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The University of Idaho has not started issuing University of Phoenix bonds, but it is already moving toward Plan B or Plan C.
U of I officials are downplaying the impact on the controversial $685 million acquisition.
The Arizona Industrial Development Authority was the university’s first choice to issue the Phoenix bonds. But AzIDA “abandoned the opportunity to participate in the loan,” the authority’s executive director, Dirk Swift, told the Lewiston Tribune on Wednesday.
The reasons for AzIDA’s decision are not clear. Arizona Education News repeatedly reached out to Arizona Gov. Katie Hobbs’ office for comment, but did not receive a response.
AzIDA was the university’s first choice for the Phoenix bond issue because the Idaho Housing Finance Association does not have the authority to lend on “intangible assets” (assets that are not physical in nature). According to the university’s “Frequently Asked Questions” page, the University of I decided on two adhesive candidates and still has AzIDA listed as the Phoenix adhesive.
“Both the State of Wisconsin (Fiscal Department) and Arizona IDA may issue bonds to fund intangible assets,” the U of I said. “These two publishers have extensive experience with these types of services. We chose Arizona IDA based on price and experience.”
The U of I’s page makes no mention of the agency that apparently issues the bonds, the New Hampshire-based State Fiscal Administration. Spokesperson Jody Walker said in a statement that the university approached “numerous” potential bond issuers.
“AzIDA refused to participate, but NFA agreed to participate in funding,” she said. “AzIDA’s decision has no impact on our transactions.”
The big hurdle facing a Phoenix takeover is ties.
University and State Board of Education officials said they cannot fund the Phoenix acquisition while it is mired in court. Attorney General Raul Labrador is challenging the deal, and a hearing in the Idaho Supreme Court is scheduled for June. Lawmakers also threatened to sue. Congress has also floated the idea of overhauling the acquisition and putting Phoenix under the masthead of a University of I nonprofit organization.
There is a non-binding May 31st deadline for the acquisition. If a deal isn’t done by that date, U of I or Phoenix can walk away from the table.
Click here for exclusive, in-depth coverage of the University of Phoenix’s proposal.
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