KBRA assigns a long-term rating of AA+ to the Harris County Hospital District's, TX (the "District") Series 2026, Limited Tax and Refunding Bonds. Concurrently, KBRA affirms the long-term AA+ rating for outstanding limited tax bonds. The Rating Outlook is Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• A growing tax base continues to generate strong property tax revenues for the District, thus supporting voter-authorized debt obligations.
• The ad valorem tax rate remains well below the Texas Constitutional limit.
• As the primary safety net healthcare provider in Harris County, the District plays an essential role within the county’s public health mission.

Credit Challenges

• The District’s large capital plan will place upward pressure on operating expenses, debt requirements and the tax levy.
• Material cuts to Medicaid may present operational challenges given the District’s payor mix.

Rating Sensitivities

For Upgrade

• Material growth in the property tax base, which supports the District’s revenue and operations and bolsters the taxing capacity within the Constitutional levy limit.

For Downgrade

• Significant secular deceleration or declines in tax base growth pressuring ad valorem tax support.
• Trend of sharply increasing operating deficits requiring substantial increases in the M&O tax rate.

To access ratings and relevant documents, click here.

Methodologies

• Public Finance: General Property Tax/Assessment Revenue Methodology
• Public Finance: U.S. Not-For-Profit Healthcare Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1014898

View source version on businesswire.com: https://www.businesswire.com/news/home/20260508494183/en/