Bonds are part of the plans for a transit sales tax measure voters in Columbus, Ohio, approved this week.
Voters in the Central Ohio Transit Authority service area approved a sales tax measure with more than 56% in favor.
The 0.5% sales tax in COTA's service area of Franklin County and portions of four other counties will increase to 1%. In Columbus, that brings the levy to 8% from 7.5%.
Erin Delffs, chief financial officer at COTA, told The Bond Buyer that the authority's plan for modernizing the transit system in Franklin County includes issuing up to $500 million in sales tax revenue bonds between 2025 and 2050, with the first series to be issued in the third or fourth quarter of 2025.
COTA will also distribute a portion of the sales tax revenue to municipalities who have applied for and were granted funding for 500 miles of sidewalks, trails and bikeways projects. COTA will not issue bonds for those projects.
The Issue 47 tax increase is projected to bring in $8 billion for transit in central Ohio.
The authority has sold bonds once, a $30 million deal in 2023 rated AAA by S&P Global Ratings, based on sales-tax revenue coverage backed by the authority to levy a property tax if needed.
The outlook is stable.
COTA officials say the new revenue
"This is a pivotal moment for COTA and the entire Central Ohio region," President and CEO Monica Téllez-Fowler said in a statement. "With the passage of Issue 47, we are empowered to make significant investments in our transit system that will improve access, equity, and sustainability for everyone."
The additional revenue will also fund improved paratransit service and the construction of 500 miles of sidewalks, trails and bikeways to improve public transit access, said Jeff Pullin, COTA director of public relations.
Two more rapid transit lines will be announced later on.
"This is a growth strategy as we anticipate up to 1 million more people living and working in Central Ohio by 2050," Pullin said. "Additionally, a 1% sales tax helps fund COTA at a funding rate similar to peer transit agencies."
Franklin County's 2020 population of 1.3 million was up 12% from 2010, according to the U.S. Census. Columbus itself has more than 900,000 residents.
The projected annual investment of $60 million will fund 83 projects across 35 cities, villages and townships over the first five years of the increased levy, according to a press release.
"Issue 47's approval reflects Central Ohio's shared commitment to building a connected, vibrant and equitable region," said Columbus Mayor Andrew J. Ginther in a statement.
"This is a win for all of Central Ohio," said Mid-Ohio Regional Planning Commission Executive Director William Murdock. "Not only will [we] never again have to say we are the largest city in the nation without rapid transit, but every community in our region will have safer sidewalks, trails and bike paths that will better connect them to their neighbors and COTA."
