KBRA Assigns AA Rating with Stable Outlook to Magnolia Independent School District, TX Series 2026 Unlimited Tax School Building Bonds

NEW YORK--(BUSINESS WIRE)--KBRA assigns a long-term rating of AA to the Magnolia Independent School District, TX Series 2026 Unlimited Tax School Building Bonds. Concurrently, KBRA assigns a long-term rating of AA to outstanding parity lien Unlimited Tax School Building Bonds. The rating Outlook is Stable.

Key Credit Considerations

The rating was assigned because of the following key credit considerations:

Credit Positives

• Diverse and rapidly growing tax base provides a reliable source of repayment for the Bonds.
• Robust economic profile.
• Strong projected enrollment growth.

Credit Challenges

• Significant increase in debt following the current issuance.
• Limited flexibility to generate additional resources based on property tax rate and State school funding restrictions.

Rating Sensitivities

For Upgrade

• Significant growth of the tax base beyond projected levels, coupled with continued positive operating performance that leads to increased reserves.

For Downgrade

• Sustained decline in the ad valorem tax base and/or decreasing enrollment resulting in General Fund deficits and an erosion of reserve levels.

To access ratings and relevant documents, click here.

Methodology

• Public Finance: U.S. Local Government General Obligation Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1015795