Long-term debt activity for the years ended September 30, 2020 and 2019 is summarized as follows:
| Type/Supported by | Balance October 1, 2019 | New Debt | Principal Repayment | Reclass | Balance September 30, 2020 |
| Notes payable | |||||
| Crimson Tide Foundation airplane | $1,060,844 | $5,900,000 | $(1,318,549) | $- | $5,642,295 |
| Bryce/Partlow Property | 27,831,500 | - | (5,566,300) | - | 22,265,200 |
| Bonds | |||||
| General Revenue | 1,165,085,000 | - | (36,320,000) | - | 1,128,765,000 |
$1,193,977,344 | $5,900,000 | $(43,204,849) | - | $1,156,672,495 |
|
| Plus net unamortized bond | |||||
| premium/discount | 100,151,687 | 92,714,465 |
|||
| Less current portion | (42,487,450) | (41,322,697) |
|||
$1,251,641,581 | $1,208,064,263 |
| Type/Supported by | Balance October 1, 2018 | New Debt | Principal Repayment | Reclass | Balance September 30, 2019 |
| Notes payable | |||||
| Crimson Tide Foundation airplane | $1,648,807 | $- | $587,963 | $- | $1,060,844 |
| Rental income | 467,970 | - | 467,970 | - | - |
| Bryce/Partlow Property | 33,397,800 | - | 5,566,300 | - | 27,831,500 |
| Bonds | |||||
| General Revenue | 962,710,000 | - | 458,950,000 | 265,575,000 | 1,165,085,000 |
$998,224,577 | - | $458,950,000 | 263,197,233 | $1,193,977,344 |
|
| Plus net unamortized bond | |||||
| premium/discount | 40,147,967 | 100,151,687 |
|||
| Less current portion | (32,681,257) | (42,487,450) |
|||
$1,005,691,287 | $1,251,641,581 |
Debt obligations generally bear interest at fixed rates ranging from 0% to 6.1% and mature at various dates through fiscal year 2049.
Maturities and interest on notes, leases and bonds payable, using rates in effect at September 30, 2020, for the next five years and in subsequent five-year periods are as follows:
Notes Principal | Bonds Principal | Total Principal | Notes Interest | Bonds Interest | Total Interest | Total Debt Service |
|
| 2021 | $6,352,697 | $34,970,000 | $41,322,697 | $134,941 | 44,006,220 | 44,141,161 | 85,463,858 |
| 2022 | 6,373,018 | 36,655,000 | 43,028,018 | 114,620 | 42,452,588 | 42,567,208 | 85,595,226 |
| 2023 | 6,393,865 | 38,495,000 | 44,888,865 | 93,773 | 40,767,218 | 40,860,991 | 85,749,856 |
| 2024 | 6,415,250 | 39,995,000 | 46,410,250 | 72,388 | 38,963,060 | 39,035,448 | 85,445,698 |
| 2025 | 870,888 | 42,700,000 | 43,570,888 | 50,450 | 37,076,330 | 37,126,780 | 80,697,668 |
| 2026-2030 | 1,501,777 | 244,120,000 | 245,621,777 | 33,787 | 154,508,439 | 154,542,226 | 400,164,003 |
| 2031-2035 | - | 277,385,000 | 277,385,000 | - | 100,758,608 | 100,758,608 | 378,143,608 |
| 2036-2040 | - | 216,350,000 | 216,350,000 | - | 55,874,612 | 55,874,612 | 272,224,612 |
| 2041-2045 | - | 132,525,000 | 132,525,000 | - | 22,529,050 | 22,529,050 | 155,054,050 |
| 2046-2049 | - | 65,570,000 | 65,570,000 | - | 4,649,500 | 4,649,500 | 70,219,500 |
$27,907,495 | $1,128,765,000 | $1,156,672,495 | $499,959 | $541,585,625 | $541,585,625 | $1,698,758,079 |
Pledged revenues for the years ended September 30, 2020 and 2019 as defined by outstanding bond covenants are as follows:
2020 | 2019 |
|
| Tuition and fees | $801,068,732 | $806,275,024 |
| Sales and services of educational activities | 9,866,923 | 12,167,759 |
| Auxiliary sales and services | 166,817,400 | 207,696,864 |
| Investment income | 59,136,114 | 57,990,752 |
| Other operating revenue | 78,176,763 | 66,807,573 |
| Total pledged revenues | $1,115,065,932 | $1,150,937,972 |
The University defeased certain indebtedness during fiscal year 2019 with the 2019 bond issuance. For this defeasence, funds were deposited in escrow trust accounts sufficient to provide for the subsequent payment of principal and interest on the defeased indebtedness. Under the trust agreements, funds deposited in the trust accounts were invested in obligations of the U.S. Government. The funds on deposit were sufficient to satisfy the debt service requirements on the defeased indebtedness resulting in lower overall debt service payments to the University. Neither the assets of the trust accounts nor the defeased indebtedness are included in the accompanying statements of net position. The principal outstanding on the 2019 defeased indebtedness at September 30, 2020 and September 30, 2019 is approximately $0.0 million and $230.2 million, respectively.
