Public-Private Financing Now Available to Build K-12 Schools in NC

Under a bill passed Monday by the North Carolina legislature, developers would be able to build K-12 schools and lease them to local governments for decades. School districts in North Carolina can already lease buildings, but not ones that were built just for them. This legislation gives school districts another option for getting new classrooms without a bond referendum. The bill has passed the Senate and the House and now awaits the governor's signature.

Public-private partnerships to build schools have been tried in Virginia, Maryland and South Carolina in recent years, and such financing has been available at the university level in North Carolina and many other states for quite some time.

The legislation is written to effect a state-wide program. A school board could ask developers for proposals for schools in a particular area. Developers would come up with the site, design and funding. The school board and county commissioners would then select among proposals. Alternatively, a school board could ask for proposals for development of a piece of land it already owns.

Although the build-own-operate and lease system could give developers more influence over locations and designs, the school district and county commissioners still would have the final say.

Senate Bill 2009 and the new Article 37 of Chapter 115C of North Carolina General Statutes, specifically new Sections 115C-531 and 532, are available online.