Wittenberg to restructure debt with $45 million in bonds

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The Springfield News-Sun provides unmatched coverage of Wittenberg University, a major employer in Clark County. We’ve dug into the university’s ongoing financial woes since a $7 million structural deficit was identified in 2012.

Wittenberg University will restructure about $45 million in debt as part of its $6.5 million cost reduction plan announced last year.

The money will mostly be used to refund current debt at a better interest rate, Wittenberg Vice President for Finance and Administration Randal Freebourn said.

“It’s one more piece of that (reduction plan) that’s coming to fruition,” Freebourn said.

Clark County commissioners agreed to issue bonds worth up to $55 million for Wittenberg through the Public Finance Authority.

The county acts as a pass-through entity for the project, Clark County Commissioner John Detrick said.

>>MORE DETAILS: Wittenberg to cut $6.5 million

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The school will receive about $6 million in new money for capital projects on campus, which will pay for recently completed roof repairs at Ferncliff Hall and Bayley Alumni House, Freebourn said. Wittenberg also plans to repair the roof at the Benham-Pence Student Center, while others will be identified in the future, he said.

“It’s extremely important,” Freebourn said. “We’ve had a lot of deferred maintenance and we have to start to attack that.”

The money won’t be used for the new $40.5 million athletic facilities expansion, which is being paid for solely through fundraising and tax credits, Freebourn said.

The university can borrow up to $55 million as part of the agreement, but only expects to use about $45 million to $46 million, he said.

“We always put the target higher just in case something comes up so we don’t have to ask for permission (again),” Freebourn said.

Wittenberg has about 1,850 students and 475 employees. It has an annual budget of $56.5 million and an estimated $70 million economic impact on Springfield.

The cuts were needed to avoid a projected structural deficit of $6.5 million at the end of this fiscal year and a $5.5 million deficit next year, school leaders said in October.