IRS auditing Gettysburg College refunding bonds
WASHINGTON — The IRS is auditing $67 million of refunding bonds issued in 2010 by the Adams County (Pennsylvania) Industrial Development Authority for Gettysburg College.
“No specific problems have been identified in the initial audit notice and information request, and the tax-exempt status of the bonds remains unchanged pending conclusion of the audit and further action by the IRS, if any,” said the event notice filed on the Municipal Securities Rulemaking Board's EMMA website.
Kaycee Kemper, spokeswoman for the Adams County IDA, declined comment Friday beyond the public notice.
Christopher Delaney, associate vice president for finance and associate treasurer of Gettysburg College, said in an email Friday that the college participated in the preparation of the public notice and has “no other comment.”
“The college intends to fully comply and cooperate with the IRS in the audit process,” the notice said. “This notice is delivered pursuant to applicable continuing disclosure obligations of the college in connection with the bonds, as to which it is an obligated person.”
The audit could be part of an ongoing initiative by the IRS to examine refunding bonds, according to Perry Israel, a Sacramento-based lawyer with his own practice who is a member of the board of the National Association of Bond Lawyers and the Committee on Tax-Exempt Financing of the American Bar Association’s Tax Section.
In May, the Harris County-Houston Sports Authority announced the IRS was auditing a 2014 tax-exempt bond refunding of $511 million that was used to refinance more than half of its outstanding debt.
In 2010 Adams County issued refunding bonds for two sets of bonds issued in 2008 for Gettysburg College.
The 2008 Series A bonds included $18.295 million that were used for the construction of a Center for Athletics, Recreation and Fitness.
The $31.38 million of Series B bonds issued later the same year covered additional costs for the same center, other “miscellaneous capital improvements,” but most of the proceeds were used to refund a 2002 bond issue of $28 million through the Pennsylvania Higher Education Facilities Authority.
Gettysburg College broke ground for the John F. Jaeger Center for Athletics, Recreation, and Fitness in June 2008.
The 55,000-square-foot facility opened in late 2009 with amenities that include a swimming facility with a spectator area, a student lounge, a multipurpose room for classes, and a climbing wall.
The college’s website says the facility cost $25 million overall and that part of the construction costs were paid by a $1.2 million donation from the alumnus for whom the facility is named.
The private independent liberal arts college, which opened in 1832, says on its website that its 200-acre campus has 72 buildings adjacent to Gettysburg National Military Park.
The IRS expects to close 577 audits in the tax exempt bond office in the current fiscal year that ends Sept. 30, down from the 717 closed in fiscal 2017 but slightly higher than the 570 concluded in fiscal 2016.