, thanks, Michael. I, I think autonomy for the schools should come in in two ways. First I’ll summarize it. It is, it’s all about your charter and it’s all about your kids. And if we break that down a little farther, let’s, let’s start with kids first. The challenge to, or the, the ability to have autonomy over your school comes at some tipping point where you have some economies of scale and you have enough kids in your building to create a margin where you’re serving the mission and you have reserves or excess funding that allows you to pour back into the classroom the building the curriculum program. So as I, I don’t want this the audience to take away that it’s completely clinical, but there is a reality that is you have to have a certain number of kids that fits your mission, that are attracted to your school so that you can then build the program that grows around them.

(03:15):

And I think secondly, the, the other aspect that I mentioned was the charter. I think many schools start on a path that is, I need to get open. We need to get open. And you’ll, you’ll take any building that is legal and where you can have kids at. There’s a place at which your charter and your, and your mission, the kids that you serve needs to take over. And you have to make intentional hard choices around this building doesn’t match my charter. You hold your charter up and you say things like, I need more performing art space, or I need a science lab, or I need fill in the blank. That ties directly back to the charter. It is okay to start in a suboptimal, but when you really want to talk about autonomy, you wanna have complete control over the size and shape the amenities and everything that that pours into your school. And that needs to be tied back to your charter and the mission that you serve.

Michael Barber (04:20):

Yeah, I think you bring up such a, a good you know, a good piece of ration there out there about tying back to the mission that these school leaders are trying to create inside of their schools. And I would love for you to you know, unpack, Hey, do you have some tips for school leaders as they think about how to, you know, dream up and come up with what their next facilities project is? You know, how do they think about what’s the lens that they think about for the next improvement? And maybe some examples you’ve seen from some of the school leaders that you’ve worked with.

Jon Dahlberg (04:54):

Yeah. It’ll, it’ll build it goes back to the charter. It goes back to understanding where you are today and where you’re heading, and how your building fits into that. So I would say that the, it’s gonna, the, the, the, it’s critical that you plan and your board is, is leading that planning and that visionary exercise of what you wanna be and how and where you want to grow to. So I think there’s a, there’s a planning exercise, and again, that comes back to what is your charter? Who are the students and the kids that you’re serving, and what gaps might your building have? Right? That, that’s, that’s visionary. And then there’s another planning piece of it, which is how much money we need, to put the amenities that, that, that meet, that fits our vision and meets the needs of our students.

(05:47):

And then there’s a patience component. We are, we’re resetting the new normal, changing your facility, moving your facility. It takes more time than it did pre covid and it’s the new normal. It is, prices are, cost of construction is and changes. It’s not just new construction, but it’s also changing. Anything that has to do with modifications or building your building is gonna take time. So you need patience. And the other piece of it is just planning so that you can build momentum because it’s a long drawn-up process. You’ve got group, you’ve got constituents in your ecosystem, your board, your staff, your students, your parents, your vendors, your community, having a, if the board has a written plan of what they want to do on their facility, and they can communicate it and you can talk about it and you can share milestones and you can build that momentum. It’s an extremely powerful tool because it is, it’s, it’s a process and it’s a journey. It’s not something that you snap your fingers and it becomes a, it becomes a done deal.

Michael Barber (06:57):

Yeah. Unfortunately, I was just gonna say, I don’t, you know, none of our school leaders probably have some sort of Mary Poppins character in their life that can pull something out of a magic bag or snap their fingers and suddenly the facility of their dreams are is, is in front of ’em.

Jon Dahlberg (07:11):

Yeah. And I, and I think, you know, in terms of examples of that, I think we work with one school in, in, in Indiana. And in addition to laying down exactly what she wanted when she first renovated, the founding executive director laid down exactly what she wanted. She asked for our help, and it was extremely practical, but it was mission-focused, and she wanted to help to renovate her lunchroom, change her storage and modify her kitchen. And in, when I talk about the planning and understanding what she wanted and why she included her kitchen staff in the planning and dreaming phase of what changes they would make and why. And something as, as small as I think that was a $50,000 project, it had a massive impact on the morale of the staff and the flow of the students. So they don’t have to be multimillion dollar grandiose changes, but it, it, it, that’s an illustration of somebody who was a leader who was very specific and very intentional in what they wanted and why. And we, we can help them. We helped them make that happen. It was, it was a fun project to be a part of, to watch the smiles on that, on those faces.

Michael Barber (08:26):

Yeah, I think you, you bring a good point up there is that involved voices of people that are gonna be utilizing your facility, right? Is if the, if the end goal is to create connections to the community, then it’s talking to the community about what would help make their your facility more attractive to the community if it’s an improvement on a specific part of the school, what are the features and needs of that particular part and, and whatnot. You mentioned something in your last answer that I wanna harp on for a couple more minutes and, and, and we’re, we’re doing eight minutes, we’re up to the eight-minute mark, but we usually try and carve out 10 to 15 for these conversations. So we’ll keep going. I wanna ask a question related to a word you mentioned, which was money. And you talk specifically about increased costs related to construction.

