The New York State Thruway Authority yesterday approved a $1.16 billion budget for 2009 that includes increased bonding over the current year.
The authority plans to sell $103.9 million more revenue bonds in 2009 than it did this year. Bond proceeds will account for $431.2 million of capital financing next year compared to $327.3 million in 2008.
The authority is not cutting its $2.1 billion 2005-2011 capital plan.
"We're not dipping into the capital program to solve our problems," said chief financial officer John Bryan. "We're going to continue maintaining the investments we committed to make."
In response to declining traffic caused by higher fuel costs and a declining economy, the authority revised its toll revenue projections for 2008 downward to $570.8 million from $596.9 million.
According to a study by Stantec Consulting Services Inc. that was included with the budget, passenger and commuter traffic in June was down 5% and compared to a year earlier and commercial traffic was down 5.2%. The firm will do another study before the authority issues bonds early next year.
Despite falling traffic, the authority, which in April approved toll increases of 5% in 2009 and 5% in 2010, expects toll revenue to increase to $637.7 million next year.
The authority expects to receive $15 million in federal aid in 2009, a $12.3 million drop from the current year.
The authority yesterday also extended an authorization to refund existing auction-rate securities until Dec. 31, 2009. The authority authorized the refunding of $575 million of consolidated local street and highway improvement program bonds in April, but that authorization expired. The refunding has been delayed due to market conditions.
The Thruway Authority also redesignated several underwriting firms as senior and co-senior managers due to the collapse of Lehman Brothers Holdings Inc., and the acquisitions by JPMorgan and Bank of America of Bear Stearns & Co. and Merrill Lynch & Co. respectively. Lehman, Bear Stearns, and Merrill had all previously been approved as senior managers.
"Over the last year, turmoil in the financial markets and corporate consolidations have reduced the number of firms that currently serve in these two pools and as a result I certainly feel that it's in the best interest of the authority to have these vacancies filled and to do so by re-designating firms based on scores that they received during the last competitive RFP process," Bryan said.
Banc of America Securities LLC, JPMorgan, and RBC Capital Markets moved up to senior underwriting designation from co-senior.
Depfa First Albany, Loop Capital Markets LLC, Roosevelt & Cross Inc., and Siebert Brandford Shank & Co. were moved into co-senior positions.
Their terms go through Dec. 31, 2009.
The authority yesterday also designated Bank of New York to serve as trustee for all bonds and notes the authority issues. The bank, which was the authority's existing trustee, was selected for a 10-year contract by competitive process out of six proposals.
The Thruway Authority operates and maintains 641 miles of roadway, which includes a 496-mile toll road connecting New York City and Buffalo as well as other major regional roads.
