By JENNIKA INGRAM | Reporter
Palisades Charter High School is accepting a $4.6 million Paycheck Protection Program loan to help the school ride through potential funding cuts and cash deferrals it could be hit with in the future, after gaining approval from its Board of Trustees during a May 12 meeting.
Following a special meeting conducted virtually last Tuesday, which included a presentation by Chief Business Officer Greg Wood, the board passed a motion to accept a PPP loan of $4,606,000, with an amendment that Dr. Pam Magee, Pali High executive director, be authorized to sign on the board’s behalf.
California Governor Gavin Newsom recently released the May revised budget and suggested there are going to be significant cash deferrals for education, Wood explained to the Palisadian-Post.
“This money will be used to offset cash deferrals over a number of years,” Wood said referring to the loan. “Funding cuts and cash deferrals are both on the table for public schools. All the details are not known yet.”
The Paycheck Protection Program is a nearly $350 billion, federally funded loan program that originated from the Coronavirus Aid, Relief and Economic Security (CARES) Act that may be forgiven if requirements are met.
“It is initially set up as a loan, which we applied for because we are definitely going to be in need for it,” Wood shared. “We are accepting the money in the aspect of it being purely a loan. It’s a loan whether it’s forgiven or not.”
The bank is helping look into the foregiveability of the loan for Pali High. The school will seek legal and financial advice in the months ahead to look at the best interest of the school and if they fit the criteria, Wood shared.
At the time of the meeting, the loan was already approved through the Small Business Administration, contingent on the board’s approval. Pali High was not required to have the board’s approval to submit an application to the SBA through a lender, but it did need the board’s approval to accept the loan.
Since Cathay Bank, the school’s bank, was unable to assist, Pali High used Utah-based Cache Valley Bank. Cache Valley Bank was not an approved bank of Pali High before, and any new bank used by the school needs approval by the board.
Consequently, the Board of Trustees passed a second motion approving the school’s use of Cache Valley Bank for the loan.
Following the special meeting, the loan was accepted and the money was transferred on May 15, according to Wood. Pali High is a 501(c)(3) nonprofit, which means they are under the umbrella to be eligible to apply for a loan, Wood explained.
“The maximum amount you can request is $10 million dollars,” Wood continued. “And you can only have 500 or less employees. We had all of those criteria.”
Pali High’s funding differs from other charter schools in the Palisades, including Palisades Charter Elementary, Marquez Charter Elementary, Canyon Charter Elementary and Paul Revere Charter Middle schools, which is why the school opted to apply for the program.
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