Download - The Future Of Charter School Funding and Facilities by Charter School Capital

Copyright © 2012 Charter School Capital

The Future of Charter School Facilities


AGENDA

2

What We Will Cover Today

•  Balancing facilities dreams and budget realities •  Funding options •  Project execution •  Other considerations


PROJECT FLOW

3

Plan Construct Design Acquire

þ  Space þ  Features þ  Budget þ  Timeline þ  Charter

issues

þ  Select firm(s) þ  Design/build

options þ  GC input þ  Timing; big

bang or phased

þ  Locate Site þ  Acquisition þ  Permitting þ  Land prep

þ  Move dirt þ  Raise the

roof þ  Control:

Project manager or owners rep

Fund

þ  Cash þ  Bank þ  Bond þ  Long Term

Lease


BUDGET VS NEED

4

Your School’s Facility Project

•  Existing reserves

•  Ongoing % of revenue

•  Fundraising – public or private

•  Funding alternatives

•  Academic mission

•  Growth plan

•  Specialty requirements

•  Local considerations

What can we afford? What is required?


CRITERIA

5

Security

CASH TRADITIONAL BANK BOND LT LEASE/

OPTION

Growth Options

FUNDING COMPARISON

Underwriting

Annual cost

Cash needed


FUNDING COMPARISON

CRITERIA

6

Cash needed to close (e.g.

$10M Project)

Annual Cost (e.g. $10M

project)

CASH

$10M

BANK BOND

~$200-500K $0-100K $3-4M

$0 $1.0M – 1.3M $1M $500K - 900K

Other Reserves?

7-10%

120% of project $

Rating?

10%

No amortization

6%- 8% on the debt

10-20yr

amortization

TRADITIONAL BANK

LT LEASE/ OPTION


CRITERIA

7

Security Interest

CASH

None

BANK BOND

Real estate + all assets None Real estate

+ all assets

School Growth Options cash = build Refinance

(rate risk?) Scalable /

expandable Refinance (rate risk?)

FUNDING COMPARISON

Underwriting / Credit

Worthiness None

Min 3 yrs

Surplus

Rating?

No minimum

Academic success

Flexible

Min 5 yrs

Surplus

Assets + Revenue

LT LEASE/ OPTION

TRADITIONAL BANK


CRITERIA

8

Security

CASH BANK BOND

Growth Options

FUNDING COMPARISON

Underwriting

Annual cost

Cash needed

TRADITIONAL BANK

LT LEASE/ OPTION


PERCEPTION VS REALITY

9

What to Consider

•  Ownership is an “investment” •  Control is critical •  Evaluate $ spent not % rates


PROJECT ELEMENTS

10

Convert Facility Dreams to Reality

•  Design needs •  Value engineering

- Design to budget

•  Space needs - Portable to permanent

•  Schedule/timeline


PROJECT ELEMENTS

11

Master Plan

•  Ensure classroom safety •  21st century learning environments •  Maintain flexibility •  Options to accommodate future growth •  Increase outdoor learning opportunities •  Reduce transportation costs •  Maximize joint use opportunities with community •  Green schools – reduce operational costs


DEFINING PRIORITIES

12

Priority One

•  Code, health, safety, infrastructure -  Americans with Disabilities Act (ADA) -  Hazardous materials removal -  Building code upgrades -  Building shell integrity -  Modular classroom building -  Seismic retrofit/modernization


DEFINING PRIORITIES

13

Priority Two

•  Program scope -  Interior renovations/complete classroom -  Energy efficiency -  Administration building modernization -  Site utilities/drainage -  Classroom technology


DEFINING PRIORITIES

14

Priority Three

•  Site facilities -  Athletic fields -  Site entry circulation -  Visitor parking -  Renewable energy: solar panel car ports


1 MO 2 -‐ 6 MO

Programming +

Project Scoping

Design Review + Approval

BEGIN

3 -‐ 5 MO

1.   SchemaGc Design

2.   Design Development

3.   ConstrucGon Documents

COMPLETION

ConstrucGon phase

Phased Summer ConstrucGon

or 6 -‐ 24 months if new construcGon

BEGIN CONSTRUCTION

PROJECT SCHEDULE

15

Design + Design review / approval likely will overlap reducing your total project time


OPTIONS

16

Additional Considerations

•  Access to working capital •  Selecting a full service partner

-  Commercial Developer -  Architect -  GC -  Design/build

•  Total cost of ownership


Stuart Ellis: [email protected]

Charter School Capital:

877.272.1001 charterschoolcapital.org

Jon Dahlberg: [email protected]