1. Emerging Legal Issues in Charter School Facility Development Richard Pinner Associate General Counsel Local Initiatives Support Corporation

2. What makes developing a charter school legally different than building a Pizza Hut?

3. Timing issues The school year only starts at one time Alternative facilities Construction delays, especially in cold-weather areas

4. Length of charter Varies, but 5 years is typical Not necessarily long enough to get balance down to conventional financing standards

5. Refinancing risk Classic market risk (e.g., not selling enough pizzas): not drawing enough students But murky political landscape in some areas Educational quality on a long- term basis

6. Differences among jurisdictions Assignment of per pupil revenue Ownership of building Operations in multiple states

8. Highest and best use Uniqueness of school buildings Limited number of replacement tenants (and when they could move in)

9. Timing of payments Revenue is not continuous Revenue is subject to delays Revenue is subject to cuts

10. Phasing issues Dealing with growth (and growth can be a good thing) Synching with complicated funding structures

11. Limited one source financing leads to complex funding structures While tools such as New Markets Tax Credits and bonds have many benefits, parties not experienced in these financing methods can find them daunting

12. Legal flexibility from non-conventional financing CDFIs (DOE guaranty) Foundations (PRIs) and other philanthropic sources