Los Angeles County

Metropolitan Transportation Authority 4

Measure R Sales Tax:
Debt Overview

Measure R Independent
Taxpayers
Oversight Committee Meeting
March 6, 2017
Measure R Sales Tax: Debt Overview

Why We Use Measure R Debt

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Recent Measure R Debt Financings
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Outstanding Measure R Debt

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 Measure R Sales Tax: Debt Overview
Measure R Ordinance authorized & anticipated debt financing

Measure R Ordinance Section 8

The Measure R Oversight Committee shall:

18 4. Review all proposed debt financing and make a finding as to

19 whether the benefits of the proposed financing for accelerating project delivery,
20 avoiding future cost escalation, and related factors exceed issuance and interest
21 costs.

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 Measure R Sales Tax: Debt Overview
Metros Debt Policy restricts debt financing
Only Transit and Highway Capital categories are eligible
The policy further limits revenue available for debt within the eligible categories
47% of Total Measure R Revenues are eligible for borrowing
53% of Total Measure R Revenues are not eligible for borrowing

35% Rail and/or Bus Capital

20% Highway Capital Eligible Revenue allocation categories Include:

87% of 35% Rail and/or Bus Capital Revenues 30.45%
2% Metro Rail Capital
87% of 3% Metrolink Revenues 2.61%
3% Metrolink 87% of 2% Metro Rail Capital Revenues 1.74%
60% of 20% Highway Capital Revenues 12.00%

Ineligible Revenue allocation categories Include:

Non-Bondable
15% Local Allocation Revenues
20% Bus Operations Revenues
5% Rail Operations Revenues
Remaining Portion of Bondable Revenue Categories

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 Measure R Sales Tax: Debt Overview
Debt bridges the gap between revenues received and expenditures to:
Accelerate project delivery
Avoid future cost escalation
Measure
Access funds at very low cost R
Revenues vs Expenditures
1,400,000,000

1,050,000,000

$" 700,000,000

$" 350,000,000

$" -0
FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017*

Expenditures Funded by Debt

Expenditures Funded by Cash 5
*Expenditures per the FY 2017 Budget Eligible Revenues
 Measure R Sales Tax: Debt Overview
Recent Transaction Results
Measure R Sales Tax Revenue Bonds Series 2016-A
Sale Date: November 17, 2016
Sale Proceeds: $601.0M
TIC: 3.42%
Final Maturity: 2039
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TIFIA Westside Purple Line Section 2
Closing Date: December 20, 2016
Principal: $307.0M
Rate: 2.90%
Final Maturity: 2037

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 Measure R Sales Tax: Debt Overview
Measure R benefits from a mix of three types of debt

Short-term Long-term TIFIA

Notes Bonds Loans

Quick access Matches debt Provides Metro

to funds helps service with the with project
Metro to keep useful life of a specific
construction project financing
projects moving flexibility

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 Measure R Sales Tax: Debt Overview
Measure R Short-Term Program keeps projects moving forward
Allows LACMTA to:
Quickly fund construction projects
Obtain low cost financing
Avoid delays and future cost escalation
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Major projects that have utilized the Short-Term Program:
Westside Purple Line Extension Section 1
Expo 2
Blue Line

Short-Term Program
(in millions)

Program Authorization $300.0

Outstanding Par as of 3/1/17 $0.2

Issuance Date 11/01/2015
Expiration 11/20/2020

Bank of the West

Banks providing
State Street
lines of credit
RBC Capital Markets
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 Measure R Sales Tax: Debt Overview
Measure R Senior Bonds bring long-term solutions
Allows LACMTA to:
Lock in low long-term rates due to Measure Rs Aa1/AAA credit ratings
Match life of the bond with the life of the project
Structure debt service near level to provide better budget certainty

Long Term Bonds

(in millions)

Principal Available
Issue Outstanding Proceeds Major Projects Funded
Series 2010 A & B $652.1 - Expo 2, Gold Line
Foothill Extension,
Series 2016 A 522.1 $175.2 Expo 2, Crenshaw/LAX, Blue
Line, Westside Purple Line
Extension Section 1
Grand Total $1,174.2 $175.2

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 Measure R Sales Tax: Debt Overview
TIFIA* Loans provide Metro with project specific financing flexibility
Direct Loan with U.S. Department of Transportation
Interest does not begin accruing until the proceeds are drawn
Amortization schedules meet overall Measure R funding needs
Low interest rates

TIFIA Loans
(in millions)

Loan Drawn Final

Project Amount to Date Available Maturity
Crenshaw/LAX $545.9 $545.9 - FY2034

Regional Connector 160.0 61.9 $98.1 FY2036

Westside Section 1 856.0 - 856.0 FY2037

Westside Section 2 307.0 - 307.0 FY2037

Grand Total $1,868.9 $607.8 $1,261.1

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*Transportation Infrastructure Finance and Innovation Act (TIFIA)
 Measure R Sales Tax: Debt Overview
Measure R benefits from a mix of three types of debt

Measure R Debt Program

(in millions)

Current Outstanding Projects Funded

Debt Type (March 1, 2017) by Debt Proceeds
Westside Purple Line
Measure R Short-Term Notes $0.2
Extension Section 1
Expo 2; Gold Line Foothill
Measure R Long-Term Bonds $1,174.2 Extension; Blue Line;
Crenshaw/LAX; Westside
Purple Line Extension Section
Crenshaw/LAX;
Measure R TIFIA Loans $607.8
Regional Connector

Grand Total Measure R Debt $1,782.2

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Measure R Sales Tax: Debt Overview

Questions?

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