The Arizona Chamber Foundation today released its latest policy brief, “Schoolhouse Ad Hoc: The State of School Construction in Arizona.”
The paper, written by Chamber Foundation Research Fellow Justin Graham as part of the Foundation’s “A for Arizona” project looks at the historic and current system for financing district and charter schools in Arizona and explores possible options for creating a system that is more fiscally sound and reliable.
We are excited about this paper because it is the first in a series of policy papers from “A for Arizona.” Lisa Graham Keegan, former Arizona state Superintendent of Public Instruction, and all-around spectacular mind on all things education reform, is leading this project for the Arizona Chamber Foundation and the Tucson Hispanic Chamber. We are thrilled about the potential this project holds, and incredibly grateful to work with Lea Marquez-Peterson at the Tucson Hispanic Chamber as we continue to examine critical education policy issues around increasing, expanding, and replicating high-performing traditional and charter school public education models in Arizona.
Our research found that Arizona’s system for school construction is inefficient and unstable and doesn’t aid in the expansion and replication of high-quality district and charter schools.Who knew that capital financing for school construction could be so intricate? We are encouraged, however, that there are models employed by other states around the country that could help bring down the cost of capital. More importantly, our interest at “A for Arizona” is to increase access to better educational options for families that could prove helpful to Arizona policymakers, and we are hopeful this research will inform that conversation as well.
The paper charts the history of school construction in Arizona and the use of debt financing mechanisms such as general obligation bonds and lease-purchase agreements and examines the formation and current status of the School Facilities Board, which was charged with public school construction and repairs.
The state Legislature has not funded the SFB in a way that was envisioned at the time of the board’s formation. As a result, school districts are reverting back to using general obligation bonds for school construction. But property-poor districts are less likely than property-rich districts to be able to access bonds, thus resulting in the same inequities in school construction we had hoped to overcome over 20 years ago, while doing nothing to aid the expansion of quality district or charter schools. On the charter school front, some have been able to access revenue bonds, but for most, construction financing remains elusive.
The paper examines potential options, however, that Arizona could pursue to develop a better school construction financing model while increasing access to quality schools, ranging from using the state land trust to back bonds to establishing a revolving loan fund to finance high quality schools.
Other states have grappled with similar school construction challenges, but have found creative ways to overcome those challenges. Arizona has options. We are hopeful that lawmakers and education leaders will use this policy brief as a conversation starter that will lead to substantive policy reforms.