Governor Deval Patrick, Treasurer Timothy Cahill and Legislative leaders today announced that the Commonwealth's Accelerated Bridge Program bonds have been awarded the highest possible credit rating by two major rating agencies. Both Moody's (Aaa) and Standard & Poor's (AAA) assigned the Program's triple-A credit ratings.
Over the life of the Accelerated Bridge Program, the triple-A ratings will save the Commonwealth an estimated $60 million in interest costs, and allow the state to continue to make critical investments in infrastructure at a lower cost to taxpayers.
"It is welcome news today that these rating agencies have assigned the Accelerated Bridge Program bonds the highest possible credit rating," said Governor Patrick. "This is further proof that our strategy for finding new efficiencies in state government and investing in our broken infrastructure at record levels is paying off. We will continue to manage state finances in a fiscally responsible way, as we have throughout these challenging times, in order to maintain our rating and our ability to make these much-needed investments."
The triple-A ratings were assigned in advance of the early-December sale of $575 million of Accelerated Bridge Program, Commonwealth Transportation Fund Revenue Bonds. In addition, the Commonwealth will issue $100 million of Accelerated Bridge Program, Grant Anticipation Notes, backed by future federal grants, which will be rated AAA by Standard and Poor’s, with a Moody’s rating expected later this week. This is the first bond sale for the Accelerated Bridge Program. The State Treasurer’s Office is managing the bond sale, with a combined effort between the Treasury, the Executive Office of Administration and Finance, and MassDOT.
These top credit ratings are a result of financing reforms proposed by Governor Patrick and the Legislature in the landmark Transportation Reform Act of 2009. The legislation authorizes the Commonwealth to create a new bond credit structure secured by gas tax and Registry of Motor Vehicle fees in the new Commonwealth Transportation Fund (CTF). The stability of these revenues, as well as provisions limiting the amount of bonds that can be issued, create a strong, secure credit structure.
Since 2008, the number of structurally deficient bridges has dropped from 543 to 482, a decline of over 11 percent. The ABP Program has completed 28 bridge projects already, with another 61 bridge projects currently in construction, and an additional 69 bridge projects scheduled to start construction within the next year. Over the course of the eight year program, more than 200 bridges will be replaced or repaired.
Together, the Commonwealth's investment in roads and bridges has grown from $515 million in FY2007 to a projected $1.085 billion in FY2010. The road and bridge construction program will support more than 10,000 jobs on 385 separate projects across the Commonwealth.
Learn more about the Accelerated Bridge Program.