Capital Finance

• FY2021
• FY2020
• FY2019
• FY2018
• ​FY2017
• FY2016
• FY2015
• FY2014

• FY2021
• FY2020
• FY2019
• FY2018
• ​FY2017
• FY2016
• FY2015
• FY2014

• UMBA $188,650,000 Project Revenue Bonds Senior Series 2022-1, $211,270,000 Project Revenue Bonds Senior Series 2022-2 (Federally Taxable)
• UMBA $312,330,000 Refunding Revenue Bonds Senior Series 2021-1, $46,585,000 Refunding Revenue Bonds Senior Series 2021-2 (Federally Taxable)
• UMBA $329,930,000 Refunding Revenue Bonds Senior Series 2020-4 (Federally Taxable)
• UMBA $200,840,000 Project Revenue Bonds, Senior Series 2020-1, $129,830,000 Project Revenue Bonds, Senior Series 2020-2 (Federally Taxable), & $319,345,000 Refunding Revenue Bonds, Senior Series 2020-3 (Federally Taxable)
• UMBA $208,725,000 Refunding Revenue Bonds, Senior Series 2019-1
• UMBA $165,130,000 Project Revenue Bonds, Senior Series 2017-1, $19,510,000 Project Revenue Bonds, Senior Series 2017-2 (Federally Taxable), & $187,680,000 Refunding Revenue Bonds, Senior Series 2017-3
• $20M MHEFA Variable Rate Demand Revenue Bonds, Series A (Remarketing Circular)
• UMBA $298,795,000 Project Revenue Bonds, Senior Series 2015-1 & $191,825,000 Refunding Revenue Bonds, Senior Series 2015-2
• UMBA $157,855,000 Refunding Revenue Bonds, Senior Series 2014-4 (Federally Taxable)
• UMBA $67,365,000 Refunding Revenue Bonds, Senior Series 2014-3
• UMBA $293,890,000 Project Revenue Bonds, Senior Series 2014-1 & $14,085,000 Project Revenue Bonds, Senior Series 2014-2 (Federally Taxable)
• UMBA $24,640,000 Project and Refunding Revenue Bonds, Senior Series 2013-3
• UMBA $212,585,000 Project Revenue Bonds, Senior Series 2013-1 & $71,790,000 Project Revenue Bonds, Senior Series 2013-2 (Federally Taxable)
• UMBA $101,700,000 Refunding Revenue Bonds, Senior Series 2011-2 (7 Month Window) (Commonwealth Guaranteed)
• UMBA $135,040,000 Refunding Revenue Bonds, Senior Series 2011-1
• MDFA $10,495,000 Revenue Refunding Bonds, Worcester City Campus Corporation Issue (University of Massachusetts Project), Series 2011
• MDFA $29,970,000 Revenue Refunding Bonds, University of Massachusetts Issue, Series 2011
• UMBA $118,985,000 Project Revenue Bonds, Senior Series 2010-1 & UMBA $430,320,000 Project Revenue Bonds, Senior Series 2010-2 (Federally Taxable-Build America Bonds - Direct Pay to Issuer) & UMBA $3,005,000 Project Revenue Bonds, Senior Series 2010-3(Federally Taxable)
• UMBA $247,810,000 Project Revenue Bonds, Senior Series 2009-1 & UMBA $271,855,000 Project Revenue Bonds, Senior Series 2009-2 (Federally Taxable-Build America Bonds - Direct Pay to Issuer) & UMBA $28,570,000 Project Revenue Bonds, Senior Series 2009-3 (Federally Taxable)
• UMBA $120,560,000 Project Revenue Bonds, Senior Series 2008-2
• UMBA $232,545,000 Project Revenue Bonds, Senior Series 2008-1
• MHEFA $99,325,000 Revenue Bonds, Worcester City Campus Corporation Issue (University of Massachusetts Project), Series D

• Fitch Report
• Moody’s Report
• Standard and Poor’s Report

Updated 5/2/2022

The University of Massachusetts President’s Office created a revolving loan program (the Pool) in order to provide a low cost financing mechanism for certain University purchases. The Pool allows the President’s Office to loan and reloan Pool funds to the campuses over the course of thirty years.

