Legislative Update No. 14
REBUILDING, RENEWING AND ENHANCING
THE UNIVERSITY OF CONNECTICUT
The FOURTEENTH in a series of reports to Governor John G. Rowland and the Connecticut General Assembly
I. UCONN 2000: THE UPDATEII. ACTIVITIES COMPLETED OR UNDERWAY:
- PLANNING, DESIGN AND MANAGEMENT
- CONNECTICUT CONTRACTOR SUMMARY
- PRIVATE FINANCIAL SUPPORT
III. CURRENT PROJECT STATUS – PHASE I (as of April 2002)
IV. CURRENT PROJECT STATUS – PHASE II (as of April 2002)
V. CURRENT PROJECTS FUND SOURCES: PHASE I (as of April 2002)
VI. CURRENT PROJECTS FUND SOURCES: PHASE II (as of April 2002)
|Construction began in August 2001 on a new building for the School of Engineering’s Information Technology program. The main building will be completed in January 2003 and the lecture hall in June 2003. A rendering of the building is also in this report.|
This is the fourteenth in a series of semi-annual reports to the Governor and the General Assembly pursuant to the provisions of Sections 10a-109 through 10a-109y of the Connecticut General Statutes, originally An Act to Enhance the Infrastructure of the University of Connecticut, now known as UCONN 2000. These reports have been issued each October and April since passage of UCONN 2000 on June 7, 1995. The law also required four-year a progress report, which was filed on January 15, 1999.
On June 22, 1995, Governor John G. Rowland signed UCONN 2000 into law at a ceremony in front of Babbidge Library, the symbol of the University’s crumbling infrastructure. Through UCONN 2000, the executive and legislative branches recognized and addressed the University’s need for a comprehensive infrastructure renewal program to attract Connecticut’s high-achieving students, educate a top-notch workforce and compete effectively for job-creating research grants. The legislative program was designed to rebuild, restore and enhance the University’s physical infrastructure, but it was also designed to enhance programmatic excellence by jump-starting the University’s private fundraising efforts with an endowment matching grant program. The overwhelming bipartisan support for UCONN 2000 reflected the depth of consensus regarding the goals as articulated in the law’s statement of purpose:
The purpose of the University of Connecticut 2000 Act is to promote the welfare and prosperity of the people of the state and the continuation and improvement of their educational opportunities by approving a special capital improvement program for the University of Connecticut and enabling the University of Connecticut to borrow money and enter into financing transactions in its own name, on behalf of the state, to expand the authority of the University of Connecticut to construct projects and to assure a state commitment to support the financing of the acquisition, construction, reconstruction, improvement and equipping of facilities, structures and related systems for the benefit of the educational and economic development needs of the state and the University of Connecticut, all to the public benefit and good, and the exercise of the powers, to the extent and manner provided in the University of Connecticut 2000 Act, is declared to be for a public purpose and to be the exercise of an essential governmental function.
Thus far, the following has been accomplished through the UCONN 2000 program:
- $700 million has been authorized in bonds with state debt service commitment.
- $199 million in special obligation bonds has been authorized, with debt to be repaid by the University from room/board and fee proceeds. Recently, Moody’s Investors Service upgraded the University’s bond rating to Aa3, or “high grade,” its second highest category. This occurred despite its January 2002 report indicating a generally gloomy forecast for the higher education sector.
- Of $595 million in construction-related contracts (i.e. exclusive of equipment) to date, 83% of all funds have been contracted to Connecticut businesses, and 26% to set-aside (minority- and women-owned and small business) contractors.
