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| New Mexico applies for Charter School funding |
January 14, 2002 |
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Wilson spearheaded efforts to provide innovative funding mechanisms for fledgling charter schools
Albuquerque, NM - Charter school advocates today met with Congresswoman Heather Wilson to review their progress in applying for federal education funding spearheaded by the New Mexico lawmaker. Wilson has quickly become one the key supporters of New Mexico’s charter school movement and is known for her efforts to support public education.
Wilson pushed for federal funding in the closing days of the 106th Congress and succeeded in earmarking $25 million for a pilot project to help charter schools with facility financing. Wilson’s program was extended under the education reform bill, The No Child Left Behind Act, that passed the 107th Congress and was signed by President Bush last week. New Mexico’s Congresswoman worked closely with charter school proponents to increase the availability of start-up funds to charter schools in New Mexico and across the nation through innovative finance arrangements.
Just one year ago, Wilson met with charter school proponents to encourage them to apply for federal funds to set up innovative financing mechanisms. Today, the group met to report that New Mexico charter schools, through the New Mexico Business Roundtable for Educational Excellence, submitted a proposal to use $8 million of federal funds to leverage $31 million in bonds and loan guarantees for New Mexico Charter Schools.
Charter schools, unlike traditional public schools, don’t have access to funds for facilities. Charter schools that are able to find funding are often relegated to a series of portable units, basements, community centers, or co-location with existing public schools. Charter schools often have to choose between paying their rent and paying their teachers.
“This is a wonderful start,” says Wilson. “And it’s important to note that this is only the beginning. We need to invest heavily in innovative ideas like charter schools so we can provide children the quality education they need. This funding certainly has the potential to ease the biggest challenge new charter schools face, and that’s access to capital.”
“Heather has consistently worked with us to help unlock the tremendous potential in our communities,” says Dr. Jacki Riggs, President of the NM Business Roundtable for Educational Excellence. Riggs and her group organized the formation of New Mexico’s grant proposal. “We all look forward to working with Congresswoman Wilson to further the explosive growth of New Mexico’s charter schools.”
“I look forward to continuing the progress we’ve made in helping charter schools succeed in New Mexico and throughout the country,” continued Wilson. “I’m very excited about the number of charter schools that have blossomed in New Mexico. Your success,” she said to charter school operators, “is proof that our investment in charter schools is a sound one. This is about improving the quality of education available to New Mexico’s children, and I’ll keep working to achieve that goal.”
The applications submitted to the U.S. Secretary of Education and developed with the help of New Mexico banks and financing experts included three components:
Using $1.2 million of federal funds to back a bond pool of $10 million for well-established charter schools
Using $3.2 million of federal funds to guarantee loans for charter schools which have been in existence for 1 or 2 years. At a 4 to 1 leverage ratio, this would result in $12.8 million of guaranteed loans
Using $3.6 million of federal funds to guarantee loans for start-up charter schools. At a 2 to 1 level ratio, this would result in $8.2 million of loans
Grant recipients will be required to submit an annual assessment report to the U.S. Secretary of Education.
“This is exactly the kind of creative financing approach we were hoping New Mexico could come up with,” Wilson said. “I will give my full support to New Mexico’s proposal with the federal Department of Education.”
Throughout the 106th and 107th Congresses, Wilson worked closely with members of the House Education Committee on school funding proposals.
For more information about New Mexico’s charter school funding proposal, reporters can call
Dr. Jacki Riggs at 505-242-8052.
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