Structure of the University Financing

The University originally financed the Pool on March 29, 2000 through the issuance of $40,000,000 seven-day variable rate bonds maturing November 1, 2030, through the Massachusetts Health and Educational Facilities Authority (MHEFA – now MassDevelopment). On March 27, 2009, the bonds were subject to mandatory tender for purchase due to the expiration of the liquidity facility supporting the bonds and the conversion of the bonds from a weekly rate period to a long-term rate period. Only $20,000,000 of the bonds was remarketed on the Mandatory Purchase Date and an initial long term rate period of one year was established. The bonds have since been remarketed several times, the most recent remarketing being on April 1, 2022 for a four year term. Interest on the remarketed bonds in the new long-term rate period is payable on October 1 and April 1. Based upon current market conditions, the annual interest rate on loans from the Pool is 3.75% (anticipated rate to cover actual interest to bondholders plus certain administrative costs).

The University is also obligated for certain administrative expenses including trustee fees, arbitrage calculations, and remarketing fees throughout the life of the bonds. Per federal tax guidelines, the University can use up to two percent of the bond proceeds for the payment of issuance costs. The net proceeds of the financing were deposited with MHEFA, who acted as the escrow agent until the proceeds were depleted. The University Budget Office disburses the funds through a formal requisition process. Initially, campus loans were made from the proceeds of the bonds. The last campus loan made from the proceeds was on February 20, 2002, depleting the proceeds. Now that the proceeds have been depleted, the University finances the campus loans from “Repaid Principal”. Campuses repay the loans with interest over the expected useful life of the asset being financed. The principal portion of the repayments (“Repaid Principal”) is deposited with the University and invested in a Short Term Asset Reserve Fund (STAR Fund), to provide funds for future program costs. The funds will continue to recycle in this manner over the life of the bonds.

Campus Requisitions

The process of requisitioning funds from the Pool is an important part of ensuring its success. Each disbursement from the Pool will require approval through a formal requisition process. The requisition process will require a project or purchase description, a completed pool loan requisition and questionnaire, proof of purchase, supporting documentation and appropriate campus and Budget Office approval prior to disbursing funds from the Pool.

Loans are Structured as Reimbursements

The campus should use local operating funds for payment to the vendor. The campus will remit the requisition and supporting documentation to the Budget Office to initiate reimbursement from the Pool. At the time of disbursement, the campus will receive from the Budget Office a repayment schedule requiring monthly interest payments and quarterly principal payments. The campuses will also be required to provide, when needed, the detail of the original accounting for any reimbursement in order to assist the University Controller’s Office in the preparation of the year-end financial statements.

Campus Repayments

Each individual borrowing will result in a schedule of repayments to the Pool, including principal and interest amortized at 3.75%.* This rate is anticipated to be higher than the rate of the University’s obligation to bondholders to cover administrative costs. Therefore, the positive difference between the monthly campus interest payments and the University interest payments to bondholders and to vendors for administrative costs will be used to establish and maintain the administration fund. The administration fund will be used to cover the ongoing administrative costs of the Pool. The PeopleSoft chartfield strings identified by the campuses will be used to transfer funds from the Pool to each campus for loans and from the campuses to the President’s Office for their monthly repayments. The campus repayments will be amortized based upon the type of project or purchase, typically ranging from one to ten years. The amortization periods will depend upon the campus’ desired terms and the useful life of the financed item. At no time can a loan be amortized beyond the financed item’s useful life and the Budget Office must concur with the requested amortization period. University Trustee approval, state legislation, and federal tax principles limit the University to only certain categories for purchases from the Pool. Please note that you may be reimbursed for allowable expenditures paid subsequent to February 3, 1999 as permitted by University Board of Trustee approval. If you have questions regarding your individual projects or purchases please provide us with documentation so that we can discuss the appropriateness of such items. The University Budget Office retains the right to disallow any item for inclusion in the Pool. Therefore, if a purchase is contingent upon receiving a loan from the Pool, please verify with us that a loan is allowable prior to your initial outlay. 

*Subject to change.

Pool Accounting

The University Budget Office will maintain records and supporting documentation for the Pool activity and the University Controller’s Office will generally make on-top entries to campus financial statements at each fiscal year end. However, the campuses may need to book Pool transactions locally for certain Pool loans. Furthermore, the pool and its activity will be audited centrally during the year end audit.

All loans are structured as reimbursements. Complete and sign the Pool requisition, attach a copy of the invoice and any additional support as necessary to describe the purchase, attach PeopleSoft transaction reports that support the expenditure and date of disbursement, copies of invoices and any additional support as necessary to describe the purchase.

