AURORA, Ore. (AP) -- The state Board of Higher Education voted to let the University of Oregon ask the Legislature for $200 million in state bonds to pay for a new basketball arena just east of campus.

If state lawmakers authorize the bonds this February, university \ officials will return to the board for approval to sell them.

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The university wants to break ground this spring and have the arena ready for the 2010 basketball season. The arena would have at least 12,500 seats and replace McArthur Court, the hallowed home to the Ducks since 1927.

Board members were mostly interested in the financial analysis showing that the UO athletic department can afford to pay back the state debt.

Under the plan, the university would pay off the bonds over 40 years, primarily using revenue generated by basketball games, concerts and other events. Additional funding would come from gifts to the Duck Athletic Fund and the newly established Athletic Legacy Fund, started with a $100 million pledge from Nike co-founder Phil Knight and his wife, Penny.

University President Dave Frohnmayer said the university will build the fund to $150 million in five years through additional fundraising. Earnings from the legacy fund would be used to balance the athletic department's budget should the arena not bring in enough money. But university officials say arena revenue comes up short of costs only in the most pessimistic projections.

Board member Dalton Miller-Jones asked about a letter sent to the board by UO biology professor Nathan Tublitz and signed by four other faculty members. It asks 10 questions about the adequacy of the financial analysis and financing plan.

It asks, for example, what effect losing Oregon basketball teams might have on arena revenue, and whether projections took into account the likelihood of periodic national economic downturns.

Frohnmayer said nothing in the letter surprised him, even though he saw it for the first time Friday. He said all the issues had been exhaustively considered.

Said Kilkenny: "Our numbers are very conservative. There's no plausible scenario where we feel we would have to draw on university (non-athletic) resources."

The UO athletic department is one of only about 20 in the country that requires no support from the university's general fund. Frohnmayer and Kilkenny say revenue from arena will help keep it that way.