According to a Biz Magazine report, national investors retreated from a large portion of a $114 million bond deal for LSU amid concerns over budget instability and state support for the school. LSU issued $114 million in revenue and refunding bonds to generate money and to save taxpayer dollars. Proceeds from the bond sale would have funded a Family Housing Complex, residence halls and a Student Health Center, and also would have saved interest on existing debt. Last week, Moody’s lowered LSU’s credit outlook from positive to stable because of “limited prospects for sustained revenue growth.” Moody’s action puts LSU one step away from a negative outlook, which could result in a downgrade for the university’s credit rating. LSU has been planning for financial exigency, essentially academic bankruptcy, in the event of further deep cuts to higher education in this year’s budget.
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