"All that’s left is for NTTA to come up with some $3.3 billion in cash."
October 22, 2007
By MICHAEL A. LINDENBERGER
The Dallas Morning News
The long-awaited agreement between TxDOT and the North Texas Tollway Authority over who will build and operate the State Highway 121 toll road has been signed, NTTA spokesman Sam Lopez said Monday.
The department of transportation’s new executive director signed the 800-page document on Thursday, clearing the way for NTTA to build the remaining segments of the Hwy. 121, and to collect steadily increasing tolls there for the next 50 years.
All that’s left is for NTTA to come up with some $3.3 billion in cash – an inducement it used to win the contract over its rival, Spanish road operator Cintra. NTTA has a deadline of Dec. 1, or 45 days after the agreement’s execution to close its financing for the deal and present the payments.
The final amount of the payment may be somewhat less than the promised $3.3 billion, however. Most of the upfront money is from the $2.5 billion NTTA promised to pay as a cash bonus to win the contract. But the remaining $833 million represents the net present value of what had initially been planned as annual payments over the 50-year contract.
Thanks to wildly fluctuating bond rates, the present value of those annual payments has varied significantly since NTTA won preliminary approval in June to build and operate the 26-mile toll road. Mr. Lopez said the final amount won’t be known until the authority sells its bonds, either later this month or next.
Whatever the final amount of the upfront payment, most of it is already accounted for. Hundreds of proposals have poured in from area governments seeking to use the money for roads, bridges, bike trails and other initiatives.
Ric Williamson, chairman of the Texas Transportation Commission, warned in an interview last month that the upfront payment promised by the NTTA is far more than the contract was worth. Mr. Williamson said if traffic projections for the road are not met, then NTTA would raise its rates on Hwy. 121 and all its roads.
NTTA chairman Paul Wageman said last week that the authority remains "very comfortable" with the price it paid for Hwy. 121.
© 2007 The Dallas Morning News Co
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