The leaders of Orange County's largest tollway system cleared the way Thursday for a $2.4-billion bond sale designed to shore up the sagging finances of one of its highway networks.
Proceeds from the bonds will be used to refinance the Foothill-Eastern system, where the Transportation Corridor Agencies operates the 241 and 261 tollways.
The roads, which course through the hills of east Orange County, have been performing below their ridership and revenue projections. Studies indicate that without a refinancing, the Foothill-Eastern highways would default on their debt payments.
On Thursday, the Foothill-Eastern board approved a revised cooperative agreement with Caltrans, which maintains the highways and will take control of them once their debts are retired.
The pact is a prerequisite for the bond sale and was necessary because the refinancing will extend the toll collection period and the time when Caltrans can take them over from 2040 to 2053.
"This allows us to move forward on the refinance," said Lisa Telles, the TCA's communications director. "We still need to see what the market does" before the sale can proceed.
Telles said the agency, which operates 51 miles of tollways, might be able to issue the bonds before end of the year.
According to the agreement, the TCA will pay Caltrans about $215 million between 2041 and 2053, which can be used operations, maintenance or other transportation projects. It also cannot charge tolls after 2040 if the Foothill-Eastern corridor is built south of Oso Parkway in Mission Viejo -- the so-called Tesoro Extension -- unless Caltrans agrees.
"This agreement allows the authority to execute the needed restructuring of its debt while maintaining an important relationship with the department," Caltrans officials said in a prepared statement.