The federal government provides a variety of financial resources for school construction, renovation, or repair. Although few federal programs focus specifically on supporting school infrastructure, many programs may be used for capital improvements at school facilities. Additional resources are available through states and utilities.
The Infrastructure Investment and Jobs Act (IIJA), American Rescue Plan Act (ARP), and 2021 Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) provide tens of billions of dollars in new funding to U.S. K-12 public schools for facility and transportation improvements. Strategic use of this funding will help remedy the historic inequity of school facilities investments, reduce school energy expenditures, help schools lead the nation in solving the climate crisis, and create good-paying union jobs.
Federal tax exemptions and credits lower the cost of capital for construction and renovation of elementary, secondary, and postsecondary schools. Local and state governments may issue public purpose or private activity bonds to finance capital improvements in schools. The New Markets Tax Credit supports qualified low-income community investments, including charter schools.
A number of federal loans and grants are available through federal agencies. To search open federal grants visit Grants.gov. Recommended keywords to utilize include energy efficiency, K-12, school improvement, schools, HVAC, and ventilation to search within Grants.gov for current opportunities. A selection of available federal programs and state and utility resources are described below.
U.S. DEPARTMENT OF AGRICULTURE (USDA)
- National School Lunch Program (NSLP) Equipment Assistance Grants distribute $30 million for school lunch equipment through state educational agencies that may be used for increasing the energy efficiency of the school food service operations.
- USDA Rural Development provides schools and their partners access to grants, loans, and loan guarantees as public entities under various programs that could be used for energy-efficiency and renewable energy projects. Programs include:
- Certain Community Facilities Programs can finance school construction and rehabilitation, as well as fund the acquisition of electric school buses and other service vehicles. Community Facilities funding can also support charging infrastructure owned by a school district, nonprofit or government agency. Community Facilities provides direct loans and grant and guaranteed loans.
- The Rural Energy Savings Program supports partnerships between schools – and the utilities that serve them – to finance energy-efficiency improvements using an innovative relending program
- Certain Rural Development Electric Loans can help finance EV charging stations and their associated costs at schools and other rural locations.
- Certain Rural Business-Cooperative Service Programs provide financing to create rural jobs and economic opportunity, including businesses that serve educational institutions, as well as renewable energy and energy efficiency investments at rural businesses and farms. Rural Energy for America Program (REAP) Renewable Energy Systems & Energy Efficiency Improvement Guaranteed Loans and Grants can support renewable energy systems and energy efficiency improvements in eligible, for-profit rural educational institutions. Business & Industry Guaranteed Loans can help a business or community finance EV charging station equipment for retail and public use.
U.S. DEPARTMENT OF COMMERCE (DOC)
- Public Works and Economic Development Facilities Program is a competitive grant program to fund public works investments to support the construction or rehabilitation of essential public infrastructure and facilities (e.g., schools) necessary to generate or retain private sector jobs and investments, attract private-sector capital, and promote regional competitiveness.
U.S. DEPARTMENT OF DEFENSE (DOD)
- Impact Aid for Military Connected School Districts provides funds to local educational agencies that enroll military-connected children that may be used for school facilities.
U.S. DEPARTMENT OF EDUCATION (ED)
- The Elementary and Secondary School Emergency Relief (ESSER) Fund provides tens of billions of dollars to American schools. Some of these funds can be used to conduct efficient and healthy upgrades in schools. Qualifying improvements include mechanical and nonmechanical heating, ventilation, and air conditioning systems, filtering, purification and other air cleaning, fans, control systems, and window and door repair and replacement.
- State Charter School Facilities Incentive Grants provides competitive grants to help states establish and enhance or administer "per-pupil facilities aid" for charter schools.
- Child Care Access Means Parents in School Program funds may be used to provide child care and early childhood development services to enable low-income students to pursue postsecondary education. Funds may also be used for minor renovation or repair of facilities to meet applicable state or local health or safety requirements.
