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The Massachusetts Board of Elementary and Secondary Education

Charter Schools - Information Regarding Approval of Loans beyond Charter Terms for KIPP Academy Lynn Charter School, KIPP Academy Boston Charter School, Excel Charter School, and Lowell Community Charter School

To:
Members of the Board of Elementary and Secondary Education
From:
Mitchell D. Chester, Ed.D., Commissioner
Date:
April 17, 2015

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Under the charter school statute, G.L. c. 71, § 89(k)(6), a charter school may incur temporary debt in anticipation of receipt of funds but requires approval of the Board of Elementary and Secondary Education (Board) if it wishes to agree to a term of repayment that exceeds the duration of the school's charter. At its meeting on October 21, 2008, the Board voted to delegate to me the authority to approve such loan requests. I am informing the Board of four such approvals.

The board of trustees of KIPP Academy Lynn Charter School (KIPP Lynn) requested approval to enter into two loan agreements, as described in a letter dated March 12, 2015. The first loan agreement the school sought to enter is for $17,893,000 with Citizens Bank for the refinancing of their current site at 90 High Rock Road in Lynn. The term of this loan is for ten years. The second loan is also with Citizens Bank for $1,500,000 with a five-year term.

The board of trustees of KIPP Academy Boston Charter School (KIPP Boston) requested approval to enter into two loan agreements, as described in a letter dated March 4, 2015. The first loan agreement the school sought to enter is for the amount of $18,500,000 with Citizens Bank. The term of this loan is for ten years. The second loan is with the Boston Community Loan Fund for $2,500,000 with a ten-year term. Both of these loans will be used to purchase a permanent facility for the school in Mattapan.

The board of trustees of Excel Academy Charter School (Excel) requested approval to enter into two loan agreements, as described in a letter dated February 11, 2015. The first loan agreement the school sought to enter is for the amount of $16,500,000 with Boston Private Bank The term of this loan is for ten years. The second loan is with LISC (Local Initiative Support Corporation) for $4,500,000 with a ten-year term. Both of these loans will be used to purchase a permanent facility for the high school in Boston.

The board of trustees of Lowell Community Charter School (LCCS) requested approval to enter into two loan agreements, as described in a letter dated March 2, 2015. The first loan agreement the school sought to enter is for the amount of $8,451,000 with Boston Private Bank. The term of this loan is for twenty-four years. The second loan is with the Qualified Zone Academy Board (QZAB) for $3,799,000 with a twenty-five-year term. Mass Development will also provide $3,000,000 in credit enhancements. Both of these loans will be used to purchase a permanent facility for the school in Lowell.

This memorandum provides written confirmation of my approval, pursuant to G.L. c. 71, § 89(k)(6), of terms of repayment for these loans that exceed the durations of these schools' charters. The Department has reviewed these requests, and they are reasonable and consistent with the charter school statute and regulations. These approvals in no way reflect either the accountability status or the potential outcome of the charter renewal process for these charter schools. Approval is explicitly conditioned upon the inclusion of the following language in all of the loan agreements:

The parties to the loan(s) acknowledge and agree that the Commonwealth of Massachusetts, including but not limited to the Board and the Department of Elementary and Secondary Education, provides no representations or guarantees with respect to these loans and has no liability for any portion of the loans. Furthermore, specifically and without limitation, the Board's approval of the loan has no impact on any action that the Massachusetts Board of Elementary and Secondary Education may choose to take in the future with respect to probation, revocation, or renewal of the school's charter.

If you have questions or need additional information, please contact Deputy Commissioner Jeff Wulfson or Cliff Chuang, Associate Commissioner for Charter Schools and School Redesign.



Last Updated: April 22, 2015
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