San Diego Business Journal

Sandag Raises $300M in Transportation Bond Sale

By Mike Allen Tuesday, June 5, 2012

The San Diego Association of Governments, the regional public planning, transportation and research agency, said June 1 that it raised $300 million from bonds issued last week for a variety of regional transportation projects.

The bonds that carry an interest rate of 4.1 percent were snapped up in two hours, Sandag said.

In addition to the new issuance, Sandag also refinanced $151 million in variable rate bonds and converted them to fixed rate for a net cost of zero. The conversion reduces Sandag’s exposure to variable interest rate risk and counterparty risk with related liquidity providers, the agency said.

Sandag said it will use the recent bond funds to meet near term cash flow needs of its capital improvement program, which includes projects from Oceanside to the U.S./Mexican border.

The new Sandag debt will be repaid using TransNet funds raised from a countywide half-cent sales tax for transportation projects, first passed in 1987 and extended for another 40 years in 2004.