Standard & Poor's last week knocked the University of Northern Iowa's outstanding dormitory revenue bonds to BBB-plus from A-minus and, by attaching a negative outlook to the credit, warned that another downgrade could be in works.
In addition, analysts gave an A rating to the university's upcoming sale of $10 million of field-house revenue bonds and $3.9 million of student health system bonds. Standard & Poor's revised its rating outlook for the next two-year period to negative from stable on this unlimited student fee-supported debt.
"The outlook revision is due to multiple years of declines in enrollment and freshman applicants, limited capacity to absorb large continuing tuition increases, and accumulated financial pressure from a combination of state appropriation cuts, lower enrollment, and mandated salary and benefit costs," analyst Susan Carlson said in the agency's report.
