j_cdc_2016a_2016-01-21t07:31:00z1 Hearing Summary

Date: 01/21/2016

07:38 AM -- Higher Education Institutions Debt Capacity, State Treasurer's Office



Jon Forbes, Deputy State Treasurer, gave presentations on the debt capacity of five higher education institutions, including Colorado State University (CSU) (Attachment B), Western State Colorado University (WSCU) (Attachment C), Metropolitan State University of Denver (MSUD) (Attachment D), the University of Northern Colorado (UNC) (Attachment E), and the University of Colorado (CU) (Attachment F). Committee discussion ensued on the sources of revenue for CSU listed in Attachment B. Mr. Rich Schweigert, representing CSU, came to the table to discuss CSU's sources of revenue. Mr. Forbes discussed CSU's debt service coverage ratio.



160121 AttachB.pdf160121 AttachC.pdf160121 AttachD.pdf160121 AttachE.pdf160121 AttachF.pdf



07:51 AM



Committee discussion ensued on the minimum 1.5 debt service coverage ratio. Mr. Forbes then explained the annual debt service coverage schedule for CSU.





08:02 AM



Mr. Forbes discussed the analysis of WSCU's debt capacity. Committee discussion ensued on WSCU's enrollment projections and use of the Higher Education Revenue Bond Intercept Program.





08:09 AM



Mr. Forbes discussed the analysis of MSUD's debt capacity.





08:12 AM



Mr. Forbes discussed the analysis of UNC's debt capacity, credit ratings, and enrollment projections.





08:17 AM



Mr. Forbes discussed the analysis of CU's debt capacity, net revenues available for debt service, and its non-use of the intercept program. Kori Donaldson, Legislative Council Staff, responded to a committee question on the committee's oversight of non-intercept projects. Mr. Forbes also discussed potential legislation related to changing the requirements on pledging revenue for debt service. Committee discussion ensued on the impacts to the state budget and bond markets if projects backed by the intercept program were to default.





08:29 AM



Committee discussion ensued on credit rating organizations and how the state would respond to a situation in which an institution is unable to make an intercept project debt service payment.