Rating Action: Moody's Ratings upgrades College Station (City of), TX's issuer and GOLT ratings to Aaa from Aa1; revises outlook to stable
08 Jul 2026
New York, July 08, 2026 -- Moody's Ratings (Moody's) has upgraded the City of College Station, TX's issuer and general obligation limited tax (GOLT) ratings to Aaa from Aa1. Concurrently, we have assigned a Aaa rating to the city's Certificates of Obligation, Series 2026 with a proposed par amount of $35.8 million. Including the current offering, the city has about $528 million in total debt. The outlook is revised to stable from positive.
The upgrade is supported by the consistent financial performance coupled with strong fiscal management practices that have led to an accumulation of sizable reserves, which is expected to remain exceptionally strong in the next few years.
RATINGS RATIONALE
The Aaa rating reflects a dynamic and growing local economy supported by Texas A&M University, offsetting the city's below median income of 69% of the US and full value per capita of $131,000.
The rating also reflects the city's sustained trend of exceptionally strong available fund balance, which grew to 89% of revenue in fiscal 2025 (September 30 year-end). The city's reserves are expected to improve in fiscal 2026 with a $2 million projected general fund surplus. Governance is a key driver for the rating action, reflecting the city's strong budget management with actual results favorably outpacing budget.
The rating further incorporates the city's manageable long-term liabilities ratio of 165% of 2025 revenue, including the current offering. The long-term liabilities ratio is projected to increase to roughly 185%-200% of projected fiscal 2027 revenue with additional borrowing planned over the next several years.
The Aaa GOLT rating is at the same level as the issuer rating, reflecting the ample taxing headroom under the limited property tax cap.
RATING OUTLOOK
The stable outlook reflects our expectation that economic growth and Texas A&M University's stabilizing presence, combined with strong management, will support fund balance ratios consistent with Aaa peers. Strong economic growth will further support revenue growth and rapid principal amortization to maintain manageable leverage near 200% of revenue.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
- Not applicable
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
- Substantial increase in additional borrowing absent corresponding revenue growth leading to long-term liabilities that consistently exceed 200% of revenue and fixed costs in excess of 20% of revenue
- Deviation from historical fiscal practices resulting in a material reduction of available fund balance to levels approaching 40% of revenue
- Weakening economic activity, leading to a decline in full value per capita and GDP growth that lags the US
PROFILE
The City of College Station is in central Texas, within Brazos County, and anchored by Texas A&M University. The city is in the middle of a triangle bounded by the City of Dallas to the north, Houston to the southeast and San Antonio to the southwest. In 2024, the city had an estimated population of roughly 125,000.
METHODOLOGY
The principal methodology used in these ratings was US Cities and Counties published in June 2026 and available at https://ratings.moodys.com/rmc-documents/466689. Alternatively, please see the Rating Methodologies page on https://ratings.moodys.com for a copy of this methodology.
REGULATORY DISCLOSURES
For further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. Moody's Rating Symbols and Definitions can be found on https://ratings.moodys.com/rating-definitions.
For any affected securities or rated entities receiving direct credit support/credit substitution from another entity or entities subject to a credit rating action (the supporting entity), and whose ratings may change as a result of a credit rating action as to the supporting entity, the associated regulatory disclosures will relate to the supporting entity. Exceptions to this approach may be applicable in certain jurisdictions.
For ratings issued on a program, series, category/class of debt or security, certain regulatory disclosures applicable to each rating of a subsequently issued bond or note of the same series, category/class of debt, or security, or pursuant to a program for which the ratings are derived exclusively from existing ratings, in accordance with Moody's rating practices, can be found in the most recent Credit Rating Announcement related to the same class of Credit Rating.
For provisional ratings, the Credit Rating Announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating.
Moody's does not always publish a separate Credit Rating Announcement for each Credit Rating assigned in the Anticipated Ratings Process or Subsequent Ratings Process.
Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.
At least one ESG consideration was material to the credit rating action(s) announced and described above. Moody's general principles for assessing environmental, social and governance (ESG) risks in our credit analysis can be found at https://ratings.moodys.com/documents/PBC_1462204.
Please see https://ratings.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.
Please see the issuer/deal page on https://ratings.moodys.com for additional regulatory disclosures for each credit rating.
Nathan Phelps
Lead Analyst
Adebola Kushimo
Additional Contact
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
2026 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved.
[Standard Moody's legal disclaimers and regulatory terms follow copyright notice, credit rating definitions, warranty disclaimers, liability limitations, issuer payment disclosures, Non-NRSRO CRA listings, and additional jurisdictional terms for Australia, India, Second Party Opinions/Net Zero Assessments (EU, Japan, PRC).]
