[Sign Up Now] to Receive Our FREE Daily SCVTV-SCVNews Digest by E-Mail

Inside
Weather
Santa Clarita CA
Clear
Clear
53°F
 
Calendar
Today in
S.C.V. History
September 22
1969 - College of the Canyons opens with first class of students in temporary quarters at Hart High School [story]


Fitch downgrades COC debt, lowers investment outlook to “negative”
| Wednesday, May 2, 2012

The state budget crisis is taking a hidden toll on College of the Canyons – hidden to most students, but not to investors who buy government bonds.

The financial ratings firm Fitch downgraded COC’s outstanding debt instruments by one notch Wednesday due to what the company called COC’s “inability to offset deep cuts in state funding for community colleges.”

Fitch issued a downgraded rating of “AA” on $141.7 million worth of general obligation bonds outstanding under COC’s voter-approved bond measure of 2006 – down from the previous rating of “AA+.”

The company also issued an initial rating of “AA” for $35 million in bonds due to be priced May 16. The bonds are to be issued under the same 2006 authorization.

In addition, Fitch downgraded $33.4 million in outstanding certificates of participation (COPs) to “AA-” from “AA.” The COPs were used to finance the construction of the new student services and administration building.

Lower ratings can lead to higher interest rates – i.e., the cost of paying off the debt – because they’re riskier investments.

Sharlene Coleal, COC’s vice president of business services, noted that “AA” is still a solid investment grade for bonds.

“We are pleased to once again earn an ‘AA’ bond rating from both Standard & Poor¹s and Fitch Rating,” Coleal said in a statement Wednesday. “In light of the economic conditions that continue to burden the state of California, and the fact (COC) has absorbed millions of dollars in cuts while still providing outstanding service to our students and the community, the ‘AA’ rating underscores the (college) district’s commitment to strong fiscal management while still providing high quality instructional programs.”

Coleal said COC “will have no problem” issuing the $35 million in bonds in the next few weeks.

“In fact, these tax exempt bonds will be very attractive to investors,” she said.

In its statement, Fitch said it was lowering COC’s previous “stable” outlook to “negative.”

Fitch explained: “The negative outlook reflects uncertainty associated with the district’s fiscal 2013 budget and management’s plans for restoring balance. Further state revenue cuts, in combination with ongoing cost pressures, will challenge the district’s ability to maintain adequate reserves in fiscal 2013.”

It said: “State revenues, which provide nearly two-thirds of the district’s general fund support, declined sharply in fiscal 2012. The potential for greater cuts exists if state voters turn down a proposed tax increase in November 2012.”

Fitch is looking at forecasts of a $6.3 million operating deficit in fiscal 2012-2013, which would draw down reserves to $7.1 million, or 8 percent of general fund spending.

The draw-down would be necessary, Fitch said, to offset an anticipated loss of $9.7 million from the state’s general fund, equivalent to 11 percent of the college’s total state general fund revenue.

If California voters reject Gov. Jerry Brown’s tax measure planned for the November ballot, COC stands a further loss of $3.5 million in 2013, Fitch said.

On the bright side, Fitch noted that household incomes in the area are higher and unemployment is lower relative to the county, state and nation. It said COC benefits from its access to and participation in the greater Los Angeles economy “and appears to be on the path to recovery.”

But it warned that if the college can’t “implement significant recurring solutions to the district’s budget gap in fiscal 2013,” further negative rating action would likely result.

Comment On This Story
COMMENT POLICY: We welcome comments from individuals and businesses. All comments are moderated. Comments are subject to rejection if they are vulgar, combative, or in poor taste.
REAL NAMES ONLY: All posters must use their real individual or business name. This applies equally to Twitter account holders who use a nickname.

No Comments

    Leave a Comment


    HIGHER EDUCATION LINKS
    LOCAL COLLEGE HEADLINES
    Friday, Sep 22, 2017
    College of the Canyons launched its First-Year Promise program this fall, and to ensure the future of the FYP program, which offers full-time freshman students waived tuition and fees during their first year of study, the COC Foundation has committed to fundraising $500,000 over the next two years.
    Thursday, Sep 21, 2017
    Beginning October 1, all 23 California State University (CSU) campuses will accept applications for admission to the fall 2018 term.
    Thursday, Sep 21, 2017
    College of the Canyons launched its First-Year Promise (FYP) program this fall, and to ensure the future of the FYP program, which offers full-time freshman students waived tuition and fees during their first year of study, the COC Foundation has committed to fundraising $500,000 over the next two years
    Thursday, Sep 21, 2017
    California State University, Northridge’s Friends of the Oviatt Library welcomes members of the community to nominate their favorite stories about the San Fernando Valley for consideration of the San Fernando Valley Award for Non-Fiction.
    Wednesday, Sep 20, 2017
    Public notification that the Santa Clarita Community College District (College of the Canyons) Early Childhood Education Center on the Valencia campus is participating in the USDA Child and Adult Care Food Program.
    Keep Up With Our Facebook