- Over 100 projects have been completed to date, including a new Chemistry building, a new downtown Stamford campus, a new Marine Science building at Avery Point, a new Business School building, an expanded Fine Arts complex, a new Biology and Physics building, a renovated Wilbur Cross library to serve as a one-stop-shopping center for student services, a new Agricultural Biotechnology building completed with an addition already underway, new residence and dining halls at Hilltop, South and Northwest campus, an aggressive sprinkler and smoke alarm program that has made UConn dorms among the safest in the country, a new Dairy Bar, a new Visitors Center, new facilities for parking and for the UConn Co-op, a new ice rink, a revamped field house, a beautiful pedestrian campus core, new shuttle roadways, high-tech classroom and laboratory renovations too numerous to mention, and state-of-the-art energy-efficient utility infrastructure.
- Currently under construction or in design are a center for undergraduate academic services, a renovated and expanded Student Union, an Information Technology Engineering building, a new downtown campus in Waterbury, a new Pharmacy and Biology building, and another 1200 beds in new residence halls.
- This year’s freshman class is the largest ever in the University’s history. Since the fall of 1995 at UConn’s main campus:
- Freshman enrollment has increased 56%.
- Minority freshman enrollment has increased 62%.
- Average SAT scores have risen almost 30 points.
- Freshman enrollment in the honors program has increased 50%.
- 314 valedictorians and salutatorians have joined the student body.
- Student athletes have won 47 Big East regular season and/or tournament championships, appeared in 33 NCAA tournaments, reached 10 Final Fours, and brought home to Connecticut four national championships.
- Virtually every Connecticut town has a student enrolled at UConn. Our 2001-02 cost of $12,122 for Connecticut undergraduates has been assessed an excellent educational value by financial analysts. In addition, over two-thirds of UConn’s students receive some form of financial assistance; in the current year this amount totals almost $142 million. This year the University will dedicate 38% ($47 million) of its tuition fund to financial aid.
- UConn is consistently ranked by U. S. News and World Report, America’s Best Colleges, as New England’s top public university. In 2002, U. S. News reported that the University catapulted 10 positions (to #28), representing the largest rankings jump among the top 50 national public universities ranked in 2001.
- Since 1995, the University’s endowment has grown from $50 million to over $210 million today. Annual gift receipts, at $8.2 million in 1995, were at $50.6 million in 2001 a remarkable 37% increase over the prior year. In addition, UCONN 2000 has spurred other forms of private investment, such as the construction of the Nathan Hale Inn and Conference Center on the Storrs campus.
UCONN 2000: ACTIVITIES COMPLETED OR UNDERWAY
- PLANNING, DESIGN AND MANAGEMENT
- At the November 16, 2001 Board of Trustees meeting the Fourth Supplemental Indenture authorizing $72,180,000 of the University of Connecticut Special Obligation Student Fee Revenue Bonds was approved. This issuance financed the following projects:
Projects Amounts Alumni Quadrant Renovations $ 7,000,000 Shippee/Buckley Renovations 5,000,000 East Campus North Renovations 1,000,000 Towers Renovations 2,180,000 Greek Housing 12,000,000 North Campus Student Suites & Apartments 45,000,000
- These funds are being used to augment UCONN 2000 debt service commitment funds to provide additional bed space and renovations to existing dorms and dining facilities.
- North of the Towers Dorm complex, the University will be building a centralized complex to house the University’s fraternities and sororities. This complex will provide housing for 300 students. The Environmental Impact Evaluation for the project has been completed and is being circulated for public comment. The project is out to bid for the selection of the design/build team. Construction on the project will begin later in spring 2002 with completion at the start of the fall 2003 semester. The project budget of $12 million is funded through this Fourth Supplemental Indenture.
This rendering depicts a new central dining facility at the Towers Dorms which will replace the current six small dining facilities and serve as a dining facility for the new Greek Housing Complex. Construction is scheduled to begin in June 2002.
- Renovations and installation of sprinklers for Alumni Quad, Shippee/Buckley, and East Campus North (Hicks and Grange) are in the final stages of design. At the end of the spring semester, construction will begin on the project with completion at the start of the fall 2002 semester. Funding for the project comes from a combination of funds from the Fourth Supplemental Indenture and UCONN 2000. The construction manager for the project is Whiting Turner of New Haven.
