Moody's Investors Service downgraded Eastern Illinois University's (EIU) bond rating earlier this summer, according to a press release.
The school's University Facilities System Revenue Bonds rating went from B1 to B2, while its Certificates of Participation rating went from Caa1 to Caa2.
EIU's downgrade was fueled by the state's struggles with finalizing a budget for the first time since 2015, Moody's report said. Moody's gave a negative outlook for the school.
“The negative outlook reflects the potential for further credit deterioration given EIU's exposure to ongoing potential delays and reductions in state funding with limited alternative revenue growth potential," the press release said. "Absent state funding, further deterioration of already critically thin liquidity is highly likely. The negative outlook also reflects expectations for declining enrollment which would further depress the university's operations."
The service's bond ratings range from Aaa to C. Moody's started its rating service in 1909 in order to have a system to gauge “future relative creditworthiness of securities” for its investors.
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