Weekly Market Update
Thursday, December 28, 2017
The National Student Clearinghouse Research Center found that college enrollments decreased for the sixth straight year, with undergraduate enrollment declining by 1.4%. First-time college student enrollment decreased, mainly due to fewer older students, and for-profit colleges saw a decline of 7.1%, the steepest drop of any sector. Bucking the trend, enrollment in graduate and professional programs increased.
A survey by the National Association of College and University Business Officers (NACUBO) attributes the enrollment trend to price sensitivity and competition. Institutions are pursuing a range of strategies in response: Purdue University has frozen tuition through 2019 and developed accelerated programs to help students graduate sooner, while the University of Wyoming is considering lowering tuition for non-residents to attract more out-of-state students.
In Other News
- The recent tax reform bill eliminated charitable tax deductions for college sports season tickets. As a result, schools are encouraging donors to prepurchase tickets for future years before the bill takes effect.
- Goldman Sachs predicts a tighter monetary policy and higher interest rates in coming years, based on a low and decreasing unemployment rate.
- Due to a large state budget gap, Kentucky's universities may face further budget cuts. The state has decreased per-student funding by 26.4% since 2008, and some expressed concern that further cuts may cause institutions to increase tuition and reduce staffing.
- Many selective institutions have joined the American Talent Initiative, an organization that seeks to recruit high-achieving students from low income families. Members of the organization have increased the enrollment of Pell Grant eligible students.
- Growing by more than $400 million over the past six years, the University of Missouri's endowment reached $1 billion for the first time.
Rating Agency Update
- Moody's downgraded Saint Mary's College of California's rating to Baa2 from Baa1. The outlook is stable.
- S&P raised University of California Board of Regents' Series 2010A and Series 2010B Bonds' rating to AA from AA-. The outlook is stable.
- S&P raised Ferris State University Board of Trustees, Michigan's rating to A+ from A. The outlook is stable.
- S&P assigned A- to Illinois State University's Series 2018A and Series 2018B Auxiliary Facilities System Revenue Bonds. The outlook is stable.