KBRA Assigns Harris County Hospital District (TX) Series 2025 Limited Tax Bonds AA+, Stable Outlook

NEW YORK--(BUSINESS WIRE)--KBRA assigns a long-term rating of AA+, with a Stable Outlook, to the Harris County Hospital District, TX (the "District") Limited Tax Bonds, Series 2025.

Key Credit Considerations

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

Credit Positives

• The District is the primary safety net healthcare provider in the County and plays an essential role within the County’s public health mission.
• A growing tax base continues to generate strong property tax revenues for the District, thus supporting voter-authorized debt obligations.
• District’s ad valorem tax rate remains well below the constitutional limit.

Credit Challenges

• Large capital plan that will place upward pressure on operating expenses, debt requirements and the tax levy.
• Managing potential operational challenges should federal Medicaid funding materially decline.

Rating Sensitivities

For Upgrade

• Material growth in the property tax base, which supports the District’s revenue and operations and bolsters the taxing capacity within the Constitutional levy limit.

For Downgrade

• Significant secular deceleration or declines in tax base growth pressuring ad valorem tax support.
• Trend of sharply increasing operating deficits requiring substantial increases in the M&O tax rate.

To access ratings and relevant documents, click here.

Methodologies

• Public Finance: General Property Tax/Assessment Revenue Methodology
• Public Finance: U.S. Not-For-Profit Healthcare Rating Methodology
• ESG Global 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: 1009166