Charter Schools Growth Loan Program

Many charter schools experience rapid growth, sometimes over 100%, in the first few years of operations. However, the timing of school funding in California leaves these growing schools cash poor for the first five months of the school year.

As state funding represents approximately 90% of a charter school’s revenues, a school is left with a difficult decision:

Should it expand and try to survive without any additional cash for the increased enrollment until February or should the school not grow, depriving many students of a spot in their program?

The Charter School Growth Loan Program provides the answer. Features include:

Provides a loan for the ADA the charter school will receive in February for new students added in the fall of that school year
Two loan disbursement dates: August 1 (30% of loan amount) November (70%)
Applications are due in early April
Loan approvals are made by mid-June

To participate in the Growth Loan Program, schools must:

Have been in operation for at least one year
Experience growth of 15% or greater
Have sound financials and a strong management team
Be members of the California Charter Schools Association

We’re happy to report that since 2004, the Association's Growth Loan Program has

Lent out $27 million to growing high quality charter schools
Created over 8,000 additional charter seats
To date, 100% of interest and principal payments have been made in full and on time

Want to hear more? Read all about it in these articles:

“Santa Ana Charter School Grows from Seed Loan” Orange County Register, June 22, 2005

“Loans Created for Growing Charter Schools” The Sentinel, July 6, 2005

“Charter Schools Pay Up” The Bond Buyer, June 23, 2005

Who are our funding partners for the Growth Loan Program?

Low Income Investment Fund
Raza Development Fund
Prudential Financial
Local Initiatives Support Corporation
NCB Capital Impact
Nonprofit Finance Fund

Any questions? Email our loan guru, Adam Miller