The Oklahoma Turnpike Authority (OTA) is preparing for a substantial financial undertaking, planning to issue approximately $1.3 billion in bonds to finance ongoing expansion projects and to refinance existing debt. This financial maneuver highlights not only the aggressive push towards infrastructure enhancement but also the tensions surrounding such expansions. Expected to hit the bond market later this month, the issuance includes $1.087 billion in tax-exempt second senior revenue bonds and $223.3 million designated for refunding previously issued bonds. Bookrunner Goldman Sachs is set to manage the pricing of this bond issuance, conditional upon market fluctuations.
At the heart of this financial expansion is the ACCESS Oklahoma program, an initiative aimed at widening current toll roads and constructing new ones. Launched by Governor Kevin Stitt in February 2022, the project’s estimated costs have burgeoned from an initial $5 billion to $8.2 billion, raising eyebrows and concerns among various stakeholders. Recently, in response to this significant budget increase, the OTA board authorized a toll hike, stirring legislative pushback for increased oversight over such rate changes. The program’s ambition is met with skepticism from affected property owners, who have raised legal challenges against it, claiming the expansion encroaches on their properties.
Despite the controversies, the OTA has received favorable ratings for its initial $500 million bond issuance in October 2023, with ratings of Aa3 from Moody’s and AA-minus from both S&P Global Ratings and Fitch Ratings, all accompanied by a stable outlook. However, the precautionary measures taken by OTA are noteworthy. The agency’s bond issuances have been marked by delays due to ongoing litigation which culminated in a favorable ruling from the Oklahoma Supreme Court, validating the issuance and clearing the path for those earlier financial moves.
The Call for Accountability
The growing dissent against the ACCESS Oklahoma program has galvanized activists, such as Oklahomans for Responsible Transportation, to demand more accountability and transparency from the OTA. These groups are advocating for a comprehensive third-party feasibility study and stressing the necessity for a review of compliance regarding the upcoming bond issuances. They have actively requested a moratorium on further bond sales until the complete state audit of the OTA, mandated by Attorney General Gentner Drummond, has been concluded.
As the OTA prepares to embark on this new phase of financing, the intersection of infrastructure development and public accountability remains crucial. The upcoming bond issuance not only represents a pivotal funding mechanism for Oklahoma’s infrastructure enhancements but also serves as a litmus test for public trust in the agency’s governance. Vigilance from both regulatory bodies and community stakeholders will be essential in navigating the complexities of financing ambitious projects while ensuring that the interests of all Oklahomans are duly considered.