Cintra, the Spanish-owned company that in 2006 along with Australia's Macquarie Group Ltd. signed a 75-year, $3.8-billion contract to operate the Indiana Toll Road, maintains that slower-than-expected payback on that deal doesn't affect its ability to finish three projects in Texas worth $5 billion.

In May, it was reported the company had spent two-thirds of a required $150 million reserve fund even though it had raised tolls on the 157-mile Indiana road substantially. In Texas, Cintra's involved in expanding Interstate 635 in Dallas, building a toll road between Austin and San Antonio, and rebuilding Loop 820 and Texas 121/183 in Tarrant County, all of which are 52-year agreements.

Cintra US Vice President of Corporate Affairs Patrick Rhode says projects are developed and financed separately, so failing to meet obligations on one won't affect the others. It's “virtually impossible” to default during construction and, should the company file for bankruptcy during operation, the project owner – Indiana DOT or Texas DOT, for example – isn't responsible for the company's debts.

In regard to Texas specifically, he says:

  • Bonds are issued; the federal loan is fully committed; the Texas DOT has allocated its public funds; and investors have contributed $274 million and provided “firm commitments” for three times as much.
  • Should operations revenues come in 50% below projections, cash flows still would be sufficient to repay the debt.
  • Rating agencies deemed project bonds “Investment Grade.
  • The projects benefit from “robustly guaranteed” lump-sum, fixed-price and delivery design-build contracts.