Michigan.

It's a brave new video world for Michigan bond authorities. Earlier this month, the Michigan Higher Education Facilities Authority became the state's first bond agency to conduct a board meeting and approve bond issues via a video conference.

Video technology connected seven board members in Lansing with two board members in Detroit for the authority's Aug. 20 meeting, said Roy Pentilla, the authority's executive secretary.

The board approved a $15.8 million revenue bond issue for Davenport College and a $5 million revenue bond issue for the University of Detroit Mercy, Pentilla said.

Officials from the Student Loan Marketing Association, which purchased the Davenport College issue, joined the board members in Lansing for the video conference. Officials from Comerica Bank, which handled the private placement of the University of Detroit Mercy bonds, also were on hand in Detroit.

Meeting participants were able to see and hear each other, as well as review documents, Pentilla said. "It was pretty slick," he said.

Pentilla said the authority will use video conferencing on an "as needed" basis in the future. He said it saved the Detroit participants from having to travel 90 miles to the state capital, a trip that can take up to two hours because of road construction.

The state attorney general has given video conferencing his stamp of approval, saying it complies with Michigan's open meetings law, Pentilla said.

-- Karen Pierog, Chicago

Moody's Investors Service last week upgraded the rating on $130 million of Michigan Health Care Corp. bonds to B1 from B.

The upgrade reflects improved financial performance primarily due to a reduction of expenses because of lowered salaries, the closing of a money-losing hospital, and the renegotiation of contracts with new doctors, Moody's said.

Though Detroit-based Michigan Health Care's performance has improved, "sizable risks" will challenge the institution in the near future, said John Goetz, vice president and assistant director of health-care ratings at Moody's.

Goetz said that Michigan Health Care's management "will have to be diligent" to offset a large amount of debt and dependence on funds from state Medicaid budgets.

The $130 million of bonds were issued through the Detroit Hospital Finance Authority.

Officials from Michigan Health Care could not be reached for comment.

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