The Illinois State Toll Highway Authority (ISTHA) issued $873.7 million in bonds to refund previously issued securities.
The bonds mature between 2028 and 2039, yielding between 2.55% and 3.4% They received a rating of AA- from Fitch Ratings, Aa3 from Moody’s Investors Service, and AA- from S&P Global Ratings.
“The rating reflects the essentiality of the tollway system, evidenced by its long-term growing traffic base and moderate price elasticity,” Fitch analysts wrote.
The issuance caps a year in which the ISTHA returned to prepandemic levels of revenue and traffic for the first time. Over the first three quarters of 2023, ISTHA revenue was 100% of 2019 levels and traffic was 97% of 2019 levels, according to Moody’s.
The bond proceeds will refund securities the authority issued in 2013 and 2014.
The authority operates 294 miles of highway in 12 counties across northern Illinois, collecting tolls on many of those roads. The bonds are secured by the authority’s net revenues. ISTHA recorded $1.6 billion in operating revenue last fiscal year.
RBC Capital Markets, LLC and Wells Fargo Bank, NA, served as lead underwriters on the issuance, purchasing the bonds for more than $1 billion. The price reflected a premium of $137 million. PFM Financial Advisors LLC and Backstrom McCarley Berry & Co, LLC acted as municipal advisors.