Standard & Poor's Ratings Services said it lowered its rating to AA-minus from AA on Clemson University, S.C.'s existing revenue bonds.
It also assigned a AA-minus rating to the university's series 2015 revenue bonds. The outlook on all bonds is stable.
Securing the revenue bonds are a broad range of auxiliary fees and an academic fee imposed by the board of trustees. S&P considers this security to be an unlimited student fee
"The downgrade reflects the downward pressure that the series 2015 bonds and expected series 2016 bonds exert on Clemson's pro forma financial resource ratios," said Standard & Poor's credit analyst Charlene Butterfield. "The total additional debt plans nearly triple Clemson's current debt load and weaken financial resources to levels we believe are consistent with a lower rating. We believe that at the lower AA-minus rating, Clemson's balance sheet can more effectively absorb the significant additional debt and capital spending during the next few years."
Offsetting the light pro forma financial resource ratios are Clemson's strengthening enrollment profile and consistently solid income statement.
