KBRA Affirms Travis County Healthcare District, TX Certificates of Obligation AA+, Stable Outlook
21 Jun 2024 | New York
KBRA affirms Travis County Healthcare District's (the "District") taxable and tax-exempt Certificates of Obligation (the "Certificates") at an AA+ rating, with a Stable Outlook. The District is a political subdivision of the State of Texas (the "State") created to provide medical and hospital care to the indigent residents of Travis County, TX (the "County"). The Certificates are payable from the receipt of a separate, direct, and continuing ad valorem tax, levied within the limits prescribed by State law, on all taxable property within the District. The boundaries of the District are coterminous with that of the County, and encompass the city of Austin, the State's capital.
Key Credit Considerations
The rating was assigned because of the following key credit considerations:
Credit Positives
- Strength and diversity of the District's large and growing tax base.
- Solid legal framework of the limited tax pledge supporting the Certificates' repayment
Credit Challenges
- Capital needs associated with an expansive footprint and the provision of direct care in select specialties.
- Challenges inherent to serving an indigent population that is largely uninsured or underinsured.
Rating Sensitivities
For Upgrade
- Track record of managing costs associated with the increased direct provision of specialty services and contractual relationships with partners.
For Downgrade
- Sharp secular deceleration in tax base growth that pressures organic growth of the ad valorem tax support.
To access rating and relevant documents, click here.