Fitch Ratings Affirms City of Tallahassee’s AA+ Credit Rating with Stable Outlook

Fitch Ratings has once again affirmed the City of Tallahassee’s strong AA+ ratings on its bond programs, reinforcing the City’s sound financial management practices in line with the City’s Strategic Plan. Fitch Ratings, one of the nations’ leading independent credit rating agencies, also affirmed the City’s “Stable Outlook,” underscoring confidence in the City’s long-term financial stability and disciplined fiscal management.

A strong AA+ rating enables the City to access capital markets at favorable borrowing costs, reducing expenses for infrastructure, capital improvement projects and other long-term public investments like transportation network improvements. The rating also signals to investors that the City has an exceptionally strong capacity to meet its financial obligations, broadening the pool of potential investors and strengthening demand for its bond offerings. Ultimately, the City’s sound financial practices support the reliable delivery of high-quality municipal services that enhance the quality of life enjoyed by Tallahassee residents.

Fitch evaluates a municipality’s creditworthiness through a comprehensive assessment of financial strength, economic fundamentals, governance, debt profile and long-term resilience. Additionally, the rating reflects factors such as economic diversity, revenue flexibility and the regulatory environment governing municipal finance.

According to Fitch’s most recent report, both the City’s Issuer Default Rating (IDR) and Capital Bonds received AA+ ratings.

Fitch assigned the City its highest possible assessment of “aaa” for the Financial Resilience component, recognizing the City’s strong revenue control, budgetary flexibility, commitment to maintaining healthy reserves and ability to remain financially resilient through changing economic conditions.

Fitch also noted that the City’s liability metrics are expected to improve as debt continues to amortize and the City’s resource base grows. Other positive financial indicators include the City’s strong Maximum Annual Debt Service coverage. Even after accounting for planned debt issuances, projected debt service coverage remains approximately twice the minimum threshold associated with the City’s AA+ rating, demonstrating substantial financial capacity, disciplined long-term planning and continued financial flexibility.

Expressed numerically, the City achieved a Model Implied Rating of 9.76 out of 10.0, placing it at the upper end of Fitch’s AA+ rating range.

By continuing to pair disciplined financial stewardship with strategic economic development initiatives that broaden the City’s economic base, attract high-wage industries, increase household incomes and support sustainable population growth, the City will be well positioned to further strengthen the credit fundamentals that support its AA+ rating over the long term.

For more information, visit Talgov.com.