The Walton Family Foundation has announced the creation of two loan funds totaling $300 million in support of charter schools.
Supported through the foundation's Building Equity Initiative, which was launched in 2016 to help charter schools access the capital needed to build, expand, or renovate facilities, the Charter Impact Fund and Facilities Investment Fund will provide quicker access to long- and short-term financing.
Established as a nonprofit organization, the Charter Impact Fund will be launched with $200 million in seed funding and provide long-term fixed-rate loans to high-performing charter schools anywhere in the country for up to 100 percent of project costs, providing schools with lower transaction costs and faster loan execution and enabling them to save millions over the loan term. Adapted from a revolving-loan fund model that has successfully supported clean water projects and affordable housing, CIF is the first pooled fund of its kind for charter schools.
Created in collaboration with Bank of America Merrill Lynch and managed by Civic Builders, the $100 million Facilities Investment Fund will offer charter schools five-year fixed-rate loans for up to 90 percent of project costs for new construction or the renovation of existing facilities. FIF loans are the only short-term loans currently available to charter schools that provide up to $20 million at a low fixed-interest rate.
"Big challenges require bold solutions," said Walton Family Foundation board member Alice Walton. "This effort will allow resources that were spent on facilities to be directed back into the classrooms, back to the teachers, and back to where it should be — with the students."
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