Weekly Market Update

STATE SPENDING ON HIGHER EDUCATION INCREASED MARGINALLY IN 2018

Thursday, January 25, 2018

According to an annual survey, 2018 state spending on higher education increased only slightly from 2017, despite a strong year for the national economy. Appropriations grew by 1.6% in 2018 compared to 4.2% last year, and 2018's increase was highly concentrated: California, Georgia, and Florida accounted for 57% of the overall increase in spending. Nineteen states cut higher education spending; North Dakota, representing the most severe reduction, cut spending by 14.6%. Many states face funding challenges as revenues struggle to keep pace with increasing costs. Popular political decisions to offer free tuition have further stressed state budgets, and legislators are wary about raising taxes to pay for these programs. The modest increase in 2018 follows a 5-year period where higher education spending increased by 21% nationwide.

In Other News

Rating Agency Update

  • Moody's assigned A1 to Troy University's Series 2018-A Facilities Revenue Bonds. The outlook is stable.
  • Moody's assigned Aa3 to University of Central Florida's Dormitory Revenue Refunding Bonds, Series 2018A . The outlook is stable.
  • S&P affirmed Loyola University's A rating. The outlook is stable.
  • S&P affirmed North Carolina State University's AA rating. The outlook is stable.
  • S&P affirmed Westminster College's BBB rating. The outlook is stable.
  • S&P assigned AA+ to University System of Maryland's Series 2018A Revenue Bonds. The outlook is stable.
  • S&P affirmed the University of Florida's AA- rating. The outlook is stable.
  • S&P affirmed the University of Indianapolis' BBB+ rating. The outlook is stable.
  • S&P downgraded McDaniel College's rating from BBB+ to BBB. The outlook is stable.