Kirton McConkie represents APA in largest charter school financing in Utah’s history
(Salt Lake City, UT June 28th, 2018) Kirton McConkie recently represented Utah Charter Academies (commonly known as American Preparatory Academy, or “APA”) on the largest charter school financing in Utah’s history. APA closed on financing for $41.835 million on June 6, 2018 through the Utah Charter School Finance Authority after earning their “credit enhancement” which upgraded their credit rating from a BBB- to a AA rating from Standard & Poors.
According to Brad Findlay, Board Chair for APA, “This financing means APA has much more flexibility to put money where we need it for teachers and curriculum. It also gives us much more certainty for the future operations of our school, allowing us to focus even more on how to improve the educational experience of our students.”
Several factors contributed to making this landmark financing in the history of Utah charter schools:
- This was the largest charter school financing in Utah’s history, with the second largest being also done by APA in 2015 for $29.550 million.
- This was the first charter school financing in Utah’s history to use and successfully retire New Market Tax Credit financing, which led to APA receiving a net benefit of approximately $4 million after costs.
- This was the first charter school financing in Utah’s history to use and successfully retire Qualified School Construction Bonds, resulting in a substantial savings on interest.
- This had the lowest “spread” on the interest rate between the interest rate paid by the school and the municipal market index, coming in at 20 basis points lower, resulting in savings to APA of approximately $80,000 a year.
The savings allows APA to construct a $10 million auditorium at their Draper 2 Campus, creating a facility that will further enhance the many performing arts programs at APA, and serve as a community resource. Such facility will allow APA to better compete for students by having school facilities comparable to those that traditional public schools typically enjoy.
Kirton McConkie has been the primary outside counsel for APA since 2008 and has helped APA structure, finance and build the largest charter school network in Utah, with nearly 5,000 students, through a series of strategic expansions and financings.
Joel Wright of Kirton McConkie stated, “I consider it a privilege to represent the APA team. They have taken their vision and expanded it through courage and grit, substantially improving the public education system in Utah by focusing on the basic elements of education that students and parents value most.”
The financing could not have taken place without the determined effort over a nearly eight year period from a number of outstanding professionals, including Robert W. Baird & Co. as the underwriter, and Buck Financial Advisors LLC as the financial advisor.
Joel Wright, Shareholder