Debt and Credit Ratings

Debt

During 2005-06 the University's long-term debt increased to $541.3 million.
Principal payments of $32.0 million were made during the year.
The University issued approximately $111.2 million in refunding bonds through the Dormitory Authority of the State of New York (DASNY) to refinance existing debt and achieve present value (PV) savings of $7.2 million.

Ratings were reviewed by Moody's and Standard & Poor's in conjunction with Series 2006 refunding bond issue (spring 2006).
Existing ratings were confirmed with a stable outlook: A1 Moody's, A+ Standard & Poor's.
Excerpts of most recent rating agency opinions:

Moody's Investors Service rating reflects:

The University's large diversified enrollment base, with highly reputable graduate programs and continued healthy growth in net tuition per student;
Strong performance by the health care system, although heavy reliance on health care operations remains a risk;
Healthy financial resources which have exhibited continuous growth over the last few years as fundraising and investment returns fuel growth; and
Long history of balanced operating performance stemming from strong performance of health system, growing research activities and a growing endowment.

Standard & Poor's rating reflects:

History of balanced financial operations, generating operating surpluses of $30 million or 2% of budget in 2004, $75 million or 4% in 2005, and the expectation that 2006 will also end with a surplus;
Successful fundraising efforts and continued growth in sponsored research;
Relatively stable demand trends, with good selectivity coupled with strong student quality and good student retention; and
Large endowment, exceeding $190,000 per student.