KBRA Assigns AA- Rating for El Paso County Hospital District, TX - Limited Tax; Affirms Rating for Parity Bonds; Outlook is Stable

NEW YORK--(BUSINESS WIRE)-- KBRA assigns a long-term rating of AA- to the El Paso County Hospital District, TX General Obligation Bonds, Series 2025. Concurrently, KBRA affirms the long-term rating of AA- for El Paso County Hospital District, TX - Limited Tax. The Outlook is Stable.

Key Credit Considerations

The rating action reflects the following key credit considerations:

Credit Positives

• The District is the only safety net healthcare provider in the County and plays a critical role within the County?s public health mission.
• A growing tax base continues to generate strong property tax revenues for the District, thus supporting voter-authorized debt obligations.
• District?s ad valorem tax rate is well below the State Constitutional limit.

Credit Challenges

• Proposed capital initiatives may place upward pressure on operating expenses.
• Macroeconomic environment has placed upward pressure on wages.

Rating Sensitivities

For Upgrade

• Diversification of revenue mix to include a more sizable percentage of commercially-insured payors.
• A meaningful improvement in socioeconomic metrics.

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 property tax support.

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
• ESG Global 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: 1009835

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Source: Kroll Bond Rating Agency, LLC