- Contract documents are being prepared for a new central dining facility at the Towers Dorms. This facility will replace the current six small dining facilities and provide a dining facility for the new Greek Housing Complex. Construction will begin in June 2002 with completion set for August 2003 for the start of the fall semester. Funds for the project come from a combination of UCONN 2000 and Dining Services operating funds. The construction manager for the project is Whiting Turner of New Haven.
- Contract documents are being prepared for the construction of 500 beds of apartment style housing and 500 beds of suite style housing to be located north of Northwest Quad Dorms. The floor plans for these suites will be similar to those at Hilltop Apartments and the Hilltop Suites. Funding for the project is coming from the Fourth Supplemental Indenture. Debt service will be paid by room fees. Construction on the project will begin in May 2002 with completion scheduled for the start of the fall 2003 semester. The design build firm is JPI of Irving, Texas.
- Construction documents are being finalized for renovations of locker rooms, training facilities and coaching offices for the basketball teams. Construction will begin in April 2002 with completion set for October 2002. Funds for the project are coming from a combination of private fundraising and UCONN 2000. Architects for the project are Jeter Cook & Jepson of Hartford. The construction manager is O&G Industries of Torrington.
- Development of a Cogeneration/Central Chilled Water Facility is out to bid. Such a facility could produce electricity for the Storrs campus, and the secondary waste heat could provide heating, hot water or cooling for the campus. The bid process has been undertaken as a prerequisite to determining the feasibility and advisability of moving to cogeneration. Data from the bid process will further inform a cost/benefit analysis that will enable the University Board of Trustees to make a determination whether to proceed with cogeneration.
- At the January 18, 2002 Board of Trustees meeting, a Student Union Building fee was approved that will provide $5,000,000 of the funding necessary to implement the full project scope of the Student Union renovation and expansion. This fee revenue would be in addition to the UCONN 2000 funding of $35,000,000 for the Student Union Renovation/Addition.
Models for the addition and renovation of the Student Union offer two views: from the Student Union Mall (top); and from Hillside Road near Gampel Pavilion. The work will nearly double the size of the 50-year-old building.
- Contract documents are being finalized for the Student Union project, which will include major renovations and additions to the current facility. The primary goal of the project is to expand the range and quality of activities available to students in the campus core. Included in the project will be a food court, 500-seat theatre, student activity meeting space, a ballroom and a central post office for all student mail. This facility also will provide new space for each of the campus’ cultural centers. Implementation of the project will be phased over several years. The architects for the project are Cannon Associates of Boston. Konover Construction of West Hartford is the construction manager for the project. It is anticipated that construction will begin in May 2002.
- An Environmental Impact Evaluation (EIE) is being prepared for the construction of Graduate Student Apartments. This project would provide for 500 to 1000 beds of apartment style housing. Two potential sites are being evaluated: one, west of the University’s Northwood Apartments and the other, east of the Storrs commercial block. Baystate Environmental Consultants was hired to conduct the EIE that is anticipated to be finished in June 2002. As part of the evaluation of the site by the commercial block, the cumulative environmental impact of the Storrs Center redevelopment project will be examined.
Preliminary plan for the revitalization of downtown Storrs.
- Contract documents are being prepared for renovations to the former School of Business building. The purpose of this project is to transform the old facility into a new Center for Undergraduate Education that will provide a centralized location for academic support for students as well as instructional support for faculty members and graduate students. Functions included in the facility will be the First Year Experience program (special seminars and activities for incoming freshmen), Career Services, the Institute for Teaching & Learning, the Study Abroad program, the Urban Semester program, the Center for Community Outreach, the Instructional Research Center, Honors Program, and Learning Research Center. Due to competing needs, the budget for the project has been reduced to $11,000,000. The architect for the project is Svigals Associates of New Haven. It is anticipated that construction will begin in May 2002. The construction manager for the project is Gilbane of Glastonbury.
