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Hutto ISD Maintains High Bond Ratings from Moody’s and S&P

HUTTO, Texas — Hutto Independent School District continues to impress the nation’s top bond rating agencies and announces that it has maintained its high bond ratings from Moody’s Ratings (Moody’s) and S&P Global Ratings (S&P) for rating reviews just completed.

Moody’s and S&P each assigned their bond ratings of Aa3 and AA-, respectively, to Hutto ISD’s proposed issuance of $125 million Unlimited Tax Building Bonds, series 2024. The ratings represent an affirmation of the District’s existing bond ratings. In addition, both rating agencies assigned their AAA ratings to the bonds — the highest rating possible — based on the District’s qualification for the Texas Permanent School Fund (PSF) guarantee.

According to Moody’s, the recent Aa3 rating incorporates strong liquidity and reserve levels at over 50 percent of revenue, which are expected to remain favorable given Hutto ISD’s strong budgetary planning and adherence to formalized financial policies. Additionally, the rating incorporates strong economic trends throughout the Austin metropolitan area, which have resulted in significant housing development within the District and increased student enrollment.

S&P, in its report affirming the AA- rating, similarly spoke highly of the District’s strong general fund balance, growing economy and “good management practices and policies.”

“These high bond ratings are great for bond investors and Hutto ISD taxpayers. They show investors that Hutto ISD bonds are a low-risk investment,” said Caleb Steed, Chief Financial Officer for the District. “For the taxpayer, these ratings should result in a lower interest rate, saving on total repayment.”

The strong ratings of the District and AAA enhanced bond rating provided by the Texas PSF program benefit taxpayers by lowering the interest rate obtained when bonds are sold in the market. A lower interest rate reduces interest payments and provides relief to taxpayers by reducing Hutto ISD’s overall debt burden.

“Hutto ISD prides itself in maintaining a legacy of superior fiscal management, thanks to the hard work of the District’s award-winning finance department and prudent, strategic guidance from our Board of Trustees,” said Steed. “As CFO, my primary goal is to continue to build upon and enhance the District’s reputation for strong financial management and commitment to our students and taxpayers.”

The bonds are payable from the Hutto ISD’s Interest & Sinking fund portion of the tax rate. The bonds are also guaranteed by the PSF's commitment to pay debt service if necessary.

The Hutto ISD Series 2024 bonds are the second issuance under the $522 million authorization approved by the District’s voters in May 2023 for various district-wide improvements. The

Series 2024 bonds will finance the buildout of the Hutto 9th Grade Center to become the community’s second comprehensive high school, design work for the District’s ninth elementary school, and deferred maintenance projects at existing campuses.

The District expects to sell the bonds the week of June 4.