Furthering its stature as a pioneer in the disabilities field, Elwyn has continued to innovate and evolve its mix of services and programs to address the varied needs of its clients and largely governmental program sponsors and funders. These services are delivered in a variety of locations across the eight states in which it operates. Among them is Elwyn’s headquarters and main campus located on a 260-acre site in Media, Delaware County, PA.

The master campus plan to be funded in part with tax-exempt financing includes transformation of this flagship location incorporating state-of-the-art environments that promote health and healing for residents, teachers, staff, and the surrounding community.
The master campus plan is multi-faceted and includes, most significantly, construction of a new replacement school (K-12), and enabling a new chapter in Elwyn’s continuation as the largest and oldest “approved private school” in Pennsylvania. This component of the project was to be funded through issuance of tax-exempt debt together combined with capital reserves and philanthropy.

Other components of the plan, funded primarily through a combination of individual and corporate philanthropic support and government-funded capital grants, include: 1) Expanded Children’s Residential Treatment Facility (“CRTF”) and Learning Center that provides housing and intensive therapeutic intervention services to children and adolescents (ages 6-21) with autism spectrum disorder, experiencing acute behavioral challenges and exhibiting resistance to treatment, 2) Student Transition Center (“STC”) supporting neuro-diverse students (ages 18-21), offering comprehensive job training and independent living skills, preparing them for meaningful employment and self-sufficiency, 3) Young Adult Residential Treatment Facility (“YARTF”) to provide young adults (ages 18-26) with a place to receive psychiatric care while living in a safe group setting with peers with similar psychiatric needs and 4) New commercial kitchen to cater all meals served on the Elwyn campus, including the New School and STC, existing IDD residential facilities, the CRTF, the YARTF and existing Personal Care Homes serving individuals with behavioral health challenges.

The use of tax-exempt debt financing for the New School (and, for a portion of the cost of the Student Transition Center and Commercial Kitchen) was based on a variety of factors, including project scale and cost and the direct revenue-generating nature of the New School project – notably, with interest and depreciation incurred for this project being an allowable cost in setting tuition payments by both the Pennsylvania Department of Education and referring school districts. Further, Sims and the Elwyn team considered a number of other factors in evaluating financing options, consisting of bank and/or bond financing, and in structuring the financing. These included: i) estimated $63.8 million total project cost (with $45 million of total debt financing), ii) the benefit of drawing financing, as construction progresses, rather than all at closing, iii) the magnitude of funded interest during construction and other potential financing reserves and iv) differential in interest rates between bank and bond financing, including Elwyn’s “BB+” S&P credit rating.

Considering these factors and with anticipated strong bank appetite for this project financing, Elwyn elected to undertake commercial bank financing which would entail reduced borrowing requirements and reflect a more attractive all-in interest cost.