LINE OF CREDIT INCREASE

   

WHEREAS, In April 1999, the Lincoln University Board of Trustees approved a line of credit for the University which has $2.0 million permanent and $2.0 million seasonal components; and

WHEREAS, On June 10, 2004, Lincoln University refinanced its existing loans which had restricted expansion of its line of credit without prior approval; and

WHEREAS, On June 10, 2004, Lincoln University issued bonds which permit the line of credit to be increased by a percentage of operating expenses that the Administration has deemed more flexible for the University’s needs; and

WHEREAS, Lincoln University has noted the size of the line to be less than is needed for proper operation of its finances and that the percentage of the line compared to operating expenses has eroded by 25% from12% when the Board last approved it to 9%; and

WHEREAS, Lincoln University’s historical usage has rarely exceeded $3.0 million in the last three years; and

WHEREAS, Lincoln University can report its usage to the Board to understand; now, therefore be it

RESOLVED, That Lincoln University’s permanent line of credit at $6.0 million is hereby approved; and further

RESOLVED, That an internal review process that does the following is hereby approved:

1.    Reports to the Business Affairs Committee of the Board on line of credit utilization; and
2.    Reviews with the Business Affairs Committee of the Board the University’s operational plans for full line of credit repayment whenever the line is anticipated by the Administration to go over $4.0 million.
 

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