Jefferson County Community College District, MO, ICR Outlook Revised To Stable From Negative

DALLAS (S&P Global Ratings) Jan. 31, 2019--S&P Global Ratings revised its 
outlook on Jefferson County Community College District (CCD), Mo. to stable 
from negative and affirmed its 'AA' issuer credit rating (ICR) on the 
district. At the same time, S&P Global Ratings revised its outlook to stable 
from negative and affirmed its 'AA-' rating on the district's series 2010 
recovery-zone economic-development lease certificates of participation (COPs) 
and series 2014 leasehold revenue refunding bonds, issued by Jefferson College 
Educational Facilities Authority. 

"The outlook revision reflects our opinion of the college's 
better-than-budgeted results in both fiscal years 2017 and 2018 coupled with 
expected positive operations in fiscal 2019, following management's cuts and 
its commitment to maintain positive operations," said S&P Global Ratings 
credit analyst Brian Marshall.

Payments for the series 2010 COPs and 2014 bonds are subject to annual 
appropriation, according to lease agreements and trust indentures securing the 
obligations. We rate the 2010 COPs and 2014 bonds one notch below the ICR due 
to associated risk.

The district, which services a population of slightly more than 220,000, 
operates a main campus in the city of Hillsboro, Mo., approximately 40 miles 
south of St. Louis, and a satellite campus in Arnold, 28 miles north of 
Hillsboro.

The stable outlook reflects our opinion that the college district will 
continue to generate positive operations and continue to use the budgeting 
tools at its disposal to post full accrual surpluses on a generally accepted 
accounting principles basis despite enrollment challenges.  

We could lower the rating should enrollment declines lead to a trend of 
material deficits in the near term, and if the district were to incur 
significant additional debt.

While unlikely during the outlook horizon, if the district were to materially 
increase and sustain reserves coupled with growing enrollment, we could 
consider positive rating action outside the outlook horizon.
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