UCONN 2000
Legislative Update No. 17
October 2003
REBUILDING, RENEWING AND ENHANCING
THE UNIVERSITY OF CONNECTICUT
The SEVENTEENTH
in a series of reports to
Governor John G. Rowland
and the
Connecticut
General Assembly
I. UCONN 2000: THE UPDATE
II. ACTIVITIES COMPLETED OR UNDERWAY:
III. CURRENT PROJECT STATUS - PHASE I (as of October
2003)
IV. CURRENT PROJECT STATUS - PHASE II (as
of October 2003)
V. CURRENT PROJECTS FUND SOURCES: PHASE I (as
of October 2003)
VI. CURRENT PROJECTS FUND SOURCES: PHASE II (as
of October 2003)
CHARTS:
- Total and Endowment Gifts for the University of Connecticut
- Asset Growth: The University of Connecticut Foundation, Inc.
UCONN 2000: THE UPDATE
This is the seventeenth 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.
Spurred by the contribution that UCONN 2000 has made to the transformation
of the University, student applications are up sharply in number, strength,
and diversity. The average SAT score for this year's entering freshman class
at Storrs was 1167, up 18 points from the previous fall and up 139 points since
UCONN 2000 was signed into law in 1995. In Fall 2003, 68 high school valedictorians
and salutatorians joined the 394 who have enrolled at UConn between 1995 and
2002. Minority students comprised 17% of the entering class. U.S. News and World
Report now ranks UConn in the top 25 public universities in the nation, up six
spots from last year. And our athletic program continues to bring pride and
excitement to the UConn community in Storrs, at Rentschler Field, and across
Connecticut.
21st Century UConn, the successor program to UCONN 2000, will
play a major role in continuing this progress. As has been evident throughout
UCONN 2000, the University will administer the building program at a high caliber
level, and optimize productivity and outcomes through careful assessment of
needs, cost-effective planning, and successful implementation of the program.
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| ABOVE:An architectural detail of
the renovation of the Center for Undergraduate Education,
a learning center that will house the Institute for Teaching
and Learning, computer labs, academic advising and counseling
programs and other faculty and student academic support
services. |
| BELOW: Construction is in progress
on the new School of Pharmacy/Biology building. The building
will include 120,000 square feet of space for teaching
and research for the Pharmacy program and 80,000 square
feet of research space for the Biology program. Also
included is a 26,000 square foot animal care facility
to support faculty research. |
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ABOVE: The new Information Technologies
Engineering Building houses an extensive
learning center, specialty training
facilities and some of the most innovative
research labs in the country for advancing
cutting-edge engineering technology.
The 5-level facility is home to UConn's electrical
and computer engineering and computer
science and engineering departments.
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UCONN 2000: ACTIVITIES COMPLETED OR UNDERWAY
- PLANNING, DESIGN AND MANAGEMENT
- The University has begun an update of its 1998 Master Plan.
In view of the campus' extensive physical changes resulting
from the UCONN 2000 investment and the forthcoming 21st Century
UConn initiative, it is necessary to update the plan so that
the University can manage its capital resources most effectively.
The plan will update the existing condition baseline to reflect
the current physical plant, assess current and projected space
needs relative to available facilities, assess the overall
parking and transportation system including its financial and
operational aspects, and refine the campus' physical composition
to advance improvements already in place. The planning effort
includes activities on the West Hartford and Torrington campuses.
The consultant for the Master Plan revision is JJR of Ann Arbor,
Michigan.
- The Law School Library has experienced an on-going series
of leaks since opening in 1996. The project's construction,
which predates UCONN 2000, was managed by the Department of
Public Works. Corrections undertaken did not resolve the situation,
so the University hired its own consultants (Hoffman Architects
of New Haven, and Simpson Gumpertz and Heger, Inc. of Boston)
to investigate and propose solutions to the problems. The University
is working with the Office of the Attorney General, the Department
of Public Works, and original project architects and firms
involved with its construction to address the issue.
- Design activities are complete for the Cogeneration/Central
Chilled Water Facility that will produce electricity for the
Storrs campus, and secondary waste heat that will provide heating,
hot water and/or cooling for the Storrs campus. The bid process
was undertaken as a prerequisite to determine the feasibility
and advisability of moving to cogeneration. Independent analysis
projected the potential for significant energy cost-savings,
and data from the bid process informed a cost/benefit analysis
that led the Board of Trustees to endorse proceeding with the
project. A contract award has been given to Select Energy.
The project will be financed through Caterpillar Financial
Services Corporation using a capital lease structure with an
interest rate of 4.3%. Savings generated by the facility will
pay the debt and debt service. Construction has just started
on the building and chilled water portion of the project.
