Moody’s Investors Service has lowered LSU’s credit outlook from positive to stable.
“This puts our flagship university one step away from a negative outlook which could result in a downgrade for LSU’s credit rating. We don’t want that to happen,” Louisiana Treasurer John Kennedy said in a statement. “Years of slashing state funding for our public colleges and universities and raising tuition, which puts college out of reach for many of Louisiana’s kids, are catching up with us. We need to stabilize funding for higher education.”
According to Moody’s, the revision “reflects limited prospects for sustained revenue growth due to potential reductions in state operating funding, tight state control of tuition pricing and pricing sensitivity limiting out-of-state enrollment revenue growth.”
LSU borrows money for building projects. Moody’s assigned an A1 rating to $131 million in Auxiliary Revenue and Refunding Bonds, Series 2015, for student housing facility improvements.