TTU System Receives Aa1 and AA+/Stable Outlook Ratings in Advance of Bond Issuance
July 17, 2023 | Contact: Scott Lacefield
The Texas Tech University System (TTU System) plans to issue taxable and tax-exempt revenue finance system (RFS) bonds on Thursday (July 20). The RFS bond will utilize the system’s state capital construction assistance projects authorization and will fund approximately $270 million in capital projects throughout the system.
“The issuance of the latest bonds series allows our financial teams to more efficiently manage our debt for the Texas Tech University System and our component institutions,” said Tedd L. Mitchell, M.D., chancellor of the TTU System. “A conventional and conservative fiscal approach continues to draw elite ratings from some of the most influential credit rating organizations in the world, which results in generating significant interest from investors and lower interest rates.”
The TTU System received an Aa1 rating from Moody’s Investor Service, an AA+ rating from Fitch Ratings and an AA+ rating by Kroll Bond Rating Agency. Each of the credit rating organizations assigned a “stable outlook,” making the bonds an attractive option for investors.
This marks the ninth straight year Fitch Ratings has issued the TTU System an AA+ rating and the eighth consecutive year Moody’s has reaffirmed an AA+ rating for the TTU System. The ratings solidify the TTU System’s place among the nation’s elite institutions for financial strength and practices as one of only 26 public higher education institutions in the U.S. to receive a rating of AA+/Aa1 or better.
The ratings reflect the TTU System’s continued excellence in numerous areas, including long-term and strategic enrollment growth, philanthropic support, substantial endowment and investment balances, increased state funding, a diverse scope of operations and debt services – which includes three general academic institutions and two health-related institutions – along with steady capital support from the State of Texas.
The “stable outlook” is significant considering higher education across the U.S. has recently struggled to maintain consistent and upward trends in enrollment projections.
The TTU System enrolls approximately 63,000 students across its five component universities, including Texas Tech University, Texas Tech University Health Sciences Center, Angelo State University, Texas Tech University Health Sciences Center El Paso and Midwestern State University.
“Our team was extremely pleased to receive a quality rating from all three world-class credit rating organizations,” said James Mauldin, vice chancellor and chief financial officer of the TTU System. “I want to thank our team of financial experts at the TTU System along with our university CFOs for their incredible work to position us extremely well for continued financial success across the Texas Tech University System.”
Earlier this spring, the TTU System had its long-term credit rating of AA+/stable outlook reaffirmed by S&P Global Ratings.
About the Texas Tech University System
Established in 1996, the Texas Tech University System is one of the top public university systems in the nation, consisting of five universities – Texas Tech University, Texas Tech University Health Sciences Center, Angelo State University, Texas Tech University Health Sciences Center El Paso and Midwestern State University.
Headquartered in Lubbock, Texas, the TTU System is a $2.65 billion enterprise focused on advancing higher education, health care, research and outreach with approximately 21,000 employees and 63,000 students, more than 375,000 alumni, a statewide economic impact of $16.4 billion and an endowment valued at $1.7 billion. In its short history, the TTU System has grown tremendously and is nationally acclaimed, operating at 26 academic locations in 22 cities (20 in Texas, 2 international).
In addition, the TTU System is one of only nine in the nation to offer programs for undergraduate, medical, law, nursing, pharmacy, dental and veterinary education, among other academic areas.