Trustees approve issuance of bonds, other business items
March 31, 2003
KALAMAZOO--Acting at its March 28 regular meeting, Western Michigan University's Board of Trustees authorized the issuance of tax-exempt bonds and approved several other business items.
The proceeds of the bond issue, expected to generate $54 million, will largely be used to refund 1993A general revenue bonds currently held by the University, resulting in a present value savings of some $3 million. The remainder of the bond issue will be used to finance construction of the new College of Health and Human Services facility. Trustees also authorized university officials to execute borrowing and adjustments as recommended by legal counsel.
The resolution approved by trustees specified that the highest yield for any maturity will not exceed 6 percent. The current average yield of the 1993A bonds is 5.26 percent, while the average yield of the new bonds will be approximately 3.85 percent.
In other business, members of the Board of Trustees approved an increase in the University's line of credit. A $25 million line of credit was approved by trustees in 1999 and the new authorization will allow WMU officials to borrow up to $35 million, or approximately 7.9 percent of the total University budget. Vice President for Business and Finance Robert M. Beam told members of the board that the increase would allow officials to effectively manage short-term working capital in a time of uncertainty over state appropriations cuts.
During the meeting, other business action taken by trustees included approving the sale of property in Van Buren County to fund a charitable gift annuity life income plan and passing a resolution that brings the University in line with the federally enacted Health Insurance Portability and Accountability Act, known as HIPAA.
Media contact: Jessica English, 269 387-8400, jessica.english@wmich.edu