State completes $600M road bond sale

The Commonwealth Transportation Board completed the sale of $600 million of Commonwealth of Virginia Transportation Capital Projects Revenue Bonds on May 11 to advance transportation projects managed by the Virginia Department of Transportation and the Virginia Department of Rail and Public Transportation.

The bonds were sold through a competitive bidding process. Seven underwriters submitted highly competitive bids on the bonds. Wells Fargo Bank secured the winning bid with a true interest cost of 4.025 percent. The bonds were rated AA+ by Fitch and Standard and Poor’s, and Aa1 by Moody’s.

“This infusion of funds is the first step in the plan to help accelerate or complete more than 900 projects I recommended as part of our transportation funding package,” said Gov. Bob McDonnell. “These bond proceeds will begin funding the largest investment in Virginia’s transportation network in a generation and comes at a time when interest rates and construction costs are at near historic lows.”

This bond sale is the first of three planned $600 million issuances of Transportation Capital Projects Revenue Bonds over three years. It is the first step in the governor’s plan to invest nearly $4 billion in roads, rail and transit during the next three years as supported by House Bill 2527 and Senate Bill 1446 of the 2011 General Assembly. It is the second issuance of the Capital Projects Revenue Bonds that were authorized by the General Assembly in 2007.

“This year, the General Assembly put partisanship aside and recognized that for Virginia to retain its status as the friendliest state in the nation for business, we must invest in transportation and create much-needed jobs throughout our commonwealth,” added McDonnell. “There is no better time to start getting transportation in Virginia moving again. Virginians all across the Commonwealth can expect to see construction on an unprecedented scale during the next three years.”

As a component of the transportation funding package, the bond sale will provide funding for transportation projects across the Commonwealth reflected in the update to the Commonwealth Transportation Board’s Fiscal Years 2012-2017 Six-Year Improvement Program this spring.

The 17-member CTB, appointed by the governor, establishes the administrative policies for Virginia’s transportation system. The CTB allocates highway funding to specific projects, locates routes and provides funding for airports, seaports and public transportation.