Longwood got the equivalent of a credit report last fall, and the news was good.
Moody’s Investor Service gave the university a bond rating of A1, the fifth highest among the 10 investment grade tiers. Bond ratings measure an institution’s financial management and ability to pay back borrowed money on time and in full.
“We’re in good company,” said Ken Copeland, Longwood’s vice president for administration and finance.
“This rating—the highest in the A category— provides credibility from a third party that we’re in good financial health, and it gives us greater flexibility in how we borrow funds for projects such as housing, dining and the recreation center.”
Copeland praised the help he received in coordinating the campuswide effort that resulted in Longwood’s inaugural Moody’s bond rating. “Lots of people helped collect data. It was a humongous effort that couldn’t have been done without everyone pitching in,” he said.
Longwood’s bond rating is equal to or better than 120 of the 228 public institutions and university systems, and equal to or better than 213 of the 283 private colleges and universities, in the Moody’s report issued in August 2013.
The rating is even more impressive when viewed against the negative outlook for higher education in 2014 issued by Moody’s last November, a week after Longwood was notified officially of its bond rating.
Moody’s, one of the three major national bond credit rating agencies, currently rates 514 U.S. four-year public universities, university systems and not-for-profit private colleges and universities for their stand-alone credit quality. Major factors in the assessments are market position, operating performance, balance sheet and capital investment, governance and management, and legal security and debt structure. —Kent Booty