Capital Debt Affordability Committee Treasurer Nancy K. Kopp, Chair Louis L. Goldstein Treasury Building 80 Calvert Street, Assembly Room Annapolis, MD 21401
Agenda
October 10, 2019 1:00 PM
1) Treasurer’s Opening Comments
2) CDAC Workgroup Report on Implementation of GASB 87 Christian Lund, Director of Debt Management, State Treasurer’s Office
3) Review of Size and Condition of State Tax-Supported Debt:
a. General Obligation Bonds State Treasurer’s Office: Christian Lund, Director of Debt Management b. Consolidated Transportation Bonds Maryland Department of Transportation: June Hornick, Assistant Director c. Maryland Stadium Authority Bonds Maryland Stadium Authority: David Raith, Chief Financial Officer d. Bay Restoration Bonds Maryland Water Quality Financing Administration: Jeff Fretwell, MWQFA Director e. GARVEE Bonds Maryland Transportation Authority: Allen Garman, Director of Treasury and Debt Management f. Capital Leases State Treasurer’s Office: Tanya Mekeal, Lease Administrator
4) Review of Size and Condition of Debt of Higher Education Institutions:
a. Baltimore City Community College Debra L. McCurdy, PhD, President b. Morgan State University Sidney Evans Jr., Vice President for Finance and Management c. University System of Maryland Robert Page, Associate Vice Chancellor for Financial Affairs d. St. Mary’s College Paul Pusecker, Vice President for Business and CFO
The final CDAC meeting will be held on Thursday, October 17, 2019 at 9:30 am to review and discuss the recommendation of general obligation bond authorizations.
CDAC Workgroup Report on Implementation of GASB 87
2019 CDAC Working Group: Report to CDAC on New GASB Lease Guidance
October 10, 2019 1 Topics of Discussion
1. Background
2. What We Know Now
3. Recommendations
2 Background
3 Background
• Over the summer and continuing through the fall, a CDAC workgroup convened to discuss changes to the Governmental Accounting Standards Board (GASB) guidance on lease accounting.
• Agencies represented: • State Treasurer’s Office • Comptroller of Maryland • Department of Legislative Services • Department of Budget and Management • Maryland Department of Transportation
4 Background
Why accounting standards are an issue for CDAC:
• Capital leases supported by tax revenue are defined by State law as tax-supported debt. • CDAC has historically followed GASB guidance to determine which leases should be considered capital. • GASB has finalized Statement No. 87 (GASB 87) which must be implemented by fiscal year 2021. CDAC needs to determine if and how it will respond to the new guidance.
5 Background: Current GASB Guidance
GASB currently considers a lease capital if it meets at least one of the criteria below:
. Ownership of the property transfers to the lessee by the end of the lease term; . Allows the lessee to purchase the property at a bargain price at fixed points and for fixed amounts; . The term is 75% or more of the useful life of the property; or . The PV of the lease payments is ≥90% of the fair value of the property.
If none of the above criteria apply, the lease is classified as an operating lease. Most of the State’s leases are currently considered operating.
6 Background: Guidance Following GASB 87
• Effective December 15, 2019, the Government Accounting Standards Board guidance on classifying leases will change.
• In effect, all leases other than short-term leases (leases lasting twelve months or less) will be classified in the State’s financial statements as capital leases.
• This is expected to significantly increase the number and amount of outstanding capital leases the State has on its books.
7 What We Know Now
8 What We Know Now
• Implementation is not required until fiscal year 2021, so the State’s understanding of the magnitude of the change on the State’s books is in its infancy.
• A JCR response1 submitted in January 2019 estimated that the impact of GASB 87 during fiscal year 2018 would have been: • An additional $91 million in debt service • An additional $516 million in debt outstanding
1Document available online at https://treasurer.state.md.us/media/123541/2018_p187_dbm_dgs_mdot_gasb_lease_rule.pdf 9 What We Know Now
• However, the workgroup believes the JCR estimate may reflect the floor, not the ceiling, of GASB 87’s impact.
• The JCR response focused solely on real property operating leases held by the Department of General Services (DGS), which will almost certainly be considered capital after GASB 87 is implemented.
• However, other State agencies are only now beginning to determine whether or not they have other leases that need to be counted.
• There are also other technical factors that have not yet been determined, such as a dollar threshold for counting capital leases.
10 Recommendations
11 Recommendations
The JCR response stated, and the CDAC workgroup agreed, that CDAC has three options to choose from. However, all have drawbacks: 1. Remove leases from CDAC consideration. This would likely require a statutory change and the effect on the CDAC affordability benchmarks cannot be determined until the State better understands the impact of GASB 87. 2. Consider all 13+ month leases as capital. The effect on the CDAC affordability benchmarks cannot be determined until the State better understands the impact of the change. 3. Maintain current practice. CDAC’s treatment of leases would not match the GASB guidance.
12 Recommendations
• After considering these options, the workgroup recommends maintaining current practice for now and revisiting the issue next year for the following reasons: • It likely requires a statutory change to eliminate capital leases from the affordability analysis. • Adopting GASB 87 when calculating the CDAC affordability benchmarks is not possible since the amounts are not yet known. • The State will have a better understanding of how GASB 87 impacts the State’s books by the time of next year’s CDAC meeting.
• The workgroup will revisit the issue next summer and aims to make a final recommendation to the Committee during next year’s meetings.
