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Fitch Ratings Upgrades San Joaquin Hills Transportation Corridor Agency Toll Revenue Bonds

Rating agency cites solid financial profile, fiscal management and governance of the 73 Toll Road.

Irvine, Calif. - December 19, 2022

Citing the 73 Toll Road’s robust and ongoing recovery from impacts of the COVID-19 pandemic and associated effects, Fitch Ratings has upgraded the San Joaquin Hills Transportation Corridor Agency’s (SJHTCA) senior-lien and junior-lien bonds. The SJHTCA operates the 73 Toll Road.

Following are the SJHTCA’s current bond ratings:

  • S&P: A and A- respectively, with outlook stable
  • Moody’s: Baa2, with outlook stable
  • Fitch: BBB+ and BBB respectively, with outlook stable

“The upgrade reflects SJHTCA's strong coverage metrics in Fitch's rating case, expectations for no additional leverage over the near to medium term, and the facility's significant liquidity position,” stated Fitch Ratings in a release dated Dec. 14, 2022.

“Fitch Ratings’ decision to upgrade the bonds reflects the work of this Board of Directors, as well as previous Boards, in collaboration with management staff to ensure The Toll Roads maintain a strong financial position and continue to provide excellent service and make meaningful improvements to the 73 Toll Road,” said SJHTCA Chair and Newport Beach City Council Member Will O’Neill.

“The upgrade highlights the fiscal strength of the Agency and the 73 Toll Road continues to be an asset, providing congestion relief for the region. Fiscal prudence has been and remains the foundation for the Board’s approaches. It is important that the Agency continues its path of fiscal responsibility, while continuing to explore opportunities to strengthen its position,” said SJHTCA Vice Chair and Laguna Hills Mayor Janine Heft.

“Strong fiscal management is core to the Agencies’ past and future success,” said TCA CFO Amy Potter. “These decisions are driving the Agencies’ mission to create opportunities to further reduce debt. Staff continues its commitment to working with our two Boards of Directors to focus on sound fiscal management and fulfilling the Agencies’ mission contributing to the movement of people and goods.”

All bonds issued by the Transportation Corridor Agencies (TCA) are rated investment grade. The bonds were issued to fund construction of the 73, 133, 241 and 261 Toll Roads and are repaid using toll revenue. The Agencies have taken significant steps to manage debt by leveraging lower interest rates through bond refundings without extending maturity dates and considering plans for early paydown of the bonds prior to maturity as they become callable.

The SJHTCA and Foothill/Eastern Transportation Corridor Agency (F/ETCA), which comprise TCA, are two joint powers authorities created to plan, finance, construct and operate Orange County’s 51-mile toll road network – the 73, 133, 241 and 261 Toll Roads.

The upgrade by Fitch Ratings follows recent rating upgrades for the F/ETCA and SJHTCA bonds by S&P Global Ratings in March 2022 and November 2021, respectively.

In March 2022, S&P Global Ratings upgraded the F/ETCA senior-lien and junior-lien bonds to A and A-, respectively, with outlook stable. In November 2021, S&P Global Ratings has upgraded the SJHTCA senior-lien and junior-lien bonds to A and A- respectively, with outlook stable.

The Toll Roads have been providing a choice for drivers for nearly 25 years and the tolls collected are used to repay the debt incurred to construct the system and fund on-going operations and improvements.

The Toll Roads system, which represents 20% of Orange County’s highways, is the largest toll road network in California.

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 comprised of the 73, 133, 241 and 261 Toll Roads.