City of Jacksonville receives two-level credit rating upgrade

JACKSONVILLE, Fla. — The City of Jacksonville has achieved a significant financial milestone with Fitch upgrading the City’s credit rating by two levels, moving from AA- to AA+. This upgrade reflects Jacksonville’s strong financial health, strategic monetary management, and robust fiscal outlook. In addition, S&P Global Ratings (S&P) and KBRA have reaffirmed their ratings of AA, with all three credit rating agencies indicating a stable outlook.

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“Jacksonville continues to deliver strong financial results, and credit rating agencies appreciate our diversified economy, fiscal responsibility, and investment in infrastructure and development projects,” said Mayor Donna Deegan. “This credit rating upgrade is a big deal for our city. It means savings for taxpayers through lower interest costs and money back into our coffers that can be spent on services for citizens.”

The ratings were issued after a thorough, unbiased analysis of Jacksonville’s current and future fiscal outlook, including the proposed 2024-2025 general fund budget, the usage of operating reserves, the 2025-2029 Capital Improvement Plan (CIP), and the inclusion of stadium renovation funding in the CIP.

“We are extremely proud of the credit rating upgrades from Fitch and rating affirmations from S&P and KBRA,” said Chief Financial Officer Anna Brosche. “These ratings reflect our commitment to sound financial management, strategic investments in our community, and the economic vitality of Jacksonville. As we move forward, we will continue to focus on fiscal responsibility and sustainable growth to ensure long-term prosperity for our residents.”

The rating of a city’s bonds is a measure of its credit quality, indicating the ability to pay a bond’s principal and interest in a timely fashion. A higher bond rating generally allows the city to borrow at lower interest rates, saving taxpayers millions of dollars.

“The upgrade of the IDR to ‘AA+’ from ‘AA’ reflects the combination of Jacksonville’s ‘aaa’ financial resilience assessment underpinned by its ‘high midrange’ budgetary control and expectation for available reserves to be maintained at 10% of general fund spending or higher,” stated Fitch in its report on the upgrade.

S&P Global Ratings affirmed Jacksonville’s ‘AA’ rating, noting, “steady development and permit activity continues to support strong taxable value growth, with billions announced in new capital investments across new and existing employers, including the redevelopment of the NFL stadium in downtown Jacksonville.”

KBRA also reaffirmed the City’s ‘AA’ rating, highlighting, “Over the last six years, the City has added approximately $365 million in combined operating and emergency reserves, bringing the FY 2023 combined balance in these funds to 31.6% of General Fund revenues, well above the City’s Reserve Policy for the General Fund.”

Mayor Deegan has also released explainer videos on the proposed budget and reserves to provide further clarity on these developments.

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