Press Release|Public Finance
KBRA Affirms AAA Rating for Cook County, IL Sales Tax Revenue Bonds; Outlook is Stable
25 Jul 2023 | New York
KBRA affirms the long-term rating of AAA with a Stable Outlook for the Cook County, IL Sales Tax Revenue Bonds.
Key Credit Considerations
The rating was affirmed because of the following key credit considerations:
Credit Positives
- Pledged Revenues, consisting of home rule sales taxes, provide robust debt service coverage.
- Strong bondholder protections, highlighted by a conservative non-impairment covenant (1.35x) and ABT (2.5x).
- Deep and diverse economic base underpinning the revenue pledge, with no concentration.
Credit Challenges
- Sales tax revenues, which encompass home rule sales taxes, are economically sensitive.
- The possibility, albeit remote, that the State makes statutory changes to reduce the home rule sales tax rate.
Rating Sensitivities
For Upgrade
- Not applicable at AAA rating level.
For Downgrade
- While not expected, a prolonged and deep economic downturn that results in a severe long-term reduction in Pledged Revenues and/or a substantial increase in sales tax revenue debt.
- Action by the State or County to reduce home rule sales tax rate or limit revenue collections.
To access rating and relevant documents, click here.