- The University continues standardizing building systems
and system components within its overall building and renovation
program, (e.g., electrical circuitry, panel boxes, etc.). This
process will reduce the number of replacement parts UConn needs
to inventory, speed repairs, improve the level of maintenance,
and lower overall costs.
- At the September 23, 2003 University Board of Trustees
meeting, the Board approved the project list for the Phase
III of the UCONN 2000 Program, also known as 21st Century UConn.
Also, at this meeting, the Board approved a Supplemental Indenture
to serve as the amendment to the General Obligation Master
Indenture of the UCONN 2000 program. The two approved resolutions
have been forwarded to the State Office of Policy and Management
(OPM) for submission to the State Bond Commission. The project
list adopted by the Board is the same list that appears in
the law. The list of projects and the State Debt Service Commitment
is included in this report as Exhibit "A."
- The architectural selection process has begun for the Torrey
Renovation Completion and Biology Expansion project, which
will include research labs and office spaces for the Ecology
and Evolutionary Biology programs as well as the Physiology
and Neurobiology Departments. Also included will be classroom
facilities. The new building will be constructed on the site
of the Torrey Life Sciences building.
- CONSTRUCTION
- Construction is underway for the new School of Pharmacy/Biology
building. This building will include
120,000 square feet of space for
teaching and research for the Pharmacy program and 80,000 square
feet of research space for the Biology program. Also included
in the project is a consolidated 26,000 square foot animal
care facility to support the research programs in this area
of the Storrs campus. The architect for this construction project
is Davis, Brody, Bond of New York City. Gilbane of Glastonbury
is the construction manager for this project, to be completed
in July 2005.
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ABOVE: Husky Village, a new centralized complex to house some of the University's fraternities and sororities, is located near the Towers dorms.
BELOW: Charter Oak Apartments and Suites, located north of the Northwest Quad dorms, provide 504 beds of apartment style housing and 468 beds of suite style housing.
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ABOVE and BELOW: Construction
is nearing completion
of the first phase on the Student Union Building major renovations
and additions. The work will expand the range and quality
of student activities available in the campus core. The
facility will also provide new space for each of the campus'
cultural centers.
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ABOVE: Construction of the addition
to the William Benton
Museum of Art is
scheduled for completion in December 2003.
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ABOVE: Construction
on renovations and an addition to the
Neag School of Education's Gentry building is underway.
The project includes complete renovation of the building's
interior, exterior improvements to the façade
and roof, and a 20,000 square foot
addition to the building.
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ABOVE and BELOW: Construction is underway
on renovations to
the former School
of Business as well as a 20,000 square foot addition. This
project will transform the facility into a new Center for
Undergraduate Education that will provide a centralized
location for academic support for students and instructional
support for faculty members and graduate students.
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ABOVE: Jason Mitchell, a graduate student,
demonstrates a tri-color
laser experiment
in the new high-tech Information Technologies Engineering
facility for Governor John G. Rowland during his recent
visit to campus.
BELOW: Construction
is complete on the
Waterbury Downtown
campus project,
which relocated
the Waterbury regional
campus from its
Hillside location
to East Main Street.
Existing academic
programs and additional
Bachelor of Business
and MBA programs
are offered in the
new facilities.
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| Students study and chat in the Waterbury Downtown campus |
- Construction of the Benton Museum addition is scheduled
for completion in December 2003.
This $3.2 million project is funded
through a combination of UCONN 2000 funds and private gifts.
Arbonies King Vlock of Stony Creek is the architect for the
project. Gilbane of Glastonbury is the construction manager
for the project.
- Construction on renovations and an addition to the Neag
School of Education's Gentry Building
is underway. The project scope
includes a complete renovation of the building's interior,
exterior improvements of the faade and roof, and a 20,000 square
foot 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 be complete in March
2004.
- Construction is underway on renovations to the former School
of Business as well as a 20,000
square foot addition. This project
will transform the facility into a new Center for Undergraduate
Education that will provide a centralized location for academic
support for students and instructional support for faculty
members and graduate students. The facility will house the
First Year Experience program, Career Services, the Institute
for Teaching & Learning,
the Study Abroad program, the Urban
Semester program, the Center for Community Outreach, the Instructional
Research Center, the Honors Program, and the Learning Research
Center. The architect for the project is Svigals Associates
of New Haven. The construction manager for the project is Gilbane
of Glastonbury, Connecticut. It is anticipated that construction
will be completed in December 2003.
- Construction is underway on the Student Union building
that includes major renovations
and additions to the current facility
designed to expand the range and quality of activities in the
campus core for students. Included are a food court, 500-seat
theatre, student activity meeting space, a ballroom, and a
central post office for all student mail. The facility also
will provide new space for each of the campus' cultural centers.