- As part of the overall building and renovation program, the University continues the process of standardizing building systems and system components (e.g., electrical circuitry, panel boxes, etc.). This process will reduce the number of replacement parts the University needs to inventory, speed repairs, improve the level of maintenance and lower overall costs.
- Design development drawings are under review for the new School of Pharmacy/Biology building. The project involves the construction of a 120,000 square foot building for teaching and research for the Pharmacy program and the creation of an 80,000 square foot building of research space for the Biology program. Also included in the project is a consolidated animal care facility for the research programs in this area of the campus. The architect for the project is Davis, Brody, Bond of New York City. Gilbane, of Glastonbury, is the construction manager for the project.
- Preparation of contract documents for renovations to the Neag School of Education’s Gentry building are underway. The project scope includes complete renovation of the building’s interior along with exterior improvements of the faìade and roof and an addition to the building. The architect for the project is Svigals Associates of New Haven. Gilbane, of Glastonbury, is the construction manager on the project. It is anticipated that construction on the project will begin in August 2002.
- Design activities are underway for an addition to the Benton Museum. This $1.5 million project is funded through a combination of UCONN 2000 funds ($700,000) and private gifts. Arbonies King Vlock of Stony Creek are the architects for the project.
- At the November 16, 2001 Board of Trustees meeting the Fourth Supplemental Indenture authorizing $72,180,000 of the University of Connecticut Special Obligation Student Fee Revenue Bonds was approved. This issuance financed the following projects:
- Contract documents are being prepared for renovations at the School of Law that will provide for the phased renovations of facilities including the old Library Building. The architect for this project is Allan Dehar Associates of New Haven. The construction manager is Dimeo Construction of New Haven.
- Construction has begun on the Waterbury Downtown campus project. The project will involve relocation of the Waterbury regional campus from its present Hillside location to East Main Street. The existing academic programs, along with additional Bachelor of Business and MBA programs, will be offered in the new facilities. The architect for the project is Jeter Cook & Jepson of Hartford. Although not part of UCONN 2000 funding, legislation provides that the project will be managed by the University under the authority set forth in UCONN 2000. O & G Industries of Torrington is the construction manager for the project. The new campus is scheduled to open in the fall 2003 semester.
Construction has begun on the completion of the Agricultural Biotechnology facility. A $7,770,682 Department of Energy Grant, along with $3,000,000 from UCONN 2000, will fund this second phase of the project. The University has already occupied the completed first building. The project includes construction of a second building (approximately 16,000 sq. ft.) and a new greenhouse facility (approximately 14,000 sq. ft.) as provided in the original project and the Master Plan. The facility will provide research and incubator space. Architects for the project are Svigals Associates of New Haven, and the construction manager is Turner Construction of Milford. Construction will be completed in July 2002.
ABOVE: Construction of Phase II of the Agricultural Biotechnology Facility is underway. The second building will provide further research and incubator space. A new greenhouse will be attached to the first building.BELOW: This early rendering of the Agricultural Biotechnology facility depicts the location of the greenhouses which will be attached to the first building. The height of the second building has been increased from the original plan. The facility is scheduled for completion in July 2002.
Construction began in August 2001 on a new building for the School of Engineering’s Information Technology program. This facility has approximately 94,000 gross square feet of classrooms, research lab and office space, and a 350-seat lecture hall. The architect for the project is Burt Hill Kosar Rittlemann of Washington, DC. The construction manager for the project is O & G Industries of Torrington. The main building will be completed in January 2003 and the lecture hall in June 2003.
This rendering depicts the new building for the School of Engineering’s Information Technology program. The new School of Business is to the right. Construction (pictured above) began in August 2001.
- Installation of new exterior signage has been completed at the main campus and the Health Center. The law school and regional campuses will see their new signs beginning in May 2002. The purpose is to incorporate signage that will provide a unified look and better directional information to visitors at all of the University’s campuses.
