KBRA Assigns AAA Rating to Dallas Independent School District, TX: Unlimited Tax Bonds Series 2025 A, B, and C
10 Jan 2025 | New York
KBRA assigns a long-term rating of AAA to the Dallas Independent School District, TX: Multi-Modal Unlimited Tax School Building Bonds, Series 2025A; Unlimited Tax School Building and Refunding Bonds, Series 2025B; and, Unlimited Tax Refunding Bonds, Series 2025C. KBRA additionally affirms the long-term rating of AAA for the District's outstanding Unlimited Tax Bonds (PSF) and Unlimited Tax Bonds (Non-PSF). The Outlook for each obligation is Stable.
The Series 2025A, 2025B, and 2025C Bonds have received conditional approval for and are expected to be issued with a guarantee of the payment of principal and interest from the State’s Permanent School Fund (“PSF”) guarantee program. KBRA’s ratings for these and all other outstanding series, including both those with and without the PSF guarantee, are based solely on the underlying credit standing of the District, without considering support afforded by the PSF guarantee program.
Key Credit Considerations
The rating actions reflect the following key credit considerations:
Credit Positives
- Large, diverse, and growing tax base provides reliable source of payment for the unlimited tax bonds.
- Strong financial management, policies, and procedures have historically sustained large unassigned reserves and strong liquidity.
Credit Challenges
- A secular trend of declining enrollment and statutory changes to the State’s school funding system limit prospects for growth in operating resources.
Rating Sensitivities
For Upgrade
- Not applicable at AAA rating level.
For Downgrade
- While not expected, a trend of decline in the ad valorem tax base may negatively impact the rating.
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