Moody's Ratings assigns Aa1 to Indianapolis-Marion County Public Library, IN's new GOs

New York, November 06, 2026 -- Moody's Ratings (Moody's) has assigned a Aa1 rating to Indianapolis-Marion County Public Library, IN's General Obligation Bonds, Series 2026 with a proposed par amount of about $19 million. We maintain the library's Aa1 issuer rating and Aa1 rating on the outstanding general obligation limited tax (GOLT) debt. Following the sale, the library will have about $58 million of GOLT debt outstanding.

RATINGS RATIONALE

The Aa1 issuer rating reflects the library district's large and growing economy, strong financial position and relatively low leverage that will decline because of rapid debt amortization. The district's $113 billion tax base, which includes Indianapolis, the Indiana state capital, has grown nearly 11% annually over the past five years. Real GDP growth in the region has outpaced the US by a compound annual growth rate of 0.5% over the last five years, and strong population growth and development activity are expected to continue. The resident income ratio trails the nation at about 86% but is broadly consistent with other large metropolitan areas.

The library's financial position is strong. The available fund balance ratio totaled nearly 70% and the liquidity ratio equaled 78% in fiscal 2025, compared with 66% and 75%, respectively, in fiscal 2024. The five-year financial plan projects annual general fund draws of about $2 million in 2026 and 2027, although actual results have historically been stronger than budget. Property taxes generate roughly 80% of revenue, supporting revenue stability while state property tax caps constrain revenue growth. Indiana's circuit breaker property tax caps constrained the library's property tax revenue by an estimated $9 million in 2025, rising modestly to a projected $10 million in 2026.

The long-term liabilities ratio will remain low despite a temporary increase with the Series 2026 issuance. The long-term liabilities ratio declined to about 86% in fiscal 2025 from closer to 96% in fiscal 2024 and consists primarily of $50 million of debt and $18 million adjusted net pension liability. The proposed $19 million General Obligation Bonds, Series 2026, will increase pro forma long-term liabilities to approximately 109% of revenue, before accounting for debt amortization since the latest audit. All direct debt, including the Series 2026 bonds, matures within five years, supporting declining leverage. The library does not anticipate additional debt issuance this calendar year but may issue debt for future capital needs. Moody's reported adjusted net pension liability (ANPL) declined to $18 million as of June 30, 2025, from $20 million a year earlier.

The Aa1 GOLT rating, including the rating on the Series 2026 bonds, is at the same level as the Aa1 issuer rating given the library's first budget obligation to levy ad valorem taxes for debt service.

For more information, visit Moodys.com