Financial Services Financial Services: • Tax-exempt bonds • Taxable bonds • State-supported bond programs • Tax-exempt leasing program Post-closing/ Other Services: • Investment of bond funds • Monitoring for refunding opportunities • Arbitrage compliance • Swap monitoring • Escrow restructuring • Higher education finance conferences • Investor relations
Forward Calendar • The Richard Stockton College of NJ $40 million Com petitive • The William Paterson University of NJ $90 million • Monmouth University $20 million Lehm an Brothers • Saint Peter’s College $45 million Direct Placem ent
20 0 7 Transactions Public Institutions Project Amount Montclair State University Refunding $ 6,150,000 New Jersey City University Refunding $ 17,910,000 Rowan University Refunding $ 121,355,000 Kean University (three issues) 2 residence halls; parking deck; $ 274,951,666 refunding; lease purchase Thomas Edison State College Lease purchase $ 2,700,000 Private Institutions Project Amount Centenary College Refunding of a bank loan; $ 4,784,617 capital improvements Institute for Advanced Study Academic building addition; $ 20,000,000 network and utility upgrades; renovations to academic buildings Drew University Residence hall; renovations $ 29,135,000 to existing dorms; capital improvements; equipment Princeton University (two issues) Refunding; capital improvements $ 392,620,000 Rider University Residence hall; parking facility; $ 22,000,000 infrastructure improvements Georgian Court University Wellness center; refunding; office $ 28,030,000 (two issues) space Stevens Institute of Technology Refunding $ 71,060,000 Grand Total: $ 990,696,283
Princeton University Butler College Dormitory Lewis Library
Residence Halls and Dining New Kean University
NJEFA Issuance Overview By Number of Issues By Par Amount (in Million $) * Includes par amount issued to date in 2007 Source: NJEFA
NJEFA Bonds Issued by Decade vs. Last 7 ½ Years $6,533,517,030 7,000 6,000 5,000 In Million $ 4,000 3,000 $2,505,433,659 2,000 $884,117,000 1,000 $425,931,000 0 1970s* 1980s 1990s 2000s** * Includes par amount issued in 1969 ** Includes par amount issued to date in 2007 Source: NJEFA
Higher Education: Heavy Borrowing Continues $35 9% 8% $30 7% $25 6% $20 5% 4% $15 3% $10 2% $5 1% $0 0% 5 6 7 8 9 0 1 2 3 4 5 9 9 9 9 9 0 0 0 0 0 0 9 9 9 9 9 0 0 0 0 0 0 1 1 1 1 1 2 2 2 2 2 2 Higher Education $billion HE % Share of "Municipal" Market Sources: Moody’s Investors Service; Thomson Financial
NJ Enrollm ent: Degrees Conferred 20 0 0 -20 0 6 Total Total Degrees/ Enrollments Certificates 2000 335,930 52,579 2001 346,277 53,205 2002 361,757 55,866 2003 372,696 58,277 2004 379,447 61,428 2005 379,686 64,007 2006 385,612 65,105 49,682 12,526 Cumulative Increase (14.79%) (23.82%) Source: New Jersey Commission on Higher Education
Earnings Prem ium Relative to Price of Education Sources: The College Board; U.S. Census Bureau, 2006
Am erica Rules Source: The Economist – The Brains Business – A Survey of Higher Education, Sept. 10, 2005
Education, Earnings and Tax Paym ents Sources: The College Board; U.S. Census Bureau, 2006; Internal Revenue Service, 2006; McIntyre et al., 2003
Public Assistance Program s Sources: The College Board; U.S. Census Bureau, Current Population Survey, 2006 Annual Social and Economic Supplement
Sources: The College Board; Moretti, 2004 Econom ic Benefits to Others
Volunteerism Sources: The College Board; Bureau of Labor Statistics, 2007
Earnings Over Tim e by Education Level and Gender Sources: The College Board; National Center for Education Statistics (NCES), 2007, Indicator 20
College Enrollm ent by Gender Sources: The College Board; Snyder et al., 2006; U.S. Census Bureau, 2005
Measuring Up 20 0 6 Adults holding a college degree Ages 35-64 Ages 25-34 Sources: “Measuring Up – 2006” – The National Center for Public Policy and Higher Education; Organisation of Economic Co-operation and Development (OECD). Data represent the percentage of adults with an Associate’s degree or higher in 2003
Measuring Up 20 0 6 College Participation College Completion Ages 18-24 Sources: “Measuring Up – 2006” – The National Center for Public Policy and Higher Education; Organisation of Economic Co-operation and Development (OECD). Data are for 2003.
