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S&P’s Ratings Services Raises STLCC’s Issuer Credit Rating
January 12, 2009
Standard & Poor‘s Ratings Services raised its issuer credit rating on St. Louis Community College to "AA+" from "AA" based on the district’s consistent maintenance of balanced operations, coupled with planned revenue enhancements and expenditures controls that have led to strong reserves.
Standard & Poor’s Underlying Rating (SPUR) on the STLCC Building Corporation’s outstanding leasehold revenue bonds was raised to "AA" from "AA-."
Additionally, S&P’s assigned its "AA" standard long-term rating, and stable outlook, to STLCC’s newly issued series 2008 leasehold revenue bonds. Revenue from the sale of these bonds will support construction of the new Harrison Education Center in the JeffVanderLou neighborhood in St. Louis City, and reimbursement for the acquisition of land adjacent to the Wildwood campus.
The ratings, according to representatives of S&P’s, reflects the college’s participation in an economic area that includes St. Louis City and County, its operational flexibility, strong financial operations with strong reserves, and low overall debt burden. The "AA" rating indicates that the college’s capacity to meet its financial commitment on the obligation is very strong.
"St. Louis Community College has demonstrated sound fiscal management and flexibility during very adverse financial times," said Carla Chance, STLCC’s vice chancellor for finance and business services. "When you think about the credit market today, almost everything is being downgraded. We were pleased to be upgraded in a very ‘down’ market."
Another factor is that the St. Louis Community College district predominately is located within St. Louis County, which has an excellent (AAA) credit rating.
In its summary report, Standard & Poor’s considers STLCC’s financial management practices "good" under its financial management assessment methodology. Financial officers perform budget reconciliation monthly and make monthly reports to the college’s Board of Trustees. STLCC also uses its own four-year financial planning model and annually updates it. Financial officers also periodically update capital and maintenance schedules as needed, and govern investments according to the board policies, reporting quarterly about holdings and earnings.