Tom Warne Report, 7 December 2012
AUSTIN – Following Standard & Poor’s credit rating increase from ‘BBB+’ to ‘A-’, the Texas Department of Transportation recently refinanced $810.3 million of outstanding debt used to fund the Central Texas Turnpike System (CTTS) around Austin, saving the state some $200 million over the life of the bonds. The savings were the result of an improved credit rating and lower interest rates than when the bonds were initially sold.
“The innovative way in which TxDOT is funding projects and leveraging favorable market conditions is a testament to the effort by the agency to operate like a business, increase economic development and save Texans money,” said Ted Houghton, Texas Transportation Commission chair. “A solid transportation infrastructure is sorely needed, and with continued efforts like these, we will deliver the system essential to our state’s prosperity.”
“This is a big win for the people of Texas who rely on highways to move goods and help them get to and from work with few delays,” said Phil Wilson, TxDOT Executive Director. “We will continue to work diligently to be good stewards of taxpayer dollars and use those savings to improve our state’s transportation system.”
Construction on the CTTS began in 2002 with three toll roads in the Austin area: SH 130, Segments 1-4, a 49 mile north-south road located east of Austin; SH 45 North, a 13.2 mile road in Travis and Williamson counties; and Loop 1, a 3.5 mile road also located in Travis and Williamson counties. All of the projects were completed ahead of schedule and came in under budget by approximately $438 million, primarily due to lower than expected construction bids and good weather. The SH 45 SE project was added to the CTTS Sept. 1, 2012. The roads were developed to provide traffic congestion relief through Central Texas and an alternative route for commercial trucks traveling the I-35 corridor.
This is yet another smart business move on the part of TxDOT to manage and stretch their dollars. Seemingly small changes in something like a credit rating can net an agency huge savings as evidenced here. TW