13 Review of Size and Condition of State Tax-Supported Debt: General Obligation Bonds 2019 Update on Maryland General Obligation Bonds for the Capital Debt Affordability Committee
October 10, 2019
1 Topics of Discussion
1) General Obligation (GO) Bond Status Update
2) Debt Projections
3) Fiscal Year 2019 Capital Budget Authorization History
4) Refunding Potential
5) Use of Variable Rate Debt, Derivatives and Guaranteed Investment Contracts
2 Fiscal Year 2019 GO Bond Issuances
Fiscal Year 2019 General Obligation Bond Issues Totaled $1.0 Billion
($ in millions) All-In True Dates of Series Tax-Exempt: Tax-Exempt: Tax-Exempt: Taxable: Interest Cost Sales New Money New Money Refunding Taxable Federal Tax (TIC) Competitive Negotiated Competitive Credit
2018 2nd Series 8/1/18 $510.0 2.814%
2019 1st Series 3/26/19 $490.0 2.344%
3 Fiscal Year 2020 GO Bond Issuances
Fiscal Year 2020 YTD General Obligation Bond Issues Total $550.0 Million
($ in millions) Overall True Dates of Series Tax-Exempt: Tax-Exempt: Tax-Exempt: Taxable: Interest Cost Sales New Money New Money Refunding Taxable Federal Tax (TIC) Competitive Negotiated Competitive Credit
2019 2nd Series 8/14/19 $500.0 $50.0 1.659%
4 GO Bonds Issued in Prior Five Fiscal Years Including FY 2020 YTD
$8.14 billion in General Obligation Bonds issued since July 1, 2014:
$7.87 billion in tax-exempt bonds (decrease of $368.9M from previous 5 years) • $5.60 billion in tax-exempt new money bonds (71%) • $2.27 billion in tax-exempt refunding bonds (29%)
$268.8 million in taxable bonds (decrease of $44.5M from previous 5 years) • $250.0 million in taxable bonds (93%) • $18.8 million in taxable, direct subsidy Qualified Zone Academy Bonds (QZABs) (7%)
5 Outstanding GO Debt and Amounts Authorized but Unissued
General obligation debt outstanding:
• $9.607 billion was outstanding as of June 30, 2019 • $395.5 million retired since June 30, 2019 • $550.0 million issued since June 30, 2019 • $9.761 billion outstanding as of October 17, 2019
$2.508 billion of general obligation debt was authorized but unissued as of June 30, 2019.
6 Current Projections for Future Issuances
The following figures are based on the most recent recommendations from the Spending Affordability Committee and the Governor’s Capital Improvement Plan.
Fiscal Year Authorizations Issuances 2020 $1,085 $995 2021 $1,095 $1,075 2022 $1,105 $1,090 2023 $1,115 $1,100 2024 $1,125 $1,110
All $ figures in millions. Preliminary and subject to change.
7 Ten Year Debt Service Projections
$1,800.0
$1,600.0
$1,400.0
$1,200.0
$994.7 $1,013.9 $1,033.9 $1,000.0 $950.9 $967.7 $978.5 $908.4 $934.0 $941.3 $800.0 $1,012.3 $1,036.2
$600.0
$400.0
$482.8 $495.6 $513.7 $527.5 $506.4 $535.8 $532.5 $533.8 $200.0 $401.4 $286.0 $287.0
$- 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
General Fund Annuity Bond Fund 8 All $ figures in millions. FYs 2020-2029 are projections which are preliminary and subject to change. Fiscal Year 2020 Capital Budget Authorization History
In September 2018, the CDAC voted 4-1 to recommend an authorization of $995 million for fiscal year 2020.
In December 2018, the Spending Affordability Committee recommended an authorization of $1.085 billion for FY 2020, consistent with its policy of including approximately 1.0% annual growth over the prior year authorization.
In January 2019, the Governor proposed a capital budget for fiscal year 2020 consistent with the 2018 SAC recommendation of $1.085 billion.
The net final authorization amount for the FY 2020 capital budget approved during the 2019 Legislative Session was $1.085 billion.
9 Refunding Potential
The State has been aggressive in pursuing refunding savings. The most recent refunding, issued in August 2017, generated $75.8 million in debt service savings on a net present value (NPV) basis.
Looking ahead, certain maturities from the 2009 Second Series, 2009 Third Series, 2010 First Series, and 2012 First Series bonds with a total par of $257.3 million will be eligible for a current refunding at the time of the State’s next planned issuance in March 2020. The Treasurer’s Office will monitor market conditions at the time of sale and pursue a refunding series if it is advantageous for the State.
10 Use of Variable Rate Debt, Bond Insurance, Derivatives, and Guaranteed Investment Contracts
The State is authorized to issue variable interest rate bonds in an amount no more than 15% of the outstanding general obligation indebtedness. As of today, the State has not issued any variable rate debt and has not executed any derivatives. The State did not enter into any new Guaranteed Investment Contracts related to the issuance of general obligation bonds in FY 2020.
Because of the State’s strong credit profile, perception in the market and maintenance of its AAA credit rating, there has been no need for bond insurance.
11 Review of Size and Condition of State Tax-Supported Debt: Consolidated Transportation Bonds Consolidated Transportation Bonds
Presented by June R. Hornick Assistant Director of Finance Debt Management October 10, 2019 Structure: Fixed rate Interest only first 2 years Maximum maturity of 15 years Level debt service payments Additional Bonds Test: Pledged taxes at least 2.0x maximum annual Debt Service Net revenue at least 2.0x maximum annual Debt Service Management Practice: Pledged Taxes at least 2.5x maximum annual Debt Service Net Revenue at least 2.5x maximum annual Debt Service
Fiscal Year 2019 Estimated : Pledged taxes coverage 5.0x Net revenue coverage 2.8x
1 Amount issued in prior 5 fiscal years: $ 2.637 billion new construction $ 502.2 million refunding ($ in millions) True Interest Cost Series Sale Date New Money Refunding (TIC)
Series 2018 (2) 9/18/2018 $630.7 3.079%
Series 2018 5/9/2018 $130.0 2.776%
Series 2017 (2) 9/13/2017 $425.0 2.283%
Series 2017 4/26/2017 $265.0 2.641%
