Update on Bond Ratings
January 8, 2020
Dear Members of the Kent State University Community,
In October, I provided a broad financial update to the Kent State community along with a commitment to enhanced transparency. It is in that spirit that I write you today to share further news about Kent State's financial health.
Following detailed presentations on the university's finances to Moody's and Standard & Poor's, our bond ratings agencies have both affirmed our positive "credit" rating along with a stable outlook for the future. This is excellent news and an external validation of the university's response to the challenges facing higher education in Ohio.
Moody's and Standard & Poor's cited several reasons for a positive outlook for Kent State's future:
- Improving retention and graduation rates systemwide.
- Strong annual fundraising of nearly $40 million and $45 million in the last two fiscal years.
- Solid governance from the Board of Trustees and the successful hire of a new president with significant experience with the university.
While this is encouraging news, both agencies also pointed out several risks and challenges that require our continued vigilance and dedication to sound fiscal management, including:
- A highly competitive Ohio higher education landscape, challenging state demographics and state-imposed tuition guarantees that will continue pressuring enrollment and revenue growth.
- Weak revenue diversity, evidenced by an elevated 63% reliance on student charges.
- Declines in international enrollment.
I have said before that Kent State's financial health and sustainability are a shared responsibility – we are stronger when all of us are involved and engaged. Your support of the hiring freeze and other proactive measures helps ensure a bright future for our university.
We will continue to employ deliberate and decisive strategies to meet "the new normal" in terms of student enrollment. We recognize that this work is not easy. I am grateful for your active participation and continued support in creating a positive and stable future for Kent State.
I wish you and your loved ones a happy and healthy New Year!