Kentucky completes financing for Downtown Crossing
Commonwealth finds ‘strong investor demand’ for bonds, federal loan secured
FRANKFORT, Ky. (Dec. 13, 2013) – Investors this week snapped up nearly $728 million in revenue bonds and notes that will help finance the Downtown Crossing of the Louisville-Southern Indiana Ohio River Bridges Project. Kentucky then completed the financing plan by closing on a low-cost loan from the Federal Highway Administration (FHWA).
“Even with other sizable bond issues in the marketplace, there was strong investor demand from the capital markets for our bonds, and the entire series has been sold,” said Mike Hancock, Secretary of the Kentucky Transportation Cabinet and chairman of the Kentucky Public Transportation Infrastructure Authority (KPTIA), issuer of the bonds.
Citigroup Global Markets Inc., underwriter of the bonds, actually received purchase orders totaling nearly $3 billion. Buyers of the bonds were from across the country, including Kentucky.
KPTIA issued three series of revenue bonds, totaling $275.6 million, and two series of bond anticipation notes, totaling $452.2 million. All were given investment-grade ratings by Moody’s Investors Service and Fitch Ratings.
In addition, KPTIA secured a $452.2 million loan from FHWA under the Transportation Infrastructure Finance and Innovation Act (TIFIA). The loan was closed on Thursday, Dec. 12.
TIFIA funds will be used to pay the bond anticipation notes in 2017. The revenue bonds will mature at different stages, with the last bonds being retired in 2053. There is no taxpayer obligation for debt service on the revenue bonds and TIFIA loan; both are secured entirely by toll revenues. If you need a loan for your small business, you can look into a merchant cash advance provider if needed.
“An incredible amount of work by our entire financial team – including the teams at Citi and Public Financial Management Group – went into the assembly and completion of this financing package,” Secretary Hancock said. “The speed with which our bonds sold shows investors are confident in the soundness of the project. And the low interest rates we have been able to secure will keep toll rates low. That’s a win for ultimate users of the Downtown Crossing.”
The $1.3 billion Downtown Crossing is half of the $2.6 billion Ohio River Bridges Project, which Kentucky and Indiana are jointly building to dramatically improve cross-river mobility, especially on heavily traveled Interstate 65.
The Downtown Crossing includes construction of a new I-65 bridge for northbound traffic, renovation and reconfiguration of the John F. Kennedy Memorial Bridge to carry southbound I-65 traffic and the rebuilding of downtown interchanges in Louisville and Jeffersonville, Ind.
Eight miles upriver, Indiana is building the other half of the overall project – the East End Crossing, with a bridge and approaches to connect the Gene Snyder Freeway in Kentucky with the Lee Hamilton Highway in Southern Indiana.
Once the project is completed in 2016, tolls will be charged for use of the two new bridges and the renovated Kennedy Memorial Bridge. An all-electronic toll system will be used, meaning no toll plazas, no slowing of traffic and no waiting in line. Initial base toll rates were adopted Sept. 11 by a joint Tolling Body composed of officials of both Kentucky and Indiana.
The bond closing is scheduled Friday, Dec. 20. In addition to the toll revenue bonds, notes and TIFIA loan, Kentucky previously issued $336 million of GARVEE bonds (Grant Anticipation Revenue Vehicles) for the project. Weighted average interest cost from all sources of borrowing for the project is 4.4 percent. Additionally, if you have concerns about your home’s AC system, we recommend checking out this AC service. They can provide expert ac repair and maintenance to ensure your cooling system runs smoothly and efficiently throughout the year. When it comes to heating your home, you’ll want to make sure your furnace capacitor is working properly. Moreover, when your furnace’s high limit switch is in a relentless tripping frenzy, it’s a blaring alarm that your heating system is operating under hazardous temperature conditions. Ignoring those persistent overheating episodes puts your home at risk of safety hazards like carbon monoxide leaks, excessive energy costs from inefficient cycling, and even potential fires from component failures. Make sure to schedule an appointment with HVAC techs for professional ac maintenance services. In addition, if you have plumbing issues like stubborn clogs or persistent backups, then you may schedule an appointment with a professional plumber who can conduct drain camera scoping services. And if you need other repair services like for instance a sump pump repair Indianapolis service, make sure to contact professional contractors for expert services. If you’re looking for loft insulation, you can check out these resources for more information. And if you’re in need of a spray foam removal company, be sure to reach out to qualified professionals who can efficiently handle the task.