Before a charter school can be implemented, funds must be secured to cover all of the school's expenses. This may include the building of a new school unless a building can be found and used to house the charter school. Even so, the building may need substantial renovations before the charter school can be opened. In addition to building and maintenance funds, funds will also be needed for salaries, supplies, equipment and other expenses. Because it may be difficult or virtually impossible for a school to depend strictly on funds allotted from the school district, school funding must be found from other sources.
Following are three sources for charter school funding:
- School Grants-Many charter schools rely on grants for funding, especially for initial start-up expenses and additional programs that may be added to the school's curriculum. Grants from sources such as the Charter School Growth Fund (CSGF) have allowed an increase in the creation of charter schools over the decade or so. In many cases, the state education department will secure large amounts of grant money through federally funded programs. School districts wishing to develop a charter school must then apply for a portion of the education grant money according to state guidelines and specifications for applications. In many cases, priority funding is given to those charter schools which will service educationally disadvantaged students in a district.
- Local Funding-In some cases, a local school district may have enough money for school set aside in its budget to assist with the development or maintenance of a charter school. Parties interested in implementing a charter school may want to approach their local school board and superintendent to inquire about education funding that may be earmarked for special projects. Although in most cases, the district will not be the sole funding source of the charter school, there may be enough funds available to maintain certain areas, such as salaries and/or supplies each year or other areas needing educational funding.
- School Loans-While most schools typically prefer to gather the majority of their funding from grants that don't have to be repaid, it isn't unusual for school loans to be secured in addition to grants and financial aid. In 2002 The Reinvestment Fund (TRF), along with NCB Development Corporation of Washington, D.C., created a program that loans money to charter schools. This program, the Charter School Capital Access Program (CCAP), was then able to expand its charter school loan program and make available funds from other financial institutions as well. TRF has also implemented a second loan program, referred to as TRF Growth Fund.
Finally, the process of seeking funding for charter schools should begin as soon as possible. In many cases, the deadlines for grant and loan applications are several months before any funds are actually allotted. Some schools which are developing budgets may rely heavily on these funds and need to know as soon as possible if the funds will be available.