Despite the state’s historic budget impasse, Moody’s Investors Service has reaffirmed Harper College’s Aaa rating – the highest rating possible.
The rating agency cited Harper’s strong financial reserves and available liquidity that are expected to remain healthy given the College’s relatively modest reliance on state funding (about 5 percent of the College’s budgeted operating revenue). The Aaa rating further reflects Harper’s large and diverse tax base, strong demographic profile and modest debt burden.
The Moody’s report does, however, maintain a negative outlook reflecting the ongoing financial challenges that Harper faces if Illinois does not pass a budget and meet its obligations.
The state’s budget battle has already prompted Moody’s to downgrade the credit rating of 15 community colleges and several four-year colleges and universities across the state. A lower credit rating makes it more expensive for a college to borrow funds for capital improvements and infrastructure maintenance.
“The very difficult decisions made last year to reduce the budget by $5 million played a key role in keeping our Aaa bond rating,” Harper College President Dr. Ken Ender said. “This is a testament to the College’s commitment to fiscal responsibility despite the unprecedented situation facing higher education in Illinois.”
Moody’s new issuance was a required step as Harper prepares to issue about $5 million in bonds to finance various capital projects around campus. The College’s Board of Trustees adopted a bond resolution at its regular meeting in February; the bond sale is expected to close in early March.
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