Post by pavel on Feb 24, 2016 5:00:58 GMT -6
Citing state budget crisis, Moody’s places 8 Louisiana universities on review for credit downgrades
One of the influential financial rating agencies has placed eight of Louisiana’s public universities on its credit downgrade watch list, including LSU, the University of New Orleans, Southern University, the University of Louisiana at Monroe and Louisiana Tech University.
The decision to review the schools for downgrades, which Moody’s Investors Service announced this week, is directly tied to a state budget crisis that threatens drastic cuts to higher education funding.
The Louisiana Legislature is in a special session to try to address a $900 million shortfall in the budget that ends June 30 and a $2 billion shortfall in the budget that begins July 1. Lawmakers have said they are trying to work out a fix that would include some cuts and some revenue-generating measures.
“Funding cuts implemented more than halfway through (fiscal) 2016 limit the universities’ financial flexibility to adjust revenue or expenses, as spring term enrollment and student charges have been established,” Moody’s analysts said in a news release. “The uncertainty for (fiscal) 2017 state funding may adversely affect enrollment, as decisions on the state budget, including scholarship availability, will coincide student choices for fall 2016.”
Read more: theadvocate.com/news/14966384-123/citing-state-budget-crisis-moodys-places-8-louisiana-universities-on-review-for-credit-downgrades
One of the influential financial rating agencies has placed eight of Louisiana’s public universities on its credit downgrade watch list, including LSU, the University of New Orleans, Southern University, the University of Louisiana at Monroe and Louisiana Tech University.
The decision to review the schools for downgrades, which Moody’s Investors Service announced this week, is directly tied to a state budget crisis that threatens drastic cuts to higher education funding.
The Louisiana Legislature is in a special session to try to address a $900 million shortfall in the budget that ends June 30 and a $2 billion shortfall in the budget that begins July 1. Lawmakers have said they are trying to work out a fix that would include some cuts and some revenue-generating measures.
“Funding cuts implemented more than halfway through (fiscal) 2016 limit the universities’ financial flexibility to adjust revenue or expenses, as spring term enrollment and student charges have been established,” Moody’s analysts said in a news release. “The uncertainty for (fiscal) 2017 state funding may adversely affect enrollment, as decisions on the state budget, including scholarship availability, will coincide student choices for fall 2016.”
Read more: theadvocate.com/news/14966384-123/citing-state-budget-crisis-moodys-places-8-louisiana-universities-on-review-for-credit-downgrades