Moody’s upgrades Chicago Public Schools; investment grade a notch away

The Chicago Board of Education on Wednesday saw its issuer rating and debt ratings from Moody’s Investors Service upgraded a notch, to Ba1 from Ba2 — still speculative grade, but one level below investment-grade status. The rating outlook remains positive after the upgrade.

Moody’s cited improvements in Chicago Public Schools’ operating fund net cash balance, which went from under 5% of revenues in 2018 to 13% in 2023; improved cash flows, as seen in its reduced cash flow borrowing; and fixed cost ratio, which went down to roughly 20% of revenue, supported by revenue growth from increases in state aid and property tax receipts.

The district’s finances have benefited from the from the school district’s operations.