PCSD 2022 Impact Report

2022 IMPACT REPORT CREATING LONG-TERM HOMES FOR HIGH-QUALITY CHARTER SCHOOLS

2 | Pacific Charter School Development

DEAR PARTNERS AND SUPPORTERS, Pacific Charter School Development (PCSD) was founded 18 years ago based on the belief that every child deserves the opportunity to learn in a vibrant and inspiring school facility. Charter schools have long struggled to identify, secure, and finance school facilities that fulfill their growth plans. Our mission at PCSD is to dismantle systemic inequality in education by expanding educational opportunities for students in under-resourced communities.

Fueled by the collective commitment of our charter school partners and the generous support of our philanthropic partners, we have delivered more than 100 facilities and added 43,000 more seats in high-quality charter schools since 2004. The pandemic did not slow our progress or urgency. Over the past two years, we have completed 19 charter school facilities providing 6,100 additional seats. We continue to be inspired by the commitment, drive, and impact of our charter school partners.

Our dedicated PCSD and WCSD (Washington Charter School Development) staff have spent the past two years intensely focused on living one of our core values: empathy.

Throughout the pandemic, we made it a priority to safeguard the health and well-being of our extended community, and to check in regularly with both the school leaders we support and with one another. We also helped relieve the burden of facilities from what was and continues to be a stressful and taxing time through creative solutions that kept all of our facility projects progressing on time and on budget.

On the cover: Ednovate USC Hybrid High College Prep

Diversity, equity, and inclusion remains central to our work. We are committed to creating school facilities that meet the needs and aspirations of communities of color, intentionally partnering with businesses led by people of color, fostering a PCSD workplace where team members of all backgrounds can thrive, and celebrating our team’s diversity.

We could not do our important work without our philanthropic partners and volunteer board. We are grateful to our donors for their ongoing investment in our vision, and to our Board of Directors for their leadership and guidance as we navigated challenges these past two years.

As we approach our third decade, we will continue to invest in under-resourced communities throughout California and Washington State in order to further expand access to high-quality learning. We are also poised for growth, and are exploring opportunities to broaden our impact and bring our unique approach into new regions and support growing sectors, particularly in communities of color.

We are excited and encouraged by what’s to come, and we look forward to the possibilities of the future we are building together.

Reginald Gilyard Board Chair PCSD

John Sun Chief Executive Officer PCSD 2022 Impact Report | 3

Our Mission Broad inequity in public education has left many students without high-quality educational options. In historically under-resourced communities, a lack of affordable school facilities has been a consistent barrier to growing quality schools. PCSD exists to break down that barrier.

“PCSD is a true partner. We rely on them as subject matter experts, and have full confidence in their advice.”

— Saman Bravo-Karimi Former CBO Bright Star Public Schools

4 | Pacific Charter School Development

PCSD’s mission is to dismantle systemic inequality in education by expanding educational opportunities for students in under-resourced communities.

Systemic Inequity in Education • In the Los Angeles Unified School District, just 11% of schools reached the statewide average in English and math for their African American students, based on a report released in 2019.

• Across Washington state, less than 15% of low-income students met State math standards and just 31% met state English standards in fall 2021.

• Low-income students in Washington are half as likely to enroll in a 4-year institution immediately after high school as their non low-income peers.

Our Unique Approach

O U R A P P R O A C H T O W O R K I N G W I T H PA R T N E R S I S CHARACTERIZED BY FOUR CENTRAL TENETS: MISSION ALIGNED

TRUSTED PARTNERS

SECTOR EXPERTS

TENACIOUS PROBLEM SOLVERS

We share the commitment of our charter school partners to provide students in under-resourced communities with greater access to educational and career opportunities. We are fully invested in our partners’ success as they work to create transformative change for students and families.

We have decades of experience and expertise guiding partners through the complex facilities development process, leading and driving the work so our partners can stay focused on what matters most: teaching and learning.

Our Team

We maintain a trusting, collaborative relationship with our charter school partners, built on timely, clear, and transparent communication. We are committed to our partners’ financial sustainability and to ensuring they do not commit to deals they will be unable to afford long term.

Unforeseen roadblocks are inevitable in the facilities development process. We work sideby-side with our charter school partners to solve complex challenges to ensure facilities projects are delivered on time and on budget.

PCSD & WCSD Staff

PCSD and WCSD are led by a dedicated team of professionals with broad experience and expertise, ranging from business to architecture and construction to urban planning. We strive to reflect the diversity of the communities we serve, and advance diversity and inclusion in our own hiring, retention, and promotion practices for staff and leadership. We also seek to collaborate with other organizations making efforts to advance racial and social equity.

