URI loses $2.5M in state aid
Jeff Sullivan
Issue date: 4/17/09 Section: News
"From an accounting standpoint, [the state is] basically saying we're giving you this money, but then we're taking it away because we have to pay the debt," said Weygand. "So it goes in and then out, it doesn't really come to us."
Weygand said these general obligation bonds are given to the university for capital projects as loans that the state is obligated to pay for.
"Occasionally what the state will do is they will show people that they are giving us [URI] that $11 million," Dougan said. "I think it could be seen as misleading, but frankly what they're really doing is meeting their obligation to pay off the general obligation bonds approved for the university."
Weygand expanded on this idea in a separate interview.
"The state of Rhode Island is saying 'I want to build this building, I need a mortgage essentially,'" Weygand said. "[An investment company] becomes the agent, goes out and sells the bonds. The idea is that Rhode Island will stand behind these bonds if something happens to the University of Rhode Island, like it they closed up shop or something like that."
Weygand said these general obligation bonds are given to the university for capital projects as loans that the state is obligated to pay for.
"Occasionally what the state will do is they will show people that they are giving us [URI] that $11 million," Dougan said. "I think it could be seen as misleading, but frankly what they're really doing is meeting their obligation to pay off the general obligation bonds approved for the university."
Weygand expanded on this idea in a separate interview.
"The state of Rhode Island is saying 'I want to build this building, I need a mortgage essentially,'" Weygand said. "[An investment company] becomes the agent, goes out and sells the bonds. The idea is that Rhode Island will stand behind these bonds if something happens to the University of Rhode Island, like it they closed up shop or something like that."
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