Facilities financing: Monetizing education's untapped resource

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Article Highlights

  • 3 ways to help better school facilities' needs #education

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  • Himanshu Kothari explores the causes of the nation's $300 billion funding shortfall in K-12 facilities #education

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  • Public-private partnerships to fund schools work #education

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Like most everyone, schools have been forced to tighten their belts to survive in today's economic downturn. School leaders have been cutting budgets for afterschool activities, classroom equipment, and staff, all in an era of increasing academic expectations. It is little surprise, then, that facilities issues have been relegated to the bottom of the to-do list. However, the enormous costs and burdens of outmoded facilities arrangements represent an immense opportunity for the nation's school systems.

In "Facilities Financing: Monetizing Education's Untapped Resource," finance specialist and education real estate expert Himanshu Kothari explores the causes of the nation's $300 billion funding shortfall in K-12 facilities and offers concrete recommendations to address this troubling trend. Kothari posits that public-private partnerships are a promising avenue for tapping the resources needed to address capital needs, but that current financial conditions in K-12 scare off potential investors. By overhauling facilities financing and exploring innovative approaches, policymakers can create the space for private investors to support school facilities.

Helping schools better meet their facilities needs, Kothari argues, entails:

1) Holding educators and schools accountable for academic and financial performance.

2) Loosening regulations that limit the reach of charter schools and other nontraditional programs.

3) Creating more opportunities for schools to take advantage of nontraditional financing options.

Enacting such measures, Kothari asserts, will allow for a more stable and investor-friendly system for financing facilities. He explains, "Once established, uniformity, liquidity, and stability can foster increased partnerships between public and private parties, bringing more resources into the sector and allowing educators more time to tend to their profession."

Himanshu Kothari is a Partner and Co-Founder of PDF LLC, a development venture seeking to finance, develop, and operate cancer treatment centers in the US.

 

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