Credit Presentation to
Moody’s Investors Service
May 17, 2012
Participants
Augustana College
• Steven C. Bahls, President
• David A. English, Chief Financial Officer, Vice President of Finance and Administration
• W. Kent Barnds, Vice President of Enrollment, Communication and Planning
• Dr. Pareena Lawrence, Dean of the College
• Lynn E. Jackson, Vice President of Advancement
• Darlene J. Link, Controller
• Sheri L. Curran, General Counsel
• Kim Brunner, Chairman of the Board of Trustees
Robert W. Baird & Co.
• Thomas J. Gavin, Managing Director
• Stephan C. Roberts, Director
• Amy Young, First Vice President
Page 1
Table of Contents
Section 1:
Introductory Remarks
Section 2:
Governance and Management
Section 3:
Academic Programs
Section 4:
Student Demographics and Enrollment
Section 5:
Advancement and Fundraising
Section 6:
Finance
Section 7:
Debt Structure
Section 8:
Conclusion
Page 2
Section 1: Introductory Remarks
Introductory Remarks
• Positive financial results for FY 2011 since Moody’s review in May of 2011
• Net Unrestricted Revenue up by 14.1% in 2011 despite fewer students than 2010
• Private Gifts up over 100% in 2011
• FY 2011 Operating Expenses remained flat compared to FY 2010
• Projected operating surplus of $1 million in FY 2012
• Net Unrestricted Assets up 38.5% in FY 2011
• Implemented strict budget discipline
• Continued emphasis on academic excellence with further development of liberal arts in practice
Page 4
Section 2: Governance and Management
Governance and Management
• Self-aware and focused on assessment
• Bold, steady and forward-thinking senior leadership and Board of Trustees
• Recent history of planning success and achievement
• Fiscal stability
• Mission-centered and market-smart
Page 6
Leadership and Board of Trustees
• Thought-leadership in shared governance
• Stable and strong senior leadership
• National service and leadership
• Benchmarking against similar colleges
• Community involvement
• Financial commitment of Board
• High-level of board oversight and participation
• National and diverse Board
Page 7
Planning Success and Achievement
• The College implemented two ambitious plans in less than 10 years
• Authentically Augustana (2005-2011)
• Enrollment increase (2,200 to 2,500)
• $152 million campaign
• Grew and strengthened the faculty profile
• New programs (Capstone, General Education, New Majors and Minors)
• Affirm, Assure, Assess (2011-2014)
• Outcomes, Accountability, Continual Improvement & Transparency
• Risk Management
• Strengthening finances, community, results and physical plant
Page 8
Fiscally Stable
• Operating surpluses of $1 million annually
• Increases in student revenues
• Asset growth
• Budgeting for depreciation (approximately $5 million annually)
• Demonstrated ability to adjust quickly to market conditions
• Exceptional fundraising success
• Operating budget discipline and expense-side discipline
Page 9
Mission-Centered and Market-Smart
• “Five Buckets” response to recession and demographic shifts
• Center for Student Life
• Strong reputation and national thought-leadership
• Genuine distinctiveness in the marketplace
• Augie Choice
• Good value liberal arts college (4 year graduation guarantee)
• Location in the Quad Cities
• Academic All-American (ranked #6 in the nation)
Page 10
Section 3: Academic Programs
Academic Programs
• The college offers a total of 71 programs or majors with 192 full-time faculty members (157
are in tenured or tenure track positions)
• There are 79 part-time and adjunct faculty members
• Student to faculty ratio is at 11.5:1 and 69.2% of classes have 20 or fewer students
• 95% of all full-time faculty have a PhD or a terminal degree in their field
Page 12
Academic Programs (cont.)