Implementation of the Student Union building project will be
phased over several years. The architect for the project is
Cannon Associates of Boston. Konover Construction of West Hartford
is the project's construction manager. The first phase of the
project, which includes the theatre, is scheduled for completion
in January 2004. Immediately thereafter the second phase of
the construction will begin.
- Construction is complete on the 504 beds of apartment style
housing and 468 beds of suite style
housing known as Charter Oak Apartments
and Suites. These facilities are located north of the Northwest
Quad Dorms. The floor plans are similar to those at Hilltop
Apartments and the Hilltop Suites. The project was funded by
special obligation bonds, to be repaid by the University from
room fee revenue. The project was completed in August, in time
for the start of the Fall 2003 semester. The design-build firm
was JPI of Irving, Texas.
- In August 2003 a centralized complex to house some of the
University's fraternities and sororities
was completed. The complex is called
Husky Village and provides housing for 300 students. Capstone
Builders led the design/build team. The project budget of $12
million was funded through special obligation bonds, to be
repaid by revenue from the rent paid by fraternity and sorority
members.
- Construction is complete on a new central dining facility
at the Towers Dorms Complex to
replace four small dining facilities
and provide dining for Husky Village. The project was completed
in August 2003, in time for the start of the fall semester.
Funding came from a combination of UCONN 2000 and Dining Services
operating funds. The construction manager was FIP of Cheshire.
- Construction is complete on work at the Law School that
provided for the phased renovations
of facilities including the old
Library Building. The architect for this project was Allan
Dehar Associates of New Haven. Dimeo Construction of New Haven
was the construction manager.
- Construction is complete on the Waterbury Downtown Campus
project, which relocated the Waterbury
regional campus from its Hillside
location to East Main Street. Existing academic programs and
additional Bachelor of Business and MBA programs are offered
in the new facilities. The architect for the project was Jeter
Cook & Jepson of Hartford. Although
this project was not part of UCONN
2000 funding, legislation provided that the University of Connecticut,
under the authority set forth in UCONN 2000, manage the project.
O&G Industries
of Torrington was the construction
manager for the project. The new campus was open for the Fall
2003 semester.
- Installation of new exterior signage has been completed
at the main campus and the Health
Center. The Law School and regional
campuses will have new signs by December 2003. The purpose
of this project is to incorporate signage that will provide
a unified look and better directional information to visitors
at all of the University's campuses.
- Various renovations and deferred maintenance projects have
been completed or are in the construction
or design phase at the Avery Point
campus. These projects are located in various facilities with
different contractors.
- Renovations and installation of sprinklers in the Towers,
Grad and East campus North (Holcomb,
Whitney & Sprague)
dormitories were completed in time
for the start of the Fall 2003
semester. Completion of these projects leaves the West Campus
complex as the only group of dorms without sprinklers. The
installation of sprinklers in the West Campus complex will
be completed in the Summer of 2004. The completed projects
were funded by a combination of special obligation bonds to
be repaid by the University and UCONN 2000 funds. The construction
manager for these projects was Whiting Turner of New Haven.
- A new pedestrian walkway from Babbidge Library to South
campus is under construction. This
project is an integral component
of the Master Plan to make the central core of the campus pedestrian-fr
iendly and move traffic to the perimeter. O&G Industries
of Torrington is the construction
manager. The project is scheduled
for completion in December 2003.
UCONN 2000: SET-ASIDE CONTRACTOR SUMMARY
- Public Act 99-241 called for, among other things, information
regarding use of Connecticut-owned businesses on UCONN 2000
program projects, including those owned by women and minorities
("set-aside" contractors). Since Fiscal Year 1996,
construction and related contracts for the UCONN 2000 program
totaled $792.2 million. Twenty-four percent of this total,
or $183.4 million, has gone to "set-aside" general
contractors, contracted architects and engineers, and subcontractors.
In this period, Connecticut businesses have accounted for $701.3
million or 89% of the total contracted dollars. Small business
participation has amounted to $107.3 million and minority-and
women-owned participation has accounted for $48.3 million.
UCONN 2000: FINANCE
- 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 U.S. Bank N.A.). The University's Board
of Trustees on November 10, 1995 and the State Bond Commission approved the
Master Indenture of Trust 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 |
TIC (1) |
General Obligation Bond Issue |
| Phase I |
| February 21, 1996 |
$ 83,929,714.85 |
4.94% |
1996 Series A |
| April 24, 1997 |
124,392,431.65 |
5.48% |
1997 Series A |
| June 24, 1998 |
99,520,000.00 |
4.78% |
1998 Series A |
| April 8, 1999 |
79,735,000.00 |
4.46% |
1999 Series A |
| Phase II |
| March 29, 2000 |
$130,850,000.00 |
5.42% |
2000 Series A |
| April 11, 2001 |
100,000,000.00 |
4.54% |
2001 Series A |
| April 18, 2002 |
100,000,000.00 |
4.74% |
2002 Series A (2) |
| March 26, 2003 |
96,210,000.00 |
3.97% |
2003 Series A (3) |
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(1) TIC is the true interest cost
reflecting the interest rate for the time value of money across an entire
bond issue.