(09:11):

And I think this is something for us all to understand our, you know, is this idea of money and where we find ourselves as school leaders when we are talking about money for facilities because the cost of money has obviously increased and the cost of actually the things you need to use that money on has also increased. Can you talk just a little bit about, you know, what you’re seeing in the marketplace in terms of how school leaders need to be thinking about in terms of the amount of money for their building that they may need to be making improvements or buying versus what it was say, three to four years ago?

Jon Dahlberg (09:50):

Yeah. you, you hit the nail on the head, and I, and, and I’ll speak to that. What I want our leaders to hear right now is this is their inflation. So the cost of money for your facility is way up. The cost to build your facility is way up. The cost of buying a facility has not normalized. We’re starting to see some research that those prices might be coming down, but you’ve got stable to increasing cost of acquisition, cost of remodeling, and cost of money. There is no way that the funding rates that the sch that the schools are receiving have kept pace with that growth. So the schools are gonna be, are gonna struggle with one of two things. They’re going to have to allocate more, a couple of things, I don’t even know if it’s two, but they’re gonna, they’re gonna have to allocate more money than they probably should or want to, to have the facilities, or they’re gonna have to make them, they’re gonna have to make hard choices about what facility changes and what amenities do we build or modify, or thirdly, which is kind of a hybrid.

(10:52):

You have to get really creative. You mentioned how we can build and how can we change our building that meets our mission and still is attractive to the community. So there’s, it, it’s gonna cost more than you want and more than it did. And that’s gonna be a reality. Then the question is, do you change the size and scope or do you get creative? And, you know, I, I think we have another school in Minnesota who made a hard, who made a great choice. They are a, they wanted to be a beacon in the community, and they got to the decision to put a hardwood floor on their gym because they wanted to host community activities. And they built a, a fantastic gym that is utilized by not only the school but the community. So you can, you can make those choices. Skate phasing is also an option depending on the speed at which a school wants to grow and expand.

(11:46):

You know, making part of the changes this year and part of the changes next year might be a way to, again, come back to enrollment, assuming that there’s some growth in enrollment that affords more growth in the building. So phasing is, is an option too, but it, it leaders have to get creative in this economic reality, which we do. We do not have any research or any of the experts are telling us that the costs are gonna come down. They’re the, the, the inflation rate of cost is going to normalize, but there will not be a step function return to pre covid levels. So it’s, it’s gonna be a challenging environment until funding catches back up with the reality of facilities costs.

Michael Barber (12:27):

Yeah. In the meantime, we’re gonna have to you know, lean on experts like yourself to you know, tell us what, how school leaders are getting creative, whether it’s the phased approach or whether it’s thinking about ways that they can, you know, for lack of a better way, monetize some of their own facilities to help serve the mm-hmm. <Affirmative> their neighborhoods and communities in more creative ways to generate revenue for making those improvements. So, you know, lots of things for school leaders to think on. I wanna be respectful of both your time as well as our audience’s time, Jon, and we’re gonna call it a hard stop. We we’re 12 minutes into our usual 10 minute Tuesday tip series. So just wanna say thank you for having for coming on and, and hopefully you’ll come back and have another conversation with us as we tackle other big facilities-related challenges in the future.

(13:13):

For those of you that are joining us back from last season, welcome back. We’re glad to have you. We’re gonna be tackling all sorts of challenges over the next few weeks, weeks from teacher retention, enrollment, marketing we’ll have more conversations on facilities, we’ll have more conversations on mental health and all of the major challenges that US school leaders face. So I hope you’ll come back and hear from experts like Jon and some other ones that we are inviting on to our channel over the next few weeks. But until then, thanks for joining us and we’ll see you here back next week, Tuesday 10:00 AM Pacific. 1:00 PM Eastern for Tuesday. Tips. Talk to you later.

Most charter school leaders have serious hurdles to jump to provide their students with an adequate school building. In fact, according to the National Alliance for Public Charter Schools, here are the five key things you need to know about charter school facilities:

Charter schools rarely have access to taxpayer-funded facilities, even when they’re vacant.
Charter schools on average spend about 10% of per-pupil funding on facility space.
Charter school facilities often lack amenities like gymnasiums, libraries, or science labs.
Access to school buildings is one of the biggest obstacles to expanding charter school options.
Five million parents want to send their child to a charter school, but don’t have the option.

Put bluntly, this is exactly why Charter School Capital created the Facilities Financing program. We’ve been helping schools find, secure, finance, and improve their buildings for over a decade through our lease-back financing solution. And now we have a zero-cost bond option through our partnership with the non-profit, Wonderful Foundations.

There’s nothing simple about charter school facilities; and while the program is a true game-changer for charter schools across the country, it can seem complex. So, we’ve created an on-demand webinar to learn more about the program, on your schedule. >>WATCH NOW

If you want to learn more, about the facilities planning and facilities financing process for charter schools in general, check out some of these great resources:

We’re here to chat if you have any questions or are wondering where to get started. Use the chat function in the lower right of this page, or simply email hello@growschools.com to start a conversation.

