Press Release|Public Finance
KBRA Affirms AA+ with Stable Outlook for Travis County Healthcare District (TX) Certificates of Obligation (Limited Tax)
20 Jun 2025 | New York
KBRA affirms the long-term rating of AA+ with a Stable Outlook for Travis County Healthcare District's, TX (the "District's) Certificates of Obligation (the "Certificates"). The Certificates are secured by a voter-approved ad valorem tax assessed on all taxable property within the District. The District is a political subdivision of the State of Texas, with its boundaries coterminous with that of Travis County, which encompasses the City of Austin, the State's capital.
Key Credit Considerations
The rating was affirmed because of the following key considerations:
Credit Positives
- Strength and diversity of the District’s large and rapidly growing tax base.
- Solid legal framework supporting the Certificates’ repayment.
- District’s ad valorem tax rate remains considerably below the voter-approved tax levy limit, although narrowing.
Credit Challenges
- Capital needs associated with an expansive footprint and the provision of direct care in select specialties.
- Challenges inherent to servicing an indigent population that is largely uninsured and underinsured.
Rating Sensitivities
For Upgrade
- Material growth in the property tax base, which supports the District’s revenues and bolsters the taxing capacity within the voter-approved tax limit.
- Consistent maintenance of costs below expectations which reduces the overall tax levy, as the District continues to expand its network of healthcare providers/partners and provision of specialty care services.
For Downgrade
- Sharp secular deceleration in tax base growth pressuring organic growth of ad valorem tax support.
- Material decline in headroom under the existing ad valorem tax limit.
To access ratings and relevant documents, click here.