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Roles and Responsibilities - Debt Financing & Management

Section:   Debt Financing & Management Number:  35.001   
Title:  Roles and Responsibilities - Debt Financing & Management

 

Index

POLICY

APPENDIX

  • None.

  • POLICY

    .100  POLICY STATEMENT 

    The policy sets forth high-level Debt Financing and Management roles and responsibilities for the Chancellor's Office and the Institutions.

    .110  POLICY RATIONALE

    OUS seeks to ensure that the high-level roles and responsibilities of the Chancellor's Office and the Institutions related to Debt Financing and Management are documented, communicated, and clearly understood and applied.

    .120  AUTHORITY

    .130  APPROVAL AND EFFECTIVE DATE OF POLICY

    Approved by the Budget and Finance Committee of the Board on 2/15/02 as part of the Fiscal Accountability Framework Final Report.  The effective date of the policy is 3/1/02.

    .140  KNOWLEDGE OF THIS POLICY

    All Chancellor's Office and institutional personnel with debt financing and management and related responsibilities should be knowledgeable of this policy.

    .150  DEFINITIONS

    None.

    .160  HIGH LEVEL ROLES AND RESPONSIBILITIES

    A.  CHANCELLOR'S OFFICE 

    High level roles High level responsibilities
    Debt Approval Process
    Establishing Long-term Plan and Approving Bonds Provides guidance for project requests.  Reviews and approves project requests.  Submits project lists for bond limitation approval by the OUS Board, DAS, and the Legislature.
    Emergency Board Requests Reviews and submits project requests for approval to the OUS Board and the E-Board.
    Requests from the Approved Legislative Plan Reviews and approves requests for bond funds.  Coordinates with Treasury to hold bond sale.  Assigns plant fund and project number for project.  Receives funds from bond sale.  Allocates funds to institution as requested.  Provides debt service schedules for projects.
    Debt Service Payment Process
    Fund Management Transfers funds at institution's request for debt and makes semi-annual payment of debt to Treasury for forwarding to Custodial Bank.
    Fund Monitoring and Reporting Monitors annual activity of debt payment.  Monitors project expenditure limitation.  Submits state (tax certification, cash flows) and federal (arbitrage liability) reporting for Bond Counsel review.
    Monitoring Funds to Ensure Proper Usage
    Monitoring Funds Monitors allocation of bond funds to institutions.  Monitors budget and limitation of projects.  Works with institutions to resolve budget and limitation problems.
    Project Approval Approves bond allocation for small projects.  If necessary, gets approval for additional funding and limitation/appropriation from OUS Board and Legislature/E-Board.
    Submitting Arbitrage Earnings to IRS
    Calculating and Dispersing Earnings Records and distributes interest earnings.  Performs arbitrage calculation.  Charges institutions for arbitrage liability.  Submits reports and payments of arbitrage liability to the Bond Counsel and the IRS.
    Student Building Fee Funds
    Fund Management Collects student building fee from institutions.  Pays debt service on building fee debt and unallocated proceeds.
    Fund Planning Projects available funding from student building fee pool.
    Certificates of Participation (COPs)
    Request for Funds Requests that DAS include funds in COP Sale.  Requests COP funds from DAS.
    Fund Reimbursement Requests reimbursement from DAS and Trustees and processes reimbursement to institutions.
    Debt Service Payment Prepares debt payment schedule for institutions.  Pays debt service amount to DAS.

    B.  INSTITUTION

    High level roles High level responsibilities
    Debt Approval Process
    Establishing Long-term Plan and Approving Bonds Submits prioritized project requests to the Chancellor's Office.
    Emergency Board Requests Requests project approvals.  Institution also prepares a due diligence study of each project.
    Requests from the Approved Legislative Plan Submits request for bund funds.  Requests that the plant funds and project be established.
    Debt Service Payment Process
    Fund Management Requests debt payment transfers.
    Fund Monitoring and Reporting Monitors project expenditure limitations.
    Monitoring Funds to Ensure Proper Usage
    Fund Management Performs accounting functions for projects.  Works with Chancellor's Office to resolve budget and limitation problems.
    Submitting Arbitrage Earnings to IRS
    Arbitrage Earnings Payment Approves charges for arbitrage liability.
    Student Building Fee Funds
    Fund Management Collects student building fee from students.
    Fund Planning Student Government/President of the University/Administrative Council prioritizes projects to be funded with student building fees.
    Certificates of Participation (COPs)
    Request for Funds Requests COP Funds through Chancellor's Office.
    Fund Reimbursement Records expenditures and requests reimbursement from COP Funds.
    Debt Service Payment Pays debt service to Chancellor's Office.

    .690  CONTACT INFORMATION

    Direct questions about this policy to the following offices:

    Subject Contact
    General questions from institutional personnel Institution Office of Business Affairs
    General questions from institutional central administration and Chancellor's Office personnel Chancellor's Office Controller's Division

    .695  HISTORY

    10/15/03 - Reformatted
    2/15/02 - Approved 

    Policy Last Updated: 10/15/03


    APPENDIX

    None.

    Appendix Last Updated:  10/15/03