The Triborough Bridge and Tunnel Authority will offer a mandatory tender and purchase Tuesday of all three outstanding series of its variable-rate general revenue bonds, Series 2003 and 2005, totaling about $535 million.
The authority, a division of New York’s Metropolitan Transportation Authority, plans to restructure and remarket Series 2003B, 2005A and 2005B-2 bonds as nine subseries, terminating three standby-purchase agreements issued by troubled Dexia Crédit Local and substituting irrevocable direct-pay letters of credit from U.S. Bank National Association, the California State Teachers’ Retirement System and the California Public Employees’ Retirement System.
Fitch Ratings last week upgraded the long-term ratings to AAA from AA-minus on the subseries 2003B-1, 2003B-2, 2005A-1, 2005A-2, 2005B-2a and 2005B-2b, and elevated to AA-plus from AA-minus the long-term ratings for Series 2003B-3, 2005A-3 and 2005B-2c.
The agency confirmed its short-term F1-plus ratings for all the subseries.
The remarketed bonds are general obligations, payable generally from tolls on the seven bridges and two tunnels the authority operates in the New York City region. They are not a debt of the city, New York State or any other local government units. Maturities range from 2032 to 2035.
US Bancorp, Citigroup and JPMorgan are the remarketing agents. Hawkins, Delafield & Wood LLP is bond counsel. Lamont Financial Services Corp. is the financial advisor and Clifford Chance LLP is counsel to the remarketing agents.
Mitchell Moss, director of New York University’s Rudin Center for Transportation Policy & Management, said the timing is ideal for infrastructure projects. “People are going to be traveling and paying tolls for decades to come,” he said. “Americans have a love affair with mobility.”
The bond issuance consists of $94.6 million in subseries 2003B-1, $51.1 million in subseries 2003B-2, $60.5 million in subseries 2003B-3, $60.9 million in subseries 2005A-1, $32.9 million in subseries 2005A-2, $39 million in subseries 2005B-2a, $89.7 million in 2005B-2a, $48.5 million in subseries 2005B-2b, and $57.4 million in subseries 2005B-2c.
Fitch affirmed its long-term underlying rating of the authority’s $6.7 billion of outstanding general revenue bonds at AA-minus, and its $1.8 billion outstanding subordinate-revenue bonds at A-plus. Key rating drivers included the system’s importance to the regional economy.
Moody’s Investors Service rates the long-term senior revenue and subordinate revenue bonds Aa2 and Aa3, respectively, both with a negative outlook.