The Texas Department of Transportation (TxDOT) achieved the greatest savings on a single bond deal in the history of the state with a $1.68 billion refinancing in January.
The bond issued refinanced most of the outstanding debt from the Central Texas Turnpike System (CTTS) that was first issued over a decade ago. The state saved upwards of $380 million in terms of present value. The savings total will be over $940 million by the end of the fiscal year 2026. Texas Transportation Commissioner Jeff Austin III called the refinancing an outstanding achievement for the department.
"This is a significant win for the state of Texas,” Austin said. “Over the long term, this is ultimately almost a billion dollars that will be used for roads, bridges and other transportation projects rather than paying off bond debt. We talk about being good stewards of taxpayers’ money, and the TxDOT finance team has walked that talk in a very significant way.”
TxDOT will benefit from the historically low interest rate of 4.09 percent with an average payback time of 21.4 years. With the refinancing, the department was able to payback an outstanding debt of $900 million from the Transportation Infrastructure Finance and Innovation Act loan for the CTTS.
Since 2012, TxDOT has completed five such bond refinancings for a total gross savings of $1.59 billion.