The Charter Schools Development Corporation (CSDC) is a
501(c)(3) nonprofit corporation and Community Development Financial
Institution (CDFI). CSDC provides a critical service for new
and expanding charter schools which, unlike traditional schools,
have neither a ready source of capital for facilities, nor the
taxing or bonding authority to address capital funding
requirements. Because public charter schools' per-pupil funding is
often inequitable compared to that of traditional public schools
(about 75-80% on average when compared to traditional schools
nationwide), virtually all charter schools must use operational
funding - money which otherwise would go towards educational
purposes and classroom teaching and learning - to cover
capital budget shortfalls. CSDC helps charter schools with the twin
challenge of finding and financing facilities and closing the
funding gap so that they can keep their focus on their educational
mission and student achievement gains.
CSDC specializes in working with newly formed and early stage
charter schools in their first few years of operation, with a
priority of schools in low-income communities and/or communities
with a significant number of underperforming district schools. CSDC
is focused on helping to "stand up" and stabilize those schools so
that they become independently creditworthy, without the need for
CSDC's further assistance, by virtue of their successful operating
history and demonstrated ability to meet their enrollment goals and
produce good academic and financial results.
Over its decade-plus history, CSDC has provided or leveraged
millions in capital financing and facilities for charter schools in
25 states and the District of Columbia. It has steadily expanded
its program offerings and financial services as the charter school
movement has grown from a single school in Minnesota over 20 years
ago to millions of students attending charter schools in 43 states
and the District of Columbia today, with 600,000 families on
charter school waiting lists nationwide.
- CSDC, through its Building
Block Fund, has provided over $48 million in credit enhancement
for over 130 charter school organizations in 25 states and the
District of Columbia serving over 42,500 students (78% low
income). CSDC's credit enhancements take the form of partial,
limited guarantees or additional collateral for charter school
facility lease and loan payment obligations.
- CSDC has developed over 4.4
million square feet of educational facilities through its nonprofit
real estate development services (Turnkey Development Program),
whereby CSDC acquires, develops and builds-to-suit properties for
lease with option-to-purchase to its client-tenant schools, and Fee Developer
Program. CSDC has developed over $150 million in real
estate projects, several of which have been sold to the charter
school optionees under this "lease-to-own" program.
- CSDC has originated over $11
million in facilities and working capital loans through its direct lending
programs. CSDC's lending initiatives have leveraged $30 million
in debt financing and lease commitments.
- Another CSDC subsidiary, CSDC New
Markets Fund, LLC, received $40 million in New Markets Tax
Credits and fully sourced (suballocated) those federal income tax
credits for a like-amount of equity and debt capital used to
finance permanent facilities for five charter schools in four
states and D.C.
CSDC's business model has expanded in direct response to the
growth of the charter school movement and its emerging financial
sector. CSDC has a long record of success in facilitating the flow
of capital to low-income and early stage schools and continues to
advance the understanding of charter school financing within the
private sector and encourage private lenders and investors to enter
the charter school market.