    Latest Additions to SCVNews.com
    The governing boards of College of the Canyons and the William S. Hart Union School District are scheduled to discuss plans for a new Academy of the Canyons-style campus at the future Castaic High School when they sit down for their annual joint meeting Sept. 27.
    COC, Hart Planning ‘North Academy’ at Castaic High School
    The League of California Cities, with representatives from cities statewide including Santa Clarita, is calling for Gov. Jerry Brown to veto SB 649, which if enacted would allow the wireless industry to install new 5G equipment with little input from local jurisdictions.
    League of California Cities Urges Governor to Veto 5G Wireless Equipment Bill
    Tonight on SCV NewsBreak, an off-duty LAPD officer and Canyon Country resident, died Thursday evening after a collision in Porter Ranch. Plus, check out all the exciting events happening this weekend. Watch these stories and more on tonight's edition of SCV NewsBreak.
    SCV NewsBreak for Friday, September 22, 2017
    The new pedestrian bridge crossing McBean Parkway is expected to be open in time for weekend foot traffic.
    New Pedestrian Bridge on McBean Parkway Set to Reopen Saturday
    The Child and Family Center will begin providing outpatient substance use treatment services for adolescents and young adults with primary substance use disorders under the California Drug MediCal Program starting Tuesday, October 3.
    Oct. 3: Child and Family Center Begins Outpatient Substance Abuse Treatment
    College of the Canyons and the Santa Clarita Valley Senior Center will host a caregivers' workshop at the Senior Center in Newhall on Saturday, September 30 from 9 a.m. to 11:30 a.m.
    Sept. 30: COC, Senior Center Host Caregiver Workshop
    The Los Angeles County Board of Supervisors is strongly opposing the proposed Graham-Cassidy healthcare legislation, saying it would undermine the well-being of the county’s most vulnerable populations and burden taxpayers with heavier costs for years to come.
    Supes Say Graham-Cassidy Bill Threatens Health of Millions of LA County Residents
    The intersection of Soledad Canyon Road and Bouquet Canyon Road will be under construction from 7 p.m. to 5 a.m. on Friday night, September 29 and Saturday morning, September 30.
    Sept. 29-30: Soledad and Bouquet Canyon Repaving
    College of the Canyons launched its First-Year Promise program this fall, and to ensure the future of the FYP program, which offers full-time freshman students waived tuition and fees during their first year of study, the COC Foundation has committed to fundraising $500,000 over the next two years.
    COC Foundation Launches ‘First-Year Promise’ Fundraising Campaign
    Road rehab on major arterial roads and intersections in the city of Santa Clarita continues into October.
    Santa Clarita Road Rehab Drives into October
    More than 60 Air Force senior leaders convened on Friday to discuss the Air Force’s aircrew crisis, which has left the service more than 1,500 pilots short of its requirements.
    Short by 1,500 Pilots, Air Force Leaders Address Aircrew Crisis
    The Santa Clarita Valley has five major industry clusters and the SCV Economic Development Corporation targets its economic development efforts to support and expand them.
    Five Growing Industry Clusters in the Santa Clarita Valley
    In the aftermath of Hurricanes Irma and Maria, the Veterans Affairs Department VA announced Friday that it continues to provide vital health care and other support to displaced Veterans in Puerto Rico and the U.S. Virgin Islands.
    VA Aids Veterans in Puerto Rico, Virgin Islands After Hurricanes Irma and Maria
    Gatorade made misleading “anti-water statements” while pushing the benefits of its sports drinks in a video game marketed to teenagers, according to a settlement announced Thursday by California’s attorney general.
    California Fines Gatorade $300K for ‘Anti-Water’ Ad Campaign
    John Gasparyan, an off-duty Los Angeles Police Department officer and Canyon Country resident, died when his motorcycle crashed in Porter Ranch around 6:50 p.m. Thursday.
    LAPD Officer from Canyon Country Dead in Motorcycle Crash
    A former Los Angeles County probation officer was sentenced after pleading guilty to inappropriately touching two girls at a youth camp, the county District Attorney’s Office has announced.
    Ex-Probation Officer Gets 364 Days for Sexual Assault
    1969 - College of the Canyons opens with first class of students in temporary quarters at Hart High School [story]