42%

42% identify as people of color

63%

63% identify as women

PCSD & WCSD Leadership

64%

64% identify as people of color

50% 50% identify as women

What We Offer STRATEGIC PLANNING

PROJECT MANAGEMENT

ACCESS TO CAPITAL

We advise on how to align short and long-term facilities needs with growth plans, affordability, and financing.

We manage all aspects of a facilities project, from site search to design to construction, and everything in between.

We provide qualified charter school partners access to low-cost capital through philanthropic equity and our lending partners.

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Our Impact

WHO ARE THE CHARTER SCHOOLS WE SERVE? SCHOOL

100%

of the facilities we develop are for non-profit charter schools

91%

75%

89%

91% of students in PCSD’s partner schools are people of color

75% of students in PCSD’s partner schools are socioeconomically disadvantaged

89% of partner schools outperform their local district on standardized tests

PCSD TIMELINE 2004

2008

PCSD was founded with philanthropic support from NewSchools Venture Fund, The Eli & Edythe Broad Foundation, and The Walton Family Foundation to create an organization of real estate and education professionals to scope, build, and invest in high-quality charter schools serving under-resourced communities.

PCSD reached 20 completed facilities, creating more than 8,500 seats for emerging LA charter networks such as Green Dot, Alliance, Aspire, and KIPP SoCal.

W H AT H AV E W E A C H I E V E D S I N C E O U R FOUNDING IN 2004?

106

SCHOOL

school facilities built or renovated

43,078 new seats created in high-quality charter schools

72

completed projects that received equity investments

38

charter school partners supported

2010

2012

PCSD partnered with Equitas Academy in Los Angeles, which expanded the focus from PCSD serving primarily multi-school charter networks to also include single-site school operators.

With support from The Walton Family Foundation, PCSD launched two projects in Boston, and also established a partnership with the Building Excellent Schools Network to provide in-house facility training to its fellows.

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Maximizing Investments Through Revolving Funds PCSD’s unique funding model allows us to leverage philanthropy to at least 5x the original investment. Traditionally, philanthropists have contributed to a school’s capital campaign, which supports that individual school or charter management organization. When philanthropists contribute to PCSD, we recycle those investments over several years to build multiple schools. In our model, a school is typically able to repay PCSD’s initial investment within 3-7 years of opening, which allows PCSD to redeploy that investment into another school. Fueled by philanthropic support, PCSD has invested in over 70 schools since 2004.

The partners we have supported through equity investments are diverse in both their geography and educational model, and are generally growing schools with a high-quality educational program that are in their first three years of operation.

$985M+

philanthropy, private financing and state funding leveraged Equity invested in under-resourced communities Southern California - $98.4M Northern California - $38.7M Washington - $60M

$103M+ repaid and reinvested in new school projects

$

P C S D T I M E L I N E (CONTINUED) 2013

The Bill & Melinda Gates Foundation and PCSD partnered to begin development of 8 charter schools in Washington.

In 2015, PCSD established Washington Charter School Development (WCSD) to serve the local market.

8 | Pacific Charter School Development

2015

PCSD expanded to support the Bay Area with a goal of raising a $50M revolving loan fund. PCSD opened an office in Oakland and delivered its first two Bay Area projects in 2017.

“PCSD went above and beyond to get our project off the ground....

From planning to financing to project management, the team has been instrumental.”

— Kevin Sved, CEO, Navigator Schools

2020

2021

PCSD launched a Covid Loan Assistance Fund to help partners prepare for a safe return to in-person learning.

PCSD delivered its 100th school facility with the completion of Why Not You Academy in Washington State.

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Leading Through the Pandemic

P C S D H A S S U P P O R T E D S C H O O L S I N M U LT I P L E W AY S T H R O U G H O U T T H E C O V I D - 1 9 PA N D E M I C PROJECT MANAGEMENT In 2020 and 2021, our team kept 19 projects moving forward to on-schedule delivery, despite the hurdles presented by the pandemic.

FINANCIAL SUPPORT In July 2020, PCSD established a Covid Loan Assistance Fund for PCSD partner schools.

The loans provided a 2-year term with 0% interest, designed to assist operators with cash flow while they prepared their facilities for a safe return to in-person learning. A total of $150K in loans were executed, providing relief to 3 schools within our portfolio.

TECHNICAL ASSISTANCE PCSD provided technical assistance to operators, helping to brainstorm and assess improvements to increase health and safety for school reopening.

THOUGHT LEADERSHIP In October 2020, PCSD partnered with California Charter Schools Association to host a webinar focused on disseminating best practices for preparing facilities for a return to school.

