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$45 Million In State Bonds Ok’d For Gu Law School, Other Projects

Grayden Jones Staff writer

A state board voted Tuesday to issue $45 million in tax-exempt bonds for Gonzaga University to construct a law school building and renovate classrooms and residence halls.

The seven-member board of the Washington Higher Education Facilities Authority agreed to issue the bonds on behalf of Gonzaga, providing up to $22 million for the school’s proposed law school complex.

The remaining $23 million may be used by Gonzaga to refinance debts and renovate buildings, said Kim Herman, executive director of the Seattle-based higher education authority.

The agency was created by the Legislature to help private colleges and universities finance major projects and keep tuition costs down.

The board voted 4-0 in favor of issuing the bonds, with Spokane attorney Judith Butler abstaining.

Butler excused herself from the vote because she is a member of Gonzaga’s board of regents.

The authority will release money to Gonzaga as it needs it to finance its projects and retire old debts. The university must repay the bonds in 25 years or less.

Gonzaga operates one of three law schools in Washington. It currently has 503 students.

Construction of the law school building is expected to begin next year, with completion scheduled for the fall of 2000, said Gonzaga spokesman Dale Goodwin.

The four-story 102,000-square-foot law school building will be built to the south of Martin Centre along the Spokane River either on existing university property or on a 15-acre site owned by the U.S. Postal Service.

The school has been negotiating for more than a year with the Postal Service to acquire the land when it relocates its mail distribution center to the West Plains or elsewhere.

Gonzaga sought the bonds - a form of debt issued to investors - because the cost of the money is lower than a traditional commercial loan.

Because investors are exempt from paying income taxes on the interest earned from bonds, they are willing to accept a lower interest rate from the institution.

, DataTimes