Recent changes and additions to our facility financing solutions strengthen and widen our role in supporting charter schools.

Traditionally, the options available to charter school leaders procuring, maintaining, and, hopefully, coming to own their school building have been a balance of tradeoffs between stability, flexibility, and cost. A long-term lease, for example, offers stability but takes away flexibility. To a large extent, we’ve all resigned ourselves to this tug of war between compromises.

Having served as an investment partner, a lender, and an asset manager, charter schools can trust Charter School Capital (CSC) to help with their real estate challenges. In fact, over the past nearly-14 years, we’ve helped 40 schools secure school facilities.

Our partnerships with Citibank and other key investors, along with organizations in the philanthropic sector, have substantially impacted this narrative. All of this leads to more and better choices.

In our recent webinar, Tommy Alberini and Mike Robinson delve into this landscape, explore the various tensions between cost and opportunity, and unfold our new strengths.

The webinar dives deep into the advantages and disadvantages of a self-issued Bond, comparing it and contrasting in terms of long-term and short-term benefits to other financing alternatives, including CSC’s lease-back approach.

However, one of our biggest new strengths is the no-cost Bond option, detailed in the webinar. This option affords schools long-term benefits similar to a self-issued Bond, avoiding the heavy toll of needing large reserves and paying hefty fees.

We encourage you to watch the full webinar and gain new insights into an essential aspect of school leadership. And, of course, reach out to us to discuss the best approach for your school.

Watch the Webinar Here

As schools reopen and students once again fill the nation’s classrooms (physically and remotely), charter schools in all states are facing the challenging task of keeping kids safe.

We’ve assembled a list of resources – from the NEA, the National Alliance of Public Charter Schools and from other authoritative sources – all designed to empower charter school leaders to make sound decisions and put effective measures in place to create safe environments.

As we pore through these materials, several key pieces of guidance emerge:

Prepare the school campus for physically-distanced learning
- Smaller groups per classroom,
- Barriers and distance markers in place,
- Plenty of sanitizer and cleaning tools available,
- Improvements to air circulation and indoor air quality
Set up protocols for contingencies
- What to do if a teacher or staff shows symptoms,
- What to do if a student shows symptoms or tests positive,
- What to do if the school needs to close again.
Empower teachers and students with the right tools
- Ensure there’s PPE, sanitizer, cleaning stations
Set up protocols and educate students to follow these
- Teach students to avoid physical contact,
- Teach students not to share phones, toys, books, etc.,
- Teach students to properly keep physical distance

Additionally, guidance includes aspects of social equity and inclusiveness.

Ensure all remote students have access to the proper equipment and connectivity,
Ensure special-needs students have needed accommodations,
Ensure masks don’t impede hearing-impaired students from understanding teachers

This is not an inclusive list. Please refer to this previous post for links to comprehensive sources. What we aimed to accomplish in this post is to give you a contextual view of the areas to address, and key things to keep in mind.
Also, depending on how badly-affected the area and city around the school might be, measures would of course become more stringent. The goal is to facilitate learning while doing our utmost to protect the health of our students.

We hope this has been helpful. Make sure to click here for more.

Should States Support Public Charter School Facilities Funding?

Editor’s Note: This article was originally published here on July 31, 2019 by EdWeek and written by Andrew Ujufusa. We think it’s vital to keep tabs on the pulse of all things related to charter schools, including informational resources, and how to support school choice, charter school growth, and the advancement of the charter school movement as a whole. We hope you find this—and any other article we curate—both interesting and valuable.

If Charter Schools Build It, Will States Help Pay For It?

By Andrew Ujifusa on July 31, 2019 4:34 PM

Most states have policies on the books to provide some kind of funding support for the facilities that charter schools use. But dive deeper into what’s on the books, and the number and types of policies can vary significantly from state to state.

That’s one relatively straightforward conclusion to draw from a new report from the National Alliance for Public Charter Schools published earlier this month. ”State Policy Snapshot: Facilities Funding for Public Charter Schools“ says that 30 states and the District of Columbia have a policy covering at least one of the following funding issues charters deal with:

Providing a per-pupil facilities allowance to charter schools;
Creating a charter school facility grant program;
Ensuring that charter schools have equal access to all existing state facilities programs and revenues for district-run public schools in a state;
Providing a charter school facility loan program;
Providing charter schools with access to local property tax dollars generated for facilities.

In addition, 20 states and the District of Columbia have more than one such policy on the books. However, no jurisdiction has all five policies listed above, according to the alliance. And not every state’s policy, such a grant or loan program, actually gets funded.

Need some of that report’s data in visual form? Check out the interactive map here.

Questions about charter school facilities raise several issues and can prove particularly divisive.

