Debt financing on the table for the massive project
The forthcoming construction of a new science facility will cost an estimated $40 million, and will be the largest project the College has ever undertaken.
Due to the size of this expense, administrators are considering using some debt financing to pay for the development.
John Hopkins, associate vice president for college relations and marketing, said that the College has begun an “aggressive fund-raising effort,” which administrators hope will cover most, if not all, of the cost of the science facility.
Hopkins added, however, that “this is by far the largest capital project the College has ever undertaken, and it’s possible that we will need to consider supplementing the fund-raising with some debt financing.”
Typically, the College has tried to avoid debt financing as a means of funding projects.
Hopkins said, “That has generally been the case, but over the past decade or so the college has also used modest amounts of debt when necessary to accomplish our goals.”
“Our approach is very conservative, but there are instances where a prudent amount debt financing makes good financial sense,” he said.
The College’s conservative approach to financing in the past has led to what Professor John Rudisill describes as “a bond rating that is as good as it gets.” Rudisill, sharing his perspective as a professor, explained that this means that the College has access to debt financing at very low interest rates.
“Not advancing and building things to maintain our status as a premier institution seems to be unwise given that [we] could do it at a faster clip with low interest,” said Rudisill. “Most of the administration recognizes that that makes fiscal sense.”
With regard to the College’s annual budget, Hopkins said that students should not feel any major changes as a result of the project. The possibility of debt financing is not expected to make a significant dent.
Referring specifically to the expected maintenance costs of the science facility, Associate Vice President for Facilities and Auxiliaries Jackie Middleton said that the College “will accommodate that additional expense in our financial planning.”
Although specifics are still undecided, Middleton explained that the College will request proposals from a number of architectural firms which are interested in constructing the science facility.
“We anticipate beginning the design process in January 2015, and hope to break ground 18 months later, in June 2016,” she said.
“Construction will likely take another 18 months, so the soonest the new facility would be ready to come online would be sometime in 2018.”
Administrators do not anticipate any interruptions to classes during the construction process.
Curriculum changes in the sciences are also expected to accompany this project. Provost Carolyn Newton explained that members of the College’s faculty have been planning ways to adapt science education for several years.
Their input will be taken into account in the planning of the new science facility. “Faculty are excited about building a curriculum for the future, a future that we know will be ever more interdisciplinary and collaborative,” Newton said.
Currently, Newton expects that the completed facility will house the biology, biochemistry, molecular biology, neuroscience and environmental studies departments.