innovative finance for 183a
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Innovative Finance for 183A. Bill Chapman CFO, Central Texas Regional Mobility Authority. Who is the Central Texas Regional Mobility Authority. A multi-modal transportation agency authorized under 2001 state legislation A bi-county agency created in 2002 by Williamson and Travis Counties - PowerPoint PPT PresentationTRANSCRIPT
Innovative Finance
for 183A
Innovative Finance
for 183ABill Chapman
CFO, Central Texas Regional Mobility
Authority
Bill Chapman
CFO, Central Texas Regional Mobility
Authority
Who is the Central Texas Regional Mobility AuthorityWho is the Central Texas Regional Mobility Authority
• A multi-modal transportation agency authorized under 2001 state legislation
• A bi-county agency created in 2002 by Williamson and Travis Counties
• Oversight by a seven member board of local volunteers
• 11 employees
MPOMPO Transit Transit AgencyAgency
Central Central Texas Texas
Regional Regional Mobility Mobility
AuthorityAuthority
Local Local GovernmeGovernme
ntnt
TxDOTTxDOT
How It Works in Central TexasHow It Works in Central Texas
Regional PlanRegional Plan
• Over 75 miles of new capacity already open – Phase 1
• Electronic tolling
• Multiple agency participation
Central Texas Regional Mobility AuthorityAuthority & Purpose
Central Texas Regional Mobility AuthorityAuthority & Purpose• Purpose: To construct, reconstruct,
improve, extend, repair, maintain and operate revenue-generating tollway systems
• Powers of Authority: Acquire, hold, construct, improve, operate, own and lease the System, enter into contracts, set, change and collect tolls, rates, fees, and rentals, borrow money and power of eminent domain
First ProjectFirst Project
• Originally proposed in 1982
• Built under a Comprehensive Development Agreement Design/build process
Contractor assumes risk
Guaranteed maximum price of $178 million
Guaranteed completion March 2007
Public involvement activities included
Mobility Authority’s 183A CDA Procurement ProcessMobility Authority’s 183A CDA Procurement Process
• CDA Procurement Goals Foster Innovation
• Concept with Performance Requirements
• Workshops and One-on-One Meetings
• Alternate Technical Concepts
Expedite Schedule• 3 ½ years From Solicitation of Proposals to Open to
Traffic (Traditional Method Would Have Taken 5 to 7 Years)
• Overlapping Design/ROW/Utility Construction Process Rather than End on End
Mobility Authority’s 183A CDA Procurement ProcessMobility Authority’s 183A CDA Procurement Process
• CDA Procurement Goals (continued) Obtain Best Value
• Included approved Alternate Technical Concepts
• Included Added Value Concepts as separate proposals not included in cost
• Technical proposal was reviewed separately from cost proposal
• Project Completion Date corresponded as close as possible with the Opening of SH 45
• Proposers evaluations were based on the completion date, each day over minimum schedule added money to proposal
• Incentives and disincentives were used
Mobility Authority’s 183 CDA Procurement ProcessMobility Authority’s 183 CDA Procurement Process
• Primary Benefits of CDA Process: Guaranteed Maximum Price Guaranteed Delivery Date
• 183A CDA Process Specifics: The GEC prepared a cost estimate of various
alternatives and to assure reasonable price bids Right of Way Acquisition was done by Williamson
County Utility relocations were included in CDA contract
Mobility Authority’s 183 CDA Procurement ProcessMobility Authority’s 183 CDA Procurement Process
• Schedule Receipt of Unsolicited Proposal September 15,
2003
Request for Competing Qualifications December 19, 2003
Received Five Qualifications Statements February 2, 2004