Series 2016 10/26/2016 $385.0 2.310%
Series 2016 Refunding 10/26/2016 $242.5 1.556%
Series 2015 Third Issue 12/2/2015 $300.0 2.47%
Series 2015 Second Issue 6/3/2015 $136.0 2.75%
Series 2015 Refunding 6/3/2015 $259.7 1.85%
Series 2015 2/11/2015 $265.5 2.59%
Series 2014 6/11/2014 $100.0 2.66%
Total $2,637.2 $502.2
2 Amount outstanding: FY19 - $3.3 billion Legislative debt ceiling $4.5 billion Amount authorized but unissued: FY19 - $3.4 billion authorized FY19 - $ 79 million unissued Variable rate debt, swaps and bond insurance: None Bond Insurance: Not needed because of MDOT’s stable credit profile
Refunding Potential:
Advanced refunding eliminated by 2017 federal tax cuts No current refunding potential
3 Preliminary projections for new issuances
($ in millions) Debt Debt Outstanding Outstanding at Beginning New at End Fiscal Year of Year Issues Redeemed of Year
2020E $3,343 $555 $206 $3,692 2021E $3,692 $365 $255 $3,802 2022E $3,802 $290 $297 $3,795 2023E $3,795 $305 $338 $3,762 2024E $3,762 $435 $308 $3,889 2025E $3,889 $205 $323 $3,771 2026E $3,771 $225 $340 $3,656 2027E $3,656 $250 $381 $3,525 2028E $3,525 $270 $396 $3,399 2029E $3,399 $285 $414 $3,270 (E = based on September 2019 Estimate)
4 Debt service preliminary projections for the next 10 years ($ in millions)
600
500
400
300
200
100
0 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 DS Projected New Issues 7 29 43 88 124 152 181 217 238 266 DS Current Outstanding 348 387 415 410 343 329 311 311 300 285 Total Debt Service 355 416 458 498 467 481 492 528 538 551
5 Rating Agency Updates
Standard & Poor’s – AAA Moody’s – Aa1 Fitch – AA+ as of September 18, 2019
6 Review of Size and Condition of State Tax-Supported Debt: Maryland Stadium Authority Bonds Maryland Stadium Authority Briefing
Capital Debt Affordability Committee
October 10, 2019
1 Maryland Stadium Authority
• Debt Issued over the past five years
Fiscal Year Amount Purpose
2015 $9,535,000 Refund the Series 2011 Revenue Bond for Oriole Park Improvements, reduce the outstanding balance refunded by $500,000 by negotiating a lower debt service reserve 2016 $320,000,000 First series of bonds issued for Baltimore City Public Schools. Revenue bond with the pledge being lottery, Baltimore City Beverage taxes, a percentage of the casino facility rental fee, a portion of table game proceeds, and funds from the education grant from Baltimore City Public Schools. 2017 $0 2018 $426,440,000 Second series of bonds issued for Baltimore City Public Schools. Revenue bond with the pledge being lottery, Baltimore City Beverage taxes, a percentage of the casino facility rental fee, a portion of table game proceeds, and funds from the education grant from Baltimore City Public Schools. 2019 $55,000,000 Issued two series of bonds, Series 2019A was for $20.6 million of tax-exempt lease revenue bonds with the proceeds being used for various projects at M & T Bank Stadium. The second series, 2019B, was a taxable lease revenue bond with the proceeds used for various capital projects on the warehouse, parking lot controls and improvements to the walkway between the two stadiums. 2 Maryland Stadium Authority
• FY 2019 Issuance • Sports Facilities Lease Revenue Bonds, Series 2019A (Football Stadium) • Tax-Exempt Financing • Par amount - $20,595,000 • Premium - $2,540,585 • Cost of Issuance - $133,700 • Project Funds - $23,000,000 • Term – 7 years with the final maturity March 1, 2026 • True interest cost – 1.789% • Average coupon – 4.924% • Average annual debt service - $3.66 million
3 Maryland Stadium Authority
• FY 2019 Issuance • Sports Facilities Lease Revenue Bonds, Series 2019B (Warehouse) • Taxable • Par amount - $34,405,000 • Cost of Issuance – $255,859 • Project Funds - $34,176,550 • Term – 20 years, with the first 7 years interest only, with a maturity of March 1, 2039 • True interest cost – 3.547% • Average coupon – serials 3.319% and term 3.709% • Annual debt service - $1.2 million during interest only period and $3.6 million remaining 13 years
4 Maryland Stadium Authority • Amount of Outstanding Debt and Revenues
Fiscal Amount Tax Revenue Energy Debt Service Revenues Year$ Outstanding Supported Bond (tax for Tax (Lottery/ Bonds and supported Supported Camden Yards Equipment debt) and Operating Equipment Revenue and $2 ticket charge)
2014 $185,442,082 $168,862,603 $10,010,000 $6,569,479 $32,760,702 $23,440,000
2015 $168,421,865 $145,021,979 $17,455,000 $5,944,886 $31,447,251 $21,851,391
2016 $466,291,738 $125,181,285 $335,825,000 $5,285,453 $26,394,035 $21,837,615
2017 $439,642,623 $105,883,444 $329,170,000 $4,589,179 $26,520,012 $21,893,973
2018 $829,883,947 $84,790,000 $741,240,000 $3,853,947 $24,413,865 $21,817,415
2019 $850,917,515 $119,760,000 $727,780,000 $3,077,515 $23,954,023 $21,359,802
2020 $813,052,509 $96,910,000 $713,685,000 $2,257,509 $23,670,006 $21,165,006 2021 $786,581,417 $85,298,908 $698,925,000 $1,391,417 $11,611,092 $9,016,092 2022 $758,851,576 $73,119,067 $683,475,000 $476,576 $12,179,841 $9,479,841 2023 $731,935,000 $62,387,491 $667,290,000 $0 $10,731,576 $9,511,576 2024 $704,165,000 $51,567,491 $650,340,000 $0 $10,820,000 $9,525,000 2025 $677,555,000 $41,712,491 $633,585,000 $0 $9,855,000 $10,045,000 2026 $651,535,000 $32,147,491 $617,130,000 $0 $9,565,000 $9,755,000
5 2027 $632,100,000 $29,987,491 $599,855,000 $0 $2,160,000 $2,350,000 2028 $611,735,000 $27,762,491 $581,715,000 $0 $2,225,000 $2,415,000 Maryland Stadium Authority
• Fixed Rate Debt Ratings
Series S&P Moody’s Fitch 2004 AA+ Aa2 AA 2011 AA+ Aa2 AA 2012 HPAC AA+ Aa2 AA 2012 MCCC AA+ Aa2 AA 2016 AA- Aa3 AA 2018A AA- Aa3 AA 2019A AA+ Aa2 AA+ 2019B AA+ Aa2 AA+
6 Maryland Stadium Authority
Maryland Stadium Authority Summary of Swaps and Variable Rate Demand Bonds as of June 30, 2019
