KBRA assigns a long-term rating of AAA to the Dormitory Authority of New York State State Personal Income Tax Revenue Bonds (General Purpose), Series 2026C (Tax-Exempt) and affirms the long-term rating of AAA for the State’s outstanding State Personal Income Tax Revenue Bonds. The rating Outlook is Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

  • Provisions of the PIT Enabling Act and the importance of residual PIT revenues to fund State operations mitigate the risk of legislative non-appropriation or a failure to pay financing agreement payments when due after amounts have been appropriated and set aside in the RBTF.

  • RBTF Receipts provide ample historical and projected coverage of maximum annual debt service.

  • The 2.0x additional bonds test and essentiality of surplus PIT revenues mitigate against overleveraging.

Credit Challenges

  • PIT receipts, particularly the non-withholding component, are inherently volatile and closely correlated to the income of wealthy residents and financial sector performance. The share of PIT receipts related to net capital gains is significant.

Rating Sensitivities

For Upgrade

  • Not applicable at AAA rating level.

For Downgrade

  • A trend of declining debt service coverage that approaches the 2.0x ABT level.

  • Failure by the State Legislature to annually appropriate financing agreement payments.

To access ratings and relevant documents, click here.

Methodologies

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

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