Moody’s Investors Service Assigns Rating for Fort Worth ISD for Upcoming Bond Sale
Moody’s Investor Service has shared this news release – below --regarding the Fort Worth ISD’s bond rating.
New York, August 04, 2022 -- Moody's Investors Service has assigned Aa1 underlying and Aaa enhanced ratings to Fort Worth Independent School District, TX's $142.2 million Unlimited Tax School Building Bonds, Series 2022. Moody's maintains the Aa1 issuer and general obligation unlimited tax (GOULT) ratings. The issuer rating reflects the district's ability to repay debt and debt-like obligations without consideration of any pledge, security or structural features. Post-sale, the district will have $1.3 billion in outstanding GOULT debt. The outlook on the underlying ratings is stable.
The Aa1 issuer rating reflects the district's favorable location within the Dallas-Fort Worth Metropolitan area that serves as an economic driver of the region. Additionally, the rating reflects the district's conservative fiscal management and healthy financial performance despite continued enrollment declines due to competition from charter schools. Lastly, the rating reflects manageable fixed costs and slightly elevated leverage with plans for additional debt in the near term.
The Aa1 rating assigned to the district's GOULT bonds is equivalent to the Aa1 issuer rating given an unlimited property tax pledge that is dedicated for debt service and levied upon all taxable property within the district.
The Aaa enhanced rating is based on the rating of the Texas Permanent School Fund (PSF) and the structure and legal protections of the transaction which provide for timely payment by the PSF if necessary. Moody's currently rates the Permanent School Fund Aaa.
“The District is pleased with the rating and it will position the District well as it moves into the market in the next couple of weeks,” said FWISD Chief Financial Officer Carmen Arrieta-Candelaria. “We want to continue to focus on Transparency and good fiscal stewardship.