At least $19M in federal loans awarded to 41 charter schools in North Carolina

North Carolina news

RALEIGH, N.C. (WNCN) — More than 40 charter schools in North Carolina were listed as receiving a total of at least $19 million in federal loans from the Paycheck Protection Program.

CBS 17 News ran the names of each of the 201 charter schools listed on the state Department of Public Instruction website through a database of the 16,324 employers that the U.S. Small Business Association said received loans of at least $150,000 as of early July.

Of the 41 schools that appeared in the data set, three were listed as receiving loans ranging between $2 million and $5 million. Another four were shown as receiving loans of between $1 million and $2 million, including two in our area — Central Park School for Children in Durham and Henderson Collegiate.

The Paycheck Protection Program awards low-interest loans to employers with no more than 500 workers to cover payroll and expenses, and it becomes a grant if the loans are used to keep those employees at the same pay rates.

CBS 17 News found that 19 charter schools received loans between $350,000 and $1 million, and 15 more were listed with loans between $150,000 and $350,000.

Because those loan amounts were provided in ranges and not specific dollar figures, the $19 million represents the lower bound of the total amount received by the state’s charter schools — while the upper bound could reach $47.25 million.

Critics say charter schools could be “double-dipping” because some also were receiving some of the more than $400 million in federal funds awarded to the state through the Coronavirus Aid, Relief, and Economic Security Act. 

Public charter schools are funded mostly by state and local governments. Because some are managed by small nonprofit businesses, those were eligible for PPP loans. Traditional public schools were not eligible for those loans.

“The public money is still supporting charter schools, and there’s no need for PPP funding, which was intended to really help struggling small businesses,” said Natalie Beyer, a school board member in Durham who also is on the board of Public Schools First NC, a nonprofit group that advocates for public education.

Beyer says those charter schools’ boards should meet and vote to return the money to the federal government.

But Rhonda Dillingham, the executive director of the North Carolina Association for Public Charter Schools, called the loans “a real lifeline” and “a real savior” because of the different funding structures for charter and traditional schools.

She said public charter schools “get about 70 cents on the dollar compared to our district counterparts,” and that the per-pupil funding goes toward the students. The remaining 30 percent, she said, typically comes from fundraising.

“It was virtually impossible for these schools to conduct the fundraising that they had done in the past,” Dillingham said. “That’s why the PPP was so important.”

Mary Ann Wolf, director of the Public School Forum of North Carolina, said her group is declining to take a position on the PPP loans.

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