Cornell University 2011-2012 Annual Report - DFA Home - Cornell ...

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(dollars in thousands)8. BONDS AND NOTES PAYABLEA. General InformationBonds and notes payable as of June 30 are summarized as follows:SUMMARY OF BONDS AND NOTES PAYABLE2012 2011 Interest rates Final maturityDormitory Authority of the State of New York (DASNY)Revenue Bond Series1990B-fixed rate $ 45,440 $ 47,980 3.00 to 5.00% 20252000A-variable rate/weekly 49,100 51,090 2.99* 20292000B-variable rate/weekly 66,140 68,460 4.63* 20302004-variable rate/weekly 79,200 81,600 3.51* 20332006-fixed rate 184,735 196,120 4.00 to 5.00 20352008B&C-fixed rate 122,980 125,420 3.00 to 5.00 20372009-fixed rate 299,470 305,000 3.00 to 5.00 20392010-fixed rate 285,000 285,000 4.00 to 5.00 2040Tax-exempt commercial paper 57,500 59,000 0.08 to 2.99* 2037Tompkins County Industrial Development Agency (TCIDA)2002A-variable rate/weekly 40,495 41,940 4.52* 20302002B-variable rate/weekly 15,390 15,390 0.04 to 0.25 20152008A-fixed rate 67,170 68,630 2.00 to 5.25 2037Bond Series 1987B-fixed rate 725 3,080 11.11 2013Urban Development Corporation 2,125 2,250 - 20292009 Taxable-fixed rate 500,000 500,000 4.35 to 5.45 2014/2019Taxable commercial paper 78,500 78,500 0.17 to 0.35 -Other 2,588 2,676 6.63 2029Total bonds and notes payable $ 1,896,558 $ 1,932,136* Rates presented are the swap interest rates as noted in the Fair Value of Interest Rate Swaps in Statement of Financial Position table.The University’s bonds and notes payable had carrying amounts of $1,896,558 and $1,932,136 at June 30, 2012 and 2011,respectively, compared to estimated fair values of approximately $2,092,452 and $2,053,009 at June 30, 2012 and 2011,respectively. Estimated fair value of bonds is based on quoted market prices for the same or similar issues. The marketprices utilized reflect the amounts a third party would pay to purchase the bonds and are not considered an additionalliability to the University.Interest expense during the fiscal year ending June 30, 2012 was $86,201, of which $85,722 was related to the bonds andnotes payable displayed in the table above. During the fiscal year ending June 30, 2011, interest expense was $70,065, ofwhich $69,730 was related to the bonds and notes payable. The University capitalized interest on self-constructed assetssuch as buildings, in the amounts of $12,257 and $19,313 for the fiscal years ending June 30, 2012 and 2011, respectively.Debt and debt service related to borrowings by New York State for the construction and renovation of facilities of theContract Colleges are not included in the consolidated financial statements because they are not liabilities of the University.Under the DASNY Revenue Bond Series 1990B agreement, the bonds are a general obligation of the University and aresecured by a pledge of revenue.During fiscal year ending June 30, 2012, the University changed the standby bond purchase agreement provider for theTCIDA Series 2002A and 2002B bonds resulting in a tender offer of the bonds. The tender offer provided the mechanismfor the substitution of the standby bond purchase agreement but did not alter the terms of the bonds. Due to the tenderoffer, the University was required to write off the unamortized issuance costs associated with the 2002 bonds of $219.31