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March 30, 2023

CHEFA INSIGHTS for April 2023

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Insight Highlights

Successful Bond Pricing for Quinnipiac University

SB 1104: CHEFA Priority Bill Advance out of Higher Education Committee

CHEFA Revolving Loan Fund Closes First Non-Client Loan

FY 2023 Higher Education Sector Report Summary

CHEFA CDC Works to Provide CT Nonprofits Access to New Market Tax Credits

We are the Connecticut Health & Educational Facilities Authority (CHEFA), and our vision is to enhance the welfare and prosperity of the citizens of the State of Connecticut by being leaders in public finance.

Mark Your Calendars

Child and Adolescent Mental Health:
How Can CT Tackle This Public Health Challenge?
A nonprofit forum co-hosted by CHEFA and
the Connecticut Council for Philanthropy
April 26, 2023
9:00 a.m. – 11:30 a.m.
10 Columbus Blvd. 7th Floor, Hartford CT 06106

Successful Bond Pricing for Quinnipiac University

Quinnipiac University is celebrating a major financial milestone after successfully pricing its tax-exempt, Series N Bonds. The University raised $58.955 million from the sale, which received a staggering $101.4 million worth of orders from investors. The deal was split into two maturities, with $19.4 million maturing on July 1, 2048, and $39.555 million maturing on July 1, 2053.

The proceeds from the bond sale will be used to finance a brand new 417-bed residence hall as part of Quinnipiac University’s ambitious Facilities Master Plan. The 10-year, $244 million plan has identified the need for more beds, and the new residence hall is expected to improve the quality and type of housing units available on campus. It will also enable the University to eliminate triples and quads and include more first-year housing types and single rooms in its campus inventory. The project is expected to improve the overall student experience, leading to future enrollment growth, and supporting the University’s 3-year live on campus requirement. The residence hall is scheduled to open in 2024.

Quinnipiac University’s financial strength was confirmed with its “A3” rating by Moody’s with a Positive Outlook and “A-“ rating with a Stable Outlook from S&P. The deal was underwritten by Barclays (Senior Manager) and RBC Capital Markets (Co-manager), while PFM acted as the Financial Advisor, and Hinkley Allen provided Bond Counsel for the Authority. The bond sale closed on March 15, 2023, marking a significant achievement for Quinnipiac University.

SB 1104: CHEFA Priority Bill Advances out of Higher Education Committee

Hartford CT Capitol Building

Earlier this month CHEFA Executive Director Jeanette W. Weldon testified before the Higher Education and Employment Advancement Committee in support of SB 1104. She was joined by CHEFA Managing Director Michael Morris.

SB 1104 is a priority bill for CHEFA. It will amend the current definition of project as outlined in CHEFA’s enabling statutes. This will allow CHEFA the flexibility needed to meet the changing needs of our clients and other 501(c)(3) organizations by allowing CHEFA to provide financing for programs, services, and other mission-focused initiatives. These bonds would not be SCRF backed by the State, and no state funding would be involved.

SB 1104 also updates CHEFA’s enabling statutes by deleting outdated language in CHEFA’s enabling statutes, and/or references to programming that is no longer used or available. This will provide for greater clarity in the interpretation of CHEFA’s enabling legislation.

SB 1104 received strong bipartisan support from committee members, and was voted out with unanimous consent from all in attendance. It is currently awaiting action in the Senate.

CHEFA will continue working to move SB 1104 forward, and keep all relevant stakeholders updated of further developments.

CHEFA Revolving Loan Fund Closes First Non-Client Loan

In March, CHEFA closed a $50,000 loan with Silvermine Guild of Artists, Inc. out of New Canaan, CT. This loan will enable Silvermine to purchase new tools and equipment for its various art studios, as well as update its telephone system. This is the first loan closed after CHEFA expanded its Revolving Loan Fund to include all 501(c)(3) organizations. Previously, only 501(c)(3) organizations who were existing borrowers of CHEFA-issued debt were eligible to apply for funding through the CHEFA Revolving Loan Fund.

The CHEFA Revolving Loan Fund program was created in 2020 with an initial funding of $1 million dollars from CHEFA’s operating reserves and has allowed CHEFA to provide affordable and flexible financing to nonprofits seeking to address their capital needs. Since its inception, CHEFA has closed over $800,000 in loans to a wide range of nonprofits across the state.

CHEFA is proud of its ability to provide financing to organizations and address critical capital needs. Loans such as those made to purchase vehicles for Meals on Wheels programs, critical medical equipment for endoscopic procedures and IT equipment for senior living centers have a significant impact on the lives that these organizations serve. These loans, and all other loans through the CHEFA Revolving Loan Fund program, have directly impacted over 14,000 Connecticut residents annually, 25% of which reside in low-income communities.

