The Port Authority of New York and New Jersey’s leadership has implemented needed reforms to the agency, but challenges over the next ten years are “enormous,” according to independent reviews made public on Wednesday.

Governors Chris Christie and Andrew Cuomo, who head the bi-state agency, directed the agency to undergo the audit as a condition for their approval for the toll increase.

The reports by consulting and financial advisory firms, Navigant Consulting Inc. and Rothschild Inc., found that the toll and fare increases, which took effect in Sept. 2011, were necessary and that the agency’s leadership has made meaningful reforms.

The reports also found that the agency will face challenges, including prioritizing, funding, and executing over $11.4 billion in deferred capital projects that are not presently included in the $26.9 billion preliminary 2011-2020 capital plan, continued investment in transportation systems, and completing the World Trade Center Program.

The Navigant report is the second phase of a report that was first released more than seven months ago, which called the agency “an organization at a crossroads,” needing major reform.

Phase II of the report notes that the leadership has defined a roadmap to continue the agency’s ongoing transformation and has so far completed or has underway over 50 distinct reform initiatives.

“While we are encouraged by these findings, we recognize these are just the first steps of many that we will need to put in place to bring about lasting change,” said Port Authority Chairman David Samson.

According to the Rothschild report, the agency has “sufficient debt capacity to fund the capital expenditures plan while satisfying the principal credit metrics included in its financing obligations and those analyzed by the credit rating agencies.”

The Port Authority’s outstanding consolidated bonds are currently rated Aa2 by Moody’s Investors Service, and AA-minus by both Standard & Poor’s and Fitch Ratings.

The release of the independent reports come ahead of the authority’s $2 billion sale of taxable bonds, which are being issued to finance WTC projects.

The Navigant report, which said the agency’s communication of project costs has “vastly improved,” re-affirmed that the total cost of the WTC program is estimated at completion to cost approximately $14.8 billion.

RBC Capital Markets is lead underwriter on the deal, which is scheduled for next week.

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