Three Proposers Short Listed February 25, 2004
Issued Draft Request for Detailed Proposals March 15, 2004
Issuance of Request for Detailed Proposals May 5, 2004
Receipt of Detailed Proposals August 16, 2004
Potential CDA Award Date October 1, 2004
Began Toll Collection May 3, 2007
Sources of FundsSources of Funds
• Par Amount of Senior Lien Bonds$182,049,638
• Par Amount of BANS 66,000,000
• TxDOT Equity 64,700,000
• Local Contributions 14,100,000
• Reoffering premium 5,441,955
• Interest Earnings 3,405,973
• Accrued Interest on market debt 1,040,831
Total sources 336,738,397
Uses of FundsUses of Funds
• Project Construction Fund $212,000,000• Deposit to Capitalized Interest Fund 31,124,342• Deposit to Debt Service Reserve Fund 15,006,200• Future Feasibility Studies 15,000,000• Right of Way Acquisition 14,100,000• O & M Reimbursement 13,797,497• Preconstruction Costs 12,700,000• Gross Bond Insurance 9,634,737• Working Capital Requirements 8,500,000• Underwriters Discount/Cost Of Issuance 3,283,769• Deposit to Debt Service Fund 1,040,831• Deposit to Renewal and Replacement Fund 550,000• Rounding 1,021
Total 336,738,397
CDA AgreementCDA Agreement
• CDA Execution Authorized (HCC) October 27, 2004
• Notice To Proceed 1 December 7, 2004
• Notice To Proceed 2 March 2005 730 days from Notice to Proceed 2
• Guaranteed Completion March 2007
• Begin Toll Collection March 2007
• Guaranteed Lump Sum Cost of $178 Million
• Incentive: $10,000 per day for early opening (maximum $1,000,000)
• Liquidated Damages: $20,000 per day beyond 730 days (no maximum)
• $50,000,000 Performance and Payment bonds
TIFIATIFIA
• $66,000,000
• Flexibility Multiple payment schedule Ability to Restructure/Flexible Subordinate Lien Deferred payment
• Negotiations
• Prepayment
• 4.69% interest rate
TIFIA TimelineTIFIA Timeline
• Letter of interest 3/12/04
• Application 7/13/04
• Executed term sheet 2/7/05
• Secured loan agreement 3/1/05
CoverageCoverage
On Senior Lien Bonds, coverage rampsup from 1.75 in 2009 to 5.65 in 2045
Central Texas Regional Mobility Authority183-A Project
$-
$5,375,000
$10,750,000
$16,125,000
$21,500,000
$26,875,000
$32,250,000
$37,625,000
$43,000,000
$48,375,000
$53,750,000
$59,125,000
$64,500,000
$69,875,000
$75,250,000
$80,625,000
Period Ending 1/1
2005 Senior D/S TIFIA D/S Capitalized Interest Net Revenues at 1.75x Coverage (Senior) Net Revenues
Financing Objectives ChecklistFinancing Objectives Checklist
• Achieve Investment Grade Rating on Senior Lien Debt
• BBB- Standard and Poor’s
• Baa3 Moody’s
• FGIC Insurance
• 1.75 Minimum coverage
• Achieve lowest possible borrowing cost
• Produce maximum amount of net available cash flow
• CDA agreement
Financing Objectives ChecklistFinancing Objectives Checklist
• Make CTRMA financially self-sufficient for visible future TIFIA Loan
TxDOT Toll Equity Grant
• Close financing by mid to end of February Closed March 2, 2005
Bonds issued in a market environment with extremely low yields
Financing PlanFinancing Plan
$167,967,611Senior Lien
Revenue Bonds
March 2, 2005
$66,000,000BANS
Bond Insurance
$55,000,000
TxDOT Toll Equity Grant
Bond Insurance
CDA AGREEMENT 730 DAYS TO COMPLETE
Bond Insurance
March 2007 Complete
$167,967,611Senior Lien
Revenue Bonds
$66,000,000BANS
Bond Insurance
$55,000,000
TxDOT Toll Equity Grant
Toll Revenues$66,000,000
BANS
Bond
Insurance
Legislative UpdateLegislative Update
• House Bill 1892 Toll road moratorium bills
• 2 year ban on privatization of state toll roads (9/1/09)
• Lengthy list of exceptions including NTTA in Dallas and HCTRA in Houston
Passed in House 137 to 2
Passed in Senate 27 to 4
Passed in House 139 to 1
• Senate Bill 1267 – Sen. Nichols Very similar