Connecticut State Colleges and Universities President Mark Ojakian (CSCU) today announced that the system has successfully priced $101.4 million of revenue bonds through the Connecticut Health and Education Facilities Authority (CHEFA). The bonds carry an all-in interest cost of 2.89%.
The bond issue, known as Series Q, includes $78.1 million in project funding and $23.3 million in refunding bonds. The project funding will support projects at Central, Southern, Eastern and Western Connecticut State Universities over the next three years. The projects supported by these revenue bonds produce revenues in the form of parking fees or the University Fee paid by students to support auxiliary facilities such as garages, residence halls, and student centers. The largest projects included under this bond issuance are a new parking structure at Willard and DiLoreto Hall at Central ($24 million) and Phase I of the renovation and addition project at Berkshire Hall at Western ($25 million).
“These bonds will support critically important projects on our university campuses,” President Ojakian said. “The tremendously favorable rate is good news for our campuses and the students they serve.”
The refunding bonds will replace higher-cost debt with new bonds at a savings of 9.5%, amounting to a net present value saved of $3.8 million. These savings far exceed the Board of Regents’ policy which requires savings greater than 2% for refunding issues.
“This is an outstanding result for our state universities and their students,” Board of Regents for Higher Education Chair Matt Fleury said, “The interest on these bonds is extremely favorable and will mean that we can hold our fees low in the future while still making critical investments in our campuses. I would like to thank CFO Ben Barnes and the very capable staff at CSCU, as well as staff at CHEFA who made this financing so successful.”
The bond pricing was obtained through a competitive sale. The winning underwriters of the transaction are UBS (project bonds) and Wells Fargo (refunding bonds.) The bond sale will close on May 10.
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