Jackson will grant Summit loan request
The Historic Jackson County Courthouse. File photo
The Jackson County Board of Commissioners decided it intends to grant the loan request from Summit Charter School in the amount of $2.5 million.
“Summit is grateful for this opportunity to partner with the Jackson County Board of Commissioners to positively impact the education of 303 Summit students and support our incredibly dedicated teachers and staff,” the school said in a statement.
During an Oct. 24 meeting of the county commissioners, County Manager Don Adams presented a draft letter of intent which, once signed by the board, allows county staff to move forward with the planning and execution of the loan. The county plans to have the money to Summit Charter School by the first of the new year.
“The purpose of the short-term loan request is to bridge cash flow needs during construction as we raise funds and collect pledges toward our total fundraising goal of $6.5 million to fully fund Summit’s facility expansion,” said Head of School Kurt Pusch in a statement following the decision.
Pusch had come before the Board of Commissioners during an Oct. 10 work session to formally request the loan . Commission Chairman Mark Letson recused himself from the discussion because he also serves on Summit’s Board of Trustees.
Summit broke ground on phase II of its high school expansion in August. The whole project will cost the school an estimated $6.5 million. Fundraising efforts for the expansion have been led by the Summit Charter School Foundation, a 501(c)3 that raises private funding for the school. The foundation has raised $4.8 million toward the total goal, with $2.8 million of that money in hand and the remainder in pledges that are committed over the next several years.
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According to the agreement between the school and the county, the loan will be paid back over 36 months. The interest rate will be based upon the actual return on investments that Jackson County is receiving for its cash investments, which currently sits at about 5.5%. Summit Charter School will be responsible for all costs associated with the loan, which the school will have to formally commit to.
The letter of intent says “Jackson County requests that Summit Charter School commit to these costs in writing.”
“We would require something in writing from Summit Charter School basically committing to these costs,” said Adams.
The letter that was voted on during the Oct. 24 meeting is not a formal action and all tasks laid out in the letter must be completed before the Jackson County Board of Commissioners takes any final action.
The loan would be secured with a deed of trust and a promissory note put on the school property, which will be released when the loan is repaid in full.
At the recommendation of the county manager, money for the loan will come from the general fund, rather than sales tax funds, in order to keep it set aside for public school funding.
Before the General Assembly passed new legislation this year that drastically changed the laws affecting charter schools, they could not make requests for capital funding from local board of commissioners. While capital funding for public k-12 schools comes from local tax dollars, as well as occasional state grants, charter schools were required to raise their own money for capital projects.
Charter schools have always received state and local funding, as per pupil funding from state and local sources follows each student who enrolls in a charter school.
The new legislation now allows counties to “provide funds to charter schools by direct appropriation” for the purposes of acquiring real property; acquisition, construction, reconstruction, enlargement, renovation or replacement of buildings and other structures; and acquisition or replacement of furniture and furnishings, instructional apparatus, technology, data processing equipment, business machines and similar items.
“With the Board of Commissioners approval of a letter of intent to move forward with Summit’s bridge loan request, Summit will now work with Jackson County staff to finalize the terms of a loan agreement,” the school said in a statement. “Before a loan is executed, the terms must still be approved by the Jackson County Board of Commissioners, the Summit Charter School Foundation Board, and the Summit Charter School Trustee Board.”