Send the requisition and support to Joseph Skrzek (jskrzek@umassp.edu) at the University of Massachusetts Budget Office, 333 South Street, Suite 400, Shrewsbury, MA 01545-4176.

Please contact Joseph Skrzek in the Budget Office to ensure that your purchase is allowable and that sufficient Pool funds are available prior to your initial outlay if your purchase is contingent upon receiving a loan from the Pool.

The following are two examples of repayment plans for loans from the Pool. Note: In order to estimate a repayment plan for a different loan amount with the same assumptions in either example 1 or 2 below, simply divide your loan amount by $1,000,000 and multiply the result with the loan payment presented in either example. As an example, if you want to determine a repayment amount for a $2,000,000 loan with the same assumptions as in example 1, divide $2,000,000 by $1,000,000 and the result is 2. Next, multiply the payments in example 1 by 2 to determine the estimated repayments.

Example 1 – $1,000,000

Assumptions: Interest rate: 3.75% Loan date: 05/01/2022 Loan length: 3 years

Example 2 – $1,000,000

Assumptions: Interest rate: 3.75% Loan date: 05/01/2022 Loan length: 5 years

University Board of Trustee policy, Commonwealth legislation and federal tax principles limit the University to Pool loans that finance or refinance the acquisition of telecommunications, electronic, computer, office, research, equipment and administrative systems and the renovation costs related thereto. At all times and without exception, loans from the Pool must be for capital expenditures (defined by Treasury Regulation 1.150-1(b)) that are for the sole benefit of the University of Massachusetts in its educational mission and not for any private use. The Budget Office retains the right to disallow any item for inclusion in the Pool. Refer to the Pool Loan Brochure in the Other Resources section for examples of pool eligible acquisitions and pool eligible expenses.

Based upon current market conditions, the annual Pool interest rate on loans is 3.75%. Please note that the Budget Office has the authority to modify the pool loan interest rate based upon market conditions. Each requisition from the Pool will result in a schedule of repayments to the Pool, including quarterly principal and monthly interest payments amortized at the Pool interest rate. See the Pool Loan Repayment Examples in the Key Documentation section of this page. The repayments will be amortized based upon the type of project or purchase, typically ranging from one to ten years, without a penalty for prepayment. At no time can a loan be amortized beyond the financed item’s useful life and the Budget Office must approve the campus’s requested amortization period.

There are a few options. The first is to view our example amortization schedules. These examples present a variation of loan amounts and amortization periods.

Each campus will receive a repayment schedule detailing the monthly interest and quarterly principal payments at the time of each requisition from the Pool. The Controller’s Office will automatically take the required monthly repayment from the campus using the PeopleSoft chartfield strings provided by each campus, on the last business day of every month.

The accounting for the Pool transactions is similar to that of the University leases. The Budget Office will maintain records and supporting documentation for the Pool activity and the University Controller’s Office will generally make on-top entries to campus financial statements at each fiscal year end. However, based upon the type of Pool transaction, the campuses may need to book Pool activity locally. In addition, the University Controller’s Office has developed draft Accounting and Reporting Guidelines for the Pool activity that can be found above.

• The Pool Loan Brochure
• Pool Bond Issuance Official Statement
• Pool Accounting and Reporting

The following document provides a general overview of private business use:

• Private Business Use Primer

For reference, the following IRS documents address private business use:

• Revenue Procedure 2017-13 (Management Contracts)
• Revenue Procedure 2007-47 (Research Contracts)
• Treasury Regulation Section 1.141-3

WCCC, Series D

In April 2005, the Massachusetts Health and Educational Facilities Authority issued its $99,325,000 Revenue Bonds, Worcester City Campus Corporation Issue (University of Massachusetts Project), Series D for the purpose of refunding the outstanding amount of the WCCC Series A bonds. The credit rating on the WCCC Series D bonds is “AAA” based upon the purchase of bond insurance. See the Official Statement of this issue.

The University of Massachusetts Building Authority is a distinct, public organization established by the Massachusetts Legislature in 1960. Its mission is to aid and contribute to the performance of the educational and other purposes of the University by providing dormitories, dining commons and other buildings and structures on the University campuses. To fulfill this mission, the Authority borrows funds through the issuance of tax-exempt and taxable bonds and carries out these construction projects at the discretion of the Trustees of the University.