    The most prestigious recognition for government assessment agencies has been awarded to the Office of the Assessor in Los Angeles County.
    County Awarded Prestigious Government Assessment Award
    The Dodgers, who have clinched a postseason berth for the fifth consecutive year, return home tomorrow to open their final homestand of the regular season against the San Francisco Giants (Sept. 22-24) and San Diego Padres (Sept. 25-27).
    Dodgers Back Home Friday; Last Homestand of 2017 Season
    Auditions for the the upcoming Canyon Theater Guild's production of A Christmas Story are just around the corner.
    Sept. 30-Oct. 1: Christmas Story Auditions at CTG
    Now that the formerly great state of California is a sanctuary, I’ve got to compare that action with the actions in the early 1860s of the Confederate States of America. They decided what laws they wanted to follow and what ones they didn’t.
    No Home for Me | Commentary by Darryl Manzer
    Santa Clarita Valley residents have known the family-owned Italian restaurant, Sisley Kitchen, since 1993 when their doors first opened at the top of Valencia Town Center Drive in Westfield Valencia.
    Renovations Complete at Sisley Kitchen
    The Women's Soccer team will be finishing up their non-conference matches this weekend.
    Sept. 22-24: CSUN Athletics Roundup
    David Wolfram will demonstrate pastel-over-watercolor painting at the Santa Clarita Artists Association (SCAA) meeting on Monday evening, Nov. 20 at 6:30 pm. This event is free, open to the public and meets at Barnes & Noble, 23630 Valencia Blvd.
    Nov. 20: Pastel-Over-Watercolor Demonstration at SCAA Meeting
    Beginning October 1, all 23 California State University (CSU) campuses will accept applications for admission to the fall 2018 term.
    Oct. 1: CSU Accepting Fall 2018 Applications
    College of the Canyons launched its First-Year Promise (FYP) program this fall, and to ensure the future of the FYP program, which offers full-time freshman students waived tuition and fees during their first year of study, the COC Foundation has committed to fundraising $500,000 over the next two years
    COC First-Year Promise Fundraising Campaign Underway
    The city of Santa Clarita is inviting our younger residents to take part in the 30th anniversary celebration.
    City Launches ’30 Things for 30 Years’ Contest; Students Invited to Take Part
    California State University, Northridge’s Friends of the Oviatt Library welcomes members of the community to nominate their favorite stories about the San Fernando Valley for consideration of the San Fernando Valley Award for Non-Fiction.
    CSUN Library Group Invites Community to Nominate Favorite San Fernando Valley Story
    The Los Angeles Dodgers today announced sellouts for all seven potential postseason home games in the Division Series and League Championship Series just hours after tickets went on sale to the public at 10:00 a.m. It’s believed to be the quickest that the club has sold out of postseason tickets in Dodger Stadium history.
    Dodgers NLDS, NLCS Tickets Already Sold Out
    Sales of existing single-family homes increased 7.4 percent throughout Santa Clarita during August while the median price of homes that changed owners rose 6.6 percent, the Southland Regional Association of REALTORS® reported today.
    Increase in SCV August Home Sales, Prices
    Mountainview Elementary School parents were greeted with a voicemail Thursday morning informing them of a break-in on campus believed to have occurred the night before.
    Vandals Trash Library, Computers, Classrooms at Mountainview
    Hans' family did not know too much about his childhood or the country he had grown up in. About all the family knew was that Hans and his wife were born in Germany but had lived in this small Minnesota town for the last 60 years or more.
    Lesson from History | Commentary by John Windsor
    A gang sweep targeting Newhall 13, a well known Santa Clarita criminal organization, netted three arrests Thursday.
    Three Arrests Made in Newhall 13 Gang Sweep
    The Los Angeles County Sheriff's Department is proud to announce the launch of our new LASD Facebook Español.
    LASD Facebook Español Now Online
    Autumn Gratitude, Santa Clarita Artists Association's new show will be open on Sept 28th and run to November 4th, with a free artists’ reception on Friday October 6th, 5 to 9 pm.
    SCAA’s Newest Show, “Autumn Gratitude,” Opens