Note 20 – Subsequent Events
The University has evaluated all subsequent events through the auditors’ report date, and noted the following material subsequent events that required disclosure in these financial statements.
CVA BOND REDEMPTION
On August 1, 2018, CVA directed the trustee of the Series 2008 Student Housing Revenue Refunding Bonds to redeem all of the outstanding bonds and any accrued interest (2018 Redemption). The 2018 Redemption consisted of $53,040,000 in outstanding principal and $481,000 in accrued interest. The 2018 Redemption was funded with $48,015,000 in proceeds from the issuance on August 1, 2018 of the Series 2018A University Enterprise Revenue Bonds (Series 2018A) by the University, a debt service fund of $481,000 maintained by CVA, and $5,205,000 in proceeds from the August 1, 2018 maturity of the Guaranteed Investment Agreement and its accrued interest. The balance of the funding was used to pay for costs of issuance of the Series 2018A estimated at $180,000. Additionally, during the year ended June 30, 2018, the board of directors of CUPCO adopted a resolution to designate CVA a “facility” under the University’s Master Bond Resolution and to pledge all net revenues generated by CVA to repayment of the Series 2018A. For Fiscal Year 2019 and forward, the board of directors of CUPCO pledged that any net proceeds generated through any sale or long-term lease of CVA be promptly available for distribution to the University.
On October 17, 2018, the University issued $64,360,000 of University Enterprise Revenue Bonds, Series 2018B to fund the construction of four projects at UCCS. Interest rates on the bonds ranged from 3 percent to 5 percent, and the first interest payment date is December 1, 2018. The final maturity of the bonds is June 1, 2048, with the first principal payment due on June 1, 2020.
During the year ended June 30, 2018, the Regents authorized up to $200 million of commercial paper to fund capital projects during their construction. As of June 30, 2018, the University had issued $40 million of commercial paper (see Note 9). On September 9, 2018 the University issued an additional $30 million of commercial paper to continue funding construction projects at CU-Boulder, bringing the total outstanding to $70 million. The University anticipates additional issuance of commercial paper in this program during Fiscal Year 2019.
The University has formed as a Colorado limited liability company named Altitude West, LLC. (Altitude West), a captive insurance company. The purpose of Altitude West is to insure property/casualty/workers’ compensation exposures of the University, for the benefit of the University and to pursue any other lawful purpose for which a captive insurance company issued a certificate of authority in the state and operating as a limited liability company may be organized under Colorado law. The filing of the Articles of Organization was effective August 20, 2018, with the office of Colorado’s Secretary of State and captive operations began with an effective date of October 1, 2018, with an initial contribution from the University of $2.5 million.
© Office of University Controller 2018