• In the past 3-4 years the College has added 8 new academic programs in:
• International Business
• Multimedia Journalism and Mass Communication
• Graphic Design
• Creative Writing
• Pre-Engineering/Physics
• Neuroscience
• Japanese
• Pre Seminary
• All academic programs are working towards increasing student participation in deeply engaging and
experiential learning based educational opportunities. Student participation rates in select programs
include:
• 24% undergraduate research activities
• 53% Study Abroad
• 52% Internships
• 86% Community Volunteerism
• 99% Senior Inquiry
Page 13
Academic Outcomes
• Augustana ranks as the top school among our peers when measuring Academic Challenge as
measured by National Survey of Student Engagement
• 2010-11 data on graduates indicates that within 9 months of graduation:
• 36% went to graduate school
• 49% were fully employed
• 12% were employed part-time
• 3% were seeking employment
Page 14
Preparing for the Future
• Focus on strengthening the following academic initiatives:
• Advising and mentoring of students across the College
• College wide Student Learning Outcomes mapped to the curriculum
• Departmental Student Learning Outcomes mapped to the curriculum
• Ongoing Departmental Review linked to a staffing plan
• Strategic Plan for the Community Engagement Center to better integrate it with our academic
programs
Page 15
Section 4: Student Demographics and Enrollment
Student Enrollment Overview
• 250% increase in first-year student multicultural enrollment (2001-2011)
• 78% increase in applicant pool (2001-2011)
• 46% increase in first-year student out-of-state enrollment (2001-2011)
• 13% increase in overall enrollment (2001-2011)
• Improving selectivity
• Stable academic profile and strong retention
• Opening new markets
• Steady growth in revenue in challenging economy
Page 17
Enrollment Trends
• Enrollment has increased by 13.4% the last ten years (nearly 300 more students)
Total Enrollment
Last Ten Years
2,600
2,506
2,524
2,512
2,525
2,501
2,500
2,446
Enrollment
2,443
2,400
2,363
2,277
2,300
2,266
2,237
2,200
2,100
2002
2003
2004
2005
2006
2007
Page 18
2008
2009
2010
2011
2012 est.
Enrollment Trends and Demand
Enrollment Trends & Demand
New Full Time Students (Fall)
5,000
4,616
4,500
4,200
4,070
4,000
3,636
3,413
3,500
3,000
3,291
2,874
2,722
2,647
2,257
67%
70%
2,000
2,875
2,679
2,340
2,223
2,060
2,837
2,468
2,462
2,500
3,080
2,921
70%
70%
70%
67%
67%
65%
66%
1,500
1,000
25%
26%
614
599
23%
25%
679
23%
20%
691
712
21%
20%
17%
639
616
752
709
675
500
0
Fall 2003
Fall 2004
Fall 2005
Fall 2006
Fall 2007
Freshman Applicants
Fall 2008
Acceptances
Page 19
Fall 2009
Matriculants
Fall 2010
Fall 2011
Fall 2012
(projected)
Selectivity and Matriculation
Primary Selectivity and Matriculation
New Full Time Students (Fall)
100%
84%
76%
77%
75%
73%
75%
69%
73%
66%
68%
61%
50%
67%
30%
70%
70%
27%
28%
28%70%
70%
67%
32%
67%
65%
27%
28%
66%
23%
25%
23%
Fall 2011
Fall 2012
(projected)
25%
25%
26%
23%
25%
23%
20%
21%
20%
17%
0%
Fall 2003
Fall 2004
Fall 2005
Fall 2006
Fall 2007
Primary Selectivity
Page 20
Fall 2008
Fall 2009
Primary Matriculation
Fall 2010
Stabilizing Profile During Growth
• The average ACT score for first-year students the last ten years was 25.5
Quality Profile of Entering First-Year Students
ACT Mean
28
26
25.8
25.8
25.8
25.2
25.4
25.5
25.2
2006
2007
2008
25.6
25.5
25.5
25.5
2009
2010
2011
2012 est.
24
22
20
18
16
2002
2003
2004
2005
Page 21
Strong and Stable First to Second Year Retention
1st Year to 2nd Year Retention Rate
Ten Year History
90.0%
88.0%
86.0%
87.4%
87.0%
85.0%
84.5%
84.5%
87.8%
87.6%
2010
2011
86.9%
85.0%
84.0%
82.0%
82.3%
80.0%
78.0%
2002
2003
2004
2005
2006
Page 22
2007
2008
2009
Improving Out-of-State Recruitment
Total Numbers Out-of-State Students
In First-Year Cohort (Includes International Students)
% of Out-of-State Students
In First-Year Cohort (Includes International Students)
140
19%
20%
121
115
120
107
80
77
80
84
71
67
60
16%
16%
15%
16%
14%
94
100
18%
61
60
14%
11%
12%
10%
11%
10%
11%
10%
10%
8%
6%
40
4%
20
2%
0
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
est.
