Regional transportation group fronts $200 million to sustain highway projects

NORTH BAY, Jan. 29, 2009 -- The Metropolitan Transportation Commission plans to lend the state up to $200 million to sustain five threatened Bay Area highway projects under construction, including widening of Interstate 80 south of Fairfield and expansion of Highway 101 north of Santa Rosa, three projects with bids to be awarded in coming months including added lanes on Highway 101 north of Rohnert Park, plus traffic monitoring projects.

The commission voted Wednesday to authorize its Bay Area Toll Authority to purchase as much as $200 million in state general obligation bonds to make up for Proposition 1B transportation money the state suspended in mid-December to make up for billions in budget deficit and weak market demand for state bonds.

That funding freeze affected $1 billion going toward 90 Bay Area road projects.

"There still are details to work out," said MTC spokesman John Goodwin.

Namely, the toll authority and the state will need to negotiate an interest rate for the private placement.

Other terms of the agreement are that bond proceeds would go to Bay Area projects, the Pooled Money Investment Board would continue to reimburse the projects up to the purchase amount and the bond term would not exceed three years.

Caltrans needed $155 million to sustain or start construction on the eight projects covered by the proposed bond purchase, according to the commission.

Had work stopped on the projects, the state said it faced tens of millions of dollars in shutdown and restart costs.