JP Morgan is the latest member of the banking world to rally behind the charter school movement. It recently announced a well-articulated $325 million initiative to help build, expand, and renovate facilities of high-performing charter schools. $50 million in grants will go to community development financial institutions (CDFIs) to support their charter funding efforts, $100 million will be made available as “new markets tax-credit equity,” and $175 million will go toward debt financing. Those might sound like big numbers, but JP Morgan estimates that the initiative will help underwrite just forty charter schools. As with any public-private education venture, backlash against the proposal has been fierce. JP Morgan has posited the undertaking as “philanthropy,” which may be a stretch since the firm allegedly stands to profit from government tax credits for its “donations.” Valid, but mostly irrelevant. Let’s not confuse criticism for JP Morgan with the real issue at hand: A new willing and able funding source for already-underfunded charter schools in a desperately tight credit environment.
“JP Morgan Chase Creates $325 Million Fund Initiative for High-Performing Charter Schools,” JP Morgan Press Release, Market Watch, May 4, 2010
“Banking Giant Offers Financing for Charter Schools,” by Mary Ann Zehr, Education Week, May 28, 2010