Houston City Council OKs $650 million bond issue for firefighter settlement

A proposed settlement between Houston and its firefighters union moved forward Wednesday with the city council authorizing the issuance of $650 million of general obligation judgment bonds, although a vote on a collective bargaining agreement was delayed.  

Both are part of a plan to end an eight-year contract impasse and litigation in Harris County District Court that Mayor John Whitmire with firefighters. 

A rating upgrade could occur from a contract “that results in sustainable public safety spending relative to its resource base and a reduction of carrying costs materially below 20% of governmental spending, leading to a strengthened expenditure framework assessment,” Fitch said in a September report. A deal with firefighters that weakens that assessment could lead to a downgrade. 

The nation’s fourth largest city has GO ratings of AA from S&P Global Ratings and Aa3 from Moody’s Ratings.