How Idaho is Helping Charter Schools Focus Resources on Instruction

Idaho’s public charter school sector has been growing fast over the last decade. Since 2015 our state has added about 17,800 new
school seats in 26 new school buildings. In the early days of this new school growth the financing for new school construction was
solely dependent on the generosity of the J.A. and Kathryn Albertson Family Foundation (JKAF), and the lending of the private
sector.
JKAF funded a Program Related Investment (PRI) fund that was managed by the nonprofit facility financing partner Building Hope.
Building Hope was recruited by JKAF to use their PRI support to structure facility financing deals that leveraged their philanthropic
support to garner less costly charter school facility financing from private lenders and banks.
Over time inflation and higher interest rates have driven up the costs associated with building and financing public charter school
facilities across Idaho. Yet, the need for new school seats hasn’t gone away. Our state has continued to grow, add students and
need new school options for families. To continue financing school construction for public charter schools we needed the state of
Idaho to step up and do more. To its credit the state has done just that.
In 2019 the Idaho Legislature created the public charter school facilities program, which allowed high performing public charter
schools to refinance their facility costs under the state’s credit rating. This state support has been invaluable to eligible schools that
refinance their shorter-term debt into 30 or 35-year bond deals. A key partner in this work has been led by the Idaho Housing and
Finance Association that issues the nonprofit facility bonds for these deals.
In 2023 the Idaho Legislature went further and created a $50 million revolving loan fund for public charter schools based on the
design, experience and success of the JKAF/Building Hope PRI model. The state of Idaho is now a partner in the facility financing
of public charter schools through this revolving loan fund with the private and philanthropic sector.
This story of doing more with less is described brilliantly in this report by the Foundation for Excellence in Education’s (ExcelinEd)
Matthew Joseph. The lead takeaway from the school finance researcher Joseph is that through a series of evolving and smart
public/private partnerships the state of Idaho has saved over $110 million for its taxpayers in lower financing costs for participating
public charter schools. These saving have allowed participating schools to hire on average 10 teachers more than they would be
able to do otherwise. This is incredibly important as Idaho’s public charter schools do not have access to any local taxpayer support
such as levies. Charters operate on only the state and federal funds that follow students to the school their parents chose for their
education.