Harris County Hospital District, TX – Limited Tax Rating Report

Rating Summary

The long-term rating reflects Harris County Hospital District’s (the “District’s” or “Harris Health’s”) strong and growing ad valorem tax base, large and diverse economy, and strong bond security features. While KBRA’s analysis recognizes the District’s mandate to provide essential healthcare services to Harris County’s (the “County’s”) indigent population and takes into consideration the District’s financial operations, which includes considerable reliance on federal healthcare payments, it is the District’s sizable and growing tax base, the strong limited tax pledge, and ample remaining capacity to raise the ad valorem tax rate, that primarily supports the rating.

The District’s substantial, nearly $3.0 billion, 10-year capital improvement plan (“CIP”) is expected to pressure operating expenses, debt requirements and the tax levy, while federal funding cuts to Medicaid may present additional operational challenges. Nonetheless, KBRA expects the District’s seasoned…