NEW YORK - Moody's Investors Service has affirmed the Baa3 rating on the College for Creative Studies, Mich.’s limited obligation revenue and revenue refunding bonds, Series 2008 which were issued through the Michigan Higher Education Facilities Authority. The rating outlook has been revised to positive from negative.

The college's Baa3 rating reflects its small size, high bank loan exposure, and well developed market niche in the highly competitive art and design school segment of higher education.

Aided by a close connection to the resurgent automobile industry, the college maintains strong demand statistics and healthy philanthropic support. CCS also has a relatively good balance sheet and liquidity position compared to debt and operations.

The rating incorporates the college's debt structure which consists of bank loans with balloon payments due in one to four years; small size, which makes it vulnerable to modest fluctuations in enrollment or expenses; and exposure to adverse economic conditions in the state of Michigan.

The rating outlook was revised to positive from negative reflecting the college's material reduction in bank debt, completion of the college's major capital project, and indications of strengthened student demand for fall 2012.

The positive outlook indicates upward rating pressure as significant portions of bank debt are expected to be paid down during the outlook time period.

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