The $281 million question: Who’s paying for the arena project?

The new arena project on Cook Field has raised questions around the Miami University community since it was first announced in February 2025. While ROTC students worried about their facilities being moved, intramural sports teams debated a replacement location choice, students raised concerns over tuition impacts and faculty rattled about program cuts, the underlying question remained unclear: who will pay for the new arena?

The project, now labeled at up to $281 million, according to the university, includes a new sports arena, a parking lot and the relocation of both the ROTC program and recreational fields. It does not include a hotel or restaurant, as those would be separately funded.

On top of the near-$300 million, the university will have to pay off interest on the debt it accumulates from issuing bonds. David Creamer, senior vice president for finance and business services, said the interest rate is estimated to be at 4.2%.

“There’s probably going to be — in addition to the $280 million that’s borrowed — about, if I recall, about $90 million in interest over the life of the debt,” Creamer said.

Miami already has an outstanding debt of more than $432 million, according to the Oxford Free Press.

The arena will be funded through the issuance of bonds, although none of these loans have been issued to investors yet. The debt service for the arena project will be funded through an increased annual draw on investment income of $10.2 million per year for 25 years and annual savings from retiring debt. Creamer said the project will take 25% of the non-endowment fund, which is unrestricted and controlled by the Board of Trustees.

Enjoy what you're reading?
Signup for our newsletter

The project will also partially be funded through donations. In an email to The Miami Student, Interim Vice President for University Advancement Jill Gaby wrote the fundraising goal is established at $75 million. $500,000, which is less than 1% of the goal, has been pledged so far.

Gaby said Miami is considering incentivizing donations through recognition opportunities including potential naming opportunities for the arena and spaces within it.

The financial risks of large construction projects are worrisome for some stakeholders because of broader demographic trends facing higher education. With the sharp projected decline in the amount of college-aged students in the United States, there are concerns about future financial trouble at the university.

“[The bond issue] says the bond holders must be paid first if there is any financial trouble at the university,” said Cathy Wagner, professor of English and member of the Faculty Alliance of Miami (FAM). “If there were a genuine deficit, not just a budget deficit, … and [we] couldn't pay the debt, then the bond holders would have to be paid first.”

Wagner said this situation occurred at the University of Virginia, where high debt forced the university to cut programs and spending.

Programs have already been cut and consolidated at Miami. Wade Warren, junior social work major and deputy secretary to the treasury of the Associated Student Government, said when programs were removed and opportunities were taken away students were disappointed.

“When it came to the programs getting defunded, there was the immediate loss of the programs within the year, and follow that up with an expenditure that is going to take years to fully come to fruition,” Warren said. “It is hard to grapple with sometimes as a student.”

Students and faculty alike are feeling those program cuts and consolidations. Jennifer Purdum, associate teaching professor at Miami regionals in the art department, said at the February Board of Trustees meeting, she was informed that her position would be dissolved after 18 years as collateral damage to the sports arena. She said she had never known the grief or feeling of utter disposability like she has experienced from Miami in the last three months.

Faculty members, like Wagner, have raised concerns about what happens if the university faces financial trouble along with carrying new debt.

“[FAM feels] pretty strongly that in a situation where programs are being cut, jobs are being cut, massive transformations are happening to the university on the basis of financial problems, especially coming up … It's not a time to be taking out massive debt for a project that is demonstrably massively unpopular,” Wagner said.

Although there will be 2,000-3,000 less seats in the new arena, Creamer said it could raise revenues for the university. According to a project information packet from university communications and marketing, the tighter space enhances the fan experience and will allow the university to maximize revenue generation, drive ticket sales and generate more sponsorships.

Although questions regarding Miami’s future finances remain, the arena project construction is set to begin in September 2026.

duganec@miamioh.edu