(2) The DSC 2002A bonds provided
$994,688.03 directly to the Office of the State Treasurer.
(3) Note - the DSC 2003 bonds face
amount of $96,210,000 together with an additional $3,790,000 of original
issue premium, totaled $100,000,000 available for Projects.
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The eight series of UCONN General Obligation DSC bonds
issued total $814,637,146.50 in face value. Project funding to date totals
$812,000,000 available for UCONN 2000 project spending. The remaining balance,
together with accrued interest and net original issue premium, funded the
costs of issuance.
On March 26, 2003 The University issued $96,210,000
face amount of the University of Connecticut Debt Service Commitment Bonds
2003 Series A, at a very favorable true interest cost of 3.97%, the lowest
in the history of the program, with a 10.5 Years Average Life and with very
favorable call redemption terms of 2013 @ Par. The 2014 through 2023 maturities
carried MBIA bond insurance.
- UConn 2000 General Obligation Debt Service Commitment
Projects
To date, fifty projects totaling $912 million have
been authorized to receive General Obligation Debt Service Commitment bond
proceed funding, as follows:
UCONN2000 GENERAL OBLIGATION BONDS SECURED
BY THE DEBT SERVICE COMMITMENT OF THE STATE
| Project-Name |
General Obligation Supplemental
Indenture Authorizations |
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| Agricultural Biotechnology
Facility Completion |
$3,000,000 |
| Agricultural Biotechnology
Facility |
9,400,000 |
| Alumni Quadrant Renovations |
11,500,000 |
| Avery Point Marine Science
Research Center-Phase I |
30,000,000 |
| Avery Point Marine Science
Research Center-Phase II |
7,341,000 |
| Avery Point Renovation |
3,000,000 |
| Benton State Art Museum Addition |
700,000 |
| Business School Renovation-Phase
II |
8,000,000 |
| Central Warehouse New |
7,500,000 |
| Chemistry Building |
53,062,000 |
| Deferred Maintenance & Renovation
Lump Sum-Phase |
I 40,792,000 |
| Deferred Maintenance & Renovation
Lump Sum Balance-Phase II |
105,400,000 |
| East Campus North Renovations |
7,710,000 |
| Equipment, Library Collections & Telecommunications-Phase
I |
60,500,000 |
| Equipment, Library Collections & Telecommunications
Completion-Phase II |
101,123,000 |
| Gant Plaza Deck |
6,516,000 |
| Gentry Renovation-Option B |
10,000,000 |
| Grad Dorm Renovations |
3,000,000 |
| Heating Plant Upgrade |
9,969,000 |
| Hilltop Dormitory Renovations |
8,700,000 |
| Ice Rink Enclosure |
3,280,000 |
| International House Conversion
(Museum of Natural History) |
800,000 |
| Litchfield Agricultural Center-Phase
I |
1,000,000 |
| Mansfield Apartments Renovation |
2,071,000 |
| Mansfield Training School
Improvements |
3,500,000 |
| Monteith Renovation |
733,000 |
| Music Drama Addition |
7,400,000 |
| North Campus Renovation |
11,866,000 |
| North Superblock Site & Utilities |
7,668,000 |
| Northwest Quadrant Renovation-Phase
I |
2,001,000 |
| Northwest Quadrant Renovation-Phase
II |
30,000,000 |
| Parking Garage-North |
9,658,000 |
| Pedestrian Walkways (Fairfield
Road Pedestrian Mall) |
6,074,000 |
| School of Business |
25,059,000 |
| School of Pharmacy |
65,856,000 |
| Shippee/Buckley Renovations |
7,000,000 |
| South Campus Complex |
12,251,000 |
| Stamford Downtown Relocation-Phase
I |
55,785,000 |
| Student Union Addition-Option
B |
32,500,000 |
| Technology Quadrant-Phase
IA |
39,993,000 |
| Technology Quadrant-Phase
II |
34,120,000 |
| Torrey Life Science Renovation |
2,181,000 |
| Towers Renovation |
20,000,000 |
| Underground Steam & Water
Upgrade-Phase I |
6,000,000 |
| Underground Steam & Water
Upgrade Completion-Phase II |
6,000,000 |
| Waring Building Conversion |
11,452,000 |
| Waterbury Property Purchase |
200,000 |
| West Campus Renovations |
500,000 |
| White Building Renovation |
2,430,000 |
| Wilbur Cross Building Renovation |
17,409,000 |
| Totals |
$912,000,000 |
As of October 1, 2003, General Obligation Debt Service
Commitment bonds have been issued to fund $812,000,000 of the above projects
with $100,000,000, representing Fiscal Year 2004 authorizations effective
July 1, 2003, expected to be issued during early winter 2004.
