Situation
The Charter School of Arts and Sciences, one of the largest in the U.S., was experiencing severe losses. As a result, the school’s authorization was at risk. In addition, expansion had been financed with $30 million in secured tax-free bond financing.
Action
GGG was retained as Director of Organization. GGG worked closely with management and educators to re-engineer the cost structure of the school. In short order, the financial terms of numerous vendor contracts were reduced and payment plans were negotiated. Additionally, GGG, working intimately with the school’s CFO, bondholders and counsel, negotiating modified terms and forbearance of the bond issue.
Results
The school’s profitability, positive Fund Balance, was returned and authorization was restored at the end of one year. As Director of Reorganization, GGG continued to oversee the profitability of the school and act as liaison between the school and bondholders for the next several years.