November 17, 2023

FOR IMMEDIATE RELEASE
November 17, 2023

Moody’s Upgrades 鶹ý’s Credit Ratings, Moves Outlook to ‘Stable’

(FAIRBANKS, AK) - Citing fiscal certainty and growing revenue, Moody’s Investor Service (Moody’s) today , and moved the rating outlook up to “stable.” The changes reflect Moody’s growing confidence in 鶹ý’s financial stability, capacity, and overall creditworthiness.

“These positive rating actions are just one more signal that increased state funding has helped 鶹ý achieve financial stability,” said 鶹ý Chief Financial Officer Luke Fulp. “When combined with our efforts to grow student enrollment and support a research enterprise that is aligned with state priorities and economic interests, 鶹ý is well-positioned to continue empowering Alaska.”

The announcement comes as 鶹ý’s fall enrollment remains on track to grow by 4% over last year, with total headcount projected to reach 21,000 students. Last week, 鶹ý’s Board of Regents approved FY25 operating and capital budget requests prioritizing deferred maintenance, continued operating efficiency, and strategic programs that grow enrollment and empower Alaska - all ongoing efforts contributing to Moody’s growing confidence.

Moody’s specific actions were:

  • upgrading 鶹ý’s issuer rating one notch to A3 from Baa1, based on the materially improved state funding environment; improved operating efficiencies; growing enrollment and tuition; expanding research activity; and 鶹ý’s vital role as the sole provider of public, post-secondary education in Alaska;
  • upgrading 鶹ý’s general revenue bond rating one notch to A3 from Baa1, based on the improved issuer rating and the University’s continued ability to pay for debt service;
  • upgrading 鶹ý’s lease revenue bond rating one notch to Baa1 from Baa2, based on the improved issuer and general revenue bond ratings, and 鶹ý’s minimal leasing obligations; and
  • moving 鶹ý’s rating outlook to “stable,” based on expectations that state financial support for operations and capital expenditures will remain strong. 

Moody’s identified factors that could lead to future ratings upgrades, including:

  • Continued improvement in operating performance with stronger revenues, and 
  • Increased liquidity to cover operating expenses.

Analysts also noted that future reductions in state funding, downturns in the state’s credit rating, or increased operating deficits could result in future rating downgrades.

Moody’s is a leading credit ratings, research, and risk analysis provider. The firm provides independent, third-party analysis to sovereign nations, public and corporate debt issuers, and universities around the country. Investors use credit ratings to measure creditworthiness and risk, and generally measure financial strength and capacity.

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For more information, contact Jonathon Taylor, director of public affairs, at 907-350-0168 (cell) or jonathon.taylor@alaska.edu.