As of October 1, 2003 the General Obligation Debt Service
Commitment Bond Proceeds Construction Account remaining balance available
to pay for Projects was only $1,459,588.09.
- University's Financial Statements
As the issuer of the UCONN 2000 program debt,
the University now incorporates UCONN 2000 debt into its financial statements.
As a result of recent changes in the Government Accounting Standards Board
rules, the University's General Obligation and Special Obligation bonds are
shown as liabilities on the University's financial statements. The financed
UCONN 2000 projects and any unspent bond proceeds are shown as assets. The
State's commitment to pay the debt service for the University's General Obligation
Bonds is also shown as an asset on the University's financial statements.
- Trustee Banks
The proceeds of the sale by the University of
any Bonds are part of the Trust Estate established under the General Obligation
Master Indenture of Trust with the Trustee Bank as security for bondholders.
Consequently the Trustee Bank holds all of the bond proceeds, with this exception:
the State Treasurer's Office may hold and invest the University's General
Obligation Bonds Debt Service Commitment funded Cost of Issuance account.
The Special Obligation Master Indenture has similar Trust Estate provisions
and the Trustee Bank holds all the Special Obligation bond proceeds received
at issuance including the cost of issuance account.
Prior to June 1998, all University General Obligation
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 opined that the University, and 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 and disbursed as directed
by the University pursuant to the Indenture. Per the State's preference, the
University General Obligation Debt Service Commitment Bond proceeds for cost
of issuance are still treated like State bond proceeds and deposited with
the Office of the State Treasurer, and disbursed through the Office of the
State Comptroller.
The Indentures of Trust provide 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 Trustee bank,
and in the case of the Debt Service Commitment bonds, also the State Treasurer.
The Indentures provide 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 the University's General Obligation
Debt Service Commitment Bonds that are paid from the State's General Fund,
debt on the Special Obligation Bonds is paid from certain 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 the 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.
- Special Obligation Student Fee Revenue Bond Issues
Student Fee Revenue Bonds have been issued pursuant
to the Special Obligation Indenture of Trust, dated as of January 1, 1997,
between the University as Issuer and U.S. Bank N.A. as successor to State
Street Bank & Trust as Trustee ("the Special Obligation Master Indenture").
The Board of Trustees approved the Master Indenture on November 8, 1996.
UConn's Board of Trustees and the Governor
approve the subsequent Supplemental Indentures for each Special Obligation
bond issue. The University and Office of the State Treasurer, working in
conjunction, manage the Special Obligation Bond sale process. University
Special Obligation Student Fee Revenue Bonds issues to date are summarized
below:
| Date of Issue |
Par Amount |
TIC (1) |
Special Obligation Student Fee Revenue Bond Issue |
| February 4, 1998 |
$ 33,560,000.00 |
5.08% |
1998 Series A |
| June 1, 2000 |
$ 89,570,000.00 |
6.02% |
2000 Series A (2) |
| February 14, 2002 |
$ 75.430,000.00 |
4.94% |
New Money 2002 Series A |
| February 27, 2002 |
$ 96,130,000.00 |
4.89% |
Refunding 2002 Series A |
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(1) TIC is the true interest cost
reflecting the interest rate for the time value of money across an entire
bond issue. The University Special Obligation Bonds are generally issued
for an approximate 30-year final maturity, compared to a 20-year final
maturity for the General Obligation DSC Bonds, hence the TIC may appear
relatively higher for Special Obligation Bonds.
(2) The Series 2000-A bonds were
refunded on Feb. 27, 2002.
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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 Special
Obligation First Supplemental Indenture was also dated January 1, 1997 and
authorized the issuance of bonds up to a principal amount not to exceed $30,000,000
for construction of the South Campus Residence and Dining Hall, plus amounts
necessary to fund a Special Capital Reserve Fund ("SCRF") and provide
for costs of issuance. 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.
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.
The $89,570,000 SFR 2000 Bonds were defeased in substance on February 27,
2002, as further described below, and are no longer 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 $72,180,000 of construction for the 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 in substance all of the $89,570,000
of Student Fee Revenue Bonds 2000 Series A bonds outstanding. Proceeds were
deposited with the Trustee bank in an irrevocable escrow fund sufficient to
satisfy future debt service and call premiums on the prior issue.
