The rating on Austin, Texas' public improvement bonds is based upon the full faith and credit of the city, and the ratings on the certificates of obligation and contractual obligations are based upon a limited-tax pledge of the city. The 'AA+' ratings reflect the city's: A strong and diverse economic base, anchored by state government and higher education, that continues to experience rapid tax base growth despite the recent economic contraction; A significant high-tech manufacturing industry, and an expanding service sector; Improved financial flexibility achieved through an increase in capital expenditures funded through operating revenues; and Moderate and decreasing overall debt levels coupled with a manageable capital improvement plan (CIP) and rapid debt amortization. Offsetting credit factors include eroded financial
