PASADENA, Texas – San Jacinto College recently received high bond ratings from two nationally recognized credit rating agencies, rating the Series 2008 Limited Tax Refunding Bonds as “High Grade/High Quality.” Standard & Poor’s rated the bonds “AA,” and Moody Investor Services rated the bonds “Aa3.”

A bond rating is evidence of credit risk – the higher the rating the lower the risk. Among the many factors that determine market price for municipal bonds, the bond rating is often the single most important factor that determines interest rates, and therefore cost to the issuer.

Strength of the underlying economy, debt structure, financial condition, demographic factors and management practices of the College were taken into consideration by the ratings agencies. The ratings reflect the District’s sound financial position, supported by diverse and stable revenue streams, along with a history of strong reserves.  The ratings also reflect the College’s participation in the deep and diverse Houston metropolitan statistical area.

“A credit rating for a college is very much like an individual’s credit score,” said David Tiffin, Vice President of Fixed Income Banking and U.S. Debt Markets at RBC Capital Markets, a financial consultant to the District. “The higher the rating, the lower the interest rate charged on borrowed money. While there are two ratings notches above the District’s AA, only those college districts solely serving a metropolitan area earned those ratings. This is a testament to the fiscal management of San Jacinto College’s Board, Chancellor and senior management team.”

In response to changes in the financial markets, San Jacinto College has completed refinancing $12.7 million of its Series 2000 Variable Rate General Obligation Bonds by issuing fixed-rate bonds. Kenneth Lynn, Vice Chancellor of Fiscal Affairs, said, “The bond refinancing was in response to recent uncertainty in the financial markets surrounding municipal bond insurers. Because of general market concerns, variable interest rates on municipal bonds have increased dramatically in the last few weeks. The refunding was a successful strategy to limit short term rate increases and lock in lower fixed rates for the long-term. The refinancing resulted in savings to our taxpayers of approximately $2.5 million over the life of the bonds. In this era of ever-rising prices it’s refreshing to be able to reduce costs for our taxpayers.”

For more information about San Jacinto College, please visit www.sanjac.edu.