by Caleb Fort
Daily Lobo
Andrew Cullen, UNM budget administrator, said he is thrilled with the outcome of the recent $125 million bond sale.
"We hit a couple of good days in the market," he said.
UNM will pay 4.5 percent interest on the bonds. Cullen expected the University to pay about 4.6 percent.
He said the lower interest rate was the result of competition between institutions buying the bonds. He said because UNM's bonds were in such high demand, several financial institutions were willing to accept lower interest rates.
Cullen said at one point there was demand for three times as many bonds as were available. He said the bonds were probably so popular because of good publicity.
The Bond Buyer magazine called UNM's bonds its pick of the week.
Two bond rating agencies reviewed the bonds. Moody's Investor Services gave the bonds their third highest rating. Standard & Poor's gave the bonds their fourth highest rating.
The bonds were sold on Aug. 2 and Aug. 3.
The bonds, which will finance construction and renovation of educational buildings, are going to be paid back using an increase in student fees. Fees will increase $56 a year for the next five years and remain $280 per year higher for at least 30 years, until the bonds are paid back.
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Cullen said students were given enough input about raising student fees to pay for the bonds.
"Many student leaders came forward," he said. "I believe that we included students in the issue."
Student Ciana Danska disagreed. She said students were not given enough say in whether or not fees would be raised.
"It's insane," she said. "Students are the ones who will ultimately be paying."
Danska said administration should be more considerate about raising fees because the Lottery Scholarship does not cover them.
Brittany Jaeger, ASUNM president, said she is in favor of the bond issue, but the decision should not have been made while students were gone.
"I would have liked for it to have been delayed a semester so that students could have given their input," Jaeger said. "I think it would have looked a lot more appealing to students if they had been given an opportunity to voice their opinion."
The first public meetings about the bond issue were held in June, after many students had left for the summer, and the bonds were sold in the beginning of August, before many students returned.
Kevin Stevenson, assistant to UNM President Louis Caldera, said in June it would cost UNM at least $400,000 to wait to sell the bonds.
Jaeger said students should not have to pay for the Cancer Research Center or the Lobo Center - an administration building - both of which will get money from the bonds.
Cullen said the first buildings to use money from the bonds will be the School of Architecture and Planning and the Centennial Engineering Center. He said 85 percent of the money must be spent within three years, but he hopes UNM will do more than just spend the money.
"It may be ambitious, but we're hoping to complete all of these projects within three years," he said.
