Minutes of a Regular Meeting, June 22-23, 2004 - Digital Collections

June 22-23, 2004 29164The Legislative Authority granted under Concurrent Resolution No. 33 encompassesthe development of the Multi-Tenant Office Facility project at the University Research Campus(URC). At the September 2003 meeting, the Board approved the project to design and build thefacility at URC, for primary occupancy by Weathernews Americas Inc. A lease has beennegotiated with Weathernews, providing for a net lease for thirty-years. The initial commitmentis for the lease of approximately 25,000 square feet (approximately fifty percent of the facility)with Weathernews retaining options to increase its square footage over time in specifiedincremental units.The Legislative Authority granted under Concurrent Resolution No. 54 encompassesfunding the balance of the Federal contribution to the National Weather Center project, which isbeing constructed at the URC pursuant to the Board’s approval. A lease has been negotiatedwith the U.S. National Oceanic and Atmospheric Administration (NOAA), providing for a netlease for twenty-years. NOAA will occupy 123,758 square feet or approximately fifty-onepercent of the facility.The University’s administration is now preparing for the issuance of revenue bonds inthe next two to three months in support of these research projects. Said bonds will be secured bythe revenues of the Real Estate System, and the proceeds will be used to fund the constructionof University-owned research facilities.In cooperation with the State Bond Adviser, the University’s administration hassolicited and secured Bond Counsel (Floyd Law Firm) and Financial Advisor (Capital WestSecurities) services in support of the issuance of the debt anticipated by the above actions.Preparation of the disclosure statement (often referred to as the Preliminary OfficialStatement or POS) will be coordinated by the Financial Advisor with direction and input fromthe University’s administration, Bond Counsel, and The State Bond Advisor (i.e. the financingteam). The POS will be submitted to the appropriate oversight organizations for review,approval, and rating, and will be used by the financing team to determine an appropriate plan offinancing the project. Due to the complexity of issuing debt, it is likely the plan of financing willrecommend that an underwriter be selected to ensure a favorably negotiated, as opposed tocompetitive, marketing and sales effort.The project is expected to generate sufficient long-term cash flows from space rentalto fund required debt service and maintain prudent debt service coverage. In conjunction withthe appointment of a Bond Counsel and Financial Advisor, the University’s administration willdevelop an appropriate plan of financing the project and prepare and distribute the documentsnecessary to disclose material information on the purpose of the debt and how it will be repaid.The resulting plan of financing will be reported back to the Board at the earliest possiblemeeting.In relation to the plan of financing, the final Bond Resolution will include a covenantfor the Board of Regents to fix, establish, maintain and collect such rentals, fees and charges forthe use and services of the facility as, in the judgment of the Board, will provide revenuessufficient to:(1) Pay the reasonable cost of operating and maintaining the facility;(2) Pay principal of and interest on the Bonds;