Posted on 06/22/2018 12:12:35 PM PDT by Presbyterian Reporter
School claims it won’t use any state appropriations or tuition funds for the payout
Moody’s Investors Service downgraded Michigan State’s bond rating by one notch in May, but it still maintains a strong Aa2 rating, which should keep borrowing costs low.
Michigan State University will fund its unprecedented $500 million settlement with survivors of Larry Nassar’s sex abuse through proceeds from a bond offering, after the board of trustees unanimously approved the settlement and bond amount at a raucous meeting Friday morning.
The board also voted to retain interim President John Engler, despite recent calls for his resignation by two trustees and multiple state officials.
Any recovered funds will go directly toward paying down the debt, the board said.
The school, a Midwest powerhouse with an enrollment of 50,000 students, said it won’t tap any state appropriations or use tuition funds for the settlement payout. It is in talks with its insurers, and has said it expects to recover at least some funds through them.
Any recovered funds will go directly toward paying down the debt, the board said at a packed meeting marked by shouts of “Shame on you, MSU” and calls for the interim president, John Engler, to resign.
It wasn’t clear how the school planned to cover the payments on the bond. School officials didn’t immediately respond to requests for comment.
(Excerpt) Read more at marketwatch.com ...
So exactly how is the corrupt Michigan State planning to payback $500 million plus interest for their complicity in allowing their Sports Doctor to molest these girls?
Maybe they will cut the salaries and benefits of the leftist Administrators and Professors---small chance that would ever happen.
Sex abuse bond sounds sort of like Stockholm syndrome.
Leftist Utopia. How’s that embracement of diversity working out?
Seems like a lot of money. How much would it be people had killed?
Cutting salaries is not really a source of funds.
They need to get supporters to chip in.
BOOKMARKING
It wasn’t clear how the school planned to cover the payments on the bond. School officials didn’t immediately respond to requests for comment.
Gives a whole new meaning to diversifying your investments.
It’s sleight of hand, to say they will issue bonds to pay off settlements.
What revenue source will be used to pay off the bonds?? Maybe they have not thought this through.
And who in the investment community is going to buy these bonds???
Aren’t bonds normally backed by the credit worthiness of the state or business entity which issues the bonds? And don’t investors look for a revenue stream within the business operations of the business entity, which will enable repayment?
These could end up as junk bonds couldn’t they?
Survivors? How many people did he kill?
$500,000,000 settlement? Somewhere there is one damn happy law firm.
The bonds are backed by the Aa2 rating of Michigan State, so investors would have no problems buying the bonds. The chance of the bonds being worthless is quite small.
Unless there are some ‘very’ deep pocket MSU alumni willing to finance these bonds, I do not see how MSU finds $500 million plus interest to fund the bonds.
Somehow I would doubt that any alumni would want it to be known that they gave millions to MSU to payoff the corruption.
Izzo knew.
Doesn’t anyone ever read the article before posting?
Did he? I wasn’t aware he had anything to do with MSU gymnastics.
“”””survivors of Larry Nassar’s sex abuse
Survivors? How many people did he kill?””””
Did any of these survivors speak English? These survivors were in college, right? They don’t know how to contact the police or kick the guy in the nuts?
Very interesting. Thanks for posting.
So basically, the university isn’t penalized at all.
This is the problem with corporate liability. Someone else — in innocent someone else, ultimately the taxpayers directly or indirectly — is going to be stuck with the bill. The truly liable parties are the MSU and US Gymnastics officials who failed to exercise oversight. They’re the ones who should pay. Bankrupt everyone in Larry Nasser’s chain of command. That’s the way to stop future occurrences.
“So exactly how is the corrupt Michigan State planning to payback $500 million plus interest for their complicity in allowing their Sports Doctor to molest these girls?”
Universities have several funding schemes that don’t have anything to do with state appropriations or tuition. They have endowment funds, patent income, rental property, service fees, and all the excess sports money.
You’re talking about a lot of money here, though, so I don’t know if even all that would make these bonds attractive.
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