KBRA assigns a long-term rating of AAA to the State of Wisconsin General Obligation Bonds of 2025, Series B. KBRA additionally affirms the: long-term rating of AAA for the State's outstanding General Obligation Bonds; the short-term rating of K1+ for the State's General Obligation Commercial Paper (CP) Program and General Obligation Extendible Municipal Commercial Paper (EMCP) Program; and, the long-term rating of AA+ for the State's Master Lease Certificates of Participation. The rating outlook for the long-term ratings remains Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• Strength and breadth of the G.O. pledge, coupled with liquidity and market access to support short-term debt.
• Trend of conservative budgets, strong financial results and improved reserve levels.
• Strong liquidity position based on all sources of available cash for operations.
• Essentiality of assets under the Master Lease Program, supported by a strong, well-established legal framework.

Credit Challenges

• Drawdown of unusually large fund balance in 2025-27 biennium to a more historically normal level leaves outyear gaps to be addressed in next biennium.
• Federal policy changes for Medicaid cost-sharing and SNAP administration costs will increase program costs for the State beginning in FY 2026, escalating thereafter. These additional costs are not yet known and are not fully accounted for in the 2025-27 biennium budget.

Rating Sensitivities

For Upgrade

• Not applicable.

For Downgrade

• Material financial weakening, driven by budgetary imbalance over an extended period.
• While unlikely, limited and/or expensive market access that impedes the State’s ability to manage maturing CP and EMCP Notes.
• A change in the essentiality of assets leased under the Master Lease Program that increases the risk of non-appropriation.

To access ratings and relevant documents, click here.

Methodologies

• Public Finance: U.S. State General Obligation Rating Methodology
• Public Finance: U.S. State Annual Appropriation Obligation Rating Methodology
• ESG Global Rating Methodology

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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