The long-term rating on District of Columbia, D.C.'s bonds, issued for American University, reflects: * Profitable, yet, tuition-dependent operations; * Improvements in liquidity and endowment; and * An adequate demand profile. Also factored into the rating is leadership stability since 1994 and sound financial planning. A higher rating is precluded by limited admissions flexibility, high student fee dependence, and only adequate liquidity. The short-term rating on the bonds is based on a standby purchase agreement provided by Westdeutsche Landesbank Girozentrale (West LB). Although West LB's short-term rating is 'A-1+', the short-term rating on the bonds cannot be higher than the equivalent long-term rating assigned to the university. The standby purchase agreement covers purchase price for tendered bonds and expires on
