S&P Global Ratings upgraded the Hawaiʻi Department of Transportation’s Highway Revenue Bonds from ‘AA+’ to ‘AAA’ on April 7, according to an announcement made by the department on April 14. The new rating is the highest possible for such bonds. Moody’s Ratings also affirmed its ‘Aa2’ rating for the bonds, noting that “the highway revenue bonds benefit from the state’s proactive management, with a history of adding or modifying transportation related taxes and surcharges, as needed, to enhance highway funding and adapt to the growth of electric vehicles.”
The upgrade in bond ratings matters because it reflects confidence in Hawaiʻi’s fiscal approach and could reduce borrowing costs for future transportation projects. Governor Josh Green said, “The upgraded rating by S&P Global Ratings and the affirmed rating by Moody’s Ratings reflects the state’s fiscally sound approach to investing responsibly and strategically in Hawai‘i’s transportation infrastructure. Continued investment in our highway system is vital to ensuring Hawai‘i’s ongoing economic growth, while keeping our residents connected.”
Ed Sniffen, Director of HDOT, said, “The upgraded bond rating positions HDOT to continue to improve and modernize our highways and bridges statewide, while enhancing roadway safety and efficiency.” According to the official website, the Hawaii Department of Transportation manages facilities including multiple airports for domestic and international carriers, commercial harbors and a statewide highway system according to the official website.
HDOT plans to sell about $440 million worth of Highway Revenue Bonds on Thursday, April 16. There will be a special order period for individual investors based in Hawaiʻi on Wednesday, April 15. Interest earned from these bonds will be exempt from both federal and state income taxes.
According to information provided by the official website, HDOT operates as part of Hawaii’s executive branch government structure. It oversees operations across all six major Hawaiian islands with infrastructure that includes 11 commercial service airports, four general aviation airports, nine commercial harbors and approximately 2,450 lane miles of highways according to its website. The department collaborates with federal agencies such as the Federal Aviation Administration (FAA), U.S. Coast Guard and Federal Highway Administration as well as local county departments according to its official site.
Looking ahead at broader implications for Hawaii’s communities and economy: according to the department’s mission statement, HDOT aims “to deliver a safe, efficient, accessible and sustainable transportation system that supports mobility for people and goods while fostering economic growth and quality of life.”