Supporters believe that as public schools, charters shouldn’t face particular hardships when it comes to issues like paying for space. And some charters, particularly those that aren’t part of big established networks or are just getting off the ground, do face major hurdles when it comes to finding and paying for their locations. As one Portland, Ore., charter founder told Education Week back in 2013, ”We have to meet all of these code requirements that older schools [and private schools] may not have to comply with because we’re a new school, which makes even the consideration of most spaces impossible and difficult.”

However, others argue that comparing charter schools’ facilities access to the bonds and other financial tools used by traditional district-run schools oversimplifies how the traditional public schools actually get their facilities. Skeptics have also cited the instance of a charter school suing its management company, Imagine Schools, which also rented a facility to the school, over allegations that Imagine charged the school excessive rent. A similar case played out in Los Angeles in 2013 that ended with two founders of a charter school getting sentenced to prison and community service.

In New York City, which must provide charters with rental assistance if it doesn’t provide public space for them, charter schools’ facilities access has provoked bad blood for years.

New Opportunity for Charter Facilities?

One additional policy areas charters are exploring? Opportunity Zones. As we wrote earlier this week, these zones were established by the 2017 tax law and are designed to provide tax benefits to investors who put money into designated distressed communities. Supporters of Opportunity Zones believe charters could be big beneficiaries by linking up with these investors, possibly in conjunction with other groups and institutions seeking space, to help with facilities and other costs.

A February presentation on Opportunity Zones hosted by the alliance notes that the structure of the zones “rewards patient capital” (since the tax incentives hinge on long-term investments) and “takes equity capital off the sidelines and puts it to work in low-income communities.”

The alliance’s July report on state policies says this about the general landscape and trends for this issue:

One of the biggest challenges to the continued expansion of charter schools is the fact that many charter school laws place the ultimate burden of obtaining and paying for facilities on charter schools themselves. As a result, charter school leaders struggle to find suitable and affordable facilities to house their growing numbers of students.

States play an important role in determining the options available to help fund charter school facilities. Increasingly, states are enacting and updating state policies to help offset the cost of leasing, purchasing, and maintaining charter school facilities.

Read the full alliance report on those policies below:

State Policy Snapshot: Facilities Funding for Public Charter Schools

The Ultimate Guide to Charter School Facility Financing:

Thinking about a new facility for your charter school or enhancing your current one? This guide shares straightforward and actionable advice on facilities planning, financing options, getting approved, choosing a partner, and much more! Download it here.

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How Changing the School Environment Can Effect Student Outcomes

Editor’s Note: This post was originally published here on July 18, 2019 by VOA . Kim Cook reported this story for the Associated Press. Pete Musto adapted it for VOA Learning English. George Grow was the editor.

We think it’s vital to keep tabs on the pulse of all things related to charter schools, including informational resources, and how to support school choice, charter school growth, and the advancement of the charter school movement as a whole. We found this article particularly interesting because we know that school health equals student health and school buildings are environments that when designed properly, can positively affect student health and enable students to grow and thrive. We hope you find this—and any other article we curate—both interesting and valuable.

Educators, Designers Look to Change Traditional Classroom Furniture

For much of the past hundred years, classrooms have been designed with the teacher seated in front of desks for students. The desks are almost always positioned in lines facing the teacher.

But many educators now say children can do better in a less structured learning environment. And designers have been providing spaces and seating to meet those suggestions.

Bob Pearlman works as an education consultant in the United States. He helps teachers and school administrators with educational planning and other issues. He told The Associated Press that traditional classrooms are a thing of the past. Now students work in “extended learning areas” that include project-planning rooms, workrooms, and laboratories, as well as learning spaces for groups and individuals.

Pearlman points to Albemarle County Public Schools, in Charlottesville, Virginia. The school system invited teams from all its schools to develop learning spaces that would help students deal with complex ideas and work on creative building projects. Now, its elementary school classes have exchanged traditional desks for things like soft seating and connectable tables.

Another change to the design of classrooms is the ability to connect to the internet.

“Classrooms, libraries, and [laboratories] used to be the only spaces where students spent their school hours. Wireless, laptops and project learning have changed that,” Pearlman said. He noted that this has made all school spaces into possible extended learning areas.

Jo Earp is with Teacher magazine, a publication of the nonprofit Australian Council for Educational Research. She notes that in the 1970s, American Robert Sommer was urging a critical look at traditional classroom designs. Sommer was a psychologist. He believed that in any given room, the lighting or heating will be better in some places than in others.

Earp said that in addition to newer “freeform” classroom designs, some teachers can find good results with designs that combine new and old ideas. They could try lining up desks at the start of the year and then placing them in groups as the classroom relationships become clearer and project work begins.

Natural light, reduced outside noise and good air quality are all considerations in classroom design, says Aaron Jobson. He is with the Quattrocchi Kwok Architects in Santa Rosa, California.

“More and more evidence connects the physical environment to learning outcomes,” Jobson said.

RELATED: Learn the nine foundations of a healthy school from a Harvard School of Public Health study and how your school building affects student health, attendance, and performance

New designs include glass walls inside buildings and doors that increase connectedness among students and create more open space for teachers.