- Phase I of the Wilbur Cross renovation was completed in July 2001. This project locates all business functions relating to student services in one central, customer-friendly location. These functions include financial aid, bursar, registrar, dining services, residential life, and services to students with disabilities. The contractor for the project is Aspinet Construction of Avon. The remainder of the project will be completed in July 2002. As part of the rejuvination of one of the campus’ most important old buildings, a new slate roof is being installed along with masonry repairs and window replacement in the original wing.
Construction was completed for the second parking garage, located next to the Gampel Pavilion, in September 2001. The cost of the project is borne by a special obligation bond issued under UCONN 2000 authority. Revenue to support the debt service will come from parking and transportation fees. The facility contains 1547 parking spaces and 53,000 gross square feet of retail space for the UConn Co-op. The Co-op space will be completed in June 2002. The contractor for the project is Manafort Brothers of New Britain.
The new UConn Co-op, scheduled for completion in June 2002, is attached to the South Parking Garage, located next to the Harry A. Gampel Pavilion. The garage opened in September.
Construction activity continues on the Biological Sciences project. These activities began when the University and Liberty Mutual, the Surety that held the payment and performance bond for the project, came to a fronting agreement whereby the Surety agreed to pay the University $25,350,000 to complete the project. The University terminated the original contractor on February 4, 2000. Grounds for this termination included: unqualified general contractor staffing, removal of key personnel, unauthorized substitutions, subcontractor mismanagement, schedule-failure to comply with contract requirements, failure to prosecute the work, subcontractor payment irregularities, inadequate staffing/manning, change order processing failures, disregard for University property, refusal/delay in allowing document review, failure to timely provide general conditions documents, inadequate quality control, and inadequate safety supervision. Turner Construction of Milford is the construction manager on the project. It is anticipated that the project will be completed in January 2003.
Construction continues on the Biological Sciences project. The 145,000-square-foot building is scheduled completion in January 2003.
Public Act 99-241 called for, among other things, information on the use of Connecticut-owned businesses on UCONN 2000 program projects, including those owned by women and minorities. Since FY 1996, construction and related contracts for the UCONN 2000 program totaled $595.2 million. Twenty-six percent of this total, or $152.5 million, has gone to set-aside general contractors, contracted architects and engineers, and subcontractors. In this period, Connecticut businesses have accounted for $492.6 million or 83% of the total contracted dollars. Small business participation has amounted to $81.1 million and minority- and women-owned participation has accounted for $71.5 million.
Phase I Debt Service Commitment Bond Issues Completed
Section 10a-109 of the Connecticut General Statutes empowers the University to issue General Obligation Bonds secured by the State’s Debt Service Commitment (sometimes referred to as “Debt Service Commitment Bonds” or “DSC Bonds”). These Bonds are issued pursuant to the General Obligation Master Indenture of Trust, dated as of November 1, 1995, between the University of Connecticut, as Issuer and Fleet National Bank of Connecticut as Trustee (now State Street Bank & Trust). The Master Indenture of Trust was approved by the University’s Board of Trustees on November 10, 1995 and the State Bond Commission on December 21, 1995. UConn’s Board of Trustees and the Governor approve the subsequent Supplemental Indentures for each bond issue. The University and Office of the State Treasurer, working in conjunction, manage the Debt Service Commitment Bond sale process. University General Obligation Debt Service Commitment Bonds issues to date are summarized below:
Date of Issue Par Amount General Obligation Bond Issue Phase I February 21, 1996 $ 83,929,714.85 1996 Series A April 24, 1991 124,392,431.65 1997 Series A June 24, 1998 99,520,000.00 1998 Series A April 8, 1999 79,735,000.00 1999 Series A Phase II March 29, 2000 $130,850,000.00 2000 Series A April 11, 2001 100,000,000.00 2001 Series A
The six series of DSC bonds issued were $618,427,146.50 in face value, of which $612,000,000 was for UCONN 2000 projects. The balance, together with accrued interest and original issue premium, funded the cost of issuance in conjunction with the Office of the State Treasurer.