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
est.
Page 23
Successfully Adapting to Demographic Changes
Underrepresented Students
In First-Year Cohort
Underrepresented Students
In First-Year Cohort
(Does not Include International Students)
(Does not Include International Students)
133 132
140
115
120
20%
19%
20%
18%
15%
16%
100
14%
75
80
68
60
60
40
22%
48
66
58
45
35
11% 11%
12%
10%
8%
8%
9%
8%
10%
8%
6%
6%
4%
20
2%
0
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
est.
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
est.
Page 24
New Recruitment Initiatives
• Regional Office of Admission (Naperville)
• Expanded International Recruitment Efforts
• Faculty participation in recruitment
• Augustana College Summer Academy
• New recruitment materials and market research
• Expanded travel in CA, TX and American Southwest
• Expanded outreach to community-based organizations (new position)
• Improving advising
• New retention efforts
Page 25
Class of 2016 Preliminary Results
• 2nd largest applicant pool in history (4,200)
• 3rd most selective year in history (68%)
• 650 enrollment (building toward budget goal of 675)
• Multicultural recruitment success
• 20% multicultural (highest % of a class)
• 2nd largest number of multicultural students
• Highest net revenue per student in history (approximately $24,911)
• Increase of approximately $700 in revenue per student
Page 26
Regional Competition (National Clearinghouse cross-admits for fall 2008, 2009, 2010, 2011)
Institution
Cost to attend
Enrollment
Loyola University (private)
$50,198
9,856
Illinois Wesleyan University (private)
$48,522
2,090
DePaul University (private)
$45,618
16,384
Augustana College (private)
$45,198
2,518
Marquette University (private)
$45,142
8,387
Elmhurst College (private)
$43,086
3,190
North Central College (private)
$42,783
2,729
Bradley University (private)
$40,310
4,955
University of Iowa (public)
($38,454 OOS) $21,120
21,564
University of Illinois (public)
$28,098
32,256
Illinois State University (public)
$24,816
18,594
Source: College Board Fall 2011 Cost of Attendance
Page 27
Comprehensive Fees
First-Year Comprehensive Fees
Ten Year History
$50,000
$45,000
$35,000
$30,000
$25,000
$39,396
$32,235
$33,363
$30,150
$31,326
$37,800
$40,000
$26,098
$20,397
$28,173
$21,672
$29,862
$22,971
$31,731
$24,408
$41,829
$40,416
$33,717
$43,398
$34,614
$26,484
$20,000
$15,000
$10,000
$6,501
$6,891
$7,323
$7,233
$7,650
$8,070
$8,181
$8,466
$8,784
$5,701
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
$5,000
$0
Tuition and Fees
Room and Board
Page 28
Comprehensive Fees
Stable revenue while diversifying and growing
Net Tuition and Net Comprehensive Fee per First-Year Student
Ten Year History
$30,000
$25,000
$20,000
$15,000
$17,109
$17,763
$11,523
$11,982
2002
2003
$19,164
$19,886
$12,927
$13,481
2004
2005
$21,108
$21,849
$14,301
$14,676
2006
2007
$24,331
$24,327
$16,661
$16,377
$22,952
$14,771
$24,285
$24,911
$15,819
$10,000
$5,000
$0
NTR per Student
2008
2009
Net Comp Fee per Residentional Student
Page 29
2010
2011
2012 est.
