Deal of the Year 2018 — Northeast: Triborough Bridge and Tunnel Authority

The Triborough Bridge and Tunnel Authority, also known as MTA Bridges and Tunnels, is a unit of New York’s Metropolitan Transportation Authority.

On September 20, it remarketed its tax-exempt $107.3 million Series 2001B general revenue variable rate bonds. This was the first municipal issuance of bonds linked to the Secured Overnight Financing Rate, or SOFR, index, and only the sixth SOFR-based transaction in the overall fixed-income market.

With the pending phaseout of the London Interbank Offered Rate, or LIBOR, the authority looked to SOFR as an index it wanted to incorporate into its debt portfolio.

The transaction was a successful remarketing for the TBTA as the 2001B credit facility was approaching its expiration date.

The TBTA initially offered the bonds at a rate of 67% of SOFR plus 48 basis points and, reflecting strong investor demand, the spread was tightened by five basis points to 43. Seventeen accounts placed orders for the bonds. TBTA fulfilled its new-money needs by pricing the next day another SOFR-based floating rate note structured with a two-year mandatory tender.

Finance director Patrick McCoy, speaking to board members, called it a proactive step for the MTA, one of the largest municipal issuers.