MTA Bond Credit Rated AA+
Earlier this afternoon, the MTA sent out word that their bond credit rating was scored at AA+ by the Kroll Bond Rating Agency. Here is more about that via an official press release:
The Metropolitan Transportation Authority (MTA) today announced that bonds issued through its Transportation Revenue Bond (TRB) credit have been rated AA+ by the Kroll Bond Rating Agency in its inaugural assessment. AA+ is among the rating agency’s highest possible measures of debt creditworthiness, and it is an indication that MTA bonds have been “determined to have minimal risk of loss due to credit-related events,” and that MTA bonds “are deemed very high quality.”
The rating applies to the MTA’s Transportation Revenue Bonds, which are backed by a diverse pledge of revenues, including fares, tolls, and government subsidies and dedicated taxes.
In making its determination, Kroll exhaustively evaluated the MTA’s finances, levels of customer demand, management history, debt issuance structures, transparency in financial disclosure, history of commitment from the New York State Legislature, and measures of the MTA’s importance to the continued functioning of the Western Hemisphere’s largest economy.
“MTA provides a critical transportation network for over 15 million people in the greater New York Metropolitan area, which is essential to the economic and social fabric of the area,” the rating agency noted in its guidance to bond buyers. “MTA has a well-defined governance and management structure, which includes specific policies governing the budget process, multi-year financial and capital planning and debt management.” The rating report continued: “MTA management has a strong track record of balancing its operating budget over changing economic cycles and unforeseen events as well as managing complex capital programs designed to improve and expand the system.”
On key credit strengths, Kroll noted that “…it views the monthly deposits of revenues with the Trustee, prior to the payment of operating expenses to be a strong security feature of the TRB Resolution”. Kroll’s high rating of MTA’s Transportation Revenue Bonds reflects its recognition of the significance of non-operating revenues in the pledge and, hence, gives more weight to the gross pledge of revenues that provides tremendous coverage to bondholders.
In response to the receipt of the rating, MTA Chief Financial Officer Robert E. Foran said: “Much of the public discourse surrounding the MTA finances focuses on the total volume of debt outstanding, but Kroll’s rating is based on a deeper look into the soundness of the MTA’s underlying financial fundamentals, both now and in the foreseeable future. The sterling rating is recognition of the bottom line fact that the MTA has, and can be expected to have, the resources available to repay its bondholders while continuing to operate its $1 trillion network of trains, buses, bridges and tunnels in service of the New York region.”
The MTA’s Transportation Revenue Bond credit is rated “AA-” by S&P, “A2” by Moody’s and “A” by Fitch.
The MTA also issues bonds under three other credits: Dedicated Tax Fund Bonds that are backed by taxes collected by the State of New York and dedicated to the MTA, and Triborough Bridge and Tunnel Authority Bonds (through senior and subordinate liens) that are backed by tolls collected at MTA Bridges and Tunnels’ nine water crossings. MTA’s portfolio of outstanding bonds has a weighted average cost of 3.91% and is predominantly in fixed-rate mode.
xoxo Transit Blogger
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Service Diversions 05-08-15
Get an early start on your weekend travel plans as I have just updated the Service Diversions through all of next week.
Make sure to follow @TransitBlogger on Twitter by clicking the button in the sidebar as I am using it more often. Also if you are into indie music make sure to follow @IndMusicReview & @SurgeFM!
xoxo Transit Blogger
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Service Diversions 04-27-15
Sorry for the service diversions not being posted this weekend as I was out of town However they are fully updated for this week.
xoxo Transit Blogger
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LIRR & Metro North Ridership Rises In 2014
Just a few minutes ago, the MTA has announced that ridership on the Long Island Rail Road (LIRR) & Metro-North Railroad rose in 2014. Here are the details:
The Long Island Rail Road and Metro-North Railroad both welcomed rising numbers of customers in 2014, new Metropolitan Transportation Authority (MTA) ridership figures show, making them respectively the busiest and second-busiest passenger railroads in the country.
Both railroads saw their strongest growth during non-rush hours, on non-Manhattan commutes and for non-work trips, as customers increasingly rely on the railroads for transportation outside of traditional Manhattan commutes. This increased non-peak ridership, which mirrors trends seen on the MTA New York City Subway, occurs as more jobs in the region are created outside the Manhattan core and in industries without traditional 9-to-5 workdays, such as healthcare, hospitality and arts and entertainment.
Through the 2015-2019 Capital Program, both railroads hope to continue pursuing major projects to expand capacity and improve connections, which will spur economic growth, reduce traffic congestion and make the region more sustainable.
The LIRR reported a year-end total of 85.86 million passengers in 2014, a 3% increase over the prior year. It is the third highest ridership since 1949 and highest since the modern record in 2008.
Metro-North carried 84.66 million passengers in 2014, a 1.5% increase over the prior year and the highest ridership in Metro-North’s history. Metro-North ridership has grown 77% over the past 30 years.