Financial Aid
• 98% of the student body receives some form of financial assistance
• Ten year average unfunded discount is 33%
Total and Unfunded Discount Rate
Ten Year History
50.0%
45.7%
45.0%
41.9%
40.0%
34.7%
35.6%
36.1%
35.0%
31.0%
30.0%
28.1%
37.8%
37.8%
38.4%
33.7%
32.0%
33.1%
34.3%
32.4%
2005
2006
2007
2008
2009
36.8%
41.3%
39.4%
37.1%
29.5%
25.0%
20.0%
2002
2003
2004
Unfunded Discount Rate
Page 30
Total Discount Rate
2010
2011
Section 5: Advancement and Fundraising
Comprehensive Campaign (Authentically Augustana: A Call To Action)
• The College completed a 6 ½ year comprehensive campaign in December 2011 exceeding its $100 million
goal by $52 million
• Raised $152 million - $97 million in outright cash donations
• Outright to deferred - 64% to 36%
• Funds were designated for endowment and several capital projects
• Capital projects include Carlsson-Evald Hall, Old Main, Center for Student Life, Swanson Commons,
Parkander Residence Center and football stadium
• Augustana’s cost to raise a dollar $0.087; cost nationally $0.20
Page 32
Campaign Giving
Campaign Giving
Current Board of Trustees*
$49,246,984
$17,927,284
36%
$31,319,700
64%
Outright
Deferred
*Includes all board members that served during the campaign.
Page 33
Unrestricted Giving
Unrestricted Giving
Includes: Pledge Payments, Gifts, Actualized Gifts and Matching Gifts
$1,800
$1,628.9
$1,600
$1,530.1
$1,400.2
$1,400
$1,193.3
$ in Millions
$1,200
$1,177.8
$985.6
$1,000
$876.7
$800
$600
$1,264.8
$682.4
$532.5
$589.1
$400
$200
$0
FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012*
*as of 4/30/12
Page 34
Annual Gift Income
• Five year average of $11.7 million generated each year through annual giving
• Alumni participation rate for gifts to all funds was 32% for FY 2011
Total Gift Income
Last Ten Fiscal Years
$18
$15.7
$16
$14
$11.8
$ in Millions
$12
$10.7
$10
$11.2
$10.8
$11.3
$9.1
$7.6
$7.3
$8
$5.5
$6
$4.1
$4
$2
$0
FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
(YTD)
Authentically Augustana Campaign
July 2005 - December 2011
Page 35
Summary of Private Gifts and Grants
Summary of Private Gifts and Grants by Recipient Fund
For Fiscal Year End
Unrestricted
Temporarily Restricted
Permanently Restricted
Total
2005-06
$5,131,385
9,625,289
4,688,567
2006-07
$2,739,162
4,796,603
4,373,636
$19,445,241 $11,909,401
Page 36
2007-08
$5,608,765
1,604,951
1,677,937
2008-09
$4,672,606
4,097,829
2,172,477
2009-10
2010-11
$4,318,603 $10,108,866
1,290,420
7,432,351
3,170,784
855,169
$8,891,653 $10,942,912
$8,779,807 $18,396,386
Ten Year Trend of Alumni Donors
• An annual average of 5,741 alumni donors the last ten fiscal years
Number of Alumni Donors
10-Year History
7,000
6,287
6,124
6,360
6,080
5,710
6,000
5,833
5,951
5,474
4,709
5,000
4,881
4,000
3,000
2,000
1,000
0
FY 2002
FY 2003
FY 2004
FY 2005
FY 2006
FY 2007
# of Alumni Donors
Page 37
FY 2008
FY 2009
FY 2010
FY 2011
Section 6: Finance
Historical Operating Performance (Unrestricted Fund Only)
FY 2006
Audit
FY 2007
Audit
FY 2008
Audit
FY 2009
Audit
FY 2010
Audit
FY 2011
Audit
CAGR
Unrestricted Operating Revenues ($000's)
Net Tuition & Fees
Auxiliary Enterprises
Subtotal Comprehensive Fee
Other Educational Sources
Federal and State Grants
Private Gifts and Grants
Other Income
Unrestricted Total Return
Net Assets Released from Restriction
Total Revenue
Unrestricted Operating Expenses ($000's)
Instruction
Research
Academic Support
Student Services
Auxiliary Enterprises
Public Services
Management and General Institutional Support
Other
Total Expenses
Net Operating Income
$35,075
12,810
47,885
1,199
706
5,131
518
8,963
814
$65,216
$37,964
14,433
52,397
386
792
2,739
835
17,644
2,167
$76,961
$41,206
15,874
57,079
922
786
3,164
661
(7,423)
1,621
$56,810
$43,859
16,311
60,170
503
778
4,673
645
(22,694)
3,374
$47,449
$43,064
15,869
58,932
761
2,205
4,319
876
3,885
4,080
$75,056
$43,152
16,860
60,012
1,340
795
10,109
743
7,961
8,888
$89,847
4.2%
5.6%
4.6%
2.3%
2.4%
14.5%
7.5%
-2.3%
61.3%
6.6%
$20,855
$345
10,562
5,896
10,471
961
9,109
362
$58,561
$21,280
$375
10,738
6,482
12,089
947
9,610
228
$61,748
$22,715
$453
11,882
6,796
12,729
1,198
10,248
406
