The University of Kentucky Board of Trustees approved the issuance of as much as $265 million in bonds Tuesday to pay for three major campus construction projects.
The bonds will provide about $40 million for a renovation and expansion of the Gatton College of Business and Economics. An additional $25 million for the project, which has begun, is coming from private donations.
About $100 million of the bond will be used to build a new science building, and $110 million will go to the renovation of Commonwealth Stadium.
Preliminary concepts and design work are underway for the science center, and work has begun on the stadium. The science building will replace the current Donovan Residence Hall.
University officials said they expect the total bond issue to be about $256 million, with $5 million for bond issuance costs.
The bonds will require about $16.2 million a year in debt service. UK Athletics will pay about $11.1 million a year for the stadium debt service and for a portion of the science building. UK will pick up the remaining $5.1 million.
"I'm proud to get to this point," UK President Eli Capilouto said after the meeting. "We have followed the process over the last two and half years that considered debt capacity, our needs and how this will better position us to fulfill our mission."
In a moment of rare public discussion, trustee Bill Britton said he was a bit nervous about the size of UK's debt load, which is approaching $1 billion, including major construction projects at UK HealthCare.
"I just implore each one of us as we sit in meetings and hear about debt potential to just give it some serious thought," he told board members.
After the meeting, Britton said he fully supports the new projects, but he wants people to realize that it means real money at a time when both state and federal revenue to UK are down.
"We need our antennae to be up on this," he said. "What pots of money are really going to increase?"
Capilouto said UK had carefully studied its debt capacity.
"We are well within our financial parameters when it comes to making safe investments," he said.
The board also accepted some major gifts to help with the Gatton campaign, including $2 million from Terry Woodward of Owensboro and $1 million from Roger Mick of Brentwood, Tenn.