For their October 2019 bond issue, IDEA Public Schools earned an “A-” underlying bond rating from Standard & Poor’s.\u00a0 This represents the first time a charter school has earned an underlying rating in the “A” category on its own, without any form of enhancement or support.\u00a0 This is truly a significant accomplishment, and an important milestone for the charter school industry!\u00a0 It also means all $900+ million (yes, you read that correctly) of outstanding debt carries the same “A-” underlying rating, whether or not a particular series is guaranteed by the PSF.<\/p>\n
The 2019 issue, which totaled over $214 million, all new money, was also guaranteed by the Texas PSF, earning a “AAA” rating on top of the underlying “A-“.\u00a0 For 30-year debt, IDEA’s TIC was 3.01%.\u00a0 Yowza!<\/p>\n
For years, rating agencies have theoretically held that charter schools could break out of the “BBB” or “Baa” category, but no agency had ever gone as far as to actually assign such a rating.\u00a0 No longer.\u00a0 In granting the upgrade from “BBB+”, S&P focused on the very strong enterprise profile of IDEA’s operations in Texas.\u00a0 They noted IDEA’s proven track record to successfully manage expansion while maintaining very strong academic and financial performance.\u00a0 They also highlighted IDEA’s sophisticated management team with an extensive “bench”, historically positive operation margins, and\u00a0 consistently favorable test results remaining well above state averages.<\/p>\n
This rating was at least a year overdue.\u00a0 Ratings are relative measures of risk, and with other ratings in the charter school industry in the high “BBB” category assigned last year, there was a false impression that the group of schools in the “BBB+” category were all the same.\u00a0 But, what separates IDEA is the ability to obtain the academic and financial results they do at the the unprecedented scale at which they obtain them.\u00a0 The 2020 budget is based upon over 50,000 students across five regions totaling 91 schools on 45 campuses.\u00a0 And, they plan to keep on trucking into new regions in Texas, as well as expanding into other states.\u00a0 The 2020 operating budget for Texas is in excess of $650 million.<\/p>\n
Buck Financial serves as Co-Financial Advisor to IDEA, as does Masterson Advisors LLC.\u00a0 Robert W. Baird & Co. served as senior manager, Hunton Andrews Kurth served as bond counsel, McCall Parkhurst served as underwriter’s counsel, PMSI serves as project manager to IDEA, BB&T Capital Markets served as Co-Manager, and Regions Bank served as Trustee.<\/p>\n
Congratulations to the students, families, and staff at IDEA Public Schools on another successful bond issue.\u00a0 And “Well done!” to the staff and leadership of IDEA on showing that the “A” bond rating category does not have to remain a theoretical construct.<\/p>\n","protected":false},"excerpt":{"rendered":"
For their October 2019 bond issue, IDEA Public Schools earned an “A-” underlying bond rating from Standard & Poor’s.\u00a0 This represents the first time a charter school has earned an underlying rating in the “A” category on its own, without any form of enhancement or support.\u00a0 This is truly a significant accomplishment, and an important… read more<\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-274","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/posts\/274","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/comments?post=274"}],"version-history":[{"count":1,"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/posts\/274\/revisions"}],"predecessor-version":[{"id":275,"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/posts\/274\/revisions\/275"}],"wp:attachment":[{"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/media?parent=274"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/categories?post=274"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buckfinancial.net\/blog\/wp-json\/wp\/v2\/tags?post=274"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}