$66,426
$24,226
$398
12,232
7,113
12,694
911
10,523
366
$68,464
$24,218
$434
11,982
7,217
11,394
883
9,996
294
$66,419
$24,235
$526
13,359
6,717
11,414
907
9,502
280
$66,941
3.1%
8.8%
4.8%
2.6%
1.7%
-1.1%
0.8%
-5.0%
2.7%
$6,654
$15,213
($9,616)
($21,015)
$8,638
$22,906
28.0%
Operational Highlights:
• Net tuition increased 0.21% despite fewer students in 2010-2011
• Private Gifts and Grants up 100% in 2011
• Unrestricted Revenues increased 19.7% in 2011
• Operating Expenses remained flat to 2010
Page 39
FY 2012 Budget and FY 2013 Forecast
• The College projects a surplus of $1 million for FY 2012
• The College budgeted for net revenue of $1 million in FY 2013, after fully funding depreciation
• Since FY 2011, the College has fully budgeted for depreciation to address its plant
• Expense Controls
• Additional hiring reviews
• Changed Investment advisor
• Switched to self-insurance for health insurance
• FY 2013 reduced $700,000 from FY 2012 forecast expenses
• Enrollment:
• Fall 2011-12:
2,501
• Fall 2012-13 projected:
2,525
Page 40
Endowment Value and Allocation
Endowment Value
In Millions
$120
Endowment Allocation by Class
As of April 2012
$100
$ in Millions
$80
$60
Equities
$112.4
$114.5
$105.6
$85.5
$40
$113.5
41.00%
59.30%
Fixed Investments
$94.7
32.50%
Alternative Investments
23.90%
$20
26.50%
0.00%
16.80%
0.00%
$0
FY07
FY08
FY09
FY10
FY11
FY12*
Policy
Current Mix
*as of 3/31/12
Return in
FY 2010
FY 2011
FY 2012 (through 3/31/12)
Page 41
11.7%
22.6%
-0.2%
Cash (0%)
Section 7: Debt Structure
Outstanding Debt
Debt Outstanding as of Delivery Date of Series 2012
(Dollars in Thousands)
Series
Series 2003A*
Series 2003B
Series 2005
Series 2007
Series 2012**
Refunded Series 2003A*
Total
Percentage
Fixed Rate Variable Rate Final Maturity
$30,570
10/1/2032
$6,290
10/1/2032
$14,400
10/1/2035
$3,362
6/1/2022
$37,630
10/1/2032
($30,570)
$40,992
$20,690
66%
34%
*To be refunded in full or part by Series 2012.
**Refunding of Series 2003A and new money. Preliminary, subject to change.
• The College has no interest rate swaps
• The Series 2003B and Series 2005 are supported by LOCs from Harris which are set to expire on October 21, 2012
• The College is in the process of renegotiating the LOCs with Harris at 30 bps lower than current pricing with a three year term
• The variable rate exposure is manageable given the College’s strong liquidity and internal practices (budgeting, liquidity and
covenants)
• It is the College’s intent to buy down variable rate debt over time to lower exposure
Page 43
Plan of Finance Overview
• Series 2012 will be a combination of refunding and new money bonds
• All bonds will be issued as fixed rate
• Changes the College’s variable rate exposure from 38% to 34%
• Refunding Bonds
• Refunds $30,570,000 of Series 2003A maturing October 1, 2012 through 2032 on the October 1, 2012
call date
• Refunding generates approximately $3.46 million in gross debt service savings and $2.38 million in
present value savings (7.78% of refunded par)
• No change in structure – refunding is solved uniform to current Series 2003A debt service
• New Money Bonds
• $7 million of bond proceeds will be used to partially fund the construction of the Center for Student Life
• Structured to wrap around existing debt service to generate overall level debt service
• 20 Year amortization with a final maturity of October 1, 2032
• Debt service reserve fund will be funded with bond proceeds
Page 44
Center for Student Life Project
• 35,000 square foot addition to the Thomas Tredway Library and renovation of the 39,000 square foot library
• Combines dining services, student activities and the library into one facility to provide an enhanced learning environment for students
• Contemporary dining with multiple dining stations seating up to 700 people
• Additional features include private and group study rooms, adaptable multi-purpose rooms, digital game room, expansive outdoor patio, spaces for
Reading/Writing Center and expansion of Brew
• The renovation and combination of spaces addresses the changing academic and social needs of students and will provide an advantage in
recruiting.
