BRADENTON, Fla. — The Santa Rosa Bay Bridge Authority board, which sold bonds that are now in default to build a toll bridge in north Florida, plans to ask the trustee for funds to hire an auditor.

The authority hasn't performed an audit since 2000.

Instead of reporting financials to bondholders yearly, some unaudited toll collection reports compiled by the Florida Department of Transportation were released. The FDOT has declined to do the compilations any more, according to the Bridge Authority's attorney, Roy Andrews.

The authority has also failed to file yearly audits with the state as required by statutes governing special independent districts.

Board members have frequently noted during meetings that the authority has no funds to do audits or pay for any other services.

Andrews told the board Wednesday night that the bond trustee, Bank of New York Mellon, may provide funding to bring audits up to date, but that is uncertain since the cost is unknown.

"If we go forward with any type of refinancing, we'll have to have an audit," said Andrews, who has been retained by BNY Mellon to assist the board.

The board authorized Andrews to issue a request for proposals in order to determine how much it would cost to do the audits in accordance with the bond indenture and special district regulations. The results may be discussed at the next meeting, which has been tentatively scheduled for Nov. 14.

In other action Wednesday, the board accepted a settlement of $168,600 from BP for toll losses attributed to the Deepwater Horizon oil spill in the Gulf of Mexico in 2010.

One board member asked if that money could go toward the audit, and Andrews said that it would go to the trustee since it represents lost toll revenue that is dedicated to debt service.

The board also referred to the trustee statements from Westland Bank showing that $35,190 remains in the Bridge Authority's account for its guaranteed investment contract, which was where proceeds for the debt-service reserve fund were invested.

The debt service reserve was used to supplement bond payments until it was depleted. Andrews said apparently the GIC account balance is accrued interest that had not been dispersed to the trustee.

In final action, the board agreed to continue negotiations with county and state officials in an attempt to improve signs to the Garcon Point toll bridge. That work is under way in hopes of improving traffic and revenues.

In July, the Bridge Authority missed its third bond payment because toll revenues were insufficient to pay debt service.

The authority, which issued $95 million of revenue bonds in 1996 to build the 3.5-mile bridge, had drawn on reserves for many years to supplement debt payments because traffic levels never met projections.

BNY Mellon has hired FTI Consulting Inc. to provide financial advisory and consulting services to explore restructuring the bonds.

The toll revenue bonds were uninsured when they were originally issued, though some maturities were insured in the secondary market.

Most ratings on the bonds were lowered to the bottom of the junk category when the authority first defaulted on July 1, 2011. Standard & Poor's and Fitch Ratings have both assigned a D rating to the bonds.

On June 27, Moody's Investors Service withdrew its Ca rating saying "it believes it has insufficient or otherwise inadequate information to support the maintenance of the rating. In the absence of this information, Moody's believes that it is unable to provide investors with an informed assessment of the current credit quality of this debt instrument."

Some of the bonds are actively trading.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.