Post-Issuance Compliance

Columbia University finances certain capital projects through the issuance of qualified 501(c)(3) tax-exempt bonds issued primarily through the Dormitory Authority of the State of New York.  As the borrower of these bonds, Columbia is required to comply with federal tax rules that govern the allocation of tax-exempt proceeds; investment of proceeds in compliance with arbitrage rules; annual use tracking of financed facilities and retention of records.

The Office of the Treasurer leads the University's tax-exempt bond compliance program, in close conjunction with the Office of the General Counsel.  The University has established formal policies for:

 

Post Issuance Compliance, which can be found here.

Record Retention regarding Tax-Exempt Bond Financings, which can be found here.

 

Facilities financed with tax-exempt bond proceeds must be regularly monitored to ensure compliance with IRS qualified use requirements.  For each tax-exempt bond issuance, the University is required on a regular basis to identify, track and report the qualified and unqualified uses of financed facilities. The University is required to retain related documentation for the term of each bond issuance plus three years.

Each year in October, the Office of the Treasurer informs relevant schools and department of their need to provide information and/or documentation related to the use of financed facilities and for retaining records in accordance with the above policies.  For the Fiscal Year ending June 30, 2012, the following schools and departments have reporting and retention responsibilities:

  • ♦   Office of Alumni and Development
  • ♦   Athletics
  • ♦   Columbia Technology Ventures
  • ♦   Office of the Controller
  • ♦   CU and CUMC Facilities planning and operations offices for all campuses and financed spaces: Morningside, Medical Center,  Manhattanville, Lamont Doherty, Nevis Laboratories, Baker Field,  RECAP (New Jersey)
  • ♦   CU Facilities Office of Real Estate
  • ♦   CU Facilities Office of Residential Finance and Parking
  • ♦   Office of Student Services
  • ♦   Sponsored Project Administration
  • ♦   Clinical Trials

 

To comply with IRS regulations, the Capital Planning group is responsible for calculating the private business use of bond-financed facilities.

 

REMEDIAL ACTIONS

The Office of the Treasurer is aware of the remedial action rules contained in U.S. Treasury Regulations Section 1.141-12, providing the University with the ability, in certain circumstances, to remediate voluntarily any violations of the private business tests or private loan financing test.  The Office of the Treasurer has policies and procedures in place to ensure that none of its debt issuances violates the Private Business Tests or Private Loan Financing Test and require remedial action.  The Office of the Treasurer has consulted with the University’s bond counsel regarding the applicability of the remedial action rules to management of its debt portfolio and ensured that it has the ability to remediate if required at any time in the future. 

 

VOLUNTARY CLOSING AGREEMENT PROGRAM

The Office of the Treasurer is aware of its ability, pursuant to IRS Notice 2008-31, to request a voluntary closing agreement with the IRS in the unlikely event that it needs to correct any failure to comply with the federal tax rules related to debt issuances. 

 

CONTINUING EDUCATION

The Office of the Treasurer will continue to consult regularly with its bond counsel regarding the federal tax rules applicable to its outstanding debt and changes to the federal tax law, and it will regularly update these policies and procedures to reflect any such changes. 

The Office of the Treasurer ensures that those responsible for the University’s tax-exempt bond compliance obtain regular continuing education on related issues, including but not limited to consulting with outside professionals, participating in conferences and webinars, and reading informational updates from governmental resources and professional organizations.