• Total cost estimated at $20 million
• $13 million funded with gifts and internally generated funds
• $7 million funded via Series 2012 bond proceeds
• Construction is expected to be completed by August 2013
Page 45
Estimated Sources and Uses of Funds
Sources of Funds
Par Amount
Reoffering Premium
Transfers from Prior Debt Service Funds
Transfers from Prior Debt Service Reserve Funds
Issuer Contribution
Total Sources of Funds
$37,630,000
$1,360,346
$1,025,290
$2,503,080
$13,000,000
$55,518,716
Uses of Funds
Deposit to Current Refunding Fund
Deposit to Project Construction Fund
Deposit to Debt Service Reserve Fund
Costs of Issuance
Rounding Amount
Total Uses of Fund
$31,428,081
$20,000,000
$3,335,364
$752,600
$2,671
$55,518,716
Page 46
Preliminary Structuring Numbers
Fiscal Year
Ending
June 30
New Money Bonds
Existing Debt
Service
Principal
Coupon
(10/1)
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
$4,101,747
$4,073,724
$4,042,707
$4,114,550
$4,078,846
$3,952,048
$3,923,875
$4,088,327
$4,055,123
$4,017,981
$3,656,561
$3,636,705
$3,518,633
$3,600,573
$3,580,240
$3,657,350
$3,734,475
$3,605,330
$3,679,630
$3,556,805
$3,714,770
$3,752,000
$3,714,000
$3,672,000
$91,527,997
(4/1 & 10/1)
$10,000
$45,000
2.000%
3.000%
$10,000
$140,000
$175,000
$20,000
$50,000
$90,000
$465,000
$505,000
$655,000
$600,000
$655,000
$610,000
$565,000
$720,000
$685,000
$840,000
$720,000
3.000%
4.000%
4.000%
4.000%
4.000%
5.000%
5.000%
5.000%
5.000%
5.000%
5.000%
5.250%
5.250%
5.250%
4.750%
4.750%
4.750%
$7,560,000
Interest
Refunding Bonds
Total Debt
Service
Principal
Coupon
(10/1)
$268,576
$371,775
$371,000
$370,325
$370,175
$367,225
$360,925
$357,025
$355,625
$352,375
$338,500
$314,250
$285,250
$253,875
$222,500
$190,113
$159,269
$125,538
$90,369
$54,150
$17,100
$268,576
$381,775
$416,000
$370,325
$380,175
$507,225
$535,925
$377,025
$405,625
$442,375
$803,500
$819,250
$940,250
$853,875
$877,500
$800,113
$724,269
$845,538
$775,369
$894,150
$737,100
$995,000
$1,015,000
$1,050,000
$1,080,000
$1,120,000
$1,165,000
$1,210,000
$1,265,000
$1,315,000
$1,380,000
$1,455,000
$1,530,000
$1,610,000
$1,690,000
$1,775,000
$1,875,000
$1,975,000
$2,085,000
$2,190,000
$2,290,000
$5,595,939
$13,155,939
$30,070,000
Interest
Total Debt
Service
Less: Refunded
2003A Debt
Service
Net New College
Debt Service
(4/1 & 10/1)
2.000%
3.000%
3.000%
3.000%
4.000%
4.000%
4.000%
4.000%
5.000%
5.000%
5.000%
5.000%
5.000%
5.000%
5.250%
5.250%
5.250%
4.750%
4.750%
4.750%
$982,800
$1,350,850
$1,325,675
$1,294,700
$1,262,750
$1,224,150
$1,178,450
$1,130,950
$1,081,450
$1,023,275
$955,900
$885,025
$810,400
$731,900
$649,400
$560,556
$464,744
$363,681
$262,319
$160,788
$54,388
$982,800
$2,345,850
$2,340,675
$2,344,700
$2,342,750
$2,344,150
$2,343,450
$2,340,950
$2,346,450
$2,338,275
$2,335,900
$2,340,025
$2,340,400
$2,341,900
$2,339,400
$2,335,556
$2,339,744
$2,338,681
$2,347,319
$2,350,788
$2,344,388
$487,775
$146,674
$149,099
$147,183
$145,696
$147,764
$148,558
$147,777
$145,339
