DASNY Overhauls Financing Guidelines

Changes provide borrowers with speed, certainty and flexibility

New York, NY:  Highly-rated university, college, health care and other not-for-profit borrowers can move to market faster and won't need debt service reserve funds as part of a guideline overhaul approved by the DASNY Board at its December meeting.  The authority is also offering its top-rated borrowers more control over their investments. DASNY’s high standards remain.

The changes strengthen DASNY’s position as the nation’s leading issuer of tax-exempt bonds.  This year alone, DASNY issued more than $9 billion in tax-exempt debt on behalf of New York State and leading not-for-profit institutions.

The overhaul is the culmination of a months-long listening tour spear-headed by DASNY President & CEO Gerrard P. Bushell. Since June, he and Portia Lee, Managing Director of Public Finance and Portfolio Monitoring, met with DASNY's not-for-profit borrowers, 14 senior managers, trade associations and investors. They asked that DASNY be faster, provide greater certainty and be more flexible.

DASNY President & CEO Gerrard P. Bushell said, "We listened, we heard and we acted. This is a new era for DASNY. We are being responsive to our clients’ needs while upholding our hallmark transparency and accountability. These changes make DASNY’s services more competitive. We will continue to drive New York's economy by financing and building the social infrastructure that makes our communities work. We are a reflection of the broad interests of this great state."

DASNY Board Chair Alfonso L. Carney, Jr. said, “These changes are very important to DASNY’s future and its ability to continue financing and building the universities, hospitals and libraries that make New York a better place to live. We have an obligation to level the playing field so we can do what we do best. I am pleased to have presided over the meeting where these key changes developed by management were approved unanimously by the Board.”

Healthcare Association of New York State President Dennis Whalen said, "These welcomed changes position DASNY as an important financing partner to help support health care transformation for hospitals and health systems with access to capital markets. HANYS applauds DASNY's fresh look and smart improvements to financing policies, and we look forward to a continued partnership to address the persistent capital needs of hospitals across the state."

The changes, approved by the Board on Dec. 9, fall under three categories: Speed, Certainty and Flexibility.


  • Only a single Board approval is now required for higher education and health care clients rated A or better. Previously, this option was only available to these clients if they issued through DASNY in the prior 48 months.
  • The same high standards for document preparation and review prior to Board approval remain, including tax diligence, adherence to the Tax Equity and Fiscal Responsibility Act (TEFRA), and the State Environmental Quality Review Act (SEQRA).


  • A debt service reserve fund and a mortgage are no longer required for higher education clients rated in the A category.
  • Debt service reserve funds are not required for health care clients rated A or better. 
  • This provides greater predictability for borrowers, who will no longer need to seek an exception from the Board.  
  • BBB-rated higher education clients are still required to pledge revenues and a mortgage.


  • For new transactions, higher education and health care borrowers rated AA or AAA can now have more control over their trustee held investments:
    • Disbursement:  They can direct the bond trustee to release funds as they need them.
    • Investments: They can direct the investment of funds, consistent with the requirements of their bond documents.
    • Arbitrage: They can engage their own arbitrage rebate consultants to undertake these calculations.
    • Also for new transactions, all borrowers can use third party bidding agents for their escrows rather than DASNY.


On Monday, December 14, 2015 DASNY President Bushell will detail these policy changes at a luncheon speech before the Municipal Forum of New York.




Founded in 1944, DASNY is one of the largest higher education, health care and public-purpose issuers of tax-exempt debt in the nation with an outstanding bond portfolio of approximately $47.3 billion as of September 30, 2015. DASNY is also a major public builder in New York State with a construction pipeline of 1,005 projects valued at more than $5.7 billion