Standard&Poor's Ratings Services lowered its rating and underlying rating (SPUR) to 'AA' from 'AA+' on California Educational Facilities Authority's and California Infrastructure and Economic Development Bank's debt outstanding issued for University of Southern California (USC). Standard&Poor's also assigned its 'AA' rating to USC's taxable bonds, series 2011. The outlook is stable. The lowered ratings are based largely on our view of the rapid acceleration of debt on the heels of two hospital acquisitions, the operations of which are not profitable, nor are expected to be for several years. With this issuance, the university will have more than doubled its debt in the last three years (fiscals 2008 through 2010) but in our view, has not grown