Sports Facilities Lease Revenue Refunding Bonds Football Stadium Issue Series Name Series 2007 Tax Status Tax-Exempt Dated Date 2/8/2007 Original Issue Par $73,500,000 Current Outstanding $36,210,000 Maturity 3/1/2008 – 2026 Remarketing Agent Goldman Sachs & Co. Current Remarketing Rate 5 Basis Points Liquidity/LOC Provider SBPA: Sumitumo LOC Expiration 3/14/2022 Current LOC Fee 36 Basis Points Current Reset Frequency 7-Day Date of Last Reset 9/25/2019 Reset Rate 1.56%
Synthetic Fixed Rate (MSA paid Fixed Amounts = 5.69% - 5.8%, Hedges receives SIFMA) Counterparty Barclays
7 Maryland Stadium Authority
• Variable Rate Debt Ratings
Series S&P Moody’s Fitch 2007 Short Term A-1+ VMIG 1 F1+ 2007 Long Term AA+ Aa2 AA
8 Maryland Stadium Authority • Current projections for new issuances
• FY 2020 • Issue up to $24.5 million in Ocean City Convention Center Tax-Exempt Lease Revenue Bonds, Series 2019C • Approximately $22.5 million will be used for the expansion of the Ocean City Convention Center • Capitalize 2 years of interest • Tax-supported debt • 20 year bond • Estimated debt service is $1.6 million and $2.0 million
• FY 2021 • Issue the third and final series of approximately $105 million in Baltimore City Public School Revenue Bonds • Tax-Exempt • Proceeds to be used for the balance of the Year 2 schools • Approximately average debt service of $11.0 million • Revenues from the City, Lottery and Baltimore City Public Schools are pledged • 30 year bond • Non-tax supported debt
9
Review of Size and Condition of State Tax-Supported Debt: Bay Restoration Bonds Bay Restoration Fund (BRF) Capital Debt Affordability Committee Briefing October 10, 2019
Jeffrey Fretwell, Director Maryland Water Quality Financing Administration 1800 Washington Boulevard Baltimore, MD 21230 410-537-4481 [email protected]
www.mde.maryland.gov/wqfa Bay Restoration Fund Debt Issued in Prior Fiscal Years
FY Amount ($ Million) Primary Purpose
2008 $ 50.00 Provide grants for the Enhanced 2009 - Nutrient Removal (ENR) 2010 - upgrades at the 67 major Waste 2011 - Water Treatment Plants (Estimated 2012 - Total ENR Capital Cost $1.2 billion) 2013 - 2014 $100.00 2015 - 2016 $180.00 2017 - 2018 - 2019 - Total $330.00
Page 2 Bay Restoration Fund Existing Bonds/Refunding Potential
Series 2008 Series 2014 Series 2015 Debt Issued: $50,000,000 $100,000,000 $180,000,000 Issue Date: 4/29/2008 5/14/2014 12/03/2015 Ratings: Aa2 (Moody’s) Aa2 (Moody’s) Aa2 (Moody’s) AA (S&P) AA (S&P)
True Interest Cost: 4.03% 2.55% 2.59% Interest: Fixed Rate Fixed Rate Fixed Rate Final Bond Maturity: 3/1/2023 3/1/2029 3/1/2030 Security: BRF (WWTP)Fee BRF (WWTP)Fee BRF (WWTP) Fee Debt Service Reserve: None None None Optional Redemption After: 3/1/2018 3/1/2024 3/1/2024
Refunding Potential: No/Low Savings No/Low Savings No/Low Savings based on maturity
Page 3 BRF Current Outstanding Debt & Annual Debt Service ($ Million)
Fiscal Year Ending Outstanding Debt Annual Debt Service 2008 50.000 0.000 2009 46.825 4.655 2010 44.185 4.710 2011 41.560 4.616 2012 38.820 4.614 2013 35.995 4.617 2014 133.055 4.614 2015 129.980 8.248 2016 301.615 14.330 2017 292.880 23.431 2018 273.590 31.756 2019 253.375 31.717 2020 232.075 31.827 2021 209.715 31.829 2022 186.245 31.823 2023 161.605 31.824 2024 140.360 27.216 2025 118.055 27.214 2026 94.715 27.134 2027 70.375 27.297 2028 44.905 27.697 2029 18.250 28.049 2030 0.000 18.798 2031 0.000 0.000 Page 4 Bay Restoration Fund Total Debt Authorized and Amount Unissued
Debt Authorized through FY 2020 budget: $590,000,000 Debt Issued through end of FY 2019: $330,000,000 Future Authorized Debt Issuance: $260,000,000
Projected Future Debt Issuance (FY 2022): $100,000,000
Assumptions for future debt issuance • Wt. Avg. Coupon Rate of 2.50% per year • Annual Level Debt Service • Maximum 8-Year Bond Term • Final Debt Service Payment by FY 2030
Page 5 Projected Debt Issuance, Debt Service Payments & Annual Revenue ($ Millions)
Fiscal New Debt Outstanding Debt Service Revenue Year Issues as on 6/30/Yr Payment for FY (Cash)
2008 50.000 50.000 0.000 55.068 actual 2009 0.000 46.825 4.655 53.356 actual 2010 0.000 44.185 4.710 54.818 actual 2011 0.000 41.560 4.616 54.598 actual 2012 0.000 38.820 4.614 54.552 actual 2013 0.000 35.995 4.617 92.767 << Fee Increase 2014 100.000 133.055 4.614 108.466 actual 2015 0.000 129.980 8.248 111.785 actual 2016 180.000 301.615 14.330 123.708 actual 2017 0.000 292.880 23.431 112.678 actual 2018 0.000 273.590 31.756 113.530 actual 2019 0.000 253.375 31.717 114.201 actual 2020 0.000 232.075 31.827 115.343 Est. 1% growth/year 2021 0.000 209.715 31.829 116.496 2022 100.000 286.245 31.823 117.661 2023 0.000 250.944 46.985 118.838 2024 0.000 218.558 42.377 120.026 2025 0.000 184.611 42.375 121.226 2026 0.000 149.105 42.295 122.438 2027 0.000 112.052 42.458 123.663 2028 0.000 73.296 42.858 124.899 2029 0.000 32.758 43.209 126.149 2030 0.000 0.000 33.958 127.410 2031 0.000 0.000 0.000 63.705 << Fee Decrease Page 6
Review of Size and Condition of State Tax-Supported Debt: GARVEE Bonds A. Grant Anticipation Revenue Vehicles (“GARVEE”) Bonds
Purpose Grant Anticipation Revenue Vehicle (“GARVEE”) Bonds are authorized by State statute to leverage federal aid to finance the cost of transportation facilities. GARVEEs were used as a part of the funding plan for the Intercounty Connector (“ICC”) project, in addition to various other debt instruments and cash. The use of GARVEEs for the ICC allowed the project to be constructed sooner than otherwise would have been possible and with less reliance on the State’s available funds.
Security GARVEE bonds are secured by a pledge of federal transportation funds received by the State which approximate $548.64 million annually. In addition, there is a subordinate pledge of certain State Transportation Trust Fund (“TTF”) tax sources. The GARVEEs were also structured to include debt service reserve funds for additional security.
