Press Release|Public Finance
KBRA Assigns AA+ Rating, Stable Outlook to the City of Fort Worth, TX General Purpose Bonds, Series 2024 and Tax Notes, Series 2024
7 May 2024 | New York
KBRA assigns a long-term rating of AA+ to the City of Fort Worth, TX General Purpose Bonds, Series 2024 and Tax Notes, Series 2024. Concurrently, KBRA affirms the long-term ratings of AA+ on the City's General Purpose Bonds, Tax Notes, and Certificates of Obligation (collectively, "the General Obligations"). The Outlook is Stable.
Key Credit Considerations
The rating was assigned because of the following key credit considerations:
Credit Positives
- Strong financial reserves and liquidity, bolstered by conservative budgeting practices and formal fiscal policies.
- Vibrant economic growth, evidenced by a diverse and rapidly growing tax base.
Credit Challenges
- Pension contributions remain below the ADC, and the funded ratio of the City’s Retirement Fund remains low despite numerous pension reforms enacted to date.
- Partial reliance on potentially volatile sales tax revenue exposes the GF revenue base to economic fluctuations.
Rating Sensitivities
For Upgrade
- Tangible progress in addressing full funding of the actuarially determined pension contribution.
For Downgrade
- Weakened financial flexibility due to lack of improvement or worsening of pension funding metrics.
- Sustained reduction in tax revenues not sufficiently offset by permitted increases in property tax rates.
To access rating and relevant documents, click here.