A credit upgrade occurs when a credit rating agency raises a municipality's credit rating, reflecting improved assessment of the municipality's ability to repay debt. Upgrades may result from strengthened finances, improved economic conditions, better governance, or reduced debt levels. Higher credit ratings reduce borrowing costs because lenders accept lower interest rates for lower-risk borrowers. This savings compounds over time on large infrastructure loans, potentially freeing significant funds for other purposes. Credit upgrades also signal financial health to residents, businesses considering investing in the community, and other stakeholders. Achieving upgrades often requires sustained improvement in financial metrics and practices.