The Michigan Daily
Ann Arbor, Michigan-Thursday, May 13, 1982
Ten Cents
Sixteen Pages
State credit
rating drops
to new low
LANSING (UPI) - Moody's In-
vestors Service yesterday dropped
Michigan's credit rating to the lowest in
the nation, despite the legislature's
last-minute passage of a temporary in-
come tax hike in hopes of staving off the
collapse.
Both Gov. William Milliken and state
Budget Director Gerald Miller said
they were hopeful the downgrading on
the state's crucial short-term note
issues can be reversed by September,
when the state is expected to attempt to
sell $500 million worth of the notes. -
MILLIKEN said, however, "Their
ratings will depend on what happens to
the economy."
But Miller warned the state will have
to approach the rating firm with a
"balanced, conservative" 1982-83
budget which will require substantial
revisions" in Milliken's earlier budget
recommendations.
Miller also said the downgrading
could have a "ripple effect" on the local
governments which might be attem-
pting borrowing of their own.
MILLER SAID he was "disappointed
and shocked" with the decision by
Moody's to drop the short-term note
rating to "MIG-3," a level which he said
will make it impossible to sell the entire
$500 million issue, if the rating stands.
If the rating does not go up, he said,
the state will not be able to make.
required payments to schools, com-
munity colleges, and local governments
next year and will have to change those
payment schedules.
He said a MIG-3 rating neans the
state could borrow only $150 million in
notes. He also said the Treasury Depar-
tment is looking into a "commercial
paper" issuance-which requires the
strong backing of a consortium of
banks-to produce another $100 million
in very short-term borrowing.
MOODY'S ALSO dropped the rating
on other Michigan bonds, including
dropping state Building Authority bon-
ds to "BAA." That was not considered
See NEW, Page 10
Daily Photo by DEBORAH LEWIS
Too much fun
Phil Tersch pays no attention to the rigors of sailing as he basks in the after-
noon sun. For those of you that were in classes yesterday or otherwise oc-
cupied, ignore this picture.
The reviews begin
The University is presently undergoing a self-imposed reduction
and reallocation of its diminishing resources. The first steps in-
clude reviews of three of the University's schools. For a summary
of the review committee charges, see Page 3.
Supporters rally around CEW
By FANNIE WEINSTEIN
Nearly 50 men and women turned out to support the Center
for Continuing Education of Women (CEW) at a public
hearing conducted last night by the review committee
evaluating the program.
"CEW is reaching out, and that's a marked difference from
'other departments in this University," Jens Zorn, associate
dean of LSA, told the committee, which met at Rackham
Assembly Hall.
"CEW shows the way it has provided a model," he said.
"It should continue to provide a model and we can't afford to
stop it."
THE CURRENT CEW review, which Committee Chair-
man Jacquelynne Parsons said she expects to be completed
within a month, is evaluating the performance and utility of
the program. Following this review, a Budget Priorities sub-
committee will examine possible budget reductions.
"We are not saying have one (a budget review) or don't
have one," Parsons said. "We are just evaluating the cen-
ter."
See CEW,page 5
Daily Photo by DEBORAH LEWIS*
LSA ASSOCIATE DEAN Jens Zorn addresses the review committee evaluating the Center for Con-
tinuing Education of Women during a public hearing at Rackham Assembly Hall last night.