The Mount Fights and Thrives, Amid Better Retention than Last Year

On Feb. 8, Moody’s Investor Service released their credit opinion from this past fiscal year. Moody took the Mount from “stable” to “negative” as a result of financial challenges stemming from leadership in the 2016-2017 fiscal year.

Moody’s makes credit opinion reports based on the previous fiscal year. This is not a long-term statement. According to Moody’s, “The purpose of Moody’s ratings is to provide investors with a simple system of gradation by which future relative creditworthiness of securities may be gauged.”

The Washington Post published an article on Feb. 9, written by Jeffrey J. Selingo, a regular contributor of the Post’s Grade Point higher education news blog, reflecting on small colleges in the U.S. struggling in finances. Selingo chose to use the Mount as an example in his article.

Having asked why he chose the Mount, Selingo stated that “Moody’s had just issued the report warning about [the Mount’s] debt.” But the Mount is not the only nationally-known small college with a downgrade from Moody’s. Moody’s largely focused on the positive aspects about the Mount in their credit opinion.

In the report, there were very few aspects that brought the Mount’s from stable to negative. These negative implications were increased debt, as a result of last year’s low student retention rate, and the effects of retention this fiscal year. Because it is a non-profit and private university, the Mount obtains money primarily through tuition and donations.

Vice President for Business and Finance William Davies explains that, “We are down this year in freshmen, but did not raise our costs [tuition] because it’s the right thing to do. We knew that going in and we accept that.”

“We have much to brag about – Moody told us we haven’t advertised our academics enough. We should be marketing them more. We give other small schools hope,” stated Interim Provost Dr. Jennie Hunter-Cevera.

Some of the positive aspects of the Mount that Moody’s report focused on included stabilizing leadership, strategic planning, the university’s Catholic identity and increased fundraising.

“For next year, indicators are good for traditional enrollment,” Interim President Timothy Trainor revealed. “Retention is the best in 10 years, visits by families are up 25 percent and deposits are up 20 percent compared to last year.”

“We’re down in enrollment,” Hunter-Cevera acknowledged, “but this is one of the best freshman classes. They are good in academics, class-wise and active.”

Spending is down currently compared to the beginning of the fiscal year and all signs are pointing to a good end of the fiscal year and a good beginning for the next fiscal year.

Vice President of Marketing and Communications Jack Chielli noted that, “if we have a strong year and land a new, strong freshman class, we could ask [Moody’s] to re-do our bond rating. [The Washington Post article] had minimal impact and enrollment is looking good.”

Hunter-Cevera added, “Moody’s report makes us look at our spending, but not cut the quality.  We’re a triple A school – academics, athletics and activities.”

“I understand why Moody’s downgraded,” she continued, “and I agree with their view on the long-term future of the Mount. We are working to resolve debt.”

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