Trustee-Held Construction Fund
Prior to June 1998, all Debt Service Commitment Bond proceeds were deposited with the Office of the State Treasurer and treated like State bond proceeds, including payments made to vendors through the Office of the State Comptroller. Subsequently, the Office of the Attorney General determined that the University, not the State, issues UCONN 2000 bonds. Accordingly, upon advice of bond counsel and in conformity with the Master Indenture of Trust, Debt Service Commitment Bond construction fund proceeds were deposited to the Trustee Bank. Bond proceeds for cost of issuance are still deposited with the Office of the State Treasurer, and disbursed through the Office of the State Comptroller. To date the University has directed the Trustee Bank to invest any Debt Service Commitment construction fund proceeds in the State Treasurer’s Short Term Investment Fund (STIF) which is “AAA” rated and offers daily liquidity and historically attractive risk-adjusted yields.
The Indenture of Trust provides that the University is authorized and directed to order each disbursement from the Construction Account held by the Trustee upon a certification filed with the Treasurer and Trustee. The Indenture provides that such certification shall be signed by an Authorized Officer of the University and include certain disbursement information. Once the Authorized Officer certification filings are made, the University can directly disburse payments.
University Special Obligation Revenue Bonds Secured by Pledged Revenues
UCONN 2000 also authorizes the University to issue Special Obligation Revenue bonds. Unlike Debt Service Commitment Bonds, paid from the State’s General Fund, these bonds are paid from pledged revenues of the University as defined in the particular bond series indenture.
A Special Capital Reserve Fund may be established for University Special Obligation bond issues only if our Board of Trustees determines that the Special Obligation bond issue is self-sufficient as defined in the Act. The self-sufficiency finding by the University must be submitted to and confirmed as not unreasonable or arbitrary by the State Treasurer prior to issuance of the bonds. Once approved, the Special Capital Reserve Fund is funded at issuance by the University to meet the minimum capital reserve requirement. However, subject to notification by the University on or before December 1, annually, if this amount falls below the required minimum capital reserve, there is deemed to be appropriated from the state General Fund sums necessary to restore each such Special Capital Reserve Fund to the required minimum capital reserve.
Student Fee Revenue Bonds are issued pursuant to the Special Obligation Indenture of Trust, dated as of January 1, 1997, between the University as Issuer and State Street Bank & Trust as Trustee (“the Special Obligation Master Indenture”). On November 8, 1996, the University’s Board of Trustees approved the Special Obligation Master Indenture along with the Special Obligation First Supplemental Indenture also dated January 1, 1997 that authorized issuance of bonds up to a principal amount not to exceed $30,000,000 for construction of the South Campus Residence & Dining Hall, plus amounts necessary to fund a Special Capital Reserve Fund (“SCRF”) and provide for costs of issuance.
On February 4, 1998, the University issued $33,560,000 of University of Connecticut Student Fee Revenue Bonds 1998 Series A (“SFR 1998-A Bonds”) with a final maturity of November 15, 2027. The University managed the issuance and sale of these bonds and realized a favorable true interest cost over the term. Debt service for these bonds is paid from the student Infrastructure Maintenance Fee instituted in 1997 and other Pledged Revenues as further defined in the Indenture of Trust. Such Pledged Revenues also help support future operation and maintenance costs for facilities built or expanded through UCONN 2000. The University invested the bond proceeds in the State Treasurer’s Short Term Investment Fund (“STIF”) and, in regard to the Special Capital Reserve Fund, also in longer term “AAA” rated fixed income Investment Obligations as defined in the Special Obligation Indenture of Trust.