Funding is currently available for the 2023 loan cycle and any 501(c)(3) nonprofit organization is eligible to apply. CHEFA is offering loans up to $50,000 at 3.75% for 60 months under this program. CHEFA does not require any security for the loans and has a quick turnaround for disbursement (i.e., typically 45 days). Additional information regarding the Revolving Loan Fund and the application can be found here, or contact Dan Kurowski at

FY 2023 Higher Education Sector Report Summary

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At the Board of Directors Meeting held on March 22nd, Management presented a review of its Higher Education Sector report, which included financial operating results for FY 2022 and market demand results for FY 2023. This sector report reviews the performance of the ten private institutions that comprise CHEFA’s higher education portfolio, consisting of 60 bond series with $4.93 billion outstanding.

Credit Outlook: All but one of the private institutions have a credit rating with one or more of the rating agencies. The current overall outlook of the higher education sector for the next 12-18 months by the rating agencies varies (Moody’s – Negative, S&P – Stable; and Fitch – deteriorating); however, all three rating agencies are seeing a bifurcation of the sector. All the rating agencies agree on key drivers of the sector’s outlook: declining enrollment, inflation, and the end of pandemic aid utilization to close gaps in operating budgets. The rating agencies agree that institutions with strong demand and solid resources will experience less credit stress and continue to fare well.

Market Demand: Most of the ten private Connecticut based institutions that make up CHEFA’s higher education portfolio have experienced increased market demand in FY 2023 across four key indicators: applications, selectivity, matriculation, and enrollment. Overall, total applications have increased 8.1% and total enrollment has increased 3.4% compared to FY 2022. Both total enrollment and applications at the ten private institutions are at their highest level over the past five years.

Key Financial Ratios: Due to market performance in FY 2022, total cash and investments for the ten private institutions declined 3.1% from the prior year. However, total cash and investments remain significantly higher than five years ago. Only four of the institutions had a total cash and investments to debt ratio of more than 2.0 times for FY 2022, compared to seven institutions in FY 2021.. The FY 2022 median monthly days cash on hand of 417 days declined 8.5% from the prior year but is at its second highest level over the past five years. FY 2022 individual medians of the private institutions varied significantly from a low of 83 days to a high of 768 days. The sector also saw improvements in the median net tuition revenue growth, of 7.7% in FY 2022, compared to -1.7% from the prior year. Only three institutions reported a decline in net tuition revenue from FY 2021 to FY 2022, compared to seven schools the prior year.

Total capital investment for the private institutions that make up CHEFA’s higher education portfolio, increased 19% from the prior year with 70% of the entire portfolio investing more in their plant than their annual depreciation expenses. Management expects, however, that capital spending will decline in FY 2023 due to fewer bond issuances, inflation and continued supply chain issues.

To learn more about CHEFA Higher Education Sector report for FY 2022 and the performance of ten private institutions that make up our higher education portfolio, please contact Michael Morris, Managing Director at

CHEFA CDC Works to Provide CT Nonprofits Access to New Market Tax Credits

Did you know that the CHEFA Community Development Corporation (CHEFA CDC), a subsidiary of CHEFA, is a certified Community Development Entity and eligible to apply for Federal New Markets Tax Credits on behalf of nonprofits that serve Connecticut’s low-income communities?

In 2000, the Federal Government authorized the creation of the New Markets Tax Credit (NMTC) Program administered by the Community Development Financial Institutions Fund (CDFI Fund) and the Internal Revenue Service. The NMTC Program uses federal tax incentives to stimulate investment for economic and community development projects in urban and rural low-income communities. Investors that make an equity investment in certified financial intermediaries, called Community Development Entities (CDEs), receive a 39% tax credit over a seven-year period. The CDEs, in turn, use the proceeds from the equity investment to make a capital investment in low-income community businesses located in distressed communities.

CHEFA CDC is looking to expand the availability of New Markets Tax Credits for the State of Connecticut. Currently, organizations seeking tax credits must compete with other organizations outside of Connecticut for these tax credits. However, CHEFA CDC is the only community development entity committed to exclusively serving nonprofit organizations serving low-income communities. CHEFA CDC is preparing to seek an allocation of federal New Markets Tax Credits and is actively identifying qualified projects. If you would like to learn more about the program, or would like to discuss an upcoming capital project that your organization is considering, please contact Dan Kurowski at