10 | Pacific Charter School Development

SINCE JANUARY 2020 SCHOOL

19

school facilities built or renovated

13

completed projects received equity investments

6,182

new seats created in high-quality charter schools

“PCSD plays a critical role, especially for newer charter management organizations or charter schools that don’t have expertise in-house.”

— Allison Suffet Diaz Founder and Director of Growth & Sustainability Environmental Charter Schools

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O U R IM PACT

Southern California

SUPPORTING INNOVATIV E A ND HIGH - PERFORMING SCH OOLS Southern California represents PCSD’s largest and most developed region. In the first few years in the region, PCSD focused on serving large charter networks, acting as their facilities and development arm. As the charter sector in California grew, a variety of academic models began to flourish, and PCSD began to support smaller operators, helping them grow into their first facility and then replicate to serve more students. Today, PCSD’s Southern California partners include some of the most innovative and highest-performing public schools in the state - such as Ednovate, Bright Star, Equitas, Green Dot, and KIPP SoCal.

18

YEARS

High-quality charter school seats created

working with charter schools in Southern California

29,257 since 2004

6 since 2020 2,125 since 2020

70

High-quality charter school Projects seats created

Completed

29,257 since 2004

12 | Pacific Charter School Development

$

$98.4M total philanthropy invested

PA RTN ER S POTLIGHT

“

PCSD has been a valued and trusted partner to Green Dot for over a decade.

We appreciate their ability to grow with us and develop creative solutions to facilities challenges we encounter along the way.”

— Cristina de Jesus CEO and President, Green Dot Public Schools California

Ánimo Pat Brown Charter High School For almost two decades, PCSD and Green Dot Public Schools have worked together to develop a combined 9 campuses, collectively providing a high-quality education to 6,680 students throughout the Los Angeles area.

One of these campuses is Ánimo Pat Brown Charter High School (APB) in LA’s FlorenceFirestone community. In 2008, PCSD and Green Dot partnered to develop Green Dot’s initial campus for APB in an industrial area next to an old mattress factory. Years later, the owner of the mattress factory approached PCSD and Green Dot about turning the building into a school. Not only was this a chance to create a larger campus for APB, it also freed up APB’s original facility to house one of Green Dot’s nearby middle schools, creating a 6-12 grade continuum for the Florence-Firestone community.

Converting a former industrial space into a high school campus was a complex undertaking.

The project was originally to be completed with state funds, but when that plan fell through due to the challenges of adapting the site, PCSD led the way in securing private funding instead. The PCSD team acted as liaisons and advocates for Green Dot, coordinating with the seller, local agencies and officials, and community members to make sure all requirements were met and the school could open safely.

Construction began on the new APB High School complex in 2019 and was completed in August 2020, but sat vacant for a year due to the Covid-19 pandemic. The school opened for inperson learning in August 2021. What was once a bare-bones industrial facility is now a modern facility for APB’s 600 students. The school features classrooms with high ceilings and fullyequipped science labs. The school’s signature blue serves as an accent in classroom spaces, creating brightness and unity across the campus.

The development also combines the high school with Green Dot’s Animo Florence-Firestone Charter Middle School on one 3.5 acre campus, allowing both to share programmatic resources and outdoor space. In an area where many charter schools have limited outdoor space, the PCSD and Green Dot teams turned the factory’s sprawling old parking lot into a huge artificial turf field, where students play soccer after school.

PCSD was there every step of the way to help Green Dot navigate the project’s many complexities. “PCSD has been a valued and trusted partner to Green Dot for over a decade.

We appreciate their ability to grow with us and develop creative solutions to facilities challenges we encounter along the way,” said Cristina de Jesus, CEO and President of Green Dot Public Schools California.

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O U R IM PACT

Northern California LE V ER AGING SCHOOL DISTRICT PA RTNERSHIPS

By many estimations, the Bay Area is the most expensive real estate market in the United States. Since 2015, PCSD has supported Bay Area charter schools as they struggled to access facilities, leveraging philanthropy in a traditional bridge equity model, and helping Bay Area schools access nearly $176M in state funds to develop facilities on existing district campuses. This is not only an operational win for schools, who will stay in the communities where they’ve been operating, but also a land use win in a state struggling to build sufficient housing, and a financial win for districts who struggle to secure funds to improve the facilities.

7

YEARS

High-quality charter school seats created

working with charter schools in Northern California

7,445 since 2004

6 since 2020

1,847 since 2020

19

High-quality charter Projects school seats created

Completed

14 | Pacific Charter School Development

$

$38.7M total philanthropy invested

PA RTN ER S POTLIGHT

Lazear Charter Academy

“

As a former school principal, this isn’t something I could necessarily do on my own. ... PCSD staff possess expert and complementary skills that aren’t generally within an educational team.”