“In another era, young people would buy a car with their first paycheck. Now, with access to the nation’s most vibrant public transit system, more of them are buying train passes and MetroCards. Across our region, New Yorkers are developing a mindset that riding the railroad isn’t just about going to work anymore. It’s becoming more and more integrated into the fabric of daily life,” said MTA Chairman and CEO Thomas F. Prendergast. “That’s why we’re pleased to be continuing projects in our Capital Program that will improve rail travel in the years to come, including East Side Access for the LIRR, Penn Station Access for Metro-North, and the LIRR’s Ronkonkoma Branch Double Track Project.”
On Metro-North, trips that do not involve Grand Central or Harlem-125th Street have increased 273% since 1984 and non-commutation ridership to Manhattan has increased by 133%, while commutes to Manhattan have increased by 31%.
Traditional commutes to Manhattan now constitute less than half of total Metro-North rail ridership. They account for 49% of trips taken in 2014, compared with 67% in 1984. Bronx residents commuting to Westchester County, and Westchester residents commuting to Connecticut, so-called reverse commuters, as well as Connecticut residents commuting from the east end of the New Haven Line to major employment centers in Connecticut, are some of the fastest growing types of travel on Metro-North.
On the Long Island Rail Road, which does not have the same track capacity to support reverse-direction commutes to suburban destinations, non‐commutation ridership has nevertheless increased by 66% since 1984; while commutes to Manhattan have essentially held steady, notching a slight 30-year decline of 7% while growing 2.6% in 2014. In total, LIRR ridership has grown 14% since 1984. Traditional commutes now constitute 57% of all LIRR travel, compared to 71% in 1984.
The ridership increases mirror increases in the frequency of trains. Metro-North ridership has been building in part because of 66 weekly trains the railroad added in October 2012, and another 187 weekly trains added in October 2013. Half-hourly weekend service was added to the eastern New Haven Line in November 2014.
The LIRR recently restored weekend and holiday service on the West Hempstead Branch, and has restored several trains that had been eliminated in 2010, including two evening rush‐hour trains on the Babylon Branch, two summer‐only trains to/from Long Beach, and extension of seasonal weekend service on the Montauk Branch. In total, the LIRR operated 5,000 more trains in 2014 than in 2013.
Increasing use of the railroads for large-scale sports events has also contributed to the non-commutation ridership growth. Metro-North’s Yankees-E. 153rd Street Station opened in May 2009; Barclays Center, home of the New York Nets and the future home to the New York Islanders, opened adjacent to the LIRR’s Atlantic Terminal in September 2012. Both railroads began providing trips to Jets and Giants games in 2009 with the opening of NJ Transit’s train station at the Meadowlands.
The high ridership in 2014 took place in spite of harsh winter storms that reduced travel volumes on both railroads in January and February of 2014
xoxo Transit Blogger
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MTA To Get Loan For Railroad Signal Safety
Late Friday afternoon, Governor Cuomo announced that the MTA would be receiving a nearly $1 billion dollar loan from the Federal Railroad Administration for LIRR & Metro-North signal safety upgrades. Here are the details:
Governor Andrew M. Cuomo announced that the Federal Railroad Administration has approved a loan of $967.1 million to the Metropolitan Transportation Authority for the improvement of the safety of the signal systems used by the MTA’s two commuter railroads, the Long Island Rail Road and Metro-North Railroad. The loan, which is the largest and lowest-cost financing for the MTA, will finance the installment of positive train control, a technology designed to remove the potential for human error that can lead to train-involved accidents.
“This loan is a dramatic investment in the MTA – one that will make trains safer for all riders on Metro-North and the LIRR,” Governor Cuomo said. “With this infusion of funding, crews will be getting to work on individual cars and along hundreds of miles of track to install state of the art technology that can save lives. This loan could not have been possible without the hard work and support of DOT Secretary Anthony Foxx and Acting Administrator Sarah Feinberg, and I thank them on behalf of all MTA commuter rail customers for helping us make this important advancement possible.”
MTA Chairman and CEO Thomas F. Prendergast said, “We are delighted to have been able to work with the Federal Railroad Administration to make this historic, and extremely important award possible. The most important thing we do each day is strive to ensure the safety of our passengers, our employees, and the public at large. This award will help us enhance that effort in a very significant way.”
Positive train control is a technology that allows computerized systems to automatically control certain aspects of train movement. It is intended to prevent train-to-train collisions, trains accidentally traveling into areas where track workers are working, or derailments caused by excessive train speed or the movement of a train through an improperly aligned switch. The technology can address situations like the Spuyten Duyvil derailment in the Bronx, where a train was going faster than its maximum allowable speed. Congress mandated the installation of positive train control in 2008 for all commuter railroads in the U.S.
