Austin P. Frum
Public Education Center
N.E. Washington, DC

home of
Potomac Lighthouse Public Charter School
and
Washington Yu Ying Public Charter School

History

Charter Schools Development Corporation was established in 1997 to serve the charter school community - the most dynamic, innovative and fastest-growing segment of American K-12 education, and the vehicle, through increased competition and choice, for the systemic reform and improvement of poorly performing traditional public schools.

• In 2000, CSDC formed an ad-hoc coalition of stakeholders and spearheaded the effort to create a limited federal role in assisting charter schools with the twin challenge of acquiring and financing facilities. Studies have shown facilities to be the greatest barrier to establishing and expanding charter schools, and an impediment to the growth of charter schools at scale. This challenge is compounded by the fact that charter schools are chronically underfunded, operating, on average nationwide, with only three-quarters of the operational funding of traditional (district) public schools, and typically with no additional funding for facilities or capital infrastructure. As a result, many charter schools spend 20-25% of their per-pupil educational funding to cover facility costs.
• CSDC was the lead catalyst, architect and advocate for the establishment of a $25 million Congressional demonstration program in 2001, the forerunner to the Credit Enhancement for Charter School Facilities Program administered by the U.S. Department of Education, which has provided several hundred million dollars in grants nationally for credit enhancement and revolving loan programs operated by nonprofit organizations and state agencies. CSDC received a $10 million competitive grant from the initial demonstration program in 2002 and subsequent competitive grants of $5 million in 2004, $6.6 million in 2006, and $2 million in 2010, to partially capitalize its Building Block Fund and Indianapolis Building Block Fund. With a total of $23.6 million in grants, CSDC is the second largest single recipient of federal credit enhancement funding.
• The Ewing Marion Kauffman Foundation (KF) made a $5 million Program Related Investment in the Building Block Fund in 2005, and in 2007, the Daniels Fund (DF) awarded CSDC a $3 million grant with a geographic focus on the "Mountain West" region of Colorado, New Mexico, Utah and Wyoming. The Daniels Fund grant helped launch the Mountain West Charter Schools Fund, a separate fund within CSDC Direct.
• CSDC, through its joint venture with City First Bank, received a $40 million allocation of federal New Markets Tax Credits in 2006. The tax credits were fully sourced to investors as part of the permanent financing of facilities for five charter schools within 15 months, providing a substantially quicker distribution than the originally projected three-year timeline.
• In 2010, CSDC was certified as a Community Development Financial Institution (CDFI), and specifically a Community Development Loan Fund, with a primary mission of providing financial services and technical assistance to the most underserved charter schools nationwide - those with significant low-income student populations in economically distressed communities, or in communities with a large number of poorly performing district schools - with an added organizational priority of supporting new and early-stage schools (those in their first three years of operation). Initial funding for CSDC's CDFI direct lending programs came in part from $2 million in Program Related Investments from the Calvert Foundation and the Communities at Work Fund, a $200 million fund launched in 2010 by Citi Bank, the Calvert Foundation and the Opportunity Finance Network. All of the direct lending activities of CSDC are conducted under the brand "CSDC Direct."
• For the purpose of developing, leasing and managing charter school properties, CSDC created CSDC Property Corporation ("CSDCPC"), an Arizona nonprofit corporation in April 2010. CSDCPC is a 501(c)(4) social welfare corporation formed as the "real estate arm" of CSDC, under which the Turnkey Development Program is administered.