Seven Illinois Universities Receive Credit Downgrade by Moody’s

Seven Illinois Universities Receive Credit Downgrade by Moody’s Moody’s Investors Service took action on August 9 to downgrade debt ratings for seven of Illinois’ public universities, and warned that further downgrades are coming if the state doesn’t address its pension crisis. The downgrades affected the debt ratings for the University of Illinois, Eastern Illinois University, Governors State University, Illinois State University, Northeastern Illinois University, Southern Illinois University and Western Illinois University. While not included in the downgrade, the debt rating for Northern Illinois University was downgraded in March, at the same time that Moody’s decreased the credit rating for the State of Illinois. Many feel this downgrade is premature in light of the fact that the pension conference committee is making progress toward a pension reform solution. All indications suggest that committee members are close to consensus and that a solution will be sent to lawmakers before the end of the year. These credit downgrades will cause the universities to pay higher interest rates when money is borrowed for campus improvements. This will lead to higher tuition costs in a state that is already driving students to surrounding states where out-of-state tuition is lower than Illinois’ in-state tuition. I am a chief a co-sponsor of a package of bills aimed at making college more affordable for Illinois families, so Moody’s action undermines what my colleagues and I are trying to accomplish. One of these new bills would create a $1,000 tax credit to help families making less than $150,000 per year pay for college expenses at an Illinois accredited college or university.  Another bill would encourage families to save for college expenses by offering an up-front tax deduction when they invest up to $10,000 in a “529” college savings plan. I will continue to update you on legislative issues, and as always, if my staff or I can assist you in any way, please do not hesitate to call my Crystal Lake office at 815-459-6453. Sincerely, Michael W. Tryon State Representative District 66