Limitations to Debt Outstanding Statute limits the total amount that can be issued for GARVEEs to an aggregate principal amount of $750.0 million, with a maximum maturity of 12 years. Under state law, the proceeds could only be used for the ICC. Legislation enacted by the 2005 General Assembly specified that GARVEE bonds be considered tax-supported debt in the CDAC affordability analysis.
Current Status: Debt Outstanding as of June 30, 2019: $48,865,000
Ratings GARVEEs were previously rated AAA by S&P, Aa1 by Moody’s and AA+ by Fitch.
Use of Variable Rate Debt, Bond Insurance, Interest Rate Exchange Agreements and Guaranteed Investment Contracts The GARVEE bonds are fixed rate bonds, and were issued without bond insurance due to the subordinate pledge of the TTF and the availability of debt service reserve funds. The Maryland Transportation Authority (“MTA”) has not used derivatives or guaranteed investment contracts.
Trends in GARVEE Debt A total of $750.0 million in GARVEE bonds have been issued by the MDTA. The first issuance occurred in May 2007 and totaled $325.0 million with a true interest cost of 3.99%. In December 2008, the MDTA sold the remaining $425.0 million of GARVEE bonds with a true interest cost of 4.31%. GARVEE debt outstanding and required debt service for the past five fiscal years and projections until the debt is repaid are shown in Graph 5. On August 9, 2017 the Series 2007 GARVEE Bonds were refunded and redeemed through the issuance of a Series 2017 GARVEE Refunding Bond. The 2017 GARVEE bonds fully matured on March 1, 2019. The Series 2008 bonds were refinanced with a Series 2019 bank loan on March 1, 2019. The final GARVEE bond matures on March 1, 2020 and no additional new money issuances are permitted.
Maryland Transportation Authority Refunding of 2008 GARVEES March 1, 2019 Nominal Prior Debt Service 2019 GARVEE Bond Savings* Debt Date Principal Interest Service Principal Interest Debt Service
9/1/19 - 1,249,919 1,249,919 - 537,515 537,515 712,404
3/1/20 48,865,000 1,249,919 50,114,919 48,865,000 537,515 49,402,515 712,404
Total 48,865,000 2,499,838 51,364,838 48,865,000 1,075,030 49,940,030 1,424,808 * Prior debt service minus new debt service equals nominal savings of $1.4 million.
Review of Size and Condition of State Tax-Supported Debt: Capital Leases Capital Lease Update for the 2019 Capital Debt Affordability Committee
October 10, 2019 Topics of Discussion
• Capital Lease Overview • Tax-Supported Leases in the CDAC Analysis • Tax-Supported Energy Leases that are included in the CDAC Analysis • Tax-Supported Energy Leases that are not included in the CDAC Analysis • Capital Equipment and Energy Lease Activity in Fiscal Year 2019 • Projections of Future Tax-Supported Lease Financings
2 Capital Lease Overview
• STO, on behalf of BPW, determines the size, timing, and method to finance capital assets for State agencies and manages the lease procurement and payment of debt service.
• Capital Facility Leases allow facilities to be purchased through a lease with terms ranging from 15 – 25 years. Facility leases are included in the CDAC analysis. • Energy Leases are for energy performance projects at State facilities and are limited to a fifteen year term. If utility savings offset the debt service costs, energy leases are not included in the CDAC analysis. • Equipment Leases allow State agencies to finance capital equipment over a period of time. Terms are limited to 3, 5 or 10 years. These are included in the CDAC analysis. – Financed equipment is required to: • Have a useful life at least as long as the financing term and the cost should be a material amount; • Be repossessable and easily identifiable.
3 Tax-Supported Capital Leases in the CDAC Analysis
The following table summarizes the current tax-supported capital leases included in the 2019 CDAC Affordability Analysis.
FY 2019 Tax-Supported Lease Financings Outstanding Principal Amount State Agency Equipment and Facilities Financed Outstanding as of Debt Service for FY 2019 6/30/19 Capital Equipment - Various State Treasurer’s Office on communications, computers and other $13,362,716* $4,303,349* behalf of State Agencies equipment State Treasurer’s Office on Energy Performance Projects 8,150,448* 1,429,713* behalf of State Agencies Department of Transportation Headquarters Office Building 7,720,000 2,792,175 Department of General Services Prince George’s County Justice Center 13,279,056 1,515,793 Transportation Authority State Office Parking Facility 16,750,000 1,488,422 Department of Health Public Health Lab 128,730,000 13,990,063 Total Tax-Supported Leases $187,992,220 $25,519,515
*Maryland Stadium Authority reports the Stadium Authority Capital leases in their debt. 4 Tax-Supported Energy Leases included in the CDAC Analysis
The following table summarizes the current energy leases included in the 2019 CDAC analysis. An energy lease is included in the CDAC analysis if it lacks a surety guaranty, meaning debt service may not be offset by utility savings.
Debt Outstanding Debt Service as of 6/30/2019 for FY 2019 Energy lease project
St. Mary's College of Maryland $199,648 $205,295
Veterans Affairs 283,818 56,638 University of Baltimore 3,079,462 649,125 Stadium Authority (Ravens) 850,345 263,232 Stadium Authority (Oriole Park) 2,227,170 716,432 Maryland Port Administration 4,587,519 964,413 Total $11,227,962 $2,855,135
Note: The listing does not include energy leases with a surety guaranty, which ensures that debt service will be fully offset by utility savings.
5 Capital Equipment and Energy Lease Activity in Fiscal Year 2019
Equipment
Summary of the Lease Terms for Equipment Financed in Fiscal Year 2019
3 year leases $1,229,167 5 year leases $962,025 10 year leases 0 Total $2,191,192 Energy
Summary of Energy Leases Financed in Fiscal Year 2019
Department of Public Safety and Correctional Services $12,224,708 Total $12,224,708 6 Projections of Future Tax-Supported Lease Financings in the CDAC Analysis
Types of Financing Period CDAC projections as of June 2019* Equipment Leases (1) Fiscal Years 2020 – 2022 $11 million for FY 2020, $24 million for FY 2021, and $6 million in FY 2022. Energy Leases (2) Fiscal Years 2020 – 2022 $0
(1) Fiscal Year 2020 - 2022 estimates are based on agency surveys. (2) All of the projected Energy Lease financings include projects that will have surety bond guarantees that equal or exceed the debt service payments through out the term of the lease; therefore, these projects are not included in the CDAC Affordability Analysis. DGS estimates that approximately $12 million in energy projects each fiscal year in the fiscal years FY 2020 through FY 2022.
