BRADENTON, Fla. — Florida lawmakers are moving forward to consolidate three toll-road authorities in a revised plan that now excludes the financially ailing Santa Rosa Bay Bridge Authority, which appears headed for a bond payment default this year.
The SRBBA was removed from a draft bill to wipe out “a rush to conclusion” that it was designed to bail-out bondholders, Sen. Don Gaetz, R-Niceville, told the transportation subcommittee that he chairs on Thursday.
The authority sold $95 million of revenue bonds in 1996 to build the Garcon Point Bridge in a relatively rural area of north Florida, but traffic never met projections and reserves used to make bond payments over the years are nearly depleted.
“I don’t want the taxpayers of Florida to be on the hook for decisions related to the financing of that bridge,” Gaetz said.
There is a plan to “take the bonds down at substantially less than par value,” he said, noting the plan had been discussed with the head of the budget committee, Sen. J.D. Alexander, R-Lake Wales.
Gaetz could not be reached Friday for further details.
The subcommittee ordered the consolidation bill to be prepared for lawmakers to consider in this year’s session, which runs through May 6. The bill as currently proposed would abolish the Orlando-Orange County Expressway Authority, the Tampa-Hillsborough County Expressway Authority, and the Mid-Bay Bridge Authority in north Florida and turn over their toll roads and bonds to Florida’s Turnpike Enterprise.
The authorities have lease-purchase agreements with the Florida Department of Transportation, which must pay annually from its budget to operate and maintain certain toll roads the authorities financed. The arrangement was designed to give the authorities the ability to build toll roads to meet needs in their areas without having to pay for annual operating costs.
All lease-purchase agreements with the FDOT would be abolished and no more would be allowed in the future if the bill passes freeing up department funds — some of which will be swept to help offset a deficit in the state general fund budget.
Consolidation would also eliminate the duplication of employees and consultants each authority currently hires for a savings of at least $25 million, FDOT assistant secretary Kevin Thibault told the subcommittee.
“It allows the [FDOT and turnpike] to leverage all the resources in the state to accomplish more of the transportation needs that we have,” he said, estimating that consolidation also would create $1 billion in new bonding capacity in the first five years.
Ben Watkins, director of the Division of Bond Finance, said the bill is structured to ensure that terms and conditions that apply to the outstanding debt sold by the authorities remain in force.
“The effect of that is to substitute the turnpike as the operator of those facilities,” he said. “In my judgment, that doesn’t cause a concern for the existing bondholders who own that debt.”
Watkins said theoretically the Turnpike Enterprise could eventually refinance the bonds in hopes of obtaining better interest rates. The turnpike’s bonds are rated in the double-A category by the three major rating agencies.
The Mid-Bay Bridge Authority’s bonds are rated in the triple-B category and were cited as an example of the debt that might achieve a lower interest cost through refinancing.
Sen. Jack Latvala, R-St. Petersburg, said constituents in Tampa Bay are concerned that tolls collected there would be used in other areas of the state for transportation projects.
Gaetz said he would have language drafted in the bill to ensure toll revenues collected on regional facilities remain in the areas they are collected to be used for transportation projects after obligations such as debt service are paid.
He concluded the committee meeting by saying that the bill is an attempt to consolidate and place the savings into more transportation infrastructure, such as that needed to serve bigger transport ships that eventually will come through the rebuilt Panama Canal.