September 8, 2010
Regent University: We’re Not Struggling to Stay Afloat
Regent University has taken issue with the following Gleanings item published in CT’s September issue:
Regent U. struggles to stay afloat
Despite a $95 million booster shot from the Christian Broadcasting Network, Pat Robertson's Regent University is struggling for financial stability. Moody's Investors Service predicts that the Virginia Beach school will "continue to experience deficit operating performance" that will "deplete or, at least hamper, financial resource growth" for the foreseeable future. New Regent president Carlos Campo is more optimistic but admitted to the Chronicle of Higher Education that "some fiscal challenges remain."
The item summarized a June article from the Chronicle of Higher Education, "Regent U. Gets a Bailout From Founder's TV Network, but Moody's Outlook Remains Negative," which in turn summarized the most recent Moody’s Investors Service assessment of Regent’s financial health, Rating Update: Moody’s Affirms Baa2 Rating on Regent University’s Series 2006 Revenue Bonds; Outlook Remains Negative.
Regent president Carlos Campo submitted this response to CT readers:
“We are grateful to have the opportunity to contextualize the recent Chronicle of Higher Education article on Moody's Investors Service credit rating update for Regent University, which Christianity Today republished this week. The article did not fairly represent the university’s financial state, nor a recent shift in endowment fund classification. In fact, Moody’s report clearly reflects the fact that the university has taken appropriate, positive steps to create a sustainable budget model for Regent University’s future. While we, like all universities, have felt the negative effects of the recent economic downturn, the fiscal outlook for Regent University is quite strong overall.”
Campo’s complete response, in which he highlights the financial strengths of Regent, can be found below.
Rusty Leonard, chairman and CEO of Stewardship Partners, offered his take to CT:
“I would agree that the $95 million gift [reclassification from restricted to unrestricted] from CBN means that Regent is no longer struggling to stay afloat. Bankruptcy is not an issue at the moment. It still has operating deficits to contend with, but much progress has already been made here and the [reclassification] greatly aided the balance sheet and gives the university considerable time to take the further corrective actions necessary to bring their finances in better balance. I think it is fair to assume they will find a way to make the needed changes and will be around for many years to come.”
Readers interested in assessing how accurately the Chronicle and CT items summarized the Moody’s report can look at the report themselves.
Campo’s letter in full is after the jump:
Dear CT Readers,
We are grateful to have the opportunity to contextualize the recent Chronicle of Higher Education article on Moody's Investors Service credit rating update for Regent University, which Christianity Today republished this week. The article did not fairly represent the university’s financial state, nor a recent shift in endowment fund classification. In fact, Moody’s report clearly reflects the fact that the university has taken appropriate, positive steps to create a sustainable budget model for Regent University’s future. While we, like all universities, have felt the negative effects of the recent economic downturn, the fiscal outlook for Regent University is quite strong overall.
In particular, we would like to clarify that:
Our ability to deliver outstanding academic programs has not been diminished, and not a single academic program has been eliminated due to budget issues at Regent University.
Moody's Investors Service credit rating was unchanged from their last report; Regent University’s credit rating was not downgraded in any way.
Regent University, after a comprehensive financial and academic review, was awarded reaffirmation of accreditation by the Southern Association of Colleges and Schools (SACS) in 2009.
The article failed to mention the following “strengths” (among others) Moody’s report cited for Regent University:
1) "Increases in undergraduate enrollment...are still strong. The University had 3,923 full-time equivalent students in fall 2009, up 7.4 percent from the previous year. Net tuition revenue grew almost 10 percent in fiscal year 2010, aided by growth in undergraduate revenue."
2) "Considerable financial resource base relative to similarly rated peers, with total financial resources of $163 million at the end of FY 2009, or $41,663 per student."
The university would like to affirm that we have not received any kind of a “bailout” from the Christian Broadcasting Network, in fact, the word “bailout” never appears in the original report. Like other Christian colleges and universities, Regent believes that we are truly partnering with God—and many devoted friends, advocates, alums, donors and others—to advance His kingdom through our important educational calling. We take financial stewardship very seriously, and assure CT readers (some of our dearest friends and supporters) that, with God’s grace and favor, we will continue to deliver an outstanding, Christ-centered educational experience for students who are called to excellence and Christian leadership.
Dr. Carlos Campo