A major supporter of nontraditional, explorative learning spaces is David Thornburg, who wrote the book “From the Campfire to the Holodeck.” He says schools should provide spaces based on how humans learn. That could mean one room is used in different ways at different times, or in different ways at the same time.

Loren Myers teaches at a public charter school in San Jose, California. She says redesigning traditional schools can be costly, and teachers do not have big budgets. So she noted that many teachers get creative with what little money they have to create a specially designed classroom.

In her class, Myers set up a space where students can calm down and a special workplace for students who demonstrate good behavior.

Over the years, famous designers have lent their abilities to school furniture — among them, Jean Prouve, Alvar Aalto and Arne Jacobsen. Today, classroom furniture includes all kinds of seating, with work tables of different heights.

Imagine Charter Schools, which operates schools in nine U.S. states, offers colorful seating that turns in different directions and other soft seating. Montessori schools have soft lighting similar to home environments, and simpler furniture than traditional classrooms.

Marianne Box is a design specialist at school-furniture maker Hertz Furniture, in Ramsey, New Jersey. She says movable pieces are big sellers at the company. They are designed to help control children’s energy levels, and give them places to center their attention.

Self-contained study areas have power supplies for computers, footrests and armrests.

Teacher Loren Myers loves that designers are coming up with more seating choices for young students.

“Children shouldn’t be expected to sit still in a chair for more than 20 minutes at a time,” she says. “Sometimes it’s as simple as switching where and how you sit that can set the tone for the rest of your day.”

I’m Pete Musto.

Since the company’s inception in 2007, Charter School Capital has been committed to the success of charter schools. We help schools access, leverage, and sustain the resources charter schools need to thrive, allowing them to focus on what matters most – educating students. Our depth of experience working with charter school leaders and our knowledge of how to address charter school financial and operational needs have allowed us to provide over $2 billion in support of 600 charter schools that have educated over 1,027,000 students across the country.

Charter School Energy Powered by BioStar Renewables is a full-service facility upgrade program with flexible financing options. This full-service program allows charter schools to access efficient and renewable energy solutions for their buildings—improving the learning environment for your students.

For more information on how we can support your charter school, contact us. We’d love to work with you!

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Desert Star Academy Realizes Incredible Growth and a New Facility!

Desert Star Academy is a pre-K through 8th grade charter school in Fort Mohave, Arizona and run by its dedicated founder and director, Margie Montgomery. Their mission is to create academic scholars, citizens, and productive community leaders. Their experienced, passionate teaching staff focuses on providing rigor in the classroom and creating a culture of building confidence in their scholars as the foundation for learning and growth. Their inspiring culture, curriculum, and proven academic success are just a few reasons for their astronomical year-over-year growth from 62 students in 2014 to over 450 scholars expected this year.

CHALLENGES

In the beginning, they had very little capital to get started, purchase curriculum, furnishings, and cover operational expenses.
With true-ups in November and expected increases in students each year, they were continually facing significant budget gaps
Their incredible rise in enrollment after their first year resulted in Desert Star Academy quickly outgrowing their space.
Desert Star Academy not only needed a new middle school facility, but the capital to support the education of their scholars.

SOLUTION

To get the school up and running, Charter School Capital helped provide the capital needed to cover expenses.
To bridge funding gaps, Charter School Capital purchases payments due to Desert Star Academy and provides the funds they need in advance of state payment distribution dates
To address their facilities needs, Charter School Capital bought land in 2016, completed construction on a new middle school in 2017, and provided a long-term lease to the school as well as capital for curriculum, technology, and furnishings.

“Charter School Capital is highly vested in our school’s success and the support is great! They helped me become a better business manager and I can honestly say that we wouldn’t be where we are today without the support of Charter School Capital.” -Margie Montgomery, Founder & Director, Desert Star Academy

THE RESULT

The funding and facilities support provided by Charter School Capital helped facilitate Desert Star Academy’s continued impressive growth. It enabled them to increase enrollment; hire new staff; purchase materials, technology, and curriculum; acquire new furniture; cover basic operational costs; and importantly, add a needed middle school campus. Executive Director, Margie Montgomery, the life force behind Desert Star’s achievements, is looking toward their future. In addition to her dream of building a gym and several additional classrooms for her scholars, she is working closely with Charter School Capital on a plan for the school to become financially independent while continuing their growth trajectory.

You can download the PDF of this School Spotlight here.

Since the company’s inception in 2007, Charter School Capital has been committed to the success of charter schools. We help schools access, leverage, and sustain the resources charter schools need to thrive, allowing them to focus on what matters most – educating students. Our depth of experience working with charter school leaders and our knowledge of how to address charter school financial and operational needs have allowed us to provide over $1.8 billion in support of 600 charter schools that have educated over 1,027,000 students across the country. For more information on how we can support your charter school, contact us. We’d love to work with you!

