Fiscal Year 2027-2032 Financial Forecast Page Three
• Debt issuances: Debt issuances (toll-revenue and FSK interim financings) increase by $203.5 million throughout the FY 2026 – FY 2032 forecast period. While intermediate-term financings for the FSK Bridge Rebuild decline by $656.6 million due to project cashflow adjustments and the receipt of litigation settlement proceeds, non-FSK related toll revenue bond issuances increase by $860.2 million during this timeframe due to the growth in the CTP resulting from cost changes, cashflow adjustments, new projects (system preservation and improvements), and changes in the allocated and unallocated reserves. • Debt Service: Despite the increase in debt issuances, debt service decreases by $48.9 million throughout the FY 2026 - 2032 forecast period. The reduction is primarily attributed to (1) a reduction in FSK-related debt issuances resulting from the sizeable shift ($581.1 million) in Key Bridge Rebuild Project cashflows from FY 2026 and FY 2027 to the mid-to-latter part of the CTP (FY 2028 and FY 2029); (2) the use of $2.1 billion in litigation settlement proceeds for federally eligible Key Bridge Rebuild Project expenses; and (3) the modeled receipt of $217 million in federal Emergency Relief funds as a funding source for Key Bridge related expenses. The interest expense savings associated with the aforementioned are partially offset by the interest expense associated with the increase in non-FSK- related toll revenue bond issuances. • Insurance Funds: Of the $350 million of insurance proceeds, $25 million was used for federally eligible debris and salvage costs and the remaining $325 million (plus interest) is currently being spent on federally eligible construction costs. It is anticipated that the remainder of the insurance proceeds will be exhausted in FY 2026 or early FY 2027. • Litigation Settlement Proceeds: The forecast reflects the receipt of $2.1 billion in litigation settlement proceeds from the owner and operator of the cargo ship that struck the Francis Scott Key Bridge. Like insurance proceeds, the settlement proceeds will be spent on federally eligible construction costs. Based on the current cashflows for the Key Bridge Rebuild, it is estimated that the settlement proceeds (plus interest) will be exhausted in FY 2029. • Federal Funds: Consistent with the State’s request, the federal government has appropriated $217 million in funds for the Key Bridge Rebuild. Federal reimbursements are conservatively modeled with six-month lags in the FY 2027- 2032 period. Forecast incorporates full federal reimbursement. Ineligible project expenses may be incorporated into future forecasts as these expenses are known. • Toll increase: Based on the current forecast estimates, no later than FY 2029, a systemwide toll increase will be necessary to maintain 2.0 times debt service coverage throughout the remainder of the FY 2027-2032 forecast period, as well as hold financing needs below the bond cap and maintain adequate liquidity.
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