— Ernest Peterson Director of Special Projects, Education for Change

Since converting to a charter school in 2012, Lazear Charter Academy has been providing an education focused Science, Technology, Engineering, Arts, and Mathematics (STEAM) to students in Oakland’s Fruitvale neighborhood. In 2018, the school’s campus consisted largely of portable buildings and outdated classrooms.

This STEAM-focused school needed a modern facility – without spending a fortune.

PCSD was a natural partner to help renovate the Lazear site. With a deep understanding of the charter school facilities landscape in California, PCSD offered expertise in project management, school construction financing, and navigating the specialized world of construction. “As a former school principal, this isn’t something I could necessarily do on my own,” says Ernest Peterson, Director of Special Projects at Education for Change, the charter management organization that operates Lazear and five other Oakland charter schools. “PCSD staff possess expert and complementary skills that aren’t generally within an educational team.”

Lazear’s STEAM focus in elementary grades – a relative rarity in the Oakland charter school landscape – meant the school needed plenty of space for hands-on learning. With input from students, staff, and families, PCSD and the Lazear team came up with a school design

that was bright and welcoming, and included spaces for student-directed learning. Originally the Lazear team envisioned a fully indoor facility. When budget constraints prevented that, PCSD guided the team to a more costeffective and safety-conscious outdoor design.

Completed in 2021, the new Lazear Charter Academy facility includes a Maker Space, an amphitheater, fully modernized classrooms, and a brand-new playground and sports field. Peterson’s favorite space on campus is the multi-purpose room, with roll-up doors that provide increased airflow – a major consideration during the Covid-19 pandemic – and creating a flexible indoor/outdoor space that flows into the amphitheater next to it.

With PCSD’s guidance, the team financed the project through California’s Propositions 1D and 51, which provides school districts funding for charter school renovations. PCSD’s expertise with Prop funding ensured that all requirements were met and finances were on track, and through a bridge loan from PCSD, Lazear was able to keep the project going as they waited for the Prop funding from the state. It was a win-win partnership. Lazear was able to secure a long-term lease for the school site while bringing state funds into the Oakland Unified School District, strengthening the school’s relationship with the district and its roots in the Fruitvale community.

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O U R IM PACT

Washington

SUPPORTING E A RLY-STAGE OPER ATORS PCSD first began partnering with Washington charter schools in 2013 and established Washington Charter School Development (WCSD) in 2015 to provide development and ongoing support to charter operators throughout the state. In less than a decade, WCSD has completed 15 projects in Washington, supporting expanding CMOs like Summit Public Schools, as well as supporting homegrown CMOs like Impact Public Schools and single site operators throughout the state.

WCSD has deployed approximately $60M in philanthropic equity to support the Washington charter sector, providing both facility loans and grants to further support early stage charter schools. WCSD recently secured an additional $5M in capital and recycled $2M of its own funds to support the next generation of Washington facility development and expansion.

9

YEARS

High-quality charter school seats created

working with charter schools in Washington

5,301 since 2004

7 since 2020

15 Projects charter school High-quality seats created Completed 5,301 since 2004

16 | Pacific Charter School Development

1,180 since 2020

$

$60M

total philanthropy invested

PA RTN ER S POTLIGHT

Impact Public Schools | Salish Sea Elementary

“

Once we established that relationship, [WCSD] came to all the community meetings. They were always open and happy to answer questions.”

— Tony To

“

Former CEO, HomeSight

It makes me really proud to know that our scholars are here in that space.”

— Egypt Burton Charles Principal, ISSE

School facilities projects are often developed in isolation from other local projects. This was not the case with Impact | Salish Sea Elementary (ISSE) in South Seattle. As part of a mixed-use development in Othello Square, the origins of ISSE reflected the desires of the community.

The Othello Square development was designed as a hub for the New Holly neighborhood, a diverse community with a substantial immigrant population. The project aims to offer market-rate and workforce housing, affordable commercial space, and community resources such as a jobtraining center and a healthcare clinic.

When the Seattle Housing Authority sought proposals in 2016-17 for the development of the New Holly area, HomeSight, a Washingtonbased community development organization, led a community listening process. Based on these community events, HomeSight developed the Othello Square concept: a series of interconnected community services and housing located in a campus setting adjacent to the Othello light rail stop. Participants in the listening sessions expressed a deep desire to see a college preparatory public school element included in the final campus. HomeSight partnered with WCSD to bring this aspect of the community’s vision to life. “Once we established that relationship, [WCSD] came to all the community meetings. They were always open

and happy to answer questions.” says Tony To, former CEO of HomeSight.