* Preliminary, subject to change.
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Review of Size and Condition of Debt of Higher Education Institutions: Baltimore City Community College
CAPITAL DEBT Operating & Capital Budget AFFORDABILITY COMMITTEE
Larry Hogan, Governor Dr. Debra L. McCurdy State of Maryland President Brian O’Connell Chief Budget Officer Baltimore City Community College
THURSDAY | OCTOBER 10, 2019
2901 LIBERTY HEIGHTS AVENUE | BALTIMORE, MD 21215 | 410-462-8300 | WWW.BCCC.EDU Operating & Capital Budget Baltimore City Community College
“Changing Lives, Building Communities” Baltimore City Community College is the only community college in Maryland that is a State Agency. It is also the only urban community college in the State.
BCCC’s campus is located in West Baltimore; with several Baltimore City satellite locations. As of fiscal 2019, the College served Over 13,000 credit and non-credit students annually, providing transfers to four-year colleges as well as workforce training.
BCCC buildings are 20+ years old. Buildings located on the Liberty campus date back to 1968. The most recent building on this site is the Life Science Building which was built in the mid-1990s.
2 Page 2 │ Operating & Capital Budget Baltimore City Community College
Realignment Legislation Subject to 2017 Realignment Legislation, which required various tasks including “to develop or sell all unused or underutilized real estate…”
BCCC is working with The Cordish Company, the successful bidder to the RFP on the Redevelopment of the Inner Harbor-Bard Building site. Discussions are ongoing.
College is assessing all BCCC real estate locations utilized or re-evaluating usage: . Lockwood - Multi-Use Property . Harbor Park - Workforce Development Classrooms and Administrative . Reisterstown Road Plaza - Workforce Development Classrooms, Radio Station (WBJC) . Preston Street - Workforce Development Weatherization Center (Construction Mgt.) . Bio Park - Credit Classrooms and Administrative Offices . North Pavilion – Administrative Offices . South Pavilion - Year Up Program Offices & Business Incubator . West Pavilion – Administrative Offices
3 Page 3 │ Operating & Capital Budget Baltimore City Community College
Trends in Enrollment Fall 2014-2019*
Total Enrollment & Dual-Enrollment Headcount 6,000 6.0%
5.3% 5.1% 5,000 5,269 5.0% 4,770 4,726 4,000 4,523 4,409 4.0% 4,188 3.3% 3,000 3.0% 2.3% 2.5% 2,000 2.0%
1.1% 1,000 1.0% 255 230 139 102 117 57 0 0.0% Fall 2019* Fall 2018 Fall 2017 Fall 2016 Fall 2015 Fall 2014
Total Enrollment Dual-Enrollment % Dual-Enrollment
Enrollment Strategy: Dual Enrollment, Workforce Non-Credit and Online Credit & Non-Credit Fall 2019* Dual Enrollment 2nd 8-week sections are not represented in the 255 headcount
Source: BCCC Office of Institutional Research
4 Page 4 │ Operating & Capital Budget Baltimore City Community College
Annual Unduplicated Headcount
2017-18 Annual Tuition & Fees FY 2015 – FY 2019 BCCC = $3,314 ($135) 18,000 Maryland CC=$3,408 ($142) National= *$3,660 ($152) 16,583 15,000 16,049 15,443 Total 13,974 12,000 13,177 9,798 9,278 8,874 9,000 8,015 Credit Students 6,694
7,407 6,000 6,679 6,346 6,054 6,611 Continuing Education 3,000 Students
0 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
Source: BCCC Performance Accountability Report for MHEC│*College Board: (2018) Trends in College Pricing: 2018
5 Page 5│ Operating & Capital Budget Baltimore City Community College
Annual Degrees & Certificates Awarded
FY 2015 – FY 2019
700 656 629 Career Degrees 600 538 509 488 Transfer Degrees 500
Certificates 400
Total Awards 300 279 237 232 234 198 205 217 200 168 193 175 205 152 100 104 113 108
0 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
Source: BCCC Performance Accountability Report for MHEC.
6 Page 6│ Operating & Capital Budget Baltimore City Community College
FY 2019 Unaudited Financials
Sources of Funding
Expenditures
Source: BCCC Budget Office
7 Page 7 │ Operating & Capital Budget Baltimore City Community College
FY 2021 Expectations
Number of Positions (Budgeted FY2021) . Faculty = 116 . Non-faculty Staff = 321 Other Expectations FY 2021 Budget Salaries & Benefits = $41.77 million
Number of Academic Programs Financial Aid = $9.65 million . Undergraduate: (Federal Pell, FSEOG, FWS) o 38 degrees Deferred Maintenance from Operations = $0.15 million o 18 certificates . Master’s = n/a Technology Fee = $0.95 million (new beginning FY2020) . Doctorate = n/a
Source: BCCC Budget Office
8 Page 8 │ Operating & Capital Budget Baltimore City Community College
Operating Budget
• For Fiscal Year 2020, BCCC is authorized to receive $40.2 million in State funding, the largest portion of total funding of approximately $85 million.
• Fiscal Year 2021 Operating Budget request to Department of Budget and Management (hearing in early November), totaling approximately $83 million.
• BCCC currently has an unrestricted (unallocated) fund balance of less than $1 million.
• BCCC is currently evaluating the option to issue academic and/or auxiliary bonds, capital leases or P3 arrangements.
9 Page 9 │ Operating & Capital Budget Baltimore City Community College
Operating Budget Fiscal Year 2021
Salaries, Wages & Benefits $41,767 Technical & Special Fees $7,629 Other Operating Expenses $34,007
TOTAL $83,403 (in thousands)
10 Page 10 │ Operating & Capital Budget Baltimore City Community College
BCCC Capital Debt Profile
Debt Issued in Prior Five Fiscal Years & Amount Authorized but Unissued: . BCCC has not issued debt in the prior five fiscal years . Bonding authority is $65 million for auxiliary and academic facilities . BCCC has no bond debt outstanding - the entire authorization remains unissued as of June 30, 2019.
Current Projections for New Issuances & Rating Agency Update: . BCCC is currently assessing it’s position to issue debt.
Ten-Year Projection: . Any projected bond issuance has not yet been determined.
11 Page 11 │ Operating & Capital Budget Baltimore City Community College
Liberty Campus Main Building
Renovation are complete to the Administrative Wing. The building is fully occupied.
