183A Texas TollroaD Extension
The Central Texas Regional Mobility Authority is an independent government agency formed by Travis and Williamson Counties to improve the transportation system in the Central Texas area. The Mobility Authority successfully built and currently operates the 183A toll road which serves northwest Travis and southwest Williamson Counties. Continued population and job growth in and around Austin warranted lengthening of the existing highway and the Mobility Authority sought ways to meet this need for the residents of the region. While the municipal bond market provided much of the capital needed for the project, that capital was not sufficient to completely cover the projected project costs.
In March 2007, the original 183A Expressway in Williamson County opened to traffic. Since then, the number of vehicles using 183A has greatly exceeded projections. In 2008, on average, over 65,000 toll transactions occurred each day – nearly double the 33,696 projected by traffic and revenue studies. As a result, the Central Texas Regional Mobility Authority accelerated construction of the 183A northern extension, the subject of this facility, by more than seven years. It is being built in the median of the existing frontage roads from FM 1431 to north of RM 2243.
CityView and Access Capital Advisers worked together with the Mobility Authority and its advisors, including First Southwest Company, to develop a private market solution to meet the public authority's need for immediate capital. Providing capital now allowed the Mobility Authority to benefit from significantly lower construction costs. CityView and Access Capital Advisers focused on structuring the transaction in a manner that allows continued government ownership of this important infrastructure asset while including protective covenants for long term institutional investors and providing returns sufficient to attract private and pension capital.
The subordinate financing was structured as a Build America Bond. The financing included both fixed and floating rate tranches. Both tranches are fully amortizing. The fixed component was 11.625% and the floating component is linked to CPI, paying 800 basis points above CPI. This transaction was the first time a bond issued under the Build America Bonds program had a coupon linked to CPI.