Sonoma Marin Area Rail Transit (SMART) officials said this week that the agency successfully sold $199,172,032 million in bonds to fund construction of a train and pathway linking Marin and Sonoma Counties.
SMART is bonding against its Measure Q sales tax revenue to fund the SMART train, bicycle and pedestrian path approved by nearly 70 percent of voters in 2008. The sale of $199,172,032 in bonds will net SMART $171 million in construction and additional funds in construction reserves, which will help build the rail line, buy trains and construct bridges, crossings and train stations.
“We moved to implement this fixed-rate conversion when market conditions were optimal with a team that led the way toward the best result for taxpayers,” SMART Chairperson Sonoma County Supervisor Valerie Brown said in a statement.
“This funding completes the financing that SMART will use to ease traffic congestion, create jobs, improve the business climate, and offer a greener way to move around the North Bay. We appreciate the opportunity the residents of both counties have given us,” said Marin Supervisor and SMART’s Vice Chair Judy Arnold.
The SMART rail project was approved by voters in 2008 and by a group of voters who sought to derail the rail line. Work has already started on portions of the line, with the first phase running 38.5 miles between downtown San Rafael and Santa Rosa. Eventually, the agency plans to extend the line to cover 70 miles from Cloverdale to Larkspur, allowing direct access to San Francisco ferries.
“The end result is that SMART was able to generate the funds it needed to complete the project, including important project reserves," said Farhad Mansourian, SMART’s general manager. "The interest in SMART bonds was very high, with participation by over 