Bonds

The Transportation Trust Fund Authority is authorized to issue its own bonds to finance the Transportation Capital Program projects already authorized by the Legislature.

Unlike the voter approved general obligation bonds issued by the State, the Authority’s bonds do not pledge the "faith and credit" of the State for repayment.  The Authority's bonds are also not considered revenue bonds since actual yields from each of the revenue sources do not automatically flow to the Authority.

The Authority’s Transportation System Bonds and Transportation Program Bonds are each secured by payments made under separate “state contracts” between the Treasurer, the Commissioner of NJDOT, and the Authority. Payments under these state contracts are subject to appropriation from time to time by the Legislature, which has no legal obligation to make any such appropriation.  For this reason, the Authority’s bonds are typically referred to as “appropriation-backed bonds or "state contract debt."  The Authority's bonds also reference a "state contract" between the State Treasurer and the Authority. This contact pledges that if the Legislature appropriates funds to the Authority, the funds will be made available.

The current statute limits the maturity of bonds to 31 years. The Authority generally issues serial maturity bonds that provide level debt service payments over the 31 year repayment period.

The Debt Limitation Clause in Article VIII, Section 2, paragraph 3 of the New Jersey State Constitution was amended by the voters on November 4, 2008, to add the Lance Amendment. The Lance Amendment prohibits the Legislature from enacting legislation authorizing State Appropriation obligations payable from other than constitutionally dedicated sources unless such legislation is submitted and approved by a majority of legally qualified voters of the State voting thereon at a general election.

CREDIT RATINGS

The current credit ratings on the Authority's Transportation System Bonds and Transportation Program Bonds are as follows:

BOND ISSUANCES

• The 2006 Series C, 2008 Series A, 2009 Series A, and 2010 Series A were issued as capital appreciation bonds; values do not reflect accretion.

• The 2016 Series A, 2016 Series B, and 2018 Series A were Federal Highway Reimbursement Revenue Notes (Indirect GARVEE bonds) to fund cash expenses in FY 2017 and FY 2018.  These issuances did not count against the Authority's bond authorization limitation.

BOND ISSUANCE LIMITATION

• The 1995 Reauthorization replaced an aggregate $1.7 billion limitation covering the ten preceding years to a $700 million annual limitation with unused bonding authority carrying forward into the next fiscal year. 

• The 2000 Reauthorization amended the limitation to $650 million annually, following a one-year exemption of $900 million for FY 2000. 

• The 2006 Reauthorization amended the limitation to an aggregate $1.6 billion for FY 2007 through FY 2012, to be reduced for any fiscal year with revenue appropriations in excess of $895 million.

• The 2012 Reauthorization amended the limitation to specific amounts for FY 2013 through FY 2016.

• The 2016 Reauthorization amended the limitation to an aggregate $12 billion for FY 2017 through FY 2024 for the issuance of Transportation Program Bonds, including any gross premiums received with the refunding or remarketing of such bonds. For Transportation System Bonds, there would be no remaining unused statutory authorization (except a nominal amount representing the amount thereof in excess of the nearest integral multiple of $5,000) and only refunding issuances would be authorized under the 1995 Prior Bond Resolution, as amended and supplemented.  The Indirect GARVEE bond issuances would not count against the limitation.

• The 2024 Reauthorization amended the limitation to an aggregate $15.6 billion for FY 2017 through FY 2029, including any net premiums (previously gross premiums) received with the connection of refunding or remarketing of Transportation Program Bonds.

    Outstanding Bonds/Debt Service History State Contract Bonds

* The Outstanding Debt Total and Annual Debt service amount reflects State Contract debt only. It does not include the full, unamortized accretion values on capital appreciation bonds and Indirect GARVEE debt service. New money issues and refunding bonds are reflected at Par Value

** Audited numbers

(1) estimated

Current TTFA Debt Service Schedule (Millions of Dollars)

State Contract Transportation Bonds *

* State Contract Bond amounts exclude Build America Bond tax credits but includes accretions on capital appreciation bonds.

Current Debt Service Schedule (Millions of Dollars)

Indirect Garvee Bonds

* Debt Service related to July 2018 refunding of $1.3 billion in 2016 Series A Federal Highway Revenue Reimbursement Notes

Pay-As-You-Go History

* State revenues adjusted for any lapse in appropriation. Net Pay As You Go includes $66M from the NJTA in FY 2012.

** includes appropriation lapses and reflects $47.8M of FY 2015 debt service savings from the re-marketing of variable rate bonds held in General Fund reserve for FY 2016 debt service obligations.

(a) TTFA debt service amount does not reflect $94.3M and $152.3M of interest paid in FY 2017 and FY 2018, respectively, on the 2016 Series A and 2016 Series B Federal Indirect Garvee Notes funded by the Authority's Capitalized Interest Funds.

(b) Beginning in 2018 the 2016 TTF Re-Authorization provided for new Pay As You Go dedicated revenues from the Transportation Trust Fund - Sub Account for Capital Reserves.