Indiana University among nation’s first to use ‘green bonds’
Indiana University is among the first institutions of higher education in the United States to use tax-exempt “green bonds” financing for building construction needs that also encourage sustainability.
Green bonds are a relatively new financing tool in the American bond market. They allow investors to support sustainability and protection of the environment. Projects can range from energy savings to clean water, brownfields cleanup and restoration and more efficient transportation.
Massachusetts Institute of Technology earlier this year issued green bonds, becoming the first institution of higher education in this country to do so. The first university to sell green bonds in the United States was the University of Cincinnati.
Indiana University hopes to raise $66 million through green bonds, with $45 million of the money to be used to help defray the costs of a new Arts and Sciences Building at Indiana University Northwest and $21 million for renovation of Franklin Hall (pictured) on the Bloomington campus.
Don Lukes, IU’s associate vice president and associate treasurer, said the use of green bonds is part of the university’s commitment to “sustainability, energy efficiency and careful stewardship of our resources.”
The two projects for which the green bonds will be sold are expected to achieve Silver certification from the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) program. The IU bonds are secured by fees and tuition paid by students.
The Franklin Hall renovation will include energy-efficient mechanical systems, high-efficiency glass windows and roofing, and more efficient lighting Asbestos and lead paint will also be removed. The Arts and Sciences Building likewise will feature energy-efficient mechanical systems, windows and lighting.
Indiana University is a national leader in environmental sustainability, and as such, is committed to seeking LEED certification for all new construction on its campuses.