LARAMIE — The University of Wyoming Board of Trustees met early Wednesday morning to discuss a resolution that authorizes the issuance of $260 million in bonds for the construction of new housing and parking facilities on campus.
Outlined in the resolution (available on the Trustees UW webpage) are the parameters and terms of the bonds, which includes a reimbursement to UW for previous expenditures on the student housing project.
A pricing committee will approve the final terms of the bond later this summer and oversee bond management and spending.
With the tax-exempt bonds, provided by the financial advising and consultant company PFM, the university can fund the housing and parking projects, according to the Reports and Supplemental Materials packet provided to the Board.
Four trustees sit on the committee, including Vice Chairman John McKinley, Treasurer Kermit Brown, Carol Linton and Macey Moore. Three unidentified administrators who were appointed by President Ed Seidel are also committee members.
UW Associate Vice President of Financial Affairs David Jewell presented an executive summary on the latest money issuance, which allots a $10 million cushion in the event the mentioned projects total below the $250 million budget.
“There would be the flexibility to use the proceeds from the bonds to do other related capital infrastructure projects,” Jewell said.
Any unused funds, under the terms of the resolution, can be used for construction projects related to the new residence halls, dining facility and/or parking garage. This is a resolute and proactive initiative to ensure funds are sufficiently utilized.
Additionally, the bond is slightly larger than the projected budget, which Jewell said allows room for unprecedented financial obligations, such as higher interest rates due to inflation.
“If interest rates were to go up … there’s a little bit of a cushion to allow for a larger issuance,” Jewell said.
Associate Vice President for Marketing and Communications Chad Baldwin added to Jewell’s statement, stating that the additional $10 million in bonding authorized by the trustees is really only meant for any unforeseen needs.
“We have a high degree of confidence that the project will cost a total of $250 million — we don’t think it will be less than that,” Baldwin said.
Other terms defining the 2021 University Facilities Revenue Bond include a cap on the aggregated par amount — the total amount UW promises to repay to PFM at the maturity date of the bond — which cannot exceed $260 million; and the “true interest rate,” which cannot exceed 5 percent.
The bond also has a 32-year expiration date or final maturity and must be fulfilled by June 1, 2053, according to the reports.
“That’s a little bit longer than a 30-year issuance,” Jewell said, but it allows the pricing committee to make decisions for unaccounted-for needs or circumstances.
According to the UW Debt Profile, the university is currently paying 3-5% and 2% interest rates on the 2021 A and B bonds respectively, which funded the Bison Run Village apartment complex.
As of June 30, UW has an outstanding balance of $70,815 million in bonds, with the latest maturity date in 2043.
Additionally, the University of Wyoming Foundation, tasked with raising, receiving and managing private gifts to the institution — has an outstanding line of credit in the amount of roughly $7.4 million.
Construction for two residence halls is anticipated to begin this time next year, according to last month’s board meetings. The three-story Ivinson Parking Garage, which will occupy the current parking spaces on 10th Street and Ivinson Avenue, could start construction as early as this summer.