$152,639
$155,061
$151,080
$150,633
$149,073
$151,240
$154,194
$153,131
$151,049
$142,711
$142,418
$144,583
($2,492,280)
($2,492,524)
($2,489,774)
($2,491,883)
($2,488,446)
($2,491,914)
($2,492,008)
($2,488,727)
($2,491,789)
($2,490,914)
($2,490,961)
($2,491,105)
($2,491,033)
($2,490,973)
($2,490,640)
($2,489,750)
($2,492,875)
($2,489,730)
($2,490,030)
($2,493,205)
($2,488,970)
$2,860,843
$4,308,825
$4,309,608
$4,337,692
$4,313,325
$4,311,508
$4,311,242
$4,317,575
$4,315,408
$4,307,717
$4,305,000
$4,304,875
$4,308,250
$4,305,375
$4,306,500
$4,303,269
$4,305,613
$4,299,819
$4,312,288
$4,308,538
$4,307,288
$3,752,000
$3,714,000
$3,672,000
$17,754,150
$47,824,150
$3,463,676
($52,309,531)
$100,198,555
$ Present Value Savings
% Present Value Savings
Page 47
Debt Service
Savings
$2,378,216
7.780%
Summary of Bond Covenants and Security for Bondholders
• Bonds will be issued under a new Trust Indenture
• Revenue pledge on parity with all outstanding bondholders
• Negative pledge on property financed or originally financed with the 2003A Bonds being refunded
• Debt Service Reserve Fund equal to the lesser of i) maximum annual debt service, (ii) 10% of proceeds, or
iii) 125% of average annual debt service
• Bond Covenants:
Requirement
Not less than 40%
Funded Debt Ratio (Liquidity):
Revenue Expenditure Test:
Not be less than zero for at least two of the
last three fiscal years
Page 48
Covenant Calculations
FY10
FY11
Proforma
(1)
Revenue/Expenditure Test (not less than zero) - Section 2.34 of Loan Agreement
Increase (Decrease) in Unrestricted Net Assets
Plus: Depreciation
Plus: Amortization
Plus: Accretion
Plus: Spending Policy (BOD designated percentage)
Plus/Less: One-time or non-recurring items
Less: Total Return
Investment Income (Unrestricted)
Net realized (gains) losses (Unrestricted)
Change in Market Value (Unrestricted)
Less: Net Assets Released from Restrictions relating to land, buildings and
equipment, except for such net assets that are gifts received as real property or
equipment
Less: Capital Gifts
$26,558,361
$4,597,582
$60,518
($98,072)
$7,275,649
($312,058)
$26,174,197
$4,597,582
$60,518
($98,072)
$7,275,649
($312,058)
$777,315
($200,640)
$3,307,867
$878,009
$500,017
$6,582,928
$878,009
$500,017
$6,582,928
$154,775
$1,792,667
$4,442,373
$6,211,751
$4,442,373
$6,211,751
$14,902,645
$19,466,902
$19,082,738
Unrestricted Liquid Funds
Total Unrestricted Net Assets
Less: Art Collection
Less: Net Investment in PP&E
Total Unrestricted Liquid Funds
$69,054,956
($4,405,838)
($25,738,153)
$38,910,965
$95,613,317
($8,901,289)
($30,133,350)
$56,578,678
$95,613,317
($8,901,289)
($30,133,350)
$56,578,678
Funded Debt (Net of Current Maturities)
$56,558,246
$54,909,290
$61,303,334
68.80%
103.04%
92.29%
Adjusted Increase (Decrease) in Unrestricted Net Assets
$10,132,082
$4,730,325
$108,769
$143,422
$5,923,133
($303,102)
Funded Debt Ratio (not less than 40%) - Section 2.35 of Loan Agreement
Coverage
(1) Proforma uses FY2011 results.
