Ohio University has received permission to take out debt up to $160 million to help finance construction around campus.
The Board of Trustees unanimously passed a resolution Friday “Providing for the authorization, issuance and sale of not to exceed $160,000,000 General Receipts Bonds of The Ohio University, authorizing a Supplemental Trust Agreement securing such bonds, and authorizing matters related thereto.”
The bonds will be used toward OU’s six-year capital improvement plan, in a larger context of 20 years. A combination of state funding and the debt issuance will be used to complete construction projects and take care of deferred maintenance around campus.
Stephen Golding, vice president for Finance and Administration, said the plan with be split up into 2-year increments.
"I think we can all feel comfortable about the first two years — we have the priorities, we know how we're going to fund them, if we do get a state appropriation,” Golding said. “Beyond that, it gets a little speculative.”
Renovations regarding the 20-year plan will encompass dorms, dining facilities and academic buildings, according to the resolution.
"(The plan) is an extraordinary document," said Pam Benoit, executive vice president and provost.
To show trustees the extent of necessary renovation, Associate Vice President of Facilities Harry Wyatt showed maps of the university with ages of on-campus buildings and drew comparisons of the buildings before and after renovations during the Resources Committee meeting Thursday.
"One of the hallmarks of Ohio University is the beauty of our campus,” OU President Roderick McDavis said. “We'll focus on academic buildings and student housing and be able to work on both of those simultaneously. That's truly exciting and takes the university to a higher level.”
The debt issuance is just one area of funding contributing to OU’s construction projects — others include state funding, public-private partnerships and private gifts to the university.
Trustee Sandra Anderson, chairwoman of the Resources Committee, said the plan allows OU to use state funding differently than in the past.
"We'll use the issuance of debt and the use of state appropriations, if we get them, to catch up on deferred maintenance," Anderson said. "Instead of relying on state appropriations funding, we will set aside that state appropriations funding if and when it arrives for upkeep of facilities.”
Trustees will evaluate the six-year and 20-year plans each year and will adjust them as necessary.
"(There are) savings we will expect to receive from having infrastructure improvements that will reduce or pay back the costs," Anderson said.
Anderson used the OU’s Heritage College of Osteopathic Medicine building in Columbus as an example of the university using debt well.
The OU-HCOM extension will be the first project made possible through the $105 million gift the college received from Osteopathic Heritage Foundations.
"We're using debt because the gift we're receiving (from the Osteopathic Heritage Foundations) will be coming over time, so we'll use the gift to service that debt," Anderson said.
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