Austin, TX – April 28, 2025 – Moody’s Ratings has reaffirmed the Aaa (AAA equivalent) credit rating for the Texas Bond Guarantee Program (BGP), one of the state’s most critical financial tools for public education.
The BGP is backed by the assets of the Texas Permanent School Fund (PSF), which is managed by the Texas PSF Corporation, and the program is administered by the Texas Education Agency. The BGP guarantees the principal and interest on public school and charter district bonds, enabling districts to access the lowest possible interest rates. It currently backs nearly $129 billion in bonds, saving Texas school districts – and ultimately Texas taxpayers – an estimated $400 million annually in lower borrowing costs.
“Moody’s reaffirmation is a strong endorsement of the Texas Permanent School Fund’s financial strength and the reliability of the Bond Guarantee Program,” said Robert Borden, Chief Executive Officer and Chief Investment Officer of the Texas PSF Corporation. “This rating directly benefits hundreds of school districts and charter schools across Texas by reducing financing costs, allowing them to invest more in classrooms, teachers, and students. We at the Corporation are proud to support Texas education in such a meaningful and measurable way.”
Moody’s cited the exceptional financial resources of the PSF (with total assets valued at over $62 billion) and the BGP’s strong legal reimbursement mechanics as key factors in reaffirming the highest possible rating. Moody’s rating update follows similar action by Fitch in December 2024.
The Texas PSF Corporation remains committed to protecting and growing the PSF to ensure that Texas schools can continue to benefit from lower-cost financing for generations to come.
Contact: mediarequests@texaspsf.org