85-mph Texas toll road still struggling financiallyJune 20, 2014
SAN ANTONIO (AP) — A Central Texas toll road world famous for its 85-mph speed limit continues to struggle financially, with revenue of only 30 percent of original projections.
Moody's Investor Service reported Thursday that the company that built the privately managed leg of Texas 130 southeast of Austin lacks the money to meet a payment due June 30 on the $1.18 billion loan that financed the construction.
Moody's says, however, that SH 130 Concession Co. is negotiating refinancing with 10 banks that financed the original loan, so default is unlikely.
In May 2013, Moody's downgraded SH 130's credit rating by four grades to junk status because the road was carrying only half the traffic projected when it opened October 2012.
A toll road spokeswoman says the company remains confident that prosperity is just around the corner.
"We remain confident that this first-class roadway will play an increasingly important role in relieving congestion along the gridlocked I-35 corridor as Central Texas continues to grow," SH 130 spokeswoman Megan Compton said in a statement.
However, Moody's said reserves in two funds set up by SH 130 have dwindled from $65 million to $3.3 million as of December after the company made the last of its twice-annually debt payment for 2013. It also signaled little confidence in its future finances by giving a "negative" outlook. Future performance "will likely heavily rely on toll rate increases, coupled with economic expansion and increased congestion on (Interstate 35) to drive revenue growth," the Moody's report said.
The company is a partnership of the Spanish toll road company Cintra and San Antonio-based Zachry Construction Co. It built and managed a southern extension of Texas 130 from near Austin to Interstate 10 near Seguin.