- UCONN2000 Special Obligation Student Fee Revenue Projects
To date, nine projects have been authorized to receive the
University's Special Obligation Student Fee Revenue bond proceed funding. Some
of these projects were also supported by General Obligation or other funding,
as follows:
UCONN2000 SPECIAL OBLIGATION STUDENT FEE
REVENUE BOND PROCEEDS FUNDED PROJECTS
| Projects |
Special Obligation Authorized
and Issued |
|
| Alumni Quadrant Renovations |
$ 7,000,000 |
| East Campus North Renovations |
1,000,000 |
| Hilltop Dormitory New |
21,000,000 |
| Hilltop Student Rental Apartments |
42,000,000 |
North Campus Renovation
(including North Campus Student Suites
and Apartments) |
45,000,000 |
| Parking Garage-South |
24,000,000 |
| Shippee/Buckley Renovations |
5,000,000 |
| South Campus Complex |
30,000,000 |
| Towers Renovations (including
Greek Housing) |
14,180,000 |
| Totals |
$189,180,000 |
- Credit Ratings
Since the inception of UCONN 2000, the University's bond
issues have experienced a favorable credit rating history, including several
credit rating upgrades. For example, as of October 1, 2003 Moody's assigned
a "Aa3" rating to both the University's General Obligation Bonds
secured by the State's Debt Service Commitment and the University's Special
Obligation Student Fee Revenue Bonds. It is a strong vote of confidence in
the University that both these ratings are ranked the same as the State's General
Obligation Bond "Aa3" credit rating.
The 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. A high
quality 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. A University milestone occurred in 2002 with the
achievement of the high-grade "double A" credit-rating category from
Moody's Investors Service for both its General Obligation and Special Obligation
bonds.
As of October 1, 2003, the UCONN 2000 General Obligation
Debt Service Commitment bonds were rated "AA" by Standard & Poor's; "Aa3" by
Moody's Investors Service; and "AA-" by Fitch Investors Service. Also
the University's Special Obligation Bonds not secured by SCRF were rated "AA-" by
Standard & Poor's and "Aa3" Moody's Investors Service. Fitch Investors
Service does not rate the Special Obligation bonds not secured by SCRF. The
Special Obligation Bonds Series 1998-A carry a Special Capital Reserve Fund
and are rated "AA" by Standard & Poor's "Aa3" by Moody's,
and "AA-" by Fitch. In addition to the underlying credit ratings, "AAA" rated
municipal bond insurance secures certain maturities of several of the above
bond issues.
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 2000
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 an "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 an "AAA" at Fitch and Standard & Poor's
and "Aaa" at Moody's Investors Service.
October 1998: Standard & Poor's upgraded
the UCONN 2000 General Obligation DSC Bonds and the UCONN SFR
1998-A (SCRF) bonds to "AA" from "AA-".
March 2000: Moody's upgraded UCONN 2000 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: Moody's upgraded UCONN 2000 General
Obligation DSC Bonds to "Aa2" from "Aa3".
In April 2001, the 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. Moody's upgraded UConn's SFR 1998-A
Bonds, which are secured by the State SCRF, at this time to "Aa3" from "A1".
January 2002: UConn's 2000 Special Obligation
Bonds (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 all 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 was assigned a stable outlook and represented
a positive judgment by the capital markets regarding UConn's
financial strength, real and potential growth as an institution,
and management.
August 2002: Reflecting the outlook changes
for the State's General Obligation Bonds, Moody's and Standard
and Poor's both moved their outlook from "stable" to "negative" for
UConn's General Obligation DSC Bonds while retaining their respective
credit rating levels at "Aa2" and "AA". Fitch
took no action. In a sign of confidence for the University's
management and growth potential, Moody's and Standard & Poor's
kept UConn's Special Obligation Bond ratings levels and stable
outlook unchanged.
March 2003: During tougher economic times the
rating agencies confirmed the University's General Obligation
DSC bond ratings as follows: Fitch "AA-"; S&P "AA";
and Moody's "Aa2". Moody's also confirmed UConn's Special
Obligation and Foundation bond ratings at "Aa3". Holding
the credit ratings was a good sign, in light of Moody's February
2003 move of the State General Obligation bonds, and consequently
the University's DSC and SCRF security bonds, to Watch list for
possible downgrade.
July 2003: On July 2, 2003, citing State budget
problems, Moody's downgraded the University's General Obligation
DSC bond ratings to "Aa3" from "Aa2" consistent
with its action on the State General Obligation bond rating.
The good news was that Moody's also confirmed UConn's Special
Obligation ("non-SCRF) bond ratings at "Aa3".
Moody's also briefly downgraded the University's 1998 Special
Obligation Bonds secured by the State's SCRF to "A-1" following
a general downgrade of any bonds backed by the State's SCRF,
but then upgraded the University's 1998 Special Obligation Bonds
back to "Aa-3" on July 14, 2003.
