Higher education bonds

DALLAS - Federal stimulus funding will provide a cushion for colleges and universities as they scramble to cut costs over the next two years, but prospects for 2012 and beyond are extremely uncertain, analysts at Standard & Poor's said yesterday.

CHICAGO - Southern Illinois University will enter the market as soon as next Thursday with $54 million of tax-exempt and taxable Build America Bonds in a deal led by BMO Capital Markets, which the school picked due to its work on a handful of similarly structured BAB transactions over the last two weeks.

Standard & Poor’s has affirmed its AAA rating on the Dallas County Community College District’s outstanding debt and its upcoming $110 million general obligation bond sale.

The National Academy of Sciences on Thursday aims to sell $57.5 million of variable-rate revenue debt to refund 1999 bonds. The deal is rated triple-A by Moody’s Investors Service and Standard & Poor’s based on a letter of credit from Bank of America.

President Obama on Friday ratcheted up his push to eliminate the Federal Family Education Loan program, saying he's prepared to fight "wasteful subsidies" to student lenders..

The Massachusetts Health and Educational Facilities Authority last week created an eight-member advisory committee to evaluate a possible merger with its sister authority, the Massachusetts Development Finance Agency.

CHICAGO - Barring any significant shift in the yield curve or in investor interest, the University of Minnesota will enter the market as soon as today with $35 million of taxable, general obligation Build America Bonds that officials believe will mark the first public offering of securities under the new federal program.

The Massachusetts Health and Educational Facilities Authority Thursday will create a merger committee to move forward with Gov. Deval Patrick's plans to combine the authority with the Massachusetts Development Finance Agency, although market participants worry the initiative may increase borrowing fees.

BRADENTON, Fla. - The negative watch placed on the Alabama Public School and College Authority by Standard & Poor's on March 27 is unwarranted, state finance director Jim Main said this week.

The Vermont Student Assistance Corp. has been notified by the Internal Revenue Service that $165 million of education loan revenue bonds it issued in 1998 may be taxable because of issues related to its tracking of loans and treatment of fees.

WASHINGTON - The Treasury Department Friday released "how-to" guidance on the stimulus law's new taxable Build America Bond and Recovery Zone Economic Development Bond programs, as well as allocations for the qualified zone academy bond and qualified school construction bond tax-credit programs.

DALLAS — Texas Southern University’s revenue financing system bonds have fallen below investment grade on the Fitch Ratings scale. The agency downgraded $99 million of outstanding bonds to BB-plus with a negative outlook from BBB.

Supporters of the Federal Family Education Loan program are maneuvering to save it as Congress moves forward with budget resolutions that would set spending goals based on President Obama's proposed fiscal 2010 budget, which calls for FFEL's elimination.

The Alabama Public School and College Authority is experiencing problems with a swap that it may have to pay $55 million to terminate.

State officials will still move ahead with plans to potentially merge the Massachusetts Health and Educational Facilities Authority with the Massachusetts Development Finance Agency despite the fact that state Sen. Marian Walsh Tuesday announced that she would relinquish her new role at MassHEFA.

After a seven-year hiatus from bonding, the University of Medicine and Dentistry of New Jersey today plans to sell $253 million of revenue refunding bonds with a special "lockbox" structure to secure debt service payments.

Northern Arizona University said it will cut 45 jobs and close four satellite campuses after its state funding for fiscal 2009 was cut by $21 million as part of January’s budget-balancing bill.

Fresh from a successful taxable debt sale and a downgrade, Cornell University is back in the market with $305 million of tax-exempt bonds this week with a retail order period expected to begin tomorrow with institutional pricing on Wednesday. The Dormitory Authority of the State of New York will issue the bonds.

Massachusetts Gov. Deval Patrick's administration last week announced that it will begin evaluating a potential merger of the Massachusetts Health and Educational Facilities Authority and the Massachusetts Development Finance Agency in an effort to cut expenditures and create efficiencies between the two entities, yet critics say the move could increase borrowing costs for colleges and hospitals throughout the state.

The University of Connecticut March 30 will sell $150 million of fixed-rate, tax-exempt bonds to help finance new buildings and campus renovations, with the state paying debt service on the new-money debt.