CAPE GIRARDEAU, Mo., Feb. 22, 2013 — The Southeast Missouri State University Board of Regents Feb. 21 approved a resolution directing the issuance of System Facilities Revenue Refunding and Improvement Bonds Series 2013, the proceeds of which will be used to finance construction of a project that will expand instructional space and provide a housing option at the River Campus.
In December, the Regents approved construction of new academic and residence hall space at the River Campus to meet the growing demand for instructional space for the Earl and Margie Holland School of Visual and Performing Arts and provide a housing option adjacent to the River Campus.
The $23.6 million project will add 96,550 in gross square footage to the River Campus. Bids for sitework are to be let in March, with the new facilities expected to be open for occupancy in fall 2014, said Kathy Mangels, vice president for finance and administration.
The $23.62 million cost estimate for the project includes construction, architectural and engineering fees, site development, parking lot paving, landscaping, and furniture, fixtures and equipment, Mangels said.
Annual debt service will be paid proportionately from annual revenues to the residence hall system from additional housing contracts and meal plan commissions and from annual incidental fee revenue to the general operating budget from increased majors in the Earl and Margie Holland School of Visual and Performing Arts, she said.
While working towards the best financing mechanism for the River Campus expansion project, Southeast’s administration reviewed refunding opportunities for existing system facilities bonds, where changes in interest rates may result in annual debt service savings. Based on this information, the Regents today also agreed to advance refund Series 2006A bonds which financed construction of the Student Aquatic Center and Series 2008 bonds which funded construction of Merick Hall and the purchase and renovation of Henderson Hall. The 2006A bonds have $8.05 million in principal outstanding. The Series 2008 bonds have $52.67 million in principal outstanding, Mangels said.
Refunding the 2006 and 2008 bonds will result in a $450,000 annual average savings to the University in principal and interest payments over the remaining life of the bonds, she said. Mangels added that this is a very favorable time to issue bonds. When the University issued bonds 14 months ago for construction of a residence hall on the main campus, interest rates on the 30 year issue ranged from 1.2% to 4.4%. The interest rate on the 30 year bonds approved this week were 0.45% to 3.75%, averaging almost a full percentage point less.