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Charter School Facilities: Overlooked and Underfunded

Editor’s Note: This article was originally published here on May 17, 2019 by the Washington Examiner and was written by Nina Rees, CEO of the National Alliance for Public Charter Schools and Ramona Edelin, Executive Director of the DC Association of Chartered Public Schools.

Across the U.S., accessing charter school facilities is, by far, the greatest challenge faced by charter schools. With more than 1 million students across the country on charter school waitlists and the fact that many charters operate in suboptimal buildings, we know that the lack of facilities is a serious obstacle to charter growth.

Charter school facilities are still overlooked and underfunded

It’s National Charter Schools Week, when advocates speak out for the 3.2 million students — 6% of all public school students — educated at charter schools, a thriving public education option that is increasingly popular with families.

Since the first public charter school opened one quarter of a century ago, the charter school reform has spread to 47 states and U.S. territories. In historically troubled school districts, student enrollment has grown dramatically. In New Orleans, Detroit and Washington, D.C., the share of students enrolled in public charter schools is 92%, 53%, and 47%, respectively.

Taxpayer-funded and tuition-free, charters develop their educational programs independently of school districts while being held accountable for improved student performance. This autonomy enables these unique public schools to adopt approaches that boost student outcomes. But it also creates a challenge: unlike traditional public schools, charters do not receive a schoolhouse upon opening. This makes acquiring adequate school space a constant challenge.

Nationwide, charter school leaders report that lack of access to suitable school facilities is one of their primary concerns—and one of the biggest barriers to expanding student enrollment. Nearly 1 in 5 charters had to delay opening by a year or more due to facilities-related issues.

While public school buildings paid for by taxpayers should be available to all public school students, the reality is that many school districts, including Detroit, Indianapolis, and Minneapolis, refuse to allow charter schools to lease or buy even vacant school buildings. Sadly, this results in many schools operating out of shopping malls, office buildings and repurposed industrial facilities.

Accordingly, around 40% of charters lack essential amenities such as gymnasiums, libraries, science labs, cafeterias and outdoor space, National Alliance for Public Charter Schools research finds.

This is a vital issue. Why? Because demand for charter schools from parents and guardians significantly exceeds supply. Indeed, if all families seeking a place for their child could secure one, the total number of charter students would be 8.5 million — almost three times today’s actual enrollment — according to research by Phi Delta Kappa International, a professional organization for educators. Of parents who would like to send their child to a public charter school, over half cited lack of access — the school is too distant or has a waitlist — as the reason why their children did not attend one, PDK found.

Importantly, over half of the nation’s charter students live in economically-disadvantaged homes eligible for federal lunch subsidies.

In Washington, D.C., the government spends three times the amount per student on school properties for traditional schools compared to the facility funding it makes available to their charter school counterparts, even though the charters serve a higher share of needy students. Local charters receive a per-student allowance for school facilities that varies each year through city budget wrangling and election cycles, and consequently lacks appeal to the private sector loan market to which charters must turn in a city with a red-hot real estate market.

Meanwhile, the District government has proved an appalling steward of its own property: for decades, scores of surplus school buildings have been sold to private developers, often for luxury uses, or simply left to rot. Only months ago, developers acquired five historic schoolhouses at a time when 11,000 students are on waitlists for city charters.

The District’s own laws actually require it to offer surplus school property to charters to lease or buy before developers can. This mandate is flouted more often than not, an injustice one finds repeated in the minority of other jurisdictions whose laws ostensibly protect charter students’ interests.

While four in five D.C. charter students are economically disadvantaged, those representing the city’s most vulnerable communities are twice as likely to meet college and career readiness benchmarks as their peers in the traditional school system.

At the federal level, the Charter Schools Program helps charters access space and overcome other start-up hurdles. But funding amounts to less than 1% of the U.S. Department of Education’s budget, which does not reflect the extent of charter school enrollment — or demand — today.

Because parent demand indicates millions more students would attend a charter school if one were available to them, local jurisdictions need to allow charters access to surplus public school buildings and space before developers can bid for them. Prioritizing equality in per-student facilities funding also is essential. Federal education grants could encourage this best practice.

America’s public charter schools have significantly enhanced public education quality, especially for the nation’s most disadvantaged students. Federal, state, and local government should step up to back them.

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A Barrier to Growth: The Charter School Facilities Gap

Editor’s Note: This content was originally published here in May by Academica Media. The charter school facilities gap is one of the biggest barriers to growth and a universal challenge for many charter schools. Listen as Ryan Kairalla from Doral College, speaks with Mark Medema, the Managing Director of the Charter School Facility Center for the National Alliance for Public Charter Schools. Whether it’s finding a facility, affording one, maintaining one, relocating because you’ve outgrown your facility, these are all common issues charter leaders face. Learn about the current state of charter school facilities across the country and what’s on the horizon to address some of these issues on a legislative level.

Listen to the complete podcast here or read the transcript below.