The undiscounted cash flows required to service principal and interest under the old bonds as of September 30, 2019, would have been $395.9 million compared to undiscounted cash flow requirements of $319.4 million under the new bonds. The economic gain to the University of the bond refinancing in fiscal year 2019 was calculated to be approximately $78.3 million using an effective interest rate of 2.46% applied to the old and new bond cash flow requirements.
The University’s general revenue bonds are subject to certain covenants. These covenants, among other things, require the Board to adopt an annual budget; to establish and maintain reasonable fees, rates, and other charges to ensure pledged revenues are sufficient for debt service coverage; to maintain books and records pertaining to the pledged revenues; to furnish annual audits and other periodic reports; and to comply with certain restrictions as to additional indebtedness. Based on pledged revenues received in fiscal year 2020 of $1.1 billion, the projected maximum annual debt service requirement of $85.7 million in 2023 is covered approximately 13.0 times by pledged revenues. The University is in compliance with all financial covenants as of September 30, 2020.
In November 2014, the University finalized a purchase agreement with the ADMH for approximately 118 acres of land and certain other defined appurtenances of the property, known as the Partlow Property I. This $32 million purchase is payable over a ten-year period.
In February 2015, the University finalized an additional purchase agreement with the ADMH for approximately 244 acres of land and certain other defined appurtenances of the property, referred to as the Partlow Property II. This $23.7 million purchase is also payable over a ten-year period.
The following is a detailed schedule of long-term debt as of September 30, 2020:
| Description | Date Issued | Final Maturity | Interest Rate-% | Original Debt | Outstanding Debt |
| Bonds payable: | |||||
| General Fee Revenue Bond Series 2009A | 10/30/2009 | 7/1/2039 | 5.14-6.28 | $135,425,000 | $- |
| General Fee Revenue Bond Series 2009B | 10/30/2009 | 7/1/2021 | 1.25-5.14 | 48,060,000 | 9,240,000 |
| General Fee Revenue Bond Series 2010A | 7/1/2010 | 7/1/2040 | 2.0-5.875 | 16,495,000 | 13,100,000 |
| General Fee Revenue Bond Series 2010B | 11/18/2010 | 7/1/2040 | 5.7-5.85 | 18,000,000 | 18,000,000 |
| General Fee Revenue Bond Series 2010C | 11/18/2010 | 7/1/2020 | 3.8-6.1 | 100,420,000 | 3,955,000 |
| General Fee Revenue Bond Series 2010D | 11/18/2010 | 7/1/2019 | 1.0-4.0 | 31,040,000 | - |
| General Fee Revenue Bond Series 2012A | 10/16/2012 | 7/1/2042 | 3.0-5.0 | 265,655,000 | 250,415,000 |
| General Fee Revenue Bond Series 2012B | 10/16/2012 | 7/1/2019 | 1.4-3.0 | 20,290,000 | - |
| General Fee Revenue Bond Series 2014A | 8/28/2014 | 7/1/2021 | 5 | 25,780,000 | 11,170,000 |
| General Fee Revenue Bond Series 2014B | 8/28/2014 | 7/1/2044 | 3.0-5.0 | 212,105,000 | 212,105,000 |
| General Fee Revenue Bond Series 2017A | 8/30/2017 | 7/1/2024 | 4.0-5.0 | 15,855,000 | 14,540,000 |
| General Fee Revenue Bond Series 2017B | 8/30/2017 | 7/1/2047 | 3.0-5.0 | 158,400,000 | 158,400,000 |
| General Fee Revenue Bond Series 2017C | 8/30/2017 | 7/1/2023 | 1.32-2.32 | 25,060,000 | 15,210,000 |
| General Fee Revenue Bond Series 2019A | 9/19/2019 | 7/1/2049 | 3.0-5.0 | 375,515,000 | 375,515,000 |
| General Fee Revenue Bond Series 2019B | 9/19/2019 | 7/1/2024 | 2.0-4.0 | 14,095,000 | 14,095,000 |
| General Fee Revenue Bond Series 2019C | 9/19/2019 | 7/1/2038 | 3.0-5.0 | 69,340,000 | 69,340,000 |
Total bonds payable | $1,531,535,000 | $1,165,085,000 |
|||
| Geist LLC Promissory Note | 1/24/2007 | 4/22/2019 | 6.0 | 1,800,000 | - |
Notes payable: | |||||
| Geist LLC Promissory Note | 1/24/2007 | 4/22/2019 | 6.0 | 1,800,000 | - |
| Department of Mental Health (Partlow II) | 2/27/2015 | 2/27/2024 | 0.0 | 23,663,000 | 11,831,500 |
| Department of Mental Health (Partlow I) | 11/14/2023 | 0.0 | 32,000,000 | 16,000,000 |
|
| PNC Aviation Finance (CTF airplane) | 2/17/2016 | 3/1/2021 | 2.22 | 2,925,000 | 1,060,844 |
Total notes payable | $60,388,000 | $28,892,344 |
|||
Total bonds and notes payable | $1,591,923,000 | $1,193,977,344 |
