North Star Academy Receives $19 Million In New Market Tax Credits from LIIF
Two Newark middle school campuses are getting much needed renovations thanks to $19 million in New Markets Tax Credit (NMTC) financing announced today by the Low Income Investment Fund (LIIF) for North Star Academy Charter School. North Star Academy is a member of Uncommon Schools, one of the most recognized nonprofit charter management organizations in the country. North Star Academy is using the funds for its Downtown and Clinton Hill campuses, which together currently serve over 450 fifth through eighth grade students in Newark.
“Uncommon Schools is thrilled to have completed this New Markets Tax Credit transaction, which will yield enormous benefits for North Star Academy. In particular, this transaction will significantly reduce the burden of facility costs – ensuring that North Star can continue to invest the majority of its resources into academic programming,” said Evan Rudall, CEO of Uncommon Schools.
Uncommon Schools has received national recognition for the high performance of its schools. North Star was recently named to BusinessWeek’s list of “America’s Best Schools” as the GreatSchool’s Parent’s Choice in New Jersey. North Star’s students consistently outperform the Newark district and statewide averages on state proficiency tests. In the 2008 results from state proficiency tests, 100% of North Star eighth graders scored advanced or proficient in both English Language Arts and Math, compared to statewide averages of 81% in English Language Arts and 68% in Math. In Newark, 57% and 38% of eighth graders scored advanced or proficient in English Language Arts and Math, respectively. For five years in a row, 100% of the school’s students have graduated from high school and been accepted into four-year colleges.
Despite these stellar results, North Star Academy, like other charter schools, faces significant challenges in securing financing for facilities. Unlike traditional public schools, North Star does not receive state funding for facilities projects. LIIF, a leading community development financial institution, provided $19 million of New Markets Tax Credits and led a loan with a coalition of partners including The Reinvestment Fund. U.S. Bancorp provided $6.5 million in equity to the transaction.
“Nothing is more important than the education of our children. That is why LIIF is pleased to be able to provide this funding to North Star Academy, which has an incredible record of helping Newark youth achieve academic success. In addition, North Star is a well run organization,” said Nancy Andrews, President and CEO of LIIF. “This deal highlights the importance of the NMTC program in ensuring that great organizations, like North Star Academy, continue to have access to capital in this difficult credit environment.”
Michael Ambriz, COO of North Star Academy noted, “Though the great work of LIIF, North Star will now be able to further its goals to serve even more students in Newark. In a tough economic climate where operational funding remains a challenge, we are incredibly thankful for LIIF’s involvement in this facilities transaction. The project will directly translate into additional options for our college-bound students, and we hope that through continued partnerships with organizations like LIIF, we are able to continue to expand our impact.”
The NMTC program was established by Congress in 2000 as a way to encourage economic development in the nation’s low-income areas. Over $19 billion in NMTC investments has been generated since the program’s inception.