Legislative Proposal – MDTA Bond Cap Increase Page Two Lower bonding limit hampers the legally required capital maintenance of the tolling facilities. Some portion of capital preservation projects is financed over the useful lives of the improvements and the remaining portion is funded on a PAYGO basis from net operating revenues. Recognizing the legal requirement to maintain the facilities in good working condition, a bonding capacity of less than $5 billion could require a larger increase in tolling rates/revenues to support a larger proportion of PAYGO funding. Additionally, the need to fund the FSK Bridge reconstruction costs prior to federal reimbursements may necessitate substantial short-term financings during the multiyear construction period. Without increased bonding capacity, larger increases in toll revenues are needed to fund interim FSK Bridge costs from a larger percentage of PAYGO funding. RECOMMENDATION Approval of the legislative proposal that would increase the MDTA’s bond cap to $5 billion. ATTACHMENT • Legislative Bill Language
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