THE NEW JERSEY TURNPIKE AUTHORITY
persevered through the recession’s declining toll revenues to be in a healthy fiscal position a decade later, according to the transportation agency’s chief financial officer . . . . . .
“When I look at where we are today, we are so much stronger,” said Donna Manuelli, chief financial officer of the New Jersey Turnpike Authority.
The New Jersey Turnpike Authority persevered through the recession’s declining toll revenues to be in a healthy fiscal position a decade later, according to the transportation agency’s chief financial officer.
Donna Manuelli spoke last week at The Bond Buyer’s Mid-Atlantic Municipal Finance Conference.
She said that in 2010, the authority’s financial projections showed just a $35 million general reserve fund balance for the 2019 fiscal year. Moody’s Investors Service, A from Fitch Ratings and A2 from S&P Global Ratings.
The NJTA is wrapping up a $7 billion 10-year capital improvement program that funded debt service payments through revenue bond transactions and two toll increases.
The authority saw toll revenue rise 0.6% in 2017 to $1.58 billion compared to the previous year, according to a Fitch report released in April. The Fitch analysis noted that the turnpike system could withstand slightly negative yearly growth and cover its debt service payments.
Manuelli said that the recession of 2008 created an even larger barrier for the NJTA
Today, aided by a two-step toll increase, controlling operating expenses and savings achieved through bond refunding deals, the NJTA has a general fund reserve balance north of $300 million.
“We thought we had $1.8 billion in revenue and [for] $35 million we had our fingers crossed because that was seven to eight years in the future and we were not even really out of the recession,” she said. “When I look at where we are today, we are so much stronger.”
The NJTA, which has around $11 billion in debt, owns and operates the New Jersey Turnpike and Garden State Parkway.
The agency has bond ratings of A2 from to tackle its long-range capital plan given the steep decline in toll collections during the economic downturn.
She said in October 2008 when the recession was already underway, the NJTA’s financial plan still estimated growing toll revenues. By 2010 when projections were revised, the NJTA discovered $1 billion of lost revenue.
“When I think that we lost a billion dollars of revenue and we have a general reserve fund balance of over $300 million dollars and at its bottom is going to be about $220 million, I would say that is a pretty good story,” said Manuelli. “We really are in a better place.” ◽