Fiscal Year 2026-2031 Financial Forecast Page Three
• Insurance Funds: The MDTA anticipates using insurance proceeds to fund $25 million in federally eligible debris and salvage costs. The remaining $325 million will be used to fund federally eligible expenses after the initial $60M quick release funds are exhausted. • Federal Funds: The MDTA anticipates receiving federal funds after the insurance proceeds are exhausted. Beginning in FY 2027, it is assumed that the MDTA will be reimbursed by the federal government for eligible project costs based on a one-year lag through FY 2031. The forecast assumes the MDTA will be fully reimbursed by the federal government for eligible project costs. Ineligible project expenses will also be incorporated into future forecasts as these expenses are known. • Toll increase : Based on the current forecast estimates, beginning in FY 2028, a systemwide toll increase will be necessary to maintain 2.0 times debt service coverage throughout the remainder of the FY 2025-2030 forecast period.
Assumptions
• Traffic and Toll Revenue Forecast: CDM Smith Fall 2024 Update Report • Draft FY 2026 – 2031 CTP • FY 2026 Final Operating Budget inflated by 4% • Modeled FY 2026 bond interest rate upwardly adjusted to a weighted average 4.46% (combination of prevailing bank credit line and long-term financing rates)
Evaluation Criteria
Adherence to MDTA goals and policies: • >$400 million unrestricted cash • >2.0 debt service coverage • Rate covenant ratio >1.0 sum of 120% debt service plus deposits to M&O account • Debt outstanding < $4 billion • Forecast tests the need for potential future toll increases. (Systemwide toll increases are needed beginning in FY 2028)
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Financial Forecast
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