DALLAS — The Texas Higher Education Coordinating Board on Thursday approved a proposal by the University of North Texas System for a 28,000-seat football stadium that will be financed in part with $38 million of student fee revenue bonds.

The stadium will be built at the university's main campus in Denton, about 30 miles north of Dallas. The facility, which is to be open for the 2011 football season, will replace a stadium built in 1952.

The financing plan presented to the coordinating board includes $38 million of revenue bonds supported by a $10 per credit hour athletic fee approved by 58% of UNT students in October 2008.

The fee later was approved by system regents and the 2009 Texas Legislature.

State law prohibits student fees from being used to finance more than 50% of an athletic venue.

The remaining financing will be provided by ticket sales, a planned sale of naming rights for the stadium and other sponsorship deals, and private donations raised through the university's "Believe It" campaign.

Andrew Harris, vice chancellor for finance for the UNT system, said the university intends to rely on its commercial paper program to provide interim financing.

The university system will issue 30-year bonds when the stadium is completed, with the proceeds used to replenish the commercial paper program.

The $10 per credit hour athletic fee cannot be levied until the stadium is completed.

The measure adopted by the Legislature stipulates that if the university does not issue the bonds within five years, the authorization for the athletic fee will expire. Otherwise, the fee will expire whenever the original bonds or any refunding bonds mature.

The UNT System's revenue bonds are rated Aa3 by Moody's Investors Service. The $10 per credit hour fee is expected to generate $8.7 million in 2012, of which approximately $3.9 million would go to debt service and the remainder used for athletic department operations. When the fee is levied upon project completion, the university's compulsory student fees will be reduced by $3 per credit hour.

UNT athletic director Rick Villarreal said the existing stadium is outmoded, with the field surrounded by a track that keeps fans too far from the action.

"It's a monumental day in the history of North Texas athletics that has been a long time coming," Villarreal said. "It is a credit to dedication and effort of our administration, alumni, and students who have supported this project from the beginning."

The new stadium initially will have 28,000 seats, but it could be expanded to more than 50,000 seats. It will include luxury suites.

The complex will be built across Interstate 35 from the existing Fouts Field, on the site of the school's former golf course. It will be the first college stadium designed by HKS Inc. Architects, the firm that designed the new Dallas Cowboys Stadium.

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