State News
7:56 am
Tue June 25, 2013

Illinois' poor credit rating could impact universities

Recent downgrades to Illinois' credit rating could soon have an effect on universities all over the state.

SIU President Glenn Poshard says they've received notice that Moody's, Fitch, and Standard and Poor's will all be reassessing the credit worthiness of schools all over Illinois, with the potential to lower their ratings, too.

"We were hopeful of going out for about $25-$30 million this year in borrowing funds to repair laboratories because we don't get the maintenance money from the state any longer for our buildings. We've done very well in keeping our bond rating fairly high that would enable us to do that, even under these circumstances. Now we have to reassess that whole thing."

Illinois has the lowest bond rating in the nation, and the ratings agencies say ongoing pension uncertainty is leading the concern over the future.

Experts say the lower the credit scores go, the higher interest rates for borrowing will rise. That'll mean it costs more to make necessary upgrades and to borrow for future projects.