WCSD identified Impact Public Schools – a public charter school network known for its success educating scholars from diverse cultural and linguistic backgrounds – as a potential partner for the space. Impact was looking for a home for their newest elementary school. After WCSD took the HomeSight team to visit an Impact school in neighboring Tukwila, it was clear this would be a natural fit.

With input from the community, WCSD and Impact designed a joyful, inviting learning space for 600 students. ISSE opened in August 2021 to grades TK-2 and plans to add one grade per year until they serve TK-5. The building’s large windows bring in plenty of natural light while offering a panoramic view of the neighborhood.

When children arrive at the school, they are welcomed into an airy lobby that doubles as a multipurpose space, with a staircase that flows into tiered benches for sitting. As the remaining buildings that will form Othello Square are delivered, families will have access to integrated resources, such as on-site healthcare from the Odessa Brown Health Clinic next door. “It makes me really proud to know that our scholars are here in that space,” says Egypt Burton Charles, principal of ISSE. 2022 Impact Report | 17

Looking Ahead

As we forge ahead, we are committed to continuing the work that has made an impact over the past 18 years. We are also exploring ways to expand our work and increase our future impact.

Some of these efforts include:

Expanding Real Estate Career Options for Charter School Students and Alumni

Supporting New Charter School Markets and Emerging Operators

In 2021, PCSD participated in the Construction Industry Workforce Initiative’s paid summer college internship, hosting a charter school alumnus from Leadership Public Schools. In the coming year, we are developing a paid internship program to create career pathways for students from our partner charter schools in the fields of construction, architecture, engineering, and finance. The students will be placed with PSCD and our real estate development partners.

PCSD is in a strong position for growth, and we see an opportunity to expand our place-based approach to support other growing charter markets. We have learned many lessons from our expansion into Washington State and Northern California, particularly the need to support emerging school operators with providing facility solutions, enabling them to focus their time and energy inside their classrooms. These lessons will drive our future expansion and support of our partners.

Investing in Black Leaders, Businesses, and Communities

Prioritizing Community Development and Multi-Use

PCSD aims to create intentional partnerships with Black professionals and Black-owned/Black-led organizations to break down systemic barriers to growth. In addition, we are collaborating with LISC to increase access to facility financing for schools educating a high percentage of Black students. We will be piloting this project with a charter school partner with a goal of replicating the model.

We strongly believe that education is a key pillar of community development. In 2021, we completed the development of Impact | Salish Sea Elementary in Seattle, a school facility that is not only integrated into the neighborhood but also part of the Othello Square community development project. As we look ahead, we will intentionally seek additional opportunities to develop facilities that are integrated with community hubs and support upward mobility.

18 | Pacific Charter School Development

Gratitude Our Philanthropic Partners

Washington State Investors

We are deeply grateful to our generous supporters, who have invested in building inspiring learning spaces for more than 43,000 students across California and Washington.

Ballmer Group

National Investors Walton Family Foundation

Northern California Investors Chan-Zuckerberg Initiative

Bill & Melinda Gates Foundation

Our Boards of Directors We are also thankful for the leadership, guidance, and support of our dedicated boards of directors for PCSD and WCSD, whose wisdom and expertise help drive our mission and work forward.

City Fund

PCSD Board

Doris & Donald Fisher Fund

Reginald H. (Reggie) Gilyard, Chair

Bill & Melinda Gates Foundation

Paul Habibi, Secretary

Charles & Helen Schwab Foundation

Alex Busch

Silicon Valley Community Foundation

Eric Johnson

Sobrato Family Foundation

Eli Kennedy

Southern California Investors The Ahmanson Foundation

John Sun Eric Sussman

The Eli & Edythe Broad Foundation

WCSD Board

W.M. Keck Foundation

Bill Kiolbasa

NewSchools Venture Fund

Patrick Ontiveros

The Ralph M. Parsons Foundation

John Sun

Weingart Foundation

In addition to the current board members listed above, we thank Rich Billings, who recently transitioned from PCSD’s board after 10 years, and Eli Kennedy, who recently transitioned from WCSD’s board after 8 years.

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Los Angeles Main Office 600 Wilshire Blvd, Suite 200 Los Angeles, CA 90017

Bay Area Office 66 Franklin Street, Suite 300 Oakland, CA 94607

Washington Office 107 Spring St Seattle, WA 98104

www.pacificcharter.org | info@pacificcharter.org