The Indiana Finance Authority Wednesday will sell $20 million of tax-exempt revenue bonds on behalf of the National College Athletic Association.

The NCAA will use the proceeds to finance a major expansion of its Indianapolis headquarters.

A rare borrower, the association after the sale will see its debt load nearly doubled, to $49.5 million. All of its debt is fixed rate.

City Securities Corp. is underwriter. Baker & Daniels LLP is bond counsel. The bonds will amortize over 10 years.

Ahead of the deal, Standard & Poor’s upgraded its rating on the association’s debt to AA-plus from AA. The rating agency also revised its outlook to positive from stable.

Moody’s Investors Service gave the bonds a Aa2 rating with a stable outlook.

Standard & Poor’s said its upgrade comes after the association signed a broadcasting deal with CBS Broadcasting Inc. and Turner Broadcasting System Inc. The $10.8 billion agreement locks in multimedia broadcasting rights of the Division 1 Basketball Championship through 2024.

“This new contract will allow the NCAA to continue to increase its levels of unrestricted resources and cash and investments relative to both operations and debt,” analyst Marc Savaria said in a release on the upgrade. “We expect that operations will continue to remain strong.”

The Finance Authority will loan the ­proceeds of the bonds to the NCAA, which will use the money to fund the bulk of a $34 million expansion to its headquarters.

The association leases the building from an Indiana commission for $1 a year, and recently extended the lease for 60 years.

The bonds are a full and unlimited obligation of the association, but bondholders will not receive any lien or security interest in any portion of the project or assets of the NCAA, according to bond documents.

As of fiscal 2009, the association’s unrestricted financial resources totaled $324 million, providing 4.4 times debt ­coverage.

Debt service will be repaid with NCCA revenue.

The Division I Men’s Basketball Championship, including ticket sales, media, and marketing rights, generates 85% of the association’s operating revenues.

Credit analysts pointed to the concentrated revenue source as a possible problem.

“Because of this lack of revenue diversification, the NCAA has undertaken significant contingency planning to provide for the possible need to identify an alternative venue for the championship, as well as for a possible delay or outright cancellation of the event,” Moody’s analyst Dennis Gephardt wrote in a recent report.

“The NCAA has negotiated with the ­Indiana Sports Corp. to serve as an ­ongoing backup site for the event, should circumstances lead to the need to change the event schedule or move the venue,” he added.

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