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Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Monday, April 15, 2013

S&P Downgrades Albany Law School's Bonds

AlbanyAlbany Times-Union:  Standard & Poor's Downgrades Albany Law School:

Albany Law School's ... enrollment has dropped 14 percent in just two years. The school now enrolls 617 students, down from 720 in the 2010-2011 academic year. That loss has caught the attention of the Standard & Poor's bond rating agency, which downgraded the school's outlook from positive to stable. Standard & Poor's said the situation at Albany Law reflected a national trend of law schools losing students and tuition income.

Weakening demand for Albany Law has decreased net tuition revenue and put significant pressure on the school's operating performance, the report found.

The report suggested that Albany Law is more vulnerable to the national trend of enrollment decline because it is not connected to a larger university. Law schools that are part of a larger university or university system were better able to absorb losses of the last few years. Schools tied to a university also can better attract students amid the shrinking market in the future because they are more able to offer bigger financial aid packages.

Law school enrollment and applications are expected to drop for several more years, so the trend at Albany Law probably not at the bottom yet, the report found.

Matt Leichter, Albany Law School’s Bond Rating Downgraded:

Albany Law School Grant Distribution (FT Only)

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"Schools tied to a university also can better attract students amid the shrinking market in the future because they are more able to offer bigger financial aid packages."

That seems like nonsense. Schools tied to a University tend to pay a tithe to the central university to help support other programs, while a freestanding school can keep all the tuition money itself. Generally, law schools are not subsidized by the central university.

Posted by: JDY | Apr 15, 2013 10:38:09 AM

Didn't know any law school had public bonds. Must do a general search for these as this is a great opportunity to make money shorting these bonds everywhere. The schools right now are the provebial deer in headlights but the car will hit, eventually.

Posted by: Jay | Apr 16, 2013 5:47:58 AM

A troubling trend for such a storied institution. Albany Law was one of the first 20 law schools founded in the United States, and counts among its alumni a former U.S. President, two former Supreme Court Justices, and Kate Stoneman, the first woman admitted to practice in New York.

Law school administrators must come to realize that the ultimate measure of an institution is not the number of buildings erected or tuition revenue gained. It is simply the quality of its graduates and the contributes they, in turn, make to the legal profession.

Joseph P. Breda
Albany Law School '94

Posted by: Joseph P. Breda | Apr 19, 2013 6:28:47 AM