Equitable Facilities Fund Launches Innovative State-Based Lending Fund in Texas

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Nov 01, 2022, 16:30 ET

The new Texas Facilities Fund will provide $250 million in ultra-low-cost, short-term financing for public charter schools during critical growth years.

NEW YORK, Nov. 1, 2022 /PRNewswire/ -- The Equitable Facilities Fund announced the creation of the Texas Facilities Fund (TFF), a first-of-its-kind, state-based offering designed to support high-quality education options for under-resourced communities and accelerate school pathways to long-term financial sustainability.

While charter schools receive public funding, they often lack the financial resources needed to acquire suitable facilities for their students and staff. EFF's innovative, philanthropy-backed impact fund is designed explicitly to level this playing field, providing low-cost loans for schools to undertake their own facility projects.

In Texas, TFF will offer low-cost facility financing to early-phase, growing and single-site public charter school operators that demonstrate tremendous potential. Critically, this financing will be made available to schools before they reach the enrollment and revenue thresholds for the Texas Permanent Schools Fund.

"Texas has been a leader in charter school growth for a long time, and there are numerous high-quality operators that are primed to launch new schools or expand current ones and deliver life-changing public-school seats for their communities," says Anand Kesavan, CEO of Equitable Facilities Fund. "Unfortunately, financing options for early-stage schools are often prohibitively expensive. Our philanthropic lending model offers a way forward, covering 100% of facilities costs, saving millions, and unlocking the full potential of schools and leaders who are eager to serve."

Over the course of the fund, Equitable Facilities Fund anticipates that TFF loans will catalyze the growth of high-quality Texas schools and help 10,000 Texas students access a high-quality education in world-class facilities.

Already, the fund has closed two loans for nearly $45 million to support Compass Rose Public Schools and Beatrice Mayes Institute, high-performing schools that will ultimately serve 2,300 predominantly low-income students of color in San Antonio and Houston, respectively.

"We have the talented educators, committed funders, and incredible community support we need to run great schools in San Antonio and Austin," said Paul Morrissey, CEO of Compass Rose. "TFF's launch provides the critical missing ingredient: affordable facilities. This is a game-changing vehicle that will allow Compass Rose and other operators to put thousands of students on the path to lifetimes of success."

Nationally, Equitable Facilities Fund has committed nearly $1 billion of low-cost financing since 2018 to support excellent – and equitable – K-12 schools. To date, the philanthropy-backed impact fund has supported 120 schools across 35 cities in 19 states, saving these schools over $200 million to put back into the classroom.

"By its nature, education is a very local product, and prior to TFF, local communities lacked efficient, affordable access to national financial markets," says Kesavan. "A state-based funding model is a fantastic opportunity for both schools and investors, pairing local philanthropy and expertise with scalable, low-cost, national capital."

EFF, alongside funders, charter school leaders and community partners, will celebrate the launch of the Texas Facilities Fund on November 3rd at the historic DeLUXE Theater in Houston's Fifth Ward.

In addition to the Texas fund, EFF plans to launch several state-based low-cost revolving loan funds.

About Equitable Facilities Fund

Equitable Facilities Fund is a 501(c)(3) nonprofit social impact fund created to provide low-cost facility loans that allow high-performing public charter schools to maximize the resources they dedicate to students. High-quality public charter schools promote bright futures for children across America, and EFF believes these schools should borrow under terms comparable to traditional public school districts. EFF administers an 'A' rated revolving loan fund, which recapitalizes using funds from Equitable School Revolving Fund's bond issuances, to offer high-credit, long-term, scalable bond investment opportunities. To learn more, visit www.eqfund.org or email [email protected].

SOURCE Equitable Facilities Fund