$12.8 Million Approved in Fiscal Year 2020 Budget to go to OCERS
IRVINE, Calif.–(BUSINESS WIRE)–#133tollroad–In a demonstration of the Transportation Corridor Agencies’ strong
financial health and commitment to fiscal responsibility, the Boards of
Directors of the Foothill/Eastern Transportation Corridor Agency
(F/ETCA) and San Joaquin Hills Transportation Corridor Agency (SJHTCA)
voted to pay off TCA’s unfunded pension liability with the Orange County
Employees Retirement System (OCERS) on July 1 of this year.
“In an era when so many public agencies find themselves with their backs
to the pension wall, it’s a sign of TCA’s financial strength and
compliment to my fellow Board Members and staff that we’re in a position
to pay off our unfunded pension liability,” said Director Joe Muller,
chair of TCA’s Joint Finance & Investment Committee and Dana Point Mayor.
TCA’s unfunded actuarial accrued liability (UAAL) currently stands at
$12.8 million. By paying that off now, Muller explained, TCA can lower
its employer contribution rate by almost half of the 24 percent of
salaries that it is currently obligated to pay.
“Paying off the unfunded pension liability allows TCA to realize a
present value savings of approximately $2 million based on the interest
we pay to OCERS compared to the interest we earn on our cash,” said Amy
Potter, Chief Financial Officer for TCA. “TCA is a very strong agency,
both financially and operationally, thanks to the actions of our Boards
Muller contrasted TCA’s action with the growing number of Orange County
cities resorting to tax increases to cope with rising unfunded pension
liability costs that consume expanding percentages of their budgets.
TCA’s decision to pay off the Agencies’ UAAL is the latest in a series
of actions taken by TCA to reinforce its strong financial foundation.
TCA is the government agency overseeing operations of California’s
largest network of toll roads – State Routes 73, 133, 241 and 261. In
2013 and 2014, the TCA’s took advantage of historically low interest
rates and refinanced their bond debt. The $2.3 billion F/ETCA refinance
deal attracted national attention as one of the largest fixed-rate
municipal transactions of 2013.
Since the bonds were restructured, all three major credit rating
agencies upgraded both F/ETCA and SJHTCA as investment grade. S&P Global
Ratings called TCA’s market position “strong,” and said its “role as a
congestion reliever” made using its network of toll roads a “virtual
requirement for drivers who depend on time savings.”
The F/ETCA and SJHTCA Boards of Directors and staff remain committed to
ensuring The Toll Roads are financially stable and that the Agency is
positioned to provide excellent service and be sustainable into the
future – for both customers and employees.
The Transportation Corridor Agencies (TCA) are two joint
powers authorities formed by the California legislature in 1986 to plan,
finance, construct and operate Orange County’s public toll road system.
Fifty-one miles of the system are complete, including the 73, 133, 241
and 261 Toll Roads. TCA continues to meet the region’s growing need for
congestion-free transportation alternatives.
Sarah Swensson King