S&P Global Ratings lowered its outlook on Jefferson County, Alabama, sewer revenue warrants to stable from positive and affirmed its BBB-plus rating, citing its limited flexibility to set its rates and escalating capital investment needs.
The county faces expected growing annual debt service, which grew to $136.8 million in 2025 from $80.9 million in fiscal 2022 and is projected to increase.
The county has capital needs totaling more than $1 billion in the next 10 years, and about $2.4 billion in outstanding sewer warrant debt, according to S&P.
The government expects to cover its capital needs with cash rather than new debt.
For credit positives, S&P cited the county's stable and diverse economy, realistic financial projections that show a target of at least 1.3 times debt service coverage and improved financial management policies.
About 15 years ago the county's sewer debt pushed it into what was then
The sewer warrants are rated Baa1 with a stable outlook by Moody's Ratings and BBB-plus with a stable outlook by Fitch Ratings.
Three Jefferson County commissioners didn't immediately respond to requests for comment.
