Sandy Wallops MTA Infrastructure (Bond Buyer)

November 1, 2012 – Hurricane Sandy left the best laid capital plans of New York-area transportation agencies in shambles, flooding tunnels, subway lines and LaGuardia Airport and rendering most area rail services inoperable. Hardest hit is the Metropolitan Transportation Authority (A2 / 59259YTJ8), which was already scratching for money before the superstorm dealt a massive blow to its subway system. “I can say unequivocally that the MTA faced a disaster as devastating as it has ever faced,” MTA chairman Joseph Lhota said after the storm. It’s too soon after the storm to say how much it will cost to repair damage to the MTA, or how much farebox revenue will be lost, let alone how it will all be paid for. But it’s reasonable to assume that debt will help finance some of the physical recovery, said Alan Schankel, managing director at Janney Capital Markets in Philadelphia. “There will be more borrowing for infrastructure. That’s a probability,” he said. “You’ll see a greater number of capital projects. These are tight times, and this will also lead to shifting priorities.” Not only does it take time to tally the damage, but to learn how much outside support there will be for rebuilding. Sen. Chuck Schumer, D-NY, at a press conference, said he plans to ask the federal government for 90% reimbursement on infrastructure. “The 90% is what’s called for and we are asking for that,” he said. “We have yet to see what dollar amount help will come in in federal aid or state aid or how that will work, but these kinds of arrangements generally work out well,” Schankel said.

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