On June 1, 2000, the University issued $89,570,000 of the University of Connecticut Student Fee Revenue Bonds 2000 Series A (“SFR 2000-A”) pursuant to the Special Obligation Master Indenture, and the Special Obligation Student Fee Revenue Bonds Second Supplemental Indenture dated as of May 1, 2000. Bond proceeds funded $87,000,000 of construction for the Hilltop Dormitory, Hilltop Student Rental Apartments, and Parking Garage South and also provided for capitalized interest and costs of issuance, all of which was invested in STIF. The $89,570,000 SFR 2000 Bonds were defeased on February 27, 2002, as further described below, and will no longer be reflected as outstanding debt on the University’s financial statements.
On February 14, 2002, the University issued $75,430,000 of the University of Connecticut Student Fee Revenue Bonds 2002 Series A pursuant to the Special Obligation Master Indenture and the Special Obligation Student Fee Revenue Bonds Fourth Supplemental Indenture, dated as of November 16, 2001. Bond proceeds funded Alumni Quadrant Renovations, Shippee/Buckley Renovations, East Campus North Renovations, Towers Renovations (including Greek Housing), and North Campus Renovations (including North Campus Student Suites and Apartments).
On February 27, 2002, the University issued $96,130,000 of the University of Connecticut Student Fee Revenue Bonds 2002 Refunding Series A pursuant to the Special Obligation Master Indenture and the Special Obligation Student Fee Revenue Bonds Third Supplemental Indenture, dated as of February 1, 2002. Bond proceeds were used to take advantage of favorable market conditions to advance refund and defease all of the $89,570,000 of Student Fee Revenue Bonds 2000 Series A bonds outstanding.
Since the inception of UCONN 2000, the University’s bond issues have experienced credit rating upgrades. Capital markets have recognized the tangible benefits to the State’s economy of meeting the infrastructure and educational goals of the program, as well as the University’s success in implementing them. An improved credit rating not only provides the State and the University with less expensive access to the capital markets but also supports the State’s quality reputation among investors. This year, the University marked a milestone with the achievement of the high-grade credit rating category from Moody’s Investors Service for both its General Obligation and Special Obligation bonds (“Aa2” and “Aa3”, respectively).
As of March 2002, the UCONN 2000 Debt Service Commitment bonds were rated “AA” by Standard & Poor’s; “Aa2” by Moody’s Investors Service; and “AA-” by Fitch Investors Service. In addition to the underlying credit ratings, “AAA” rated municipal bond insurance secures certain maturities. Also the University’s Special Obligation Bonds (Non-SCRF) were rated “AA-” by Standard & Poor’s and “Aa3” Moody’s Investors Service. Fitch Investors Service does not rate the bonds. Highlights of the University’s credit rating history are shown below:
- February 1996: the first issue of the University’s General Obligation Bonds secured by the State’s Debt Service Commitment carried underlying ratings of “A1” by Moody’s Investors Service, “AA-” by Standard & Poor’s and “AA-” by Fitch.
- February 1998: the first issue of UCONN Special Obligation bonds depended upon the State’s SCRF credit rating. An underlying “stand alone” credit rating was not available for this nascent program. At the time of issuance, the State SCRF enhancement allowed the bonds to obtain a “AA-” rating from Standard & Poor’s, “AA-” from Fitch Investors Service, and “A-1” from Moody’s Investors Service. The bonds were subsequently covered by municipal bond insurance and upgraded to a “AAA” at Fitch and Standard & Poor’s and “Aaa” at Moody’s Investors Service.
- October 1998: Standard & Poor’s upgraded the UCONN General Obligation DSC Bonds and the UCONN SFR 1998-A (SCRF) bonds to “AA” from “AA-“.
- March 2000: Moody’s upgraded UCONN’s General Obligation DSC Bonds to “Aa3” from “A1”.
- June 2000: the University achieved a milestone with its first underlying Special Obligation Bond “stand alone” credit rating of “AA-” (S&P), and an “A1” (Moody’s).