Metro-North Railroad and the Long Island Rail Road are in the process of implementing the technology, which includes the installation of on-board components for 1,455 rail cars and transponders alongside 588 route miles of track. In November 2013, the MTA awarded a contract to a joint venture of Bombardier Transportation and Siemens Rail Automation to act as a systems integrator that will provide the design, furnish equipment and ensure that the system functions as intended. LIRR and Metro-North forces and some third party contracts will support installations of wayside, office, communications and on-board equipment. Installation of positive train control on Metro-North territory in the State of Connecticut will be funded by the Connecticut Department of Transportation.
The loan is the largest to have been made through the Federal Railroad Administration’s Railroad Rehabilitation and Improvement Financing Program and remains subject to MTA Board Approval on April 29 and final closing in May. The MTA will issue its Transportation Revenue Bond directly to the Federal Railroad Administration and will repay the obligation over 22½ years at a fixed interest rate of 2.38%. MTA’s Transportation Revenue Bonds are rated “AA-” from Standard & Poor’s, “A2” from Moody’s, and “A” from Fitch.
Congressman Charlie B. Rangel said, “Nothing is more important than ensuring the wellbeing of New Yorkers. I applaud Governor Cuomo’s commitment to improving safety measures on Metro-North and LIRR, so that all commuters in our great State can ride knowing they are in secure hands.”
Congressman Eliot Engel said, “MTA services are an indispensable part of my constituents’ everyday lives. Thousands of commuters rely on the MTA daily to travel to work, home or school. They expect – and should receive – a safe train ride. Implementing positive train control is a critical step making this expectation a reality. The tragedies that occurred at Spuyten Duyvil in 2013 and in Westchester earlier this year may have been avoided if this life-saving technology had been in place. While we cannot assuage the pain and grief that these accidents have caused, we can make every effort to create a better railroad moving forward. I applaud the DOT and the Federal Railroad Administration for recognizing the need for this technology in the MTA system, and am very pleased that all rail travelers can experience a safer ride.”
Congresswoman Nita Lowey said, “I’m pleased that MTA’s application to install positive train control technology has been approved by the Federal Railroad Administration. Securing this funding would help ensure that disastrous events like the December 2013 Metro North accident never happen again. Over the last year, I have worked tirelessly to highlight the need for additional resources to help commuter railroads install PTC, and I will continue to work with federal and state officials to ensure that MTA gets the resources it needs to keep its riders safe.”
Congressman Gregory Meeks said, I’d like to thank Governor Cuomo for prioritizing the modernization and improvement of the Long Island Railroad and Metro-North Railroad’s 1500 railcars and hundreds of miles of track along our country’s busiest commuter rail system. This unprecedented investment of nearly $1 billion in the LIRR and Metro will improve safety for riders public, transit workers for decades to come.”
Congressman Joe Crowley said, “I’m pleased the federal government is making this important investment so we can ensure the safety of New Yorkers on our commuter railroads. The MTA’s planned improvements will go a long way toward averting catastrophic incidents such as the ones we’ve seen over the past few years.”
Congressman Steve Israel said, “This federal loan is a vital step to improving railway safety. I applaud the Metropolitan Transportation Authority and Department of Transportation on their hard work to secure this loan, and I will continue to fight for federal resources for critical New York infrastructure.”
Congressman Sean Patrick Maloney said, “I fought to pass my legislation to make positive train control installations “priority projects” for RRIF loans because investing in PTC on our commuter rail lines is the single most important thing we can do to prevent accidents and save lives. This is a critical investment in our transportation infrastructure that prioritizes the safety of thousands of my neighbors in the Hudson Valley.”
Congressman Grace Meng said, “Thanks to the Federal Railroad Administration for approving this large, low-interest loan to upgrade commuter rail signal systems. The LIRR is vital to the commutes of many of my constituents and upgrading the signal system to improve safety measures is a high priority. I am pleased that this project will move forward through FRA’s financing.”
Congresswoman Kathleen Rice said, “There’s no doubt that positive train control will make riders and workers safer and enhance the security of the commuter railroad systems that so many New Yorkers rely on every day. We need to fully implement this technology, and this major federal funding advance will allow the LIRR and Metro-North to get to work right away.”
Congressman Lee Zeldin said, “As a member of the House Committee on Transportation and Infrastructure and Subcommittee on Railroads, Pipelines, and Hazardous Materials, I applaud this crucial step to upgrade the MTA’s infrastructure to ensure safety. Last month, I voted for the Passenger Rail Reform and Investment Act (HR 749), which included reforms to improve the slow and cumbersome process for RRIF loans, ensuring more potential borrowers have access to this critical financing for improving train safety. I look forward to continuing to work with Governor Cuomo and other New York State officials to complete this important safety upgrade.”
I am all for improving safety throughout the system & am glad to see the agency is getting much needed funds to do so. My complaint centers around it being a loan as quite honestly the agency should be receiving the money without a need for repayment as it benefits the entire region economically. For all the money that has been siphoned away from the agency, to say the government owes them is a major understatement!
xoxo Transit Blogger
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