Rep. Marcus Brandon, along with Reps. Lambeth, Hardister, and Hanes filed a bill on Tuesday that would allow new charter schools to take out interest-free loans totaling no more than $25,000 each from the State Board of Education. The loans would need to be repaid in 12 monthly installments within a year of the initial allocation.
$1,575,000 in revolving loan funds would be appropriated from the General Fund to the State Board of Education for the 2013-2014 fiscal year for these charter school loans. The same amount would be appropriated for 2014-2015.
This news comes at the same time local school districts are bracing for even more cuts as a result of sequestration. State Superintendent June Atkinson told members of the State Board of Education last week that North Carolina would be hit with a $63 million loss of federal funds for 2013-14. Last week also brought news that average teacher pay in North Carolina has slid to 46th in the nation, prompting State Board of Education member John Tate to declare “this is a disaster” as he listened to the details.
Charter schools already have the option of securing tax-exempt financing through the N.C. Capital Facilities Finance Agency, a not widely-known about office under Treasury Secretary Janet Cowell. The agency helps nonprofit educational institutions, like charter schools and private universities, receive tax-exempt bonds that can be used for capital financing. In 2012, the agency approved $197 million in bonds for six institutions, including two charter schools that sought $10 million combined for refinancing and construction projects, according to the NCCFFA annual report.