The San Diego Association of Governments approved the $345 million purchase of a bankrupt toll road from a private operator at its Dec. 16 board meeting.
SANDAG, the San Diego region’s planning, transportation, and research agency, announced in August plans to purchase the toll road pending favorable findings during due diligence. The deal closed on Dec. 21.
The tollway was built by a private company that went bankrupt a little more than two years after it opened in November 2007.
The 10-mile road stretches from State Route 905 near the Otay Mesa Port of Entry at the Mexican border north through eastern Chula Vista.
In April, the association approached Southbay Expressway LLC, which emerged from bankruptcy proceedings as owner of the lease to the toll road, about purchasing the road.
After opening for business in late 2007, the toll road operator was unable to ride out the economic downturn, and the tollway filed for Chapter 11 bankruptcy in March 2010.
Among its creditors was the federal Transportation Infrastructure Finance and Innovation Act program, which took a haircut on its TIFIA loan and accepted equity in the restructured tollway.
SANDAG announced in early August that it had accepted the sale proposal, pending due diligence.
The money from a one-half-cent sales tax originally planned for improvements to Interstate 805 will help pay for the toll road purchase.
Overall, the purchase will be funded through $212 million from the fund shift, a $55 million loan, and the outstanding $92 million TIFIA loan that will stay with the project.
Though the agency does not plan to issue bonds for the project, it will use the remainder of its Build America Bonds sold in October 2010 to fund the purchase.
It will return to the bond market in May or June to replenish funds, officials said