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State-backed loans, philanthropic matches save Idaho charter schools an estimated $113 million, presenter says
Summary
A national policy adviser told a legislative committee Idaho's revolving loan fund, credit enhancement and private matching have reduced charter-school borrowing costs, producing roughly $113 million in savings and freeing funds for instruction; lawmakers discussed funding caps and per-student facility aid.
Matthew Joseph, senior policy advisor for education funding at AccelinEd, told a legislative committee that state-backed financing programs and private matching have sharply reduced borrowing costs for Idaho charter schools and freed money for classroom expenses.
Joseph said the state has incurred no net cost so far and that "the total savings so far" for charter schools amounts to "$113,000,000." He told lawmakers those savings translate into reinvestment in instruction, estimating that the average charter school could support the equivalent of "10 additional teachers" with the money saved on facilities financing.
The presentation summarized how two complementary state policies have worked together: a revolving loan fund that offers short-term no-interest loans during a school's early years, and a later-stage credit enhancement or "moral obligation" support that lowers long-term bond financing rates. Joseph said private philanthropy, including a matching contribution from the Albertson Foundation and managers such as Building Hope and Bloom, multiplied the programs' impact by reducing the amount schools must borrow from banks or developers.
Joseph cited specific examples. He said Novus Classical Academy used a no-interest loan from the state fund plus philanthropic matching to reduce its required bank borrowing by about $5 million, producing nearly $1 million in annualized savings. He also pointed to Sage International and Elevate Academy, which benefited from the state's credit-enhancement approach when they sought long-term refinancing.
Committee members pressed presenters on program details and limits. "We did a hard number of $400 per student for charter school facility," said Blake, speaking on behalf of the Idaho Charter School Network, describing last year's change to a flat per-student facility allocation. Blake told the committee that the elimination of state lottery school-facilities funding reduced that amount by about "$100 a student," and that restoring the lost funding would carry a fiscal note of about $3,000,000 and would apply only to charter schools.
Lawmakers also discussed program capacity. Joseph and other witnesses said demand for the revolving loan fund and the state's moral-obligation credit enhancement has sometimes exceeded capacity. Joseph explained the revolving loan fund provides roughly $2.5 million no-interest loans for early-stage financing and that the state's credit line for long-term support has hit its current limit, meaning new schools can be turned away from the subsidized market until capacity is increased. He urged maintaining rigorous eligibility criteria while expanding capacity to meet demand.
Committee members pressed on enrollment growth and geographic demand. Witnesses said the current charter wait list is about 6,000 students and that enrollment demand is strongest in high-growth areas such as parts of the Treasure Valley and in communities seeking themed or career-technical programs. Blake and Joseph described the financing programs as a way to allow rapidly growing or specialized charter schools to secure buildings without diverting operating dollars away from instruction.
The committee did not take new legislative action on the financing programs during the hearing. Members requested follow-up information, including detailed eligibility criteria for Idaho's programs and options for increasing capacity.
Votes at a glance: the committee approved the minutes for Jan. 7, 2025. Representative Monica Church moved to approve the minutes; the chair called a voice vote, recorded as "Aye" with no opposition and "motion carries." Exact vote counts were not specified on the record.
Closing: Presenters asked lawmakers to consider maintaining the two-part structure of early-stage no-interest loans plus later-stage credit enhancement and to explore legislative adjustments to expand capacity while preserving underwriting criteria. Joseph and network representatives said they would follow up with written materials detailing criteria and fiscal options.