Page 49
Covenant Calculations (cont.)
FY10
FY11
Proforma
(1)
Debt Service Coverage Ratio (not less than 1.2x) - Reimbursement Agreement
(Net Income Available for Debt Service / Debt Service)
(NIADS = Adjusted Increase (Decrease) in Unrestricted Net Assets Plus Interest Expense)
Adjusted Increase (Decrease) in Unrestricted Net Assets
Change in Unrestricted Net Assets
Plus: Depreciation
Plus: Amortization
Plus: Accretion
Plus: Spending Policy (BOD designated percentage)
Plus/Less: One-time or non-recurring items
Less: Total Return
Investment Income (Unrestricted)
Net realized (gains) losses (Unrestricted)
Change in Market Value (Unrestricted)
Less: Net Assets Released from Restrictions relating to land, buildings and
equipment, except for such net assets that are gifts received as real property or
equipment
Less: Capital Gifts
Adjusted Increase (Decrease) in Unrestricted Net Assets
Plus: Interest Expense
Net Income Available for Debt Service
Principal (assumes first full year debt service - FY14)
Interest (assumes first full year debt service - FY14)
Annual Debt Service
Coverage
$10,132,082
$4,730,325
$108,769
$143,422
$5,923,133
($303,102)
$0
$777,315
($200,640)
$3,307,867
$154,775
$1,792,667
$14,902,645
$2,288,372
$17,191,017
$1,831,047
$2,288,372
$4,119,419
4.17
$26,558,361
$4,597,582
$60,518
($98,072)
$7,275,649
($312,058)
$0
$878,009
$500,017
$6,582,928
$4,442,373
$6,211,751
$19,466,902
$2,286,328
$21,753,230
$1,875,169
$2,286,328
$4,161,497
5.23
$26,174,197
$4,597,582
$60,518
($98,072)
$7,275,649
($312,058)
$0
$878,009
$500,017
$6,582,928
$4,442,373
$6,211,751
$19,082,738
$2,670,492
$21,753,230
$1,638,333
$2,670,492
$4,308,825
5.05
Asset Maintenance Ratio (not less than 40%) - Reimbursement Agreement
Unrestricted and Temporarily Restricted Cash & Investments
Cash and Cash Equivalents
Plus: Investments (all)
Less: Permanently Restricted Net Assets
Total Unrestricted and Temporarily Restricted Cash & Investments
$16,318,682
$102,143,984
($65,011,156)
$53,451,510
$7,942,827
$137,570,153
($66,187,722)
$79,325,258
$7,942,827
$137,570,153
($66,187,722)
$79,325,258
Total Debt
$58,463,602
$56,588,433
$62,941,667
Coverage
91.43%
140.18%
126.03%
(1) Proforma uses FY2011 results.
Page 50
Section 8: Conclusion
Conclusions / Wrap-up
• Outstanding Board of Trustees
• Strong and stable administrative leadership
• Fiscally strong business practices and planning
• Talented faculty, committed to College
• Exceptional fundraising success
• Nimble organization, emphasizing best practices and adroit responsiveness
• Effective strategic planning and goal achievement
• Strong student demand and responsiveness to changing marketplace
• Emphasis on results and outcomes
• Significant positive changes warrant an upgrade
Page 52
Key Dates
May
S
2012
M
June
S
M
T
2012
W
T
July
2012
T W T F S
1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
F S
1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
S M T W T F S
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
20 21 22 23 24 25 26
27 28 29 30 31
17 18 19 20 21 22 23
24 25 26 27 28 29 30
22 23 24 25 26 27 28
29 30 31
Presentation to Moody’s
Date
May 17
Receive Rating
May 25
Post Preliminary Official Statement
Week of May 28
Price the Bonds
June 18/19
Close the Bonds
July 11
Page 53