The estimated construction budget totals $24,867,845.  The Foundation has put in $1,601,565 of donations into the project as of the end of June 2020 and has $816,081 of cash on hand and incoming pledge payments of $850,000 expected to be received before the loan closing with EFF.  The Equity in Project + Cash on Hand + Incoming Pledges + EFF Loan proceeds = $24,267,646 which is $600,199 short of the Total Project Cost.  EFF requires that the total project is funded with cash on hand and loan proceeds at the closing.  In order to avoid applying for a bridge loan with Boston Private Bank to fund this $600k gap, the School should consider contributing some of FY20 surplus funds to the Foundation for the Project.  

Due to the school closure, the school incurred less expenses and had an increase in food service revenue due to the changes in reimbursement rates post COVID19, and also had an increase in private funding due to COVID19 relief funds.  This resulted in a larger than budgeted surplus.   The surplus results in a 1.84 DSCR which is well above the 1.2 covenant requirement.  If the School were to contribute $300k to the Foundation in FY20, the DSCR would be 1.34, still well above the covenant requirement.

-Finance committee is making the recommendation that the BOT approve contributing a $300k of the FY20 operating surplus to the Foundation. 

- Finance committee is also recommending that the BOT approve a $300k "Bridge Loan" between the School and Foundation which will be repaid using incoming pledge payments in FY21.