Mississippi Public Universities
IHL Press Release
RATINGS RAISED AND AFFIRMED ON IHL-BACKED BONDS
4/6/2009 - Jackson, Miss.

On March 24, 2009, Fitch Ratings assigned an 'AA-' rating, thus raising its rating, and Moody's Investors Service assigned an 'Aa3' rating, thus affirming its rating, on certain newly issued Mississippi State University Education Building Corporation bonds backed by the Board of Trustees of State Institutions of Higher Learning (IHL). Both rating entities cite the state's strong System model and the IHL Board's legal authority to tap all institutions to pay debt as reason for the ratings.

"Naturally, we are pleased, since strong bond ratings ultimately result in savings for students," said IHL Deputy Commissioner for Finance and Administration Dr. Linda McFall. She explained, "Bonds are issued by the individual building corporations of each of the state's public universities, but because the universities function as a single system, the IHL Board has the governing authority to spread the debt responsibility among the eight universities. This makes the bonds less risky, improves their rating, and lowers their interest rate. For example, when new residence halls are financed with IHL bonds, we save money on interest, which allows us to contain the cost of room fees for students."

Fitch Ratings announced that it is assigning an 'AA-' rating to fixed-rate revenue bonds (Series 2009A-1 and 2009A-2), issued by the Mississippi State University Educational Building Corporation on behalf of IHL. In its announcement, Fitch listed the strengths that factored into its decision to raise the bond rating. These strengths include primarily the IHL Board's ability to spread both revenues and debt risk among the institutions, as well as the important governing role played by the IHL Board of Trustees; the System's consistent enrollment growth; sound financial performance of the institutions; the unique role played by each of the public universities to further the state's education, research, and health care goals; and low debt levels.

Moody's Investors Service assigned an 'Aa3' rating to the same fixed-rate revenue bonds (Series 2009A-1 and 2009A-2), issued by the Mississippi State University Educational Building Corporation. Moody's also affirmed its Aa3 rating of other outstanding IHL bonds. Moody's also cited the IHL Board's governing authority; the System's ability to share the responsibility for debt; System growth enrollment; and positive operating performance of the institutions as strengths of the System.

The Mississippi Board of Trustees of State Institutions of Higher Learning governs the public universities in Mississippi, including Alcorn State University; Delta State University; Jackson State University; Mississippi State University including the Mississippi State University Division of Agriculture, Forestry and Veterinary Medicine; Mississippi University for Women; Mississippi Valley State University; the University of Mississippi including the University of Mississippi Medical Center; and the University of Southern Mississippi.

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