- Debt Service
The State General Fund pays the debt service on the University's
General Obligation Debt Service Commitment Bonds. The University pays the debt
service on the Special Obligation Student Fee Revenue Bonds from its own resources.
For all the UCONN 2000 General Obligation Debt Service Commitment securities
issued since the program's inception in 1996 to October 31, 2003, debt service
totals $814.6 million of principal and $413.7 million of interest (including
capital appreciation bonds). As of October 31, 2003 there will be $669.2 million
of principal outstanding, and $282.2 million of interest remaining (including
capital appreciation bonds.) For the Fiscal Year Ending June 30, 2003 the Debt
Service Commitment paid for the University's General Obligation Bonds amounted
to $66 million (representing $37.7 million of principal and $28.3 million of
interest).
UCONN 2000 Special Obligation Student Fee Revenue securities
debt service amounts to $205.1 million of principal and $187.5 million of interest
over the course of the maturity spectrum, net of pre-refunded and defeased bonds.
As of October 31, 2003 there will be $197.5 million of principal and $161.2
million of interest remaining (including capital appreciation bonds). All other
things equal, the Special Obligation bonds incur proportional ly more interest
expense because they are generally issued for terms of up to thirty years compared
to twenty years for the Debt Service Commitment bonds. For the Fiscal Year Ending
June 30, 2003 the University paid from its own resources Special Obligation
Bond debt service of $13.2 million (representing $3.7 million of principal and
$9.5 million of interest).
- UCONN 2000 Bond Proceed Investments
The investment of Tax-exempt bond proceeds is heavily regulated
by the Internal Revenue Service, the relevant Indentures of Trust with bondholders,
Connecticut law, and other regulatory mechanisms. In addition to meeting those
requirements, the University's general investment policy is to balance an appropriate
risk-return level, heavily weighted towards safety of assets, with estimated
cash flow needs and liquidity requirements. The University is also mindful
that the rating agencies, bond buyers, and bond insurers often weigh the quality
of an issuer's investment portfolio.
Bond Proceeds form part of the Trust Estate established
with the Trustee Bank as security for bondholders. 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 State Treasurer's Office wishes to hold and invest
the University's General Obligation Bonds Debt Service Commitment funded Cost
of Issuance account, a much smaller account.
Similarly, the University has directed the Trustee Bank
to invest all the Special Obligation new money bond proceeds in dedicated STIF
accounts, with the exception of the 1998 Special Obligation Special Capital
Reserve Fund which is invested in longer term "AAA" rated federal
agencies' fixed income Investment Obligations as defined in the Special Obligation
Indenture of Trust.
The Special Obligation Student Fee Revenue Refunding Series
2002-A proceeds, other than the cost of issuance and debt service accounts that
are invested in STIF, are held by the Trustee Bank in an irrevocable escrow
fund, which is invested in U.S. Treasury State and Local Government Securities
("SLGS") and cash pursuant to the Escrow Agreement.
- UCONN 2000 Bond Proceed Investment Earnings
The Debt Service Commitment bond proceeds investment earnings
are retained by the State Treasurer's Office and do not flow to the University
or to the Trustee Bank.
Fiscal Year End June 30, 2003 UCONN 2000 Special Obligation
Student Fee Revenue Bonds investment earnings amounted to approximately $0.9
million (cash basis). The Student Fee Revenue Bonds investment earnings are
part of the Pledged Revenues and are directly retained by the Trustee Bank
to pay debt service on the bonds, and may also be used to flow to other Trustee
bond accounts, if necessary, pursuant to the Indenture of Trust.
The investment earnings on the Special Obligation Student
Fee Revenue Series 2002-A Escrow Account flow to the irrevocable escrow and
are used by the Trustee Bank to meet debt service payments on the defeased
bonds.
- Future UCONN 2000 Debt Issuance
The University anticipates offering a Debt Service Commitment
Bond issue during the winter of 2004 to fund an expected $100 million of UCONN
2000 Projects. The passage of 21st Century UConn allows for $1.3 billion of
additional securities backed by the State's Debt Service Commitment, phasing
in during fiscal year 2005. Generally, the University plans on issuing a series
of new money Debt Service Commitment bonds about every twelve months.
Additionally, the University could issue Special Obligation
Revenue bonds for certain projects that have a financial self-sufficien cy capacity,
and/or if aggregate pledged revenues are sufficient to meet requirements of
the Special Obligation Indenture. Market conditions and other factors might
also lead to issuance of either General Obligation or Special Obligation refunding
bonds in the future. Finally, the law also enables the University to enter into
tax-exempt lease financing. The Heating Plant/Co-generati on facility currently
under development is an example of this type of financing option.
