The Equitable Facilities Fund, a social impact fund supported by the Walton Family Foundation’s Building Equity Initiative, has announced that it will provide $500 million in low-cost loans over the next five years to high-performing public charter schools run by people of color.

The commitment will enable about thirty leaders of color of charter school networks serving fifty thousand students to secure facilities funding. EFF estimates that the funding will save those schools $100 million in the form of lower borrowing costs for their facilities compared with those of other financing sources — savings that school leaders will direct back into the classroom to provide support for students and teachers.

According to EFF, diversity in public school leadership has lasting positive effects on students. Research has shown that Black students who have just one Black teacher by third grade are 13 percent more likely to enroll in college and low-income young Black men are 39 percent less likely to drop out of high school if they have had at least one teacher who looks like them. Yet leaders of color often face barriers to accessing the financial resources and social networks needed to successfully launch, run, and expand schools. Over the past three years, EFF has provided $585 million in low-cost financing to support more than a hundred public charter schools, where 82 percent of students identify as people of color and 70 percent are from economically disadvantaged families.

“The lack of affordable access to capital holds back our best schools from growing,” said EFF founder and CEO Anand Kesavan. “As investors and as philanthropists, we’ve long been focused on how issues of race impact our work. Investing in communities of color can no longer be something we do as part of our business plan, it has to be our business plan. For EFF, quality public schools unlock opportunity, and school leaders sit at the very top of this value chain.”

(Photo credit: GettyImages/BRPH)