SAN DIEGO–Intent on taking advantage of historically low interest rates and declining construction costs, the San Diego Association of Governments Board today directed its staff to implement a plan to sell $350 million in bonds to finance major transportation infrastructure projects throughout the region.
“We are moving agressively to keep the promises we made to the voters of this region when they approved the extension of the TransNet half-cent sales tax for transportation,” SANDAG Chair Lori Holt Pfeiler said. “These bond funds will put people to work building important infrastructure, improving both our economy and our quality of life.”
SANDAG will use the funds to continue the implementation of the TransNet Early Action program, which includes major transit projects and freeway improvements such as extensions and/or upgrades on SR 76, SR 52, all three of the region’s interstates, and the Los Angeles-San Diego-San Luis Obispo (LOSSAN) coastal rail corridor. The TransNet extension, which began in 2008, is expected to generate $14 billion for public transit, highway, and local street and road improvements over its 40-year life.
On Friday morning the SANDAG Board, acting as the San Diego County Regional Transportation Commission, authorized staff to proceed with the bond sale, which is expected to occur Oct. 28.
The funds will allow the region to accelerate projects during a low construction cost environment; take advantage of historically low interest rates; and capture the 35 percent Build America Bonds federal interest subsidy before its scheduled expiration at the end of calendar year 2010. In addition, four cities in the region have obtained approvals from their respective councils to participate in the bond issuance in order to finance TransNet eligible capital projects.
The transaction is expected to include Series A Build America Bonds and Series B tax-exempt bonds. Moody’s Investor Service and Standard & Poor’s have assigned the bonds “Aa1” and “AAA” ratings, respectively. The bonds will be marketed by an underwriting team made up of Barclays Capital, RBC Capital Markets, Inc., De La Rosa & Co., Siebert Brandford Shank & Co., LLC, and Goldman Sachs & Co.
