BATON ROUGE, La. — Fitch Ratings has upgraded Louisiana’s Issuer Default Rating and general obligation bond ratings from AA- to AA, citing revenue policy changes, solid budget performance and strong financial reserves, according to the state treasurer’s office.
The rating agency assigned a stable outlook and upgraded certain appropriation-backed bonds from A+ to AA-.
A stronger credit rating could help Louisiana borrow on more favorable terms, potentially lowering financing costs. Any savings would depend on market conditions, the structure of individual bond issues and other financing factors.
According to the treasurer’s office, Fitch credited Louisiana’s implementation of 2024 revenue policy changes with reducing a projected structural budget gap. The agency also cited substantial fiscal flexibility, strong operating reserves and the state’s ability to respond to changing economic and budget conditions.
State Treasurer John Fleming welcomed the upgrade while calling for continued oversight of public spending.
“Louisiana has made meaningful progress, and we should recognize that achievement while remaining focused on the work ahead,” Fleming said.
Fitch also cited Louisiana’s relatively low long-term liability burden compared with available resources and its ability to manage expenditures.
The agency identified several challenges requiring continued attention, including slow economic growth, potential federal policy changes, spending pressures and adjustments to the state’s revenue structure.
The stable outlook reflects Fitch’s current expectation that Louisiana’s credit position will remain stable.