Bond ratings

Key facts

• S&P rating: AA, since 2016¹
• Fitch rating: AA+, since July 2024²
• Fitch outlook, July 2026: changed from Positive to Stable³
• Fitch’s main reason: more years of budgets that spend more than they take in³
• Rating on most new bonds: AAA, because of a state guarantee⁴

In short

A bond rating is like a credit score for the district. Leander has good ratings: AA from S&P and AA+ from Fitch.¹² In July 2026 Fitch changed its outlook from Positive to Stable, because the budget keeps spending more than it takes in.³

Why it matters to your tax bill: a better rating means lower interest on new loans, which keeps the debt tax lower.

Related: debt · refinancing · reserves and deficit

A bond rating is like a credit score for the district. Rating firms study its money. Then they give it a grade.

The grade matters because buyers lend the money. A higher grade tells buyers the loan is safer. Safer loans can get a lower interest rate. Over 20 or 30 years, a small rate gap adds up to a lot of interest.

How much does one step cost? In July 2026, the district’s bond adviser gave the board a rough rule. Each step down, like AA+ to AA, may add about 0.1% to the rate. He said that was “in today’s market.”⁵ That is his estimate, not a promise.

The grades

The scale runs from AAA at the top, then AA+, AA, AA- and down. Two firms rate Leander ISD today.

Firm	Grade now	History
S&P	AA	Raised from AA- to AA in Sept. 2016. Kept since.1
Fitch	AA+	Raised to AA in 2021.6 Raised to AA+ in July 2024.2

A third firm, Moody’s, has not given the district its own grade in its bond papers since 2019.⁷

Why some bonds say AAA

Many of the district’s bonds show AAA.⁴ That is not the district’s own grade. Texas has a large school fund that backs these bonds. Think of a parent who co-signs a loan. The parent’s strong credit makes the loan look safer.

The July 2026 change

In July 2026, Fitch kept the AA+ grade. But it changed its outlook from Positive to Stable.³ An outlook is a hint about where a grade may go next.

Fitch gave its reasons:³

• It expects the district to keep “posting short-term deficit budgets.”
• The district is “rightsizing” while revenue stays flat.
• Savings should stay above 20% of spending, or the grade could fall. They were 33% at last count.⁸

See Reserves and deficit for those numbers.

In July 2026, S&P kept its AA grade with a Stable outlook.⁸

What a lower grade would cost

The district’s bond adviser said each step down in rating costs about 0.1% more interest on new loans.⁹ On a $100 million loan, that is about $100,000 a year. Separately, the state’s money-management grade for the district fell from an A (98) to a C (79) this year. The district is appealing.¹⁰ That state grade is not a bond rating, but rating firms read it.

A late notice in 2024

When a grade changes, the district must post a notice on a public bond website. In 2024, the district says it posted the wrong file by mistake. It posted the right one about two months later.¹¹

The other side

• AA+ is one step below the top grade, AAA, on Fitch’s scale.³
• A change in outlook is not a change in the grade itself. Fitch’s report also says the district is “rightsizing.”³

Questions to ask

• Where will the district post the state’s final school money rating when it is out?
• Will the district post the full borrowing model behind the adviser’s slides?

Changes to this page

• Nov. 2, 2026: Added questions to ask.
• Nov. 2, 2026: We reworded the other-side points so they stick to what the sources show.

What you can do or watch next

• Watch for the next Fitch and S&P reviews, usually with each bond sale.
• See reserves and deficit, since savings are what the raters watch most.

What we still don’t know

• The state’s final school money rating for this year is not out yet.
• We have not seen the full borrowing model behind the adviser’s slides.

Footnotes

1. Leander ISD, Official Statement, Series 2021A/B: “On Sept. 23, 2016, Leander ISD received an upgraded underlying bond rating from Standard and Poor’s (S&P) moving from an ‘AA-’ with a stable outlook to ‘AA’ with a stable outlook.” On EMMA. ↩ ↩² ↩³

2. Fitch Ratings, “Fitch Upgrades Leander ISD, TX’s IDR and GO Bonds Due to Criteria Changes; Outlook Positive,” July 10, 2024: upgraded “to ‘AA+’ from ‘AA’ due to criteria changes.” fitchratings.com. ↩ ↩² ↩³

3. Fitch Ratings, New Issue report on the Series 2026A bonds, July 15, 2026, page 1: Long-Term IDR AA+, Outlook Stable (it was Positive in January 2026). “The Stable Outlook reflects Fitch’s expectation that the district will continue posting short-term deficit budgets while implementing its rightsizing plan in response to flat revenues.” Reserves are expected to “remain above 20% of spending, versus 33% currently,” and “falling below this threshold could pressure the rating.” Page 3 lists 33.4% for fiscal 2025. Posted by the district: Fitch Ratings – July 2026. See also Fitch’s Leander ISD page. ↩ ↩² ↩³ ↩⁴ ↩⁵ ↩⁶ ↩⁷

4. Leander ISD, Official Statement, Series 2026A, Aug. 5, 2026, cover and “Municipal Bond Ratings”: S&P “AAA” / “AA” and Fitch “AAA” / “AA+.” The AAA grades are “by virtue of” the Texas Permanent School Fund guarantee. The bonds are rated “AA” by S&P and “AA+” by Fitch without it. On EMMA. ↩ ↩²

5. Board meeting video, July 30, 2026, at 1:57:53. The district’s bond adviser (PFM Financial Advisors): “In today’s market, it may mean you’re going from a 5% borrowing cost to a 5.1% borrowing cost or a 5.2% borrowing cost. Think about that in terms of 10 basis points in our world or 0.1% … for each rating downgrade.” The quote comes from the meeting video’s automatic captions. Wording checked against a second machine transcription of the audio on Oct. 27, 2026. Video at 1:57:53. ↩

6. Leander ISD, Annual Comprehensive Financial Report 2025, letter of transmittal: “LISD moved to an AA rating from Fitch in 2021.” Fitch’s rating history lists the upgrade from AA- on Sept. 9, 2021. Fitch’s Leander ISD page. ↩

7. Our review of the rating sections in the district’s official statements from 2019 to 2026A. Moody’s appears only in text about the state school fund. ↩

8. S&P Global Ratings, Research Update, “Leander Independent School District, TX Series 2026A Unlimited-Tax School Building And Refunding Bonds Rated ‘AA’,” July 10, 2026: S&P “affirmed its ‘AA’ underlying rating on the district’s existing general obligation (GO) debt” and “The outlook is stable.” Posted by the district on its Financial Transparency page: S&P Ratings – July 2026. ↩ ↩²

9. Board meeting video, July 30, 2026, at 1:57:53 (PFM). The quote comes from the meeting video’s automatic captions. ↩

10. Texas Education Agency, School FIRST ratings 2024-25 and 2025-26, under appeal. ↩

11. Series 2026A official statement, page 34: Fitch upgraded the district on July 10, 2024. “Due to an administrative oversight, an incorrect document was uploaded on EMMA on July 22, 2024 as notice of such rating upgrade.” The correct notice was filed on Sept. 16, 2024. “About two months” is our rounding. ↩