12 Page 12 │ Operating & Capital Budget Baltimore City Community College
Loop Road - Five-Year Capital Program
The College’s Capital Budget request for fiscal years 2021-2025
Loop Road - Inner Loop and Entrance Improvements on Liberty Campus, totaling approximately $6.55 million. Prior year funding totals $1,487,000 for Planning efforts.
Project includes the construction of various safety infrastructure, and site improvements (including handicapped accessibility) for the main campus.
FY2021 Construction $ 3,749,000 FY2022 Construction $ 1,000,000 FY2023 none $ 0 FY2024 none $ 0 FY2025 none $ 0 Construction is slated to begin Summer 2020
13 Page 13 │ Operating & Capital Budget Baltimore City Community College
Library Center - Five-Year Capital Program
• The College’s Capital Budget request for fiscal years 2021-2025
• Liberty Library Learning Resource Center (LRC) - totaling $41.4 million.
• Project includes an update to the library (built in 1965 and renovated in 1989) for a modern LRC. FY2021 none $ 0 FY2022 none $ 0 FY2023 Planning/Construction $ 2,352,000 FY2024 Construction/Equipment $ 14,500,000 FY2025 Construction/Equipment $ 24,569,000
14 Page 14 │ Operating & Capital Budget Baltimore City Community College
Deferred Maintenance - Five-Year Capital Program The College is requesting $1 Million for deferred maintenance projects in FY 2021. The College has an extensive backlog of facility improvement needs that are long overdue. The aging utility and building systems have exceeded their life expectancy and are constantly being repaired. A facility assessment of capital and general repair needs (2021-2025 capital program years) was conducted by an independent contractor, Sightlines.
The College is requesting funding for the following projects: Fire Alarm System Upgrades throughout campus Campus-wide Elevator Refurbishment Replacement of HVAC Systems Restroom upgrades for Main Building
15 Page 15 │ CAPITAL DEBT AFFORDABILITY COMMITTEE Operating & Capital Budget
Larry Hogan, Governor Dr. Debra L. McCurdy State of Maryland President Baltimore City Community College
THURSDAY | OCTOBER 10, 2019
2901 LIBERTY HEIGHTS AVENUE | BALTIMORE, MD 21215 | 410-462-8300 | WWW.BCCC.EDU 16
Review of Size and Condition of Debt of Higher Education Institutions: Morgan State University
MORGAN STATE UNIVERSITY
PRESENTATION TO THE CAPITAL DEBT AFFORDABILITY COMMITTEE Review of Size and Condition of Debt Sidney H. Evans, Jr. | Vice President for Finance & Management October 10, 2019 Table of Contents
PAGE
Guiding Principles ...... 1-2
MSU Debt Management Objectives ...... 3
Debt Issued in Prior Five Fiscal Years ...... 4
Outstanding & Unissued Debt ...... 5
Debt Service Projections – Next Ten Years ...... 6
Refunding Potential / Rating Agency Update ...... 7-8
Current Projections for New Bond Issuance ...... 9
Five-Year Capital Improvement Plan ...... 10 i Internal Debt Guidelines
GUIDING PRINCIPLES
1. Strategic Debt Allocation 2. Debt Affordability and Capacity – State Authorization Level – Debt Burden Ratio – Coverage Ratio – Viability Ratio – Primary Reserve Ratio 3. Portfolio Management of Debt – Tax-Exempt – Taxable – Variable vs. Fixed
– Capital Leases 1 Internal Debt Guidelines
GUIDING PRINCIPLES (Cont.)
3. Portfolio Management of Debt (Cont.) – Derivative Products – Information and Consultation 4. Regular Dialogue with Rating Agencies – Annual Credit Review – Information and Consultation
2 DEBT MANAGEMENT OBJECTIVES
1. Access to capital in a timely and efficient manner. 2. Establish debt guidelines to: a) Optimize the debt mix; b) Manage the structure and maturity profile of debt portfolio to meet liquidity objectives and assist in cash optimization; and c) Allow growth in net assets. 3. To manage the University balance sheet while maximizing the credit worthiness of the University at the most favorable cost of capital. 4. To manage the risk portfolio of the debt structure by minimizing the exposure to market volatility. Debt will be managed on a portfolio, rather than a transactional or project-specific basis. 5. Coordinate debt management decisions with asset and cash management (liquidity) decisions and portfolio strategies.
3 Debt Issued in Prior Five Fiscal Years
Description/Series Fiscal Year Amount Project
Bonds 2018 Series Bonds 2019 $24.7M HBCU Bond Debt
Prior Five Years 0 Total Bonds $24.7M
Capital Lease – Building $0
Equipment – Leases/Purchases $19.3M Lease purchase agreement, equipment for the School of Business and WEAA Radio
Total Capital Leases $19.3M
Total Bonds & Capital Leases $44.0M
4 Outstanding and Unissued Debt
Principal Outstanding as of 6/30/19 Amount
Bonds 1993 Series $ 5.7M 2012 Series 21.3M 2018 Series 4.8M $31.8M
Capital Leases $13.2M
Grand Total $45.0M Debt Authorized but Unissued Amount Debt and Legislative Authority $88.0M Principal Outstanding 45.0M Total Unissued $43.0M
5 Debt Service Projections – Next Ten Years
Description Amount Bonds 1993 and 2012 Series Principal $27.0M Interest 7.9M Total Bonds $34.9M
Capital Leases Principal $13.2M Interest 1.4M Total Leases $14.6M
Total Debt Service $49.5M
6 Refunding Potential and Rating Agency Updates
Refunding Potential None
Rating Agency Updates . Standard and Poor’s Affirmed A+ rating on November 30, 2018 Stable Outlook . Moody’s Affirmed A1 rating on December 20, 2018 Stable Outlook
7 Rating Agency Updates (Cont.)
Credit Rating Strengths o Niche as one of the oldest HBCUs in the country o Relatively stable enrollment with slight increases over last four years o History of rising financial operating and capital support from Maryland o Low to moderate 3.9% maximum annual debt service (MADS) burden with no additional debt plans
Credit Rating Challenges o Strong competition in our market niche and from other public universities o Low endowment of approximately $40.0 million including university and foundation assets o Small unrestricted net asset balance
8 Current Projections for New Bond Issuance
A. Public Safety Building (PSB) – Critical need not in Capital Improvement Plan (CIP) – Part of Northwood Development Project – Projected cost - $15 million
B. Deferred Maintenance (DM) – DM plan developed by Sightlines (independent consultant) – $100M+ of deferred maintenance – CIP – $39M over five years
C. Student Housing – Moving forward with 700 to 900 bed project with MEDCO – Projected start date – Aug 2022 – Possible off balance sheet options
9 Five-Year Capital Improvement Plan (CIP)
Five-Year Capital Improvement Program . University appreciates the State’s support for campus refurbishment and development . Current CIP provides for: . New Student Services $ 88.0M . New Health & Human Services, Phase I 5.4M . New Health & Human Services, Phase II 149.9M . New Science Building, Phase I * 9.1M . New Science Building, Phase II* 171.3M . Deferred Maintenance** 39.0M TOTAL $ 462.6M
* Request made to move up by two years because of current inadequate facilities. ** Includes West Campus improvements.
