Economy

New York's Metropolitan Transportation Authority is looking for swap counterparties that it hopes will be able to take over derivative contracts with a subsidiary of bankrupt Lehman Brothers Holdings Inc., the agency said yesterday.

DALLAS - Louisiana's constitutional limit on annual debt service may derail Gov. Bobby Jindal's plans to use the proceeds from $400 million of revenue bonds to finance the proposed new $1.2 billion Louisiana State University teaching hospital in downtown New Orleans.

CHICAGO - Following a sharp spike in downgrades among not-for-profit hospitals over the last two months, Moody's Investors Service warned that the sector is increasingly struggling with a number of internal and market-related pressures.

Lawmakers last week conducted a second public hearing on Massachusetts’ transportation financing woes and Gov. Deval Patrick’s proposal to consolidate existing authorities.

The Port Authority of New York and New Jersey last Monday won another round in an ongoing fight to stop the Bush administration from auctioning flight slots at its airports when the U.S. Court of Appeals granted it a stay.

WASHINGTON - To fill the void left by bond insurers, highly rated states and authorities should consider providing a temporary guarantee or credit enhancement to lower-rated issuers that cannot access the municipal market at reasonable rates for transportation projects, market participants said at a conference here last week.

The Port Authority of New York and New Jersey proposed a record $3.3 billion of capital spending in 2009 as part of a $6.71 billion preliminary budget released yesterday. Slightly more than half of the capital program would be financed through bonds and notes.

WASHINGTON - State and local governments must be given federal assistance through tax code revisions, stimulus legislation, and financial aid to help with operational costs, governors from New Jersey, Vermont, and Wisconsin told the House Appropriations Committee at a hearing here yesterday.

Senators late yesterday were trying to determine if they had enough votes to approve automaker bailout legislation containing provisions that could prevent 31 transit agencies from having to make $2 billion to $4 billion in termination payments on leaseback deals that technically defaulted after their guarantors' ratings were downgraded.

CHICAGO - Indiana will collect nearly $1 billion less revenue than originally expected during its upcoming 2009-2011 biennium, fiscal analysts warned yesterday.

WASHINGTON - State revolving funds that rely on investment returns to subsidize loans should be worried about unexpected losses in liquidity and declining future returns, Moody's Investors Service analysts said in a report yesterday.

New Jersey's Local Finance Board yesterday authorized a portion of Bayonne's mixed-use Peninsula Project New York Harbor for tax increment financing, the first step in gaining state approval for such borrowing.

DALLAS - After years of sweating transportation dollars, state and local governments in Texas are quickly lining up projects that might be eligible for a federal stimulus package proposed by President-elect Barack Obama.

Fitch Ratings last week revised its outlook to negative from stable on debt issued by Akron-based Summa Health System as it prepares to take on more debt to finance an expansion.

The New Jersey Turnpike Authority yesterday approved $500 million of long- and short-term borrowing to help it address auction-rate debt.

The Michigan Senate last week approved a package of bills paving the way for a $103 million light-rail transit line on one of Detroit’s main thoroughfares.

Fitch Ratings last week upgraded to AA-minus from A-plus Saint Francis Medical Center’s $53.9 million of debt issued through the Cape Girardeau Industrial Development Authority.

WASHINGTON - Draft legislation to bail out automakers includes a provision that would require the federal government to guarantee leaseback deals that transit agencies entered into with private investors and that were approved by the Federal Transit Administration before 2006.

The Second District Appellate Court in Elgin last week heard arguments by the Chicago suburb of Bensenville seeking a halt to the demolition of 500 properties to make room for a new runway at O’Hare International Airport. The project is part of a $7.5 billion runway expansion that is being partially financed with bonds.

DALLAS - Lafayette Parish, La., would replace much of its deteriorating rural road network with proceeds from a proposed $26 million general obligation bond sale.