Sigma Nu fraternity is borrowing money through the University to construct an alumni hall, while Beta Theta Pi has had a loan request approved by Board of Trustees to pay for razing its existing house on University Boulevard and build a new one in its place.

The fraternities are taking advantage of a plan announced by UA President Robert Witt in April, which allows Greek organizations to borrow money through the University for house renovation and reconstruction projects. The organizations can get the money at a cheaper rate from the University than from a private source.

Witt said the University is willing to loan the organizations money because it is important for the Greek system to be as strong as possible. It's not about wanting to get more donations from Greek alumni, he said.

"The fraternities and sororities are a great asset to the University, and we feel anything we can do for them is appropriate," Witt said.

The fraternities and sororities own their houses, but the University owns the land they are on.

Sigma Nu President Matthew Hogan said he hopes building the new fraternity alumni hall will bring in more donations from the fraternity's alumni.

Every fraternity and sorority wanting to change its house must submit a proposal to the UA System Board of Trustees, which must then approve the proposal before any work begins, Witt said. Financing for the projects comes from issuing bonds, which the University does one or more times a year, he said.

The Greek organizations get lower interest rates and longer repayment periods by financing through the University than if they were borrowing on their own, Witt said.

Dean of Students Tom Strong said 22 fraternities and sororities have inquired about the plan to help reconstruct or renovate existing houses.

Strong said Sigma Nu, Beta Theta Pi, Delta Kappa Epsilon and Delta Tau Delta fraternities have borrowed $9.5 million so far for projects on their houses. Sigma Nu is the only house on which work has begun, he said.

The other renovation projects should begin by the end of the spring semester, Strong said.

The projected cost of the Sigma Nu construction project is more than $2 million, according to a proposal approved by the trustees. Sigma Nu is paying for the architectural fees itself, according to the proposal.

The addition to the Sigma Nu house will be a social hall and band room, Hogan said. It is being built in its backyard, he said. Hogan said the fraternity is also renovating the rest of the house, which will begin as soon as members move out at the end of the semester.

Sigma Nu would have been able to receive a loan from a bank to construct the house, Hogan said, but the fraternity would have had a higher interest rate.

"Receiving this loan through the University has enabled everything to happen in a much more timely manner," Hogan said.

According to the proposal submitted by Beta Theta Pi, the razing of its existing structure and the construction of a new house is expected to cost about $2.5 million.

DKE will borrow about $3.7 to build a new house across University Boulevard where Gorgas Hall now sits, according to trustees documents. DTD will borrow $1 million for renovations and to build a new alumni hall, according the documents.