State Senator Angela McKnight (D-31) is commending New Jersey City University for receiving a Moody’s credit rating that saw their score go from “negative” to “stable.”
By John Heinis/Hudson County View
“It is a major victory for my district to see NJCU achieve financial stability. As one of the top universities for social mobility in the country, institutions like NJCU are essential to providing opportunity and growth for students in our diverse community and beyond,” she said in a statement.
“I congratulate NJCU’s leadership on this accomplishment and look forward to seeing their continued positive impact on Jersey City.”
The Moody’s report says the institution had $244 million in outstanding debt at the end of their prior fiscal year on June 30th, 2023, and while they have turned a corner, further challenges remain in the foreseeable future.
“Revision of the outlook to stable from negative reflects meaningful traction on financial turnaround plans which have allowed NJCU to significantly reduce operating losses and stabilize cash reserves,” they wrote.
“Despite this momentum, challenges remain around stagnant net tuition revenue, high leverage, and thin reserves. Improvements in financial strategy and risk management, and management credibility, which are governance considerations under Moody’s ESG methodology, are key drivers of the rating action.”
Moody’s continues that NJCU’s credit rating could continue to go up with material and sustained improvement in operating performance, significant increase in liquidity to over 60 days cash on hand, and improved brand and strategic positioning reflected in stronger enrollment patterns and revenue growth, among other things.
Conversely, a downgrade could occur if continually implementing financial structuring leads to a decreased performance, as well is if available reserves continue to decline, and/or a breach of financial covenants.
On Thursday, Assemblywoman Jessica Ramirez (D-32) and Hudson County Commissioner Bill O’Dea (D-2), a declared candidate for Jersey City mayor, also applauded the upgrade.
“This upgrade is a testament to their hard work and dedication to ensuring that NJCU remains a premier institution of higher education in New Jersey,” Ramirez stated.
“Your vision, dedication, and strategic planning have led to a stronger financial foundation for the institution. Thank you for your exceptional leadership and commitment to ensuring the long-term success of NJCU,” noted O’Dea.
Editor’s note: This story was updated with comments from Assemblywoman Jessica Ramirez and Hudson County Commissioner Bill O’Dea.
