Business Approach
When the Charter School Financing Partnership (CSFP) was formed in 2008, members determined that working collectively was the most efficient way to access capital markets for long-term charter school financing. By pooling resources and achieving economies of scale, CSFP is able to credit enhance bonds to reduce interest costs for charter school borrowers.
A $15 million grant from the Education Department’s Charter School Credit Enhancement Program has allowed CSFP to fund a supplemental reserve that will provide additional common security to a pool of charter schools financed with tax-exempt bonds. Under the terms of this grant, CSFP will provide a minimum of $90 million in financing to charter schools and assume a 5 percent risk of loss in the pool. CSFP aims to earn a medium investment grade rating on the bonds while delivering the lowest-cost long-term financing to charter schools participating in the program.
