Pres Schill’s Track & Field Championship construction boom adds $15M a year to UO costs, UO credit rating goes negative

In June 2015 UO projected that debt expense payments for 2021 would be about $43M a year:

Now in June 2020 they are projecting debt expense payments for 2021 will be about $58M a year – a $15M increase:

Why the increase? Mostly for 30 year bonds sold to build new dorms, part of the “Athlete’s Village” that Phil Knight needed for the IAAF Track and Field Championships bids. We’ll be paying them off for a long time.

For perspective, the average student brings in about $20K a year in tuition, so it would take about 750 new students to cover this $15M in new debt.

Enrollment increases are unlikely, so the current plan from President Schill and Provost Phillips is to cut wages for faculty and staff to cover this debt expense increase and any revenue declines from cuts in state contributions and enrollment.

In any case the party is over. In March – before the impact of the coronavirus – Moody’s had already revised UO’s credit outlook to negative, citing the increased debt, spending, resistance to tuition increases, low reserves, etc. (Thanks to a helpful reader for sharing this public record, which took Kevin Reed’s office 3 weeks to provide. Full report here. So far as I can tell Angela Wilhelms and Chuck Lillis never showed it to the Trustees, nor was if discussed in their public meetings. Not exactly due diligence.)

The tables are from the back pages of the Trustees agenda materials. June 2015 here, 2020 here. It seems unlikely that the Trustees will do their due diligence on this at their June 4th meeting, given that they are the people who approved all the decisions that got us here.

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5 Responses to Pres Schill’s Track & Field Championship construction boom adds $15M a year to UO costs, UO credit rating goes negative

  1. Dog says:

    further proof that the UO is on the pathway of Academic abandonment. After they finally fire all of us faculty, or rather
    reduce our FTE to 0.1, and all the students have fled elsewhere,
    the athletic and donor monuments to narcissistic insanity will remain; perhaps the UO campus can become a State Park ….

    I wonder who will claim this legacy …?

  2. Dogmatic Ratios says:

    Since they shouldn’t exist in a democratic world, autocratic executives are, by their nature, breathtakingly incompetent.

    UOM: when will we hear about fall 2020 enrollment numbers?

    • uomatters says:

      I’m guessing nothing solid until week 4 of Fall. Housing numbers maybe sooner.

      • Anonymous says:

        those are the official numbers
        but I think we will have some indication of enrollment
        by June 15 as enrollment for fall has just started

  3. charlie says:

    Maybe it’s a bad time to bring this up. The late Dr. Clay Christensen, former Harvard Business School professor, stated that half of American unis will go bankrupt within the next few years.

    Note his referencing Moody’s regarding bond ratings, and such….