Bridging the charter school facilities gap with the National Alliance’s Mark Medema

Ryan Kairalla: Welcome to the show everybody. I’m Ryan Kairalla from Doral College. Our guest this week is the Managing Director of the Charter School Facility Center for the National Alliance for Public Charter Schools. In his role, he leads the National Alliance’s facility experts and addresses the facility policy and regulatory issues confronting charter schools nationwide. He has also worked with the Charter Impact Fund, Building Hope at the international education reform organization EdVillage and more. You can find out more about his work by visiting www.publiccharters.org.

Ladies and gentlemen, we are happy to have Mark Medema on Charter School Superstars. Hi, Mark.

Mark Medema: Hello.

Kairalla: It’s so good to be hearing from you. I’m excited to finally get to talk with a guest about facilities. That is a topic that we haven’t touched upon, and I know it’s definitely one that matters to the folks listening that are charter school advocates, charter school employees, charter school enthusiasts. So, let’s get it right into it. Can you tell the listeners a bit about the work you do with the National Alliance with the Charter School Facility Center?

Medema: Would be happy to. One of the biggest barriers to growth of charter schools these days is facilities, and as you mentioned, it’s often not talked about. Educators like to focus on education, and facilities is to say it, some people like thinking it’s like watching paint dry, and facilities, it actually is watching paint dry.

So, what we’re trying to do is bring to light some of the best practices happening for facilities, whether it’s about how school leaders and board members can develop and design and finance buildings much more affordably, or how policymakers can use public resources, whether it’s a building or state or federal funding to help lower the cost of facilities so that schools are paying more into the classroom rather than paying more money on the classroom.

Kairalla: Absolutely, and you’re so right when you say that facilities are the biggest challenges or represent one of the biggest challenges that charter schools face when building a sustainable program. I see it on the education services company side. I see it on the legal side as a lawyer. I’ve seen a lot of really otherwise successful charter schools with great models have trouble because they have issues with the actual building itself. As you noted, it can be either a problem with finding a good facility, affording that facility, maintaining that facility, getting a new facility once you’ve outgrown the old facility. Among those kind of different areas of facilities, where do you tend to see charters having the most trouble when it comes to getting a stable place to call home?

Medema: It really starts with going out and finding and developing a facility. School leaders are educational experts. They’re not commercial real estate experts, and so they’re venturing into a world that they don’t know. Commercial real estate, I think, probably doesn’t have a great brand to it to begin with, and now an educator has to figure out how to navigate an area that doesn’t really have a lot of straight ground rules and guidelines. So, they’re really in just unchartered territory for themselves.

Once they do get familiar with this, then it comes down to the cost of money. Charter schools have to borrow money at rates much higher than the government can, which is just another level of unfairness between charters and other traditional school systems, and so we need to find lots and lots of new, creative, innovative ways to bring down that cost of funds to a much more equitable level to what the traditional school systems are paying.

Kairalla: Yeah, there’s a lot about just the inherent nature of the charter model that makes facilities acquisition a challenge, or least from what I see on the legal side. You spoke about the difficulty dealing with lenders because … And I think it’s similar to the difficulty that charter schools have when dealing with landlords. These are two groups of people that look at the charter model and say, “You’re on a five-year charter maybe. This charter could succeed. It might not.” We don’t know what the political climate’s going to be, so it makes you a bigger risk either to underwrite a mortgage for or to ultimately for a landlord to want to take a chance on you, and so it does create this sort of gap. What kind of solutions have you explored with maybe your past work with Building Hope or what you do at the National Alliance that try to help bridge that gap?

Medema: There are some groups that really understand the inherent risks in charter schools much better than others. Charter schools typically will have much lower default rates, I think, than the private capital markets expect, but they just quite haven’t begun to pricing that. So, a lot of it educating the private marketplace or finding replacements for the private marketplace, and those can be through non-profit funds, which are seeded by social capital really looking for double bottom line type returns and those kind of financial returns that are much more affordable for charter schools than what the private commercial marketplace would provide.

Kairalla: And are you seeing an emergence of more of these kind of charter-friendly lenders or real estate owners or landlords as the charter model proliferates nationwide?

Medema: We’re seeing more of them. I’m not sure it’s there are tons of them still, so there’s still a huge demand. The foundations I think are stepping into this place now. They’re starting. Some of the family funds are creating their own, so not just investing in existing non-profits but creating new non-profits. So, it’s exciting to see that happen.

What we haven’t tapped into very well is the individual retail investor who would love to see their personal investments go to social good, but we haven’t really developed easy mechanisms or products for them to be able to support charter schools in their communities. I think that’s the next venture.

Kairalla: That’s a particularly interesting development because you certainly see those kind of investment vehicles in other areas of real estate space, and so perhaps if those things could emerge in the charter school field, that could be a pretty welcome development.

You spoke earlier, Mark, about policy reforms and some of the legal issues that exist maybe state by state that sort of create additional challenges for charter schools in the facility space. So, can you talk a bit about the work you do at the National Alliance to advocate at the policy level to try to make the facilities challenge easier for charter schools? Are there particular reforms that your shop is really trying to fight for?

