Higher education bonds

DALLAS - The deepening recession is putting Texas schools and universities in a tighter squeeze as investment losses have sharply reduced two funds used to guarantee bond issues.

The Department of Education yesterday announced that it will purchase student loans on a short-term basis that were issued for the 2007-2008 academic year, using untapped authority Congress granted it in legislation enacted in May.

The University of Oregon received a conditional-use permit for its new basketball arena this week, closing a long and difficult approval process that’s delayed the project many times.

The Kansas Board of Regents will meet this week to decide how to cut an estimated $114.4 million from the state’s higher education system over the next two years.

DALLAS - The University of Texas System regents last week shelved plans to sell future production from oil and gas properties to boost the Permanent University Fund until prices rebound.

CHICAGO - Catholic elementary and high schools are increasingly turning to the tax-exempt debt market to finance their capital projects, according to bankers at Ziegler Capital Markets, which recently closed a deal for the National Shrine of the Little Flower in Royal Oak, Mich.

CHICAGO - The Illinois Finance Authority board yesterday advanced plans for more than $1.7 billion of bonding by a dozen borrowers, including the University of Chicago, and hired a new executive director - the state's former top fiscal officer, John Filan.

WASHINGTON - Triple-A rated Virginia will come to market with $265 million of general obligation bonds today and tomorrow in a negotiated deal, straying from the state's traditional competitive route in response to an unstable market and higher demand from retail investors, officials said.

WASHINGTON - The Department of Education plans to provide liquidity support to the student loan market through a new commercial paper conduit facility for the purchase of loans made as far back as October 2003, and also plans to renew a high-profile student loan liquidity program for an additional academic year.

Despite a faltering national economy, voters by and large gave a very favorable reception to bond referendums on Tuesday's ballot.

WASHINGTON - An insufficient number of institutional investors agreed to tender at less than par roughly $6 billion of outstanding taxable student-loan-related securities issued on behalf of the Brazos Higher Education Service Corp. before a preliminary deadline on Friday, casting a cloud over a proposed restructuring of the securities into term floating-rate notes.

Regents of the University of Oklahoma have approved $63.5 million of general, limited, and special obligation bonds for a number of projects at the main campus in Norman.

WASHINGTON - Four nonprofit student loan lenders are urging the Treasury Department to provide issuers of student loan-backed debt with liquidity facilities, such as standby purchase agreements, so that the issuers can convert their existing auction-rate securities into variable-rate demand obligations.

The Dormitory Authority of the State of New York approved $501 million of tax-exempt bond issuance at its monthly board meeting on Wednesday.

A dispute between Louisiana State University and Tulane University over the composition of the oversight board for the proposed new $1.2 billion LSU academic hospital in downtown New Orleans has delayed the state’s plan to issue up to $400 million of revenue bonds for the facility.

BRADENTON, Fla. - Alabama on Tuesday filed a complaint in federal court asking a judge to void a swaption the Alabama Public School and College Authority entered into in 2002 and 2003 with JPMorgan.

As liquidity for municipal issuers remains scarce in the short-term market, a regional broker-dealer group and an organization representing nonprofit student loan lenders are urging the Treasury Department to provide standby liquidity facilities for issuers still trying to convert from auction-rate securities to variable-rate demand obligations.

DALLAS - With oil prices plummeting to half of what they were three months ago, the University of Texas Board of Regents has cancelled plans to raise $1 billion for the state's Permanent University Fund through the sale of oil and gas properties.

The University of Medicine and Dentistry of New Jersey faces new allegations of inflating medical costs by at least $21 million a year and increasing federal reimbursements for the hospital, according to a weekend report in the Newark Star-Ledger.

The Arizona Board of Regents last week priced $104 million of revenue refunding bonds, drawing coupons of 4% and a yield of 3.22% on the short end to 6% with a yield of 6.12% on bonds maturing in 2028.