COLUMBIA, Mo. (AP) - A credit report suggests the University of Missouri System is on track to maintain its good credit rating despite declines in overall state funding and enrollment at its Columbia campus.
Christian Basi, spokesman for the Columbia campus, said the research report issued Aug. 25 from Moody's Investors Service was a consistent follow-up from the four-campus system's summer credit rating. The system received an Aa1 rating in June, which is the second-highest rating an institution can receive, the Columbia Missourian reported.
"The purpose was to take a little bit of a deeper dive for investors on some of the key credit strengths that the University of Missouri maintains, despite some of the pressure we see overall," said Eva Bogaty, vice president and senior credit officer at Moody's.
The report said one of those strengths is the system's broad geographic and program diversity. Bogaty said the more than 20 percent freshmen class enrollment decline at the Columbia campus in fall 2016 resulted in only a 4 percent overall enrollment drop for the entire four-campus system.
Another aspect that helps maintain the strong credit rating is the University of Missouri Health Care's profitability, according to the report. It said the health system's annual growth in patient care revenue has made "significant contributions to the university system's overall bottom line."
The report also acknowledged System President Mun Choi's efforts to unite all of the campuses, solidify leadership and reduce expenses. Choi proposed a fiscal 2018 budget with more than $100 million in cost reductions, and has begun reducing expenses and reallocating resources toward the Columbia campus.
"While the team has initiated several strategies in the last few months, getting the system and campuses to work together on strategic initiatives, and rebuilding and maintaining morale while cutting expenses will be a challenge over the next year or two," the report stated.
Bogaty said if the system doesn't successfully implement those actions, then its strong credit profile will weaken.