SALT LAKE CITY — Moody’s Ratings has reaffirmed Utah’s Aaa credit rating, citing the state’s robust economic growth, strong fiscal governance, and low debt levels.
The agency announced Monday that Utah’s financial outlook remains stable, with the highest rating assigned to the state’s general obligation bonds, as well as continued high marks on lease revenue, education, and healthcare-related bonds.
Moody’s credited Utah’s performance to “exemplary fiscal governance,” substantial budget reserves, and minimal liabilities, which have enabled the state to maintain financial flexibility even amid rapid growth.
While highlighting Utah’s economic strength and diversification, Moody’s noted that the state’s swift expansion presents challenges, including rising housing costs and water resource constraints. “Growth drives spending, especially for K-12 education,” the report stated, referencing the state’s high percentage of school-aged children.
The agency also warned that long-term credit risks could emerge if the state departs from its traditionally conservative fiscal practices or depletes its reserves below 25% of own-source revenue.
As part of the rating review, Moody’s also affirmed the Aa1 rating for lease revenue bonds issued through the Utah State Building Ownership Authority and Aa2 ratings on bonds tied to the University of Utah Hospitals and Clinics and the Utah Charter School Credit Enhancement Program.
The report comes as Utah continues to lead the nation in innovation capacity, ranking first in the 2023 Innovation Intelligence Index, according to a recent analysis from the Kem C. Gardner Policy Institute. Northern Utah, including Cache County, contributes to this innovation ecosystem with research from Utah State University and companies like Thermo Fisher Scientific and Cytiva in Logan.
Moody’s stable outlook suggests Utah is well-positioned to withstand economic headwinds. “Utah stands poised to not just weather future economic storms, but to emerge stronger and more resilient,” the report concluded.