Charter schools are funded by the State of Minnesota on a per-pupil basis. They also receive state support for facilities expenses because they cannot issue bonds or raise taxes through levies like other school districts. Start-up funding is provided in the first three years by the federal government. Charter schools can also qualify for Title I funding. The current State of Minnesota hold-back of 40% of school funds puts an added financial strain on charter schools, because they must borrow at market rates to cover the necessary bridge loans.