Just ask the Texas 130 investors.
Moody’s Investor Service has downgraded the credit rating of the private company that built and operates the Texas 130 toll road extension, a rating that could continue to drop unless traffic “aggressively” grows on the road in the next two years.
Moody’s issued the rating April 12 after putting the
SH 130 Concession Co., a partnership between Spanish-based Cintra and San Antonio’s Zachry American Infrastructure, on review in March.
The toll road, from Seguin north to South Austin, was billed as the nation’s fastest when it opened to drivers in late October, boasting an 85-mph speed limit.
But traffic counts on the road are about half the initial projections, the Moody’s report said, forcing the company to dip into its financial reserves to make loan payments and raising concerns about the possibility of future default.
A downgraded credit rating can indicate a greater risk to bondholders.
The report lists the company outlook as negative, which indicates the possibility of future credit downgrading in the next one to two years, Moody’s communications strategist David Jacobson said.
See here and here for the background. As EoW notes, the real issue is that Texas taxpayers will be on the hook for this in the event of a default or other inability by Texas 130 to pay. Keep that in mind if transportation funding gets added to the call of the special session as Sens. Williams and Nichols have requested.
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