Houston GO Debt Rating Outlook Revised To Negative On Budgetary Pressures Due To Legal Settlement

NEW YORK (S&P Global Ratings) July 1, 2024--S&P Global Ratings revised its outlook to negative from stable on Houston's existing general obligation (GO) debt. We assigned our 'AA' rating to Houston's roughly $592.77 million series 2024A GO refunding bonds and roughly $132.74 million series 2024B public improvement refunding bonds. The outlook, where applicable, is negative. At the same time, we affirmed our 'A-1+' short-term rating on to the city's outstanding commercial paper (CP) notes. "The outlook revision reflects at least a one-in-three chance that we could lower the rating during our two-year outlook period due to an expected spend-down in reserves due to anticipated budgetary shortfalls related to increased debt service and salary increases resulting from a legal settlement, with

...July 1, 2024 NEW YORK (S&P Global Ratings) July 1, 2024--S&P Global Ratings revised its outlook to negative from stable on Houston's existing general obligation (GO) debt. We assigned our '##' rating to Houston's roughly $592.77 million series 2024A GO refunding bonds and roughly $132.74 million series 2024B public improvement refunding bonds. The outlook, where applicable, is negative. At the same time, we affirmed our 'A-1+' short-term rating on to the city's outstanding commercial paper (CP) notes. "The outlook revision reflects at least a one-in-three chance that we could lower the rating during our two-year outlook period due to an expected spend-down in reserves due to anticipated budgetary shortfalls related to increased debt service and salary increases resulting from a legal settlement, with limited capacity to raise revenue due to a city charter that restricts property tax increases," said S&P Global Ratings credit analyst Katy Vazquez. Houston's GO bonds are a direct obligation...

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