CMU issues revenue bonds to pay for capital projects


In order to pay for a number of capital projects, Central Michigan University's Board of Trustees passed a motion authorizing the issuance of general revenue bonds on Thursday.

Barrie Wilkes, vice president of Finances and Administrative Services, said the value of new money bonds issued would not exceed $45 million and would generate $49 million. He also plans to refund bonds released in 2005 that would generate $25 million.

Money from these bonds will fund construction of CMU's College of Medicine east campus in Saginaw and construction of the Biosciences Building.

"The interest rates are unbelievable right now," said Trustee Brian Fannon. "The university needs to take advantage of that when they can."

Low interest rates coupled with the university's high credit ratings made the decision easy for trustees.

Standard & Poor's, a financial services company, gave CMU an A+ credit rating, which demonstrates a strong capacity to meet financial commitments, but is somewhat susceptible to adverse economic conditions and changes in circumstances. Moody's Investors Service similarly rates the university as Aa3, as high quality and very low credit risk in the long-term.

Wilkes said this is a testament to CMU's fiscal integrity.

Capital projects in tow

Steve Lawrence, vice president of Facilities Management, gave his update on on-going projects to trustees on Thursday.

A street connecting East Campus Drive with Mission Street is nearing the end of construction and should be completed Sept. 26. 

Mount Pleasant's Downtown Development Authority split the cost with Central Michigan University to alleviate congestion in the area. The city was responsible for $300,000 of the project. The university contributed $147,000.

Trustee Tricia Keith said it was amazing how the university has managed to maintain its strong rating and stable financial outlook.

Wilkes said compared to other comparable state institutions, CMU ranks in a higher performing category and has much less debt.

The College of Medicine east campus location in Saginaw Phase I is on-schedule for completion in May 2015 and should be ready for classes in July. The roof and windows are complete, which is good for construction workers as winter approaches. 

"Even with a tough winter, we never missed a beat and stayed on schedule," Lawrence said.

He added that the construction has been under budget and expects a "substantial amount" of money saved can be used for other projects.

In March, GMB Architecture and Engineering designed a shared facility for women's soccer and student recreation locker rooms. The project is scheduled to be complete in done in Aug. 2015 before the season starts.

The construction site is on southern part of existing soccer practice field and will rearrange some track field and events.

The East Utility Loop is ahead of schedule and $1.2 million under budget. The initiative is part of the utilities infrastructure modeling and campus master plan, put into effect after recognizing flaws in steam and condensate lines.

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Editor-in-Chief Malachi Barrett is Battle Creek senior majoring in journalism with a minor in ...

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