Differences in College Attainm ent Sources: Jobs for the Future, Organisation of Economic Co-operation and Development (OECD), Education at a Glance 2006; Data were analyzed by the National Center for Higher Education Management Systems and the Delta Project on Postsecondary Costs for Making Opportunity Affordable, an initiative supported by Lumina Foundation for Education
Changing Workforce Needs Sources: Jobs for the Future; U.S. Bureau of Labor Statistics; Data were analyzed by the National Center for Higher Education Management Systems and the Delta Project on Postsecondary Costs for Making Opportunity Affordable, an initiative supported by Lumina Foundation for Education
The Degree Gap New Jersey Sources: Jobs for the Future; U.S. Census Bureau: 2005 American Community Survey; Data were analyzed by the National Center for Higher Education Management Systems and the Delta Project on Postsecondary Costs for Making Opportunity Affordable, an initiative supported by Lumina Foundation for Education
College Enrollm ent by Race/ Ethnicity Sources: The College Board; Snyder et al., 2006; U.S. Census Bureau, 2005
The Degree Gap Sources: Jobs for the Future; U.S. Census Bureau 2005 ACS, Population Projections, NCES, IPEDS Completions Survey; Data were analyzed by the National Center for Higher Education Management Systems and the Delta Project on Postsecondary Costs for Making Opportunity Affordable, an initiative supported by Lumina Foundation for Education
The Price of College is Going Up Sources: Jobs for the Future; U.S. Bureau of Labor Statistics; The College Board; Data were analyzed by the National Center for Higher Education Management Systems and the Delta Project on Postsecondary Costs for Making Opportunity Affordable, an initiative supported by Lumina Foundation for Education
Tuition Increases Com pared to Changes in State Appropriations 15% 10% 5% 0% 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 -5% % Change State Approps % Change Tuition and Fees * Moody’s rated public institutions Sources: Moody’s Investors Service; Center for the Study of Education Policy, Illinois State University; The College Board
New Jersey Higher Education Spending • FY 2007 - $1.97 billion - operating expenses • FY 2006 - $401 million - student aid • FY 2005 - $867 million - research and development Source: Chronicle of Higher Education
State Support is Declining Adjusted for CPI $211,394,0 0 0 $210 ,562,0 0 0 Source: New Jersey Association of State Colleges and Universities; Governor’s Budget Recommendations; US Department of Labor’s CPI Detailed Report
Private Institutions 2006 2005 2004 NJ All NJ All NJ All Privates Privates Privates Privates Privates Privates Median FTE Enrollment 4,164 2,801 3,892 2,792 3,772 2,788 (number may be estimated) Primary Selectivity (%) 70 57 76 61 67 63 Expendable Resources to 1.56 1.66 1.43 1.51 1.35 1.47 Direct Debt Expendable Resources to .89 1.17 .87 1.09 .71 1.01 Operations Annual Operating 3.4 3.1 3.8 2.9 3.4 3 Margin (%) Source: Moody’s Investors Service
Public Institutions 2006 2005 2004 NJ All NJ All NJ All Publics Publics Publics Publics Publics Publics Median FTE Enrollment 6,896 14,857 6,745 13,570 6,558 13,756 (number may be estimated) Primary Selectivity (%) 53.2 72.6 50 75.2 50.8 74.5 Expendable Resources to .4 .9 .3 .9 .4 1 Direct Debt Expendable Resources to .37 .41 .41 .4 .41 .4 Operations Annual Operating 3.4 1.9 6.5 2.2 6.5 2 Margin (%) Source: Moody’s Investors Service
Moody’s 20 0 7 Industry Outlook - Stable Strengths – Publics • Strong student demand • Revenue growth (tuition) • Growing financial resources • Operating performance remains mildly positive
* Moody’s rated public institutions Source: Moody’s Investors Service
Moody’s 20 0 7 Industry Outlook - Stable Strengths – Privates • Modest enrollment growth • Strong growth in tuition revenue • Growing financial resources • Positive investment performance and fund raising
Positive Investm ent Perform ance In Recent Years Restored Balance Sheets; Largest Outperform the Pack 25% 20% 20% 18% 17% 16% 16% 15% 15% 13% 11% 11% 9% 10% 5% 3% 0% -5% - 4% - 6% -10% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 EST Average Annual I nvestment Return Source: NACUBO Endow ment Study * 2007 Estimate by Moodys Source: Moody’s Investors Service
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