Standard & Poor's Ratings Services said it has lowered its long-term rating to A-minus from A on Pennsylvania State Public School Building Authority's college revenue bonds, issued for Harrisburg Area Community College.
At the same time, Standard & Poor's assigned its A-minus underlying rating to the authority's $8.2 million series 2013 college revenue bonds that it will issue for HACC.
"We lowered the rating to reflect our opinion of enrollment declines in recent years, and substantially weakened financial operations in fiscal 2012, that have contributed to an overall weakened financial profile for the college," said Standard & Poor's credit analyst Shivani Singh. "We based the A-minus rating on our assessment of the underlying credit quality of HACC and the Pennsylvania State Aid Intercept Program provides additional security," said Singh.
The future levels of operating support from the college's local sponsor remains uncertain at this time, and any large decreases in funding levels could result in high tuition increases for sponsored college students and negatively affect college enrollment.