Capital Development Committee approves MSU Denver bonding request for student housing and event center renovation

At a meeting of the Capital Development Committee, members unanimously approved two cash-funded projects proposed by Metropolitan State University of Denver and authorized use of the state intercept program for up to $115,000,000 in bonds, contingent on approval by MSU Denvergoverning board.

The projects include a first-ever on-campus residence hall for MSU Denver students, estimated at about 500 beds, and a renovation converting roughly 12,000 square feet of a defunct swimming pool into a multipurpose facility for the universityexercise science program and events. Casey Gearhart, vice president of government and external affairs at MSU Denver, told the committee the residence hall is a direct response to long-standing student demand and would include programming to foster community and student success. "Our complex will have approximately 500 beds and it is, I just mentioned, a direct response to long standing student demand for residential options here in our area," Gearhart said.

Jim Carpenter, vice president of administration and chief financial officer for MSU Denver, described the financing the university plans to seek through the state's intercept program. Carpenter said the university anticipates a maximum bond issue of $115,000,000, a not-to-exceed interest rate of 5.75 percent, a maximum final maturity of December 2060 and maximum annual debt service of $7,450,000. "In order to bring these projects to life, we intend to issue debt through the state's intercept program," Carpenter said. He said the debt would not be issued until early summer and that MSU Denver modeled multiple occupancy and revenue scenarios and expects the revenue model to support the housing projectrepayment.

Carpenter told the committee the debt for the pool-area renovation will be repaid using MSU Denver's existing Metro bond fee, "which is specifically dedicated to debt repayment for capital improvements." For the student housing project, the university expects to use some Metro bond fee revenue in the first year but anticipates that rental revenue from the housing will repay the project debt over time. Carpenter emphasized that the financing plan would not require an increase in the Metro bond fee. "Importantly, the financing and debt repayment for these projects will not require an increase to our Metro bond fee," he said.

Committee members asked for details on targeted rent levels and how the housing would be billed. Gearhart said the university's rent targets are modeled on current on-campus rates at the University of Colorado Denverresident complexes, which he said typically run about $6,000 to $7,000 per semester; MSU Denver has used those rates as a comparable when surveying student interest. Gearhart said the residence hall would charge on a per-semester basis, aligning with financial aid packaging, and that meal-plan options and some food service in the building are being planned. "Those rates are what we're looking at, and the interest we measured from students was directly associated with those prospective rents," Gearhart said.

Senator Mullica moved to approve the new projects listed on MSU Denver's two-year cash projection; the committee recorded a roll call and the motion passed unanimously. Mullica subsequently moved to approve use of the intercept program for bonding of up to $115,000,000 for the MSU Denver event center renovation and student housing and workforce complex projects, contingent upon approval by MSU Denver's governing board; the committee again recorded a roll call and the motion passed unanimously.

Next steps described by university staff include governing-board approval at MSU Denver and early-summer bond issuance if approved. Committee staff then moved to discuss interim meeting dates. Nina Forbes of Legislative Council staff presented tentative interim meeting dates for the committee's calendar and committee members flagged potential conflicts in June.