Bloomberg

MTA Maxed Out Its Fed Credit Line. So Now What?

Absent a huge injection of federal funds, the MTA’s options are limited. The agency had more than $45.5 billion of debt as of Nov. 4, even before last week’s borrowing from the Fed’s facility, and its forecast is for a $16.2 billion deficit through 2024. As I wrote in June, the MTA is legally barred from filing for bankruptcy, and the state has pledged not to change the law as long as any transportation revenue bonds are outstanding.

For those who might be wondering, it’s also almost certainly not possible for the MTA to simply walk away from its $3.35 billion in notes sold to the MLF and have the Fed and Treasury foot the bill without triggering a cascading effect on its entire debt structure, according to Matt Fabian at Municipal Market Analytics. As Richard Ravitch, a former MTA chairman, told me in September, the agency is entirely at the mercy of Washington lawmakers to strike a fiscal aid deal.

https://www.bnnbloomberg.ca/mta-maxed-out-its-fed-credit-line-so-now-what-1.1536126