Some dots that need connecting

by David Safier

This all sounds very interesting to me, but I'm not sure what it means. So, dear reader, here are some dots which could use some connecting.

• Bonds issued to American Charter Schools Foundation (ACSF) had a rating outlook of "Negative," but that has been revised to Stable. The bonds currently have a "BBB" rating.
• ACSF is based in Michigan, but it partners with the Leona Group, which is based in Arizona and has numerous schools in the state. Leona Group schools have "American Charter Schools Foundation" in front of their names, like "American Charter Schools Foundation d.b.a. Sun Valley High School."
• According to a Business Wire article, "The Negative Outlook reflects persistent enrollment weakening across nearly all 10 ACSF schools in Arizona for the past three years, pressuring the schools' primary revenue stream of student-based state aid."
• According to the article, when a school goes into debt, the bonds get paid first, through "a trustee intercept of state aid which provides for payment of debt service before any pro-rata distribution of revenues to the schools, and contractual subordination of the CM0's [Charter Management Organization] fee." In other words, the debt is paid before education services are rendered.
• Here's the biggie: The bonds were issued by our own Pima County Industrial Development Authority (PCIDA), Arizona.

Here's an extra added bonus dot. Leona group says its shrinking enrollment has been caused by Latino flight:

The Leona Group, the CMO, oversees day-to-day operations for the ACSF schools and attributes most of the decline to the weakened employment profile in school markets, and political changes in the state of Arizona that have led some Latino families to relocate or drop out of the public and charter school systems. English language learners (ELL) had been a key demographic for nearly all ACSF schools, making up 25% of enrollment in fiscal 2008. The ELL share declined sharply to just 8.6% in the current fiscal year, due mainly to the decline in local employment, and the fallout in the state from the debate around recently adopted immigration legislation.