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Review of Size and Condition of Debt of Higher Education Institutions: University System of Maryland
Capital Debt Affordability Committee
October 10, 2019
Robert Page Associate Vice Chancellor for Financial Affairs USM Financing Principles
• Currently fixed rate – variable to be added as interest rates rise • 20-year serial maturity bonds • Interest only first year • Level debt service payments • Revenue bonds secured by pledge of tuition and net auxiliary revenues & rate covenant • Student housing financed through P3 deals where economically advantageous
2 Evolving Higher Education Capital Needs
• Deferred Maintenance – state-supported capital facilities with a replacement value of more than $12.7B have a backlog of approximately $2B upkeep needed
• Enrollment capacity – after an increase of more than 28k students over the past 10 years, growth over the coming 10 years is expected to be about 12k students
• Research facilities – 1% growth per year in research expected
• Self-support facilities – receive no state capital funding and rely on revenue bonds, P3s, and cash accumulations to meet capital needs . Student housing . Dining . Student Unions . Parking
3 Revenue Bond Rate Covenant
The University System agrees to fix, revise, charge and collect tuition revenues and auxiliary facility fees in each fiscal year in an amount that the sum of tuition revenues and net auxiliary facility fees is not less than 200% of maximum annual debt service on the bonds.
For FY 2018: 12.75 times maximum annual debt service
For FY 2011: 12.2x
4 Debt Issued Last 5+ Fiscal Years Fiscal Year New Refunding Total 2015 - $93,690,000 $93,690,000 2016 $140,000,000 $61,735,000 $201,735,000 2017 $115,000,000 $50,075,000 $165,075,000 2018 $115,000,000 - $115,000,000 2019 (a)$115,000,000 $38,080,000 $153,080,000
2020 (to date) $107,965,000 $107,965,000 Total $485,000,000 (b) $351,545,000 $836,545,000
(a) TIC of 2.88% (b) Total present value savings - $42,629,199 over past five years+ refundings (12.12%) 5 USM Debt and Legislative Authority
Legislative Debt Cap $ 1,400,000,000
Debt Outstanding, June 30, 2019*
Comprised of: Revenue Bonds (at par) $ 1,173,000,000 Other (EPCs, Capital Leases) 23,716,679 Total outstanding (at par), June 30, 2019 1,196,716,679
Additional Debt Possible Within Debt Cap $ 203,283,321
At June 30, 2019 unspent bond project authorizations beyond remaining bond proceeds totals $147,600,000 * Preliminary and unaudited
6 Rating Agency Update (from August/September 2019 rating reports)
• Bond Ratings – Outlook Stable S&P AA+ Fitch AA+ Moody’s Aa1
• Strengths . Important role as the state's largest public higher education . Track record of surpluses with good debt service coverage . Significant multi-disciplinary research activity . Positive operations and favorable philanthropic support . Manageable financial leverage with conservative debt structure • Challenges/Weaknesses . Limited ability to grow net tuition . Stiff competition for federal research funding and students . Large unfunded pension liability
7 Projected New Issuances and Debt Service
• New Issuances . FY 2021 and thereafter $115,000,000 - No new debt to be issued in FY 2020
• Debt Service . FY 2020 $130,099,071 . FY 2025 $126,365,534 . FY 2028 $136,966,420
8 Capital Improvement Program
• State Capital Budget (FY 2021-2025) . $1,121 million ($224 million per year) . USM Bonds for Academic Facilities - $32 million (FY 2021), $30 million thereafter . Funding for 20 projects plus facilities renewal
• System Funded Construction (FY 2020-2024) . $545 million (20 projects at 8 institutions) - USM Bonds - $425 million - $120 million in cash-funding of capital projects
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Review of Size and Condition of Debt of Higher Education Institutions: St. Mary’s College Review of Size and Condition of Debt October 10, 2019 Five-Year Issuance History
2015 - $1.4 million of a $4.0 million line of credit 2016 - $.8 million to bring the total to $2.2 million on the LOC 2017 - $1.8 million final draw $4.0 million LOC 2018 - $18.7 million in 2018 Series A Academic Fees and Auxiliary Fees Refunding Revenue Bonds to currently refund all remaining outstanding maturities of the College’s 2005 Series A, 2006 Series A, 2014 Series A and the 2018 maturity of the 2012 Series A bonds.
1 Total Outstanding
$25.76 million Revenue bonds 6/30/2019
$.2 million Capitalized lease related to an energy performance contract
Authorized, But Unissued SMCM has a statutory debt limit of $60 million, our Board of Trustees authorizes issuances. Currently the amount authorized but not issued is $0.0 million
2 10-Year Debt Service
2020 – $2.30 million * 2020 – 2030 varies from $3.04 million - $.97 million
Note: Does not include capital lease payments on energy performance contract related equipment, which is funded through utility savings. Capital lease payments equal $205,295 for 2020 which is the final payment.
3 Refunding, New Issuances and Ratings Updates
There are no current refunding opportunities. Rating Agency Updates – Moody’s underlying rating for SMCM debt is A2 with a negative outlook, updated and affirmed August 2019
4 5-Year Capital Improvement Plan (as appears in the Governor’s FY20 – FY24 CIP)
New Academic Building and Auditorium • FY20+ Design/Construction $ 60.3 million
Campus Infrastructure Improvements • FY20+ Design/Construction $ 16.64 million
Goodpaster Hall Renovation • FY23 Construction / Equipment $ 1.7 million
5 Variable Rate Debt, Swaps
SMCM does not currently have any variable rate debt. 2018 issue is insured by BAM, Build America Mutual 2012 issue is uninsured
6