Tax Cuts and Jobs Act Threatens Facilities Funding for Idaho Public Charter Schools

The Idaho Charter School Network has serious concerns about the U.S. House of Representatives H.R. 1, the Tax Cuts and Jobs Act.

The bill, as passed by the House, jeopardizes the ability of public charter schools in Idaho and across the country to access the needed resources to secure a school facility. Without buildings, new charter schools cannot open and existing, high-quality schools cannot expand or replicate. Idaho currently has at least 6,000 students waitlists to enter a public charter school.

H.R. 1 eliminates the opportunity for public charter schools to access New Market Tax Credits (NMTCs), Private Activity Bonds (PABS), and Qualified Zone Academy Bonds (QZABs) in order to finance school facilities. This is devastating to Idaho public charter schools. The typical public charter school in Idaho receives about $1,490 less per pupil than traditional district schools because charters cannot access local property taxes.

Charter school facilities in the Gem State have to be funded through bonds and/or bank financing. Just this month three Idaho charter schools launched three facility projects totaling about $25 million. In total, about 110,000 square feet of new school space will allow these schools to educate over 1,700 Idaho students. We estimate that the costs of financing these deals would be 1 to 1.5% per year more for 30 years on $25 million if the House version of H.R. 1 is enacted into law. These are public tax dollars that can make the difference between success or failure for Idaho public charter schools and the students and families they educate.

The Senate bill protects NMTCs, PABs, and QZABs, which are essential pathways that make it possible for charter schools to acquire and maintain safe and appropriate school space for Idaho’s children.

“While not perfect, the Senate bill is better for Idaho public school students, and we are hopeful that the language protecting public charter schools access to tax free bonds will prevail,” said the Idaho Charter School Network’s CEO Terry Ryan.