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?
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.
Doesn’t anyone ever read the article before posting?