Medema: So, we were really excited to see Idaho’s Legislature pass and the Governor pass a moral obligation bill. So, when a traditional school district borrows money, it has the backing of the state or the school district that’s in the state behind it because it has a taxing authority, so they usually are very little risk. The students who go to public charter schools are the same public-school students that should afford the same backing of the state, and a moral obligation really says the state is providing its obligation that it’ll backup a charter school’s debt. It’s not a legal, binding obligation, but it’s a moral obligation. Idaho’s now the third state to do that behind Colorado and Utah, which will see great success and great savings to schools. What-

Kairalla: Well, that’s interesting.

Medema: What the National Alliance would like to do is talk more about this and share this with more state legislators. Lots of them just never even heard of this. It’s kind of a not very well-known strategy that’s been used in affordable housing and higher ed and healthcare centers, and we want to try and spread this to more states. So, that’s one low-hanging fruit that we should be working on the next few years.

Kairalla: Well, that’s pretty interesting, and so what you’re finding is that … Are you finding that when states adopt these moral obligation bills, which as you said don’t actually require the state to step in if the charter school defaults, just having the moral obligation bill is enough to actually allow charter schools to get more attractive lending terms?

Medema: Yes. A state might have a AAA rating and so a school district can borrow at AAA rates. That’s an S&P rating methodology criteria.

Kairalla: Mm-hmm (affirmative).

Medema: A moral obligation will get you close. It might get a AA rating, which is probably 100 basis points or one full percentage point less on the interest rate. That, over a 30-year mortgage, is millions of dollars of savings to a school. That’s money that can be spent on teachers. It can create jobs. It can go into special programming, and all with no cost to the state because again, it’s not a binding obligation. Now, the states will most likely adhere to it because they don’t want the markets to know that they’re backing out on their moral obligations, but it just doesn’t get called because charter schools are really such a good risk for investors. So, it’s never been called upon in its history.

Kairalla: Yeah, really, it’s just about the state kind of just stepping a little bit with this moral obligation, and all it’s really doing is just educating the marketplace because it sort of gives people an opportunity to take a chance on charter schools. Then, they realize, well, this is actually a pretty good investment. This is a stable, commercial real estate tenant. It’s going to be there a while. It’s performing a social good in the community, and by the way, a good school in an area tends to have an effect for surrounding real estate that’s pretty positive. And so, that can be a big win all around.

Medema: And it’s not new. It started in the ’70s in New York with housing. We just hadn’t figured out how to transfer it over to the charter school sector. Now, we’re seeing more progress on that front.

Kairalla: That’s very exciting to hear. You’re actually going to be participating in the National Charter Schools Conference. You’re going to be doing a session about, surprise, facilities, and for a lot of the listeners out there who I think are hungry for more information about this and want to hear more about the developments and how they can up their facilities game, I’m sure that they want to take part. Can you tell the listeners a bit about what you’re going to talk about at the conference?

Medema: We’ll direct the audience or for two audiences. If it’s a school leader, it’s a lot about best practices from what other schools have been doing to identify property, acquire it, work with developers, secure financing. And then as for the policymakers and some of the philanthropic foundations who are looking for more systemic changes, things like these bills or including charter schools in a district’s school bond offering, which we’ve started to see around the country, there’s a handful of policy initiatives that we think should resonate and should spread from one city to another.

Medema: Again, a lot of cities don’t know about what’s happening around the country. This isn’t a topic that’s talked about very much. Again, a little bit like watching paint dry, and so we just need to figure out how to share these best practices from one city and state to another.

Kairalla: Well, let’s start talking about this, people. Facilities are super, super important. We all have to have a place to call home for our charter schools, and I’m telling you folks. I can tell you from my own experience, a solid facility, good landlord, good property owner, everything can really make a big difference for charter schools. So, Mark, I’m so grateful for the work you do at the National Alliance to help the charter schools thrive in this area.

Let me ask you this last question before we let you go, and this has been truly a pleasure speaking with you. If with a snap of your fingers, you could make any change to the education system, what change would it be?

Medema: I think it starts with a belief that all children have the potential to meet and rise to their full expectations. I think if everybody, whether they work in schools or even just the general population, really believed that they and their neighbors and their friends and people who live down the street really believed in the full potential of all kids, making these policy changes would be easy. It’d be a snap of the fingers. Everybody would know exactly what we’re doing.

I think there’s probably still some hesitancy, and we think watching students excel is sometimes an exception. And rather than exception, I think all these students are just exceptional, and I think we can all come to that realization.

Kairalla: He is the Managing Director of the Charter School Facility Center for the National Alliance for Public Charter Schools. Find out more about his work by visiting www.publiccharters.org and don’t forget to take part in the National Charter Schools Conference June 30th to July 3rd in Las Vegas. Visit ncsc.publiccharters.org.

Kairalla: Mark Medema, everybody. Mark, thank you so much for joining us this week.

Medema: Thank you very much.

Kairalla: And thank you all for listening to Charter School Superstars.

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