Presidential candidate and Sen. Bernie Sanders (D-Vt.) — a staunch advocate for cutting tuition costs — congratulated the University in a Facebook post for “doing what once seemed like an impossible dream.”
Data from the University show that financial aid policy has taken several turns in the past decade, and in the past five years, loans have increased significantly, while grant aid has stayed roughly similar relative to the increase in loans.
“While Resolution 28 is rooted in compassion for an important social and political cause, I do not believe it meets the Board of Trustees’ adopted threshold for divestment,” President Pollack wrote in a letter.
This election seems to be focused on trivial things: from the size of Donald Trump’s fingers, to Hillary Clinton’s houses, to Ted Cruz’s facial features. While some major issues have been debated (immigration, ISIS, banking regulation), the vast majority of the nation’s problems have been disregarded — and perhaps the most important issue of all has been ignored. In the past year, hardly any of the candidates have engaged in a serious conversation regarding our extraordinary debt and deficits. As I write this, our national debt stands at a breath-taking $19,249,726,000 — nearly $1 trillion more than our Gross Domestic Product (GDP). And the numbers only continue to climb.
When the University decided that it would take on $500 million in debt to raise liquidity on March 6, Cornell’s financial officers went to work picking a date during which the bonds would fetch the best interest rate in this dramatically fluctuating market. The coupon rate, or rate of interest on which the bonds sell, depends heavily upon events like release of jobless rates, corporate earnings reports, other assets being sold that day and religious holidays, according to Joanne DeStefano, vice president of finance.
The University successfully sold $500 million in debt last week, as Cornell maintained its credit rating on one index but slipped a notch on another.
Investors fully subscribed to Cornell’s bond offerings in under 30 minutes last Thursday, according to Tommy Bruce, vice president of University Communications.
The bond offering was divided evenly between $250 million of 5-year bonds at a 4.35-percent interest rate and $250 million of 10-year at a 5.45-interest rate.
While the University has lines of credit and regularly sells-tax exempt bonds to finance construction, the sale of these taxable bonds are unusual. The magnitude of the offering is, in fact, unprecedented.
Following in the footsteps of Harvard, Princeton and Notre Dame, Cornell chose to sell $500 million of taxable bonds earlier this month in response to recent endowment losses.
In the face of a global financial crisis that has erased $29 trillion from the stock market in 2008, according to Bloomberg, the average university endowment has decreased by 24.1 percent across the U.S. in the past six months, according to the Stamford Advocate.
In December 2008, Harvard sold $2.5 billion in taxable bonds to repay borrowed funds. Princeton sold $1 billion in bonds in January, University of Pittsburgh plans to sell up to $421 million, Notre Dame already sold $150 million and University of Pennsylvania plans to sell $300 million, according to the Bond Buyer.