Finance, Audit and Facilities Committee

F–9 VII. STANDING COMMITTEES B. Finance, Audit and Facilities Committee Amendment to the Debt Management Policy and Implementation of the Internal Lending Program RECOMMENDED ACTION: It is the recommendation of the Administration and the Finance, Audit and Facilities Committee that the Board of Regents adopt the amended "Debt Management Policy: Statement of Objectives and Policies" to provide for the implementation of the Internal Lending Program. BACKGROUND: On September 19, 2002, the Board of Regents adopted the University's "Statement of Debt Policy." On July 16, 2004, the Board adopted an amendment to the University's debt policy appending an Interest Rate Swap Policy. The proposed amendment to the current debt policy contains proposed changes to the University's internal financing and debt portfolio management practices that provide for implementation of the Internal Lending Program and are specifically aimed at lowering the institution's risk-adjusted cost of capital and providing internal borrowing units with a stable and predictable borrowing rate. These proposed changes are part of a series of Treasury Office initiatives that will better integrate the management of the University's assets and liabilities to expand financial resources for funding strategic priorities. In addition to the debt management initiative, other Treasury Office initiatives include lowering cash balances to increase interest earnings and ...