By Joseph Spector
Albany Bureau Chief
ALBANY - Moody's Investors Service on Friday became the latest credit agency to downgrade the finances of the state Thruway Authority, warning about the uncertainty of funding for a new Tappan Zee Bridge.
The credit agency gave the Thruway Authority a stable outlook, but said the debt related to the new $3.9 billion bridge is reason for the downgrade.
"The downgrade considers that future financial performance will rely to a much greater extent on as yet undetermined toll increases to support the bridge construction costs and that failure to adopt sufficient rate increases within the expected time horizon would pressure financial metrics," Moody's said.
Last month, Standard & Poor's downgraded the Thruway, also citing questions about the bridge's finances.
The massive project landed a major victory last week when the federal government agreed to issue a $1.6 billion low-interest loan for the bridge, which will run over the Hudson River between Westchester and Rockland counties.
But the Thruway Authority, which will own the bridge, has yet to detail the toll structure for the new bridge. It says it plans to borrow $2.4 billion to complete the funding for the bridge, which is also expected to incur another $900 million in additional costs.
The Thruway said earlier this week that it won't rely on tolls from the rest of the 570-mile thoroughfare to fund the bridge's construction, one of the largest projects in the nation.
There was no immediate comment from the Thruway Authority on Moody's rating.
Moody's said the stable outlook was the result of the "strategic and vital transportation role" of the Thruway and its "generally stable financial performance achieved through fairly steady toll increases." It also notes that the state has recently picked up some costs associated with the Thruway.
But the agency said that, "Failure to deliver the project within budget and on time due to higher project costs, a longer permitting or construction period, or insufficient toll increases to support associated debt would place negative pressure on the rating."