Charter School Loan Guarantees
MassDevelopment works with both new and established charter schools to support student learning by financing school facilities and equipment purchases.
Through the Massachusetts Charter School Loan Guarantee Fund, MassDevelopment provides guarantees for bank loans or tax-exempt bonds financing the acquisition, construction, or renovation of owned or leased charter school facilities located in Massachusetts.
For facilities owned by the school:
- Loan guarantees cover a percentage of the first mortgage loan up to the lesser of 50% or $3 million.
- Loan advance rate may be up to 100% of the property value.
For facilities leased by the school:
- Loan guarantees cover up to the lesser of $1,000,000 or 90% of the cost of facility improvements
Holyoke Community Charter School is a K-8 school educating more than 680 children from Holyoke and surrounding communities. Recently, MassDevelopment issued an $8.4 million tax-exempt bond for the school that was used to refinance and consolidate its existing debt and pay-off expensive subordinated debt related to the 2005 purchase of the school’s building. TD BankNorth, the bond purchaser, was able to lend up to 100% loan-to-value of the school building because Holyoke Community Charter received a Charter School Loan Guarantee from MassDevelopment.