Section 712 Debt Policy
Last Revised: 3/10/08
Responsible Office: Finance
University of Maine System debt and related agreements are part of the System’s strategic mix of funding sources. Management will assess and report periodically to the Board the System’s debt capacity relative to desirable credit ratings. Debt capacity will be utilized in the capital planning process to determine the aggregate dollar value of projects that can be funded with debt in any given year. The System will utilize long term debt, primarily in the form of tax-exempt bonds, to finance long-term assets. The System will consider off-balance sheet financing (e.g., public/private partnerships) when it is desirable to work with a third party, for risk sharing, and for leasing. The System will consider interest rate swaps in conjunction with debt when appropriate to achieve interest rate savings or enhanced investment yields and to facilitate matching of assets and liabilities. The System will make limited use of variable interest rate debt. Debt and related agreements are approved by the Board.
Board of Trustees Policy:
Policy 701: Operating and Capital Projects
Administrative Practice Letters:
Section III-C: System Internal Loans