- The Impact Aid Grant System is a federal grant program for local educational agencies who have lost local property tax revenue due to the presence of nontaxable federal land. Impact Aid grants may be used for capital improvements.
- Alaska Native Education grants support innovative projects that recognize and address the unique educational needs of Alaska natives. Funds may be used for school construction expenditures.
- Native Hawaiian Education grants support innovative education programs to assist native Hawaiians. Funds may be used for school construction expenditures.
- Historically Black College and University Capital Financing Program provides low-cost capital (loans) to finance improvements to the infrastructure of the nation’s historically black colleges and universities (HBCUs).
- State Charter Schools Facilities Incentive Grants are competitive grants awarded to states that have per-pupil charter school facilities aid programs specified in state law and that annually provide financing on a per-pupil basis for charter school facilities. The program assists charter schools in meeting school facility costs.
- Credit Enhancement Grants for Charter School Facilities are awarded on a competitive basis to public and nonprofit entities to leverage nonfederal funds that help charter schools obtain school facilities through purchase, lease, renovation, or construction.
U.S. DEPARTMENT OF ENERGY (DOE)
- Grants for Energy Efficiency and Renewable Energy Improvements at Public School Facilities. The Section 40541 of the IIJA provides $500 million for competitive grants to make energy improvements at public school facilities at public schools. In April, DOE released a request for information seeking input on implementation of this new grant program. A funding opportunity announcement is expected to be released in late summer/early fall 2022 and will be posted at https://eere-exchange.energy.gov/.
- DOE’s Loan Programs Office’s Renewable Energy and Efficient Energy Solicitation can be accessed by schools to provide up to $3 billion in loan guarantees for retrofit projects.
- The State Energy Program (SEP) provides annual funding to 50 states, the District of Columbia, and the five U.S. territories to support a nationwide infrastructure of state energy offices. SEP supports public facilities, including K-12 schools and universities. Find your state energy office to find information on energy policies, programs, and financial incentives.
U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS)
U.S. DEPARTMENT OF THE INTERIOR (DOI)
- The Payments in Lieu of Taxes program provides payments for certain federal lands that reduce the tax base of local governments. Payments made under the program may be used for any governmental purpose, including school facilities.
U.S. DEPARTMENT OF TRANSPORTATION
- The Safe Routes to School (SRTS) program promotes walking and bicycling to school through infrastructure improvements, enforcement, tools, safety education, and incentives to encourage walking and bicycling to school.
U.S. DEPARTMENT OF THE TREASURY
- The Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program, a part of the American Rescue Plan, delivers $350 billion to state, local, and tribal governments across the country to support their response to and recovery from the COVID-19 public health emergency. These funds may be used for school facility improvements.
U.S. ENVIRONMENTAL PROTECTION AGENCY
Federal Emergency Management Agency (FEMA)
- Public Assistance Grant Program funds available in states and communities that have received a major or emergency disaster declaration through the Stafford Act. Funds may be used for the repair and replacement of damaged buildings and facilities.
- Hazard Mitigation Assistance Grants to states and local governments, including school districts, funds long-term hazard mitigation measures after a major disaster declaration. Allowable activities include acquisition of real property and retrofitting structures and facilities to minimize damages from high winds, earthquakes, floods, wildfires, or other natural hazards.
- For general information about FEMA grants, see https://www.fema.gov/grants.
NATIONAL ENDOWMENT OF THE HUMANITIES
- Office of Challenge Grants funds may be used to renovate or construct facilities. Nonprofit organizations such as museums, tribal centers, libraries, colleges and universities, scholarly research organizations, state humanities councils, public radio and television stations, and historical societies and historic sites are eligible to receive grants.
STATE AND UTILITY RESOURCES
- States and utilities run a wide and diverse range of incentive programs for funding school improvements. Explore the incentives available to your district or school at the Database of State Incentives for Renewables and Efficiency.