PRIVATE FINANCIAL SUPPORT
Progress toward Campaign UConn's $300 million goal continues and as of
September 30, 2003 more than $257 million (85.7% of the goal) has been achieved.
The Campaign is the largest ever undertaken by a public research university in
New England and seeks to raise $75 million for merit and need-based scholarships,
$75 million for faculty support, and $150 million for program support.
Since Campaign UConn began in 1998 through June 30, 2003, a total
of 340 new endowments have been established in support of students, faculty,
and programs. Thanks to donor generosity, these gifts of endowment are having
a lasting impact on Connecticut's flagship university.
At the close of fiscal year 2003, nearly $50 million ($49.7 million)
in new gifts and commitments were recorded, an increase of $3.3 million, or
7%, over FY 02. The number of donors increased as well, with 38,483 contributing
- an increase of 9% over FY 02. Alumni are playing a pivotal role in UConn's
success. The University is ranked 7th in the nation among public universities,
with an annual giving rate among alumni of 24%, according to U.S. News & World
Report.
Total assets in the UConn Foundation stood at $262 million, an
increase of 7% over the prior year. Investment returns for the year were positive
and added nearly $12M in revenues. The FY 03 return for the endowment pool was
+5.2% vs. the composite benchmark of +3.2%.
A record-high $25 million in support was disbursed by the Foundation
to the University; this compares to last year's record high of $22 million.
The primary uses of these funds by the University were for student scholarships
($8 million); faculty compensation, including endowed chairs ($6 million); and
program enhancements and other uses ($11.1 million).
The first five years of the state matching endowment gift program
had a profound effect in attracting major donors to support the University.
However, the University continues to experience delays in receiving over $14
million in matching funds for endowment gifts received since calendar year 2000.
This delay is having an unfortunately negative impact on our present and prospective
donors, who have collectively contributed millions of dollars based on the expectation
of the state match. Future private support, as well as the fulfillment of existing
donor pledges, may be in jeopardy if the state fails to match gifts in a timely
manner; therefore, restoration of state matching funds is a high priority for
the University.
Significant Commitments
The UConn Foundation received $372,090 from the Estate of Sylvia
Lazar to support the Louis and Sylvia Lazar Endowment Fund. The fund provides
merit scholarships for full-time students enrolled in the School of Fine Arts.
The John W. Kluge Foundation committed $275,000 to the Thomas
J. Dodd Prize in International Justice and Human Rights. The biannual prize
is awarded by University's Thomas J. Dodd Research Center to a leader or group
who has made a significant effort to advance the cause of international justice
and global human rights.
A. David '61 and Brenda Maxen Roth '61 committed $200,000 and
Pelton's Pharmacy committed $50,000 to the School of Pharmacy Endowment for
the 21st Century, which provides financial support for faculty, scholarships,
and programmatic enhancements at the School of Pharmacy.
The UConn Foundation received $81,789 from the Estate of Robert
S. Dennison to support the Robert S. and Naomi C. Dennison Fund for Acquisition
at the William Benton Museum of Art, Connecticut's State Art Museum. The fund
is used to purchase works of art created before 1950 for the Museum's permanent
collection and to cover other expenses that may be related to preserving the
works of art for future generations.
The UConn Foundation received $61,681 from the Estate of Alice
K. Norian to support the Norian Armenian Studies Programs that include a lecture
and student-faculty exchange program.
PREVAILING WAGE COMPLIANCE REPORT
The attachments referred to below cover the period of April 1,
2003 through September 30, 2003 and are issued pursuant to the requirements
of subsection (f) of section (7) of Public Act 02-3, an Act Concerning 21st
Century UCONN, by providing the following information:
- The names and addresses of contractors and subcontractors performing
repair, addition, alteration and new construction
on the university's campuses in the previous six months.
Attachment A (Download or
open as an Excel spreadsheet)
provides the list in alphabetical order.
This is the third report, which is being filed in conjunction
with the October 2003 Report Number Seventeen to provide a consolidated
report for UCONN 2000 activities. There is no sub grouping of
contractors or subcontractors, as the nature of their business
makes each interchangeable with the other as business opportunities
become available.
- The extent to which the listed contractors and subcontractors
have been in compliance with the provisions of
part III of Chapter 557 and provisions of Chapter 558 [of the Connecticut
General Statutes having to do with the payment of prevailing wage
rates].
This information is in Attachment B (Download or open as an Excel
spreadsheet) which is based on information from the State
of Connecticut Department of Labor, Wage
and Workplace Standards Division, Contract Compliance Unit and
represents a combined sharing of information by the University
of Connecticut and the Department of Labor.
- Any actions taken by the University to cooperate with the Labor
Department in the enforcement of said provisions
[in item (2)].
Attachment C lists support
initiatives by the University.
Attachment D is the Debarment list
issued by the Department of Labor
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