08 Jul 2026
New York, July 08, 2026 -- Moody's Ratings (Moody's) has upgraded the City of College Station, TX's issuer and general obligation limited tax (GOLT) ratings to Aaa from Aa1. Concurrently, we have assigned a Aaa rating to the city's Certificates of Obligation, Series 2026 with a proposed par amount of $35.8 million. Including the current offering, the city has about $528 million in total debt. The outlook is revised to stable from positive.
The upgrade is supported by the consistent financial performance coupled with strong fiscal management practices that have led to an accumulation of sizable reserves, which is expected to remain exceptionally strong in the next few years.
RATINGS RATIONALE
The Aaa rating reflects a dynamic and growing local economy supported by Texas A&M University, offsetting the city's below median income of 69% of the US and full value per capita of $131,000.
The rating also reflects the city's sustained trend of exceptionally strong available fund balance, which grew to 89% of revenue in fiscal 2025 (September 30 year-end). The city's reserves are expected to improve in fiscal 2026 with a $2 million projected general fund surplus. Governance is a key driver for the rating action, reflecting the city's strong budget management with actual results favorably outpacing budget.
The rating further incorporates the city's manageable long-term liabilities ratio of 165% of 2025 revenue, including the current offering. The long-term liabilities ratio is projected to increase to roughly 185%-200% of projected fiscal 2027 revenue with additional borrowing planned over the next several years.
The Aaa GOLT rating is at the same level as the issuer rating, reflecting the ample taxing headroom under the limited property tax cap.
RATING OUTLOOK
The stable outlook reflects our expectation that economic growth and Texas A&M University's stabilizing presence, combined with strong management, will support fund balance ratios consistent with Aaa peers. Strong economic growth will further support revenue growth and rapid principal amortization to maintain manageable leverage near 200% of revenue.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
- Not applicable
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
- Substantial increase in additional borrowing absent corresponding revenue growth leading to long-term liabilities that consistently exceed 200% of revenue and fixed costs in excess of 20% of revenue
- Deviation from historical fiscal practices resulting in a material reduction of available fund balance to levels approaching 40% of revenue
- Weakening economic activity, leading to a decline in full value per capita and GDP growth that lags the US
PROFILE
The City of College Station is in central Texas, within Brazos County, and anchored by Texas A&M University. The city is in the middle of a triangle bounded by the City of Dallas to the north, Houston to the southeast and San Antonio to the southwest. In 2024, the city had an estimated population of roughly 125,000.
METHODOLOGY
The principal methodology used in these ratings was US Cities and Counties published in June 2026 and available at https://ratings.moodys.com/rmc-documents/466689. Alternatively, please see the Rating Methodologies page on https://ratings.moodys.com for a copy of this methodology.
REGULATORY DISCLOSURES
For further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. Moody's Rating Symbols and Definitions can be found on https://ratings.moodys.com/rating-definitions.
For any affected securities or rated entities receiving direct credit support/credit substitution from another entity or entities subject to a credit rating action (the supporting entity), and whose ratings may change as a result of a credit rating action as to the supporting entity, the associated regulatory disclosures will relate to the supporting entity. Exceptions to this approach may be applicable in certain jurisdictions.
For ratings issued on a program, series, category/class of debt or security, certain regulatory disclosures applicable to each rating of a subsequently issued bond or note of the same series, category/class of debt, or security, or pursuant to a program for which the ratings are derived exclusively from existing ratings, in accordance with Moody's rating practices, can be found in the most recent Credit Rating Announcement related to the same class of Credit Rating.
For provisional ratings, the Credit Rating Announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating.
Moody's does not always publish a separate Credit Rating Announcement for each Credit Rating assigned in the Anticipated Ratings Process or Subsequent Ratings Process.
Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.
At least one ESG consideration was material to the credit rating action(s) announced and described above. Moody's general principles for assessing environmental, social and governance (ESG) risks in our credit analysis can be found at https://ratings.moodys.com/documents/PBC_1462204.
Please see https://ratings.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.
Please see the issuer/deal page on https://ratings.moodys.com for additional regulatory disclosures for each credit rating.
Nathan Phelps
Lead Analyst
Adebola Kushimo
Additional Contact
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
2026 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved.
[Standard Moody's legal disclaimers and regulatory terms follow copyright notice, credit rating definitions, warranty disclaimers, liability limitations, issuer payment disclosures, Non-NRSRO CRA listings, and additional jurisdictional terms for Australia, India, Second Party Opinions/Net Zero Assessments (EU, Japan, PRC).]