- February 2001: UCONN’s General Obligation DSC Bonds were upgraded to “Aa2” from “Aa3” by Moody’s. In April 2001, the UCONN General Obligation DSC 2001 Series A bonds were sold without any bond insurance security enhancement on any maturity, another successful first-time accomplishment for the UCONN 2000 bond program. UCONN’s 1998 Special Obligation Bonds (SCRF) were upgraded to “Aa3” from “A1” by Moody’s.
- January 2002: UCONN’s Special Obligation Bond (Non-SCRF) were upgraded to “Aa3” from “A1” by Moody’s. This graduated UCONN’s Special Obligation bonds to Moody’s “high-grade” bond category and impacted the underlying credit on $171.5 million of outstanding Special Obligation Student Fee Revenue Bonds. (The $33.6 million Special Obligation Student Fee Revenue Bonds Series 1998-A bonds which are secured by the State’s SCRF already carried the “Aa3” rating.) This high rating carries a stable outlook and represents a positive judgment by the capital markets regarding UConn’s financial strength, real and potential growth as an institution, and management.
Future Bond Issues
At the time this report was being prepared for submission, the University was engaged in the issuance process for its UCONN 2000 General Obligation Bonds Series 2002-A to fund an expected $100 million of UCONN 2000 Projects. Additionally, the University anticipates offering a Debt Service Commitment Bond issue during the spring of 2003 to fund an expected $100 million of UCONN 2000 Projects. Generally, the University plans on issuing a series of new money Debt Service Commitment bonds about every twelve months. Also, the University could issue Special Obligation Revenue bonds for certain named projects with capacity for financial self-sufficiency, and/or if aggregate pledged revenues are sufficient to meet requirements of the Special Obligation Indenture. Depending on market conditions and other factors, the University also might issue either General Obligation or Special Obligation refunding bonds in the future.
The University of Connecticut Foundation, Inc. reported that as of February 28, 2002, gifts and receipts for fiscal year 2002 total $25.4 million and progress toward the $300 million Campaign UConn goal stood at $181.4 million. The Campaign, which began in July 1998 and concludes in June 2004, is the largest ever undertaken by a public research university in New England. It seeks to raise $75 million for merit and need-based scholarships, $75 million for faculty support, and $150 million for program support.
The State of Connecticut’s matching endowment gift program continues to have a significant impact in raising private support for the University. Despite a difficult economy, the total match-eligible gift receipts and commitments for calendar year 2001 totaled nearly $14 million.
Robert Cizik, Class of 1953, committed an additional $250,000 to the Robert Cizik Manufacturing and Technology Management Fund to support an endowed chair and professorship in the School of Business. These endowments will foster the development of business leaders with solid technology, manufacturing, and business decision-making skills; bring University faculty together who have multi-disciplinary expertise and overlapping interest in technology and manufacturing; and advance UConn’s emergence as a leader in this discipline.
Roger Tamer committed $245,000 to establish the Tamer Family Endowment for Women’s Basketball. Funds from this general endowment will be used to meet specific program priorities.
Leslie and Stephen Rothenberg committed $100,000 toward the UConn Orthodontic Alumni/Ravi Nanda Endowment Fund. The fund will provide financial support for an endowed chair in orthodontics within the UConn Health Center’s School of Dental Medicine.
Wilda Van Dusen committed $1,000,000 to establish an endowment in support of the Albert and Wilda Van Dusen Chair in Academic Medicine at the Health Center’s School of Medicine.
Philanthropy is enabling UConn to recruit and retain highly talented faculty and support academic research that is spawning breakthroughs in the sciences and new paradigms in the humanities and arts. Likewise, the University is increasingly successful in enrolling outstanding students of diverse backgrounds whose decision to study at UConn is influenced by the quality and breadth of our enhanced academic programs, and availability of merit- and need-based scholarships.
Contributors invest because they understand the importance of the flagship public university to the state of Connecticut and share in UConn’s vision to be one of the best public research universities in the nation.