YSU to borrow $57M for projects

By Harold Gwin

Construction is set to begin in March on the first project on the list.

YOUNGSTOWN — Youngstown State University will borrow $57 million, most of it to finance a number of construction and improvement projects on campus.

The money will come from the sale of bonds, with $47 million earmarked for the various improvement projects and $10 million to refinance some existing debt.

The new Williamson College of Business Administration will get the largest share of the improvement money — $21 million.

That project, set to begin this spring, carries a price tag of about $34.3 million with a large chunk of that coming from philanthropic gifts received by the university.

The bonds carry an interest rate of about 5.75 percent over 25 years.

Not all of the $57 million will be borrowed at once, according to the financing plan approved by the university’s Board of Trustees Friday.

The university will initially secure the $21 million needed for the Williamson project (as construction will be ready to start in March) and $10 million for debt refinancing. The refinancing is expected to save YSU about $500,000 in interest costs.

R. Lee Mairose of RBC Capital Markets, an investment adviser on the bond issue, told the board that it likely will be sometime in 2010 before the rest of the improvement money is borrowed as projects slated for the rest of those funds come ready.

They include a new indoor recreation facility to be known as the WATTS Center, restoration and possible improvements to the Wick Pollock Inn, renovating and upgrading Kilcawley Center and the Kilcawley House residence hall and enhancements to the university’s Science, Technology, Engineering and Mathematics facilities.

Approval of the bond issue is “an exciting step forward with our master plan,” said David C. Sweet, university president.

The university already has funds set aside to cover the bond debt service.

There are philanthropic gifts earmarked to cover the first several years of payments and state capital funds are also available.

Further, the university proposes to tap, as needed, annual savings of $2.5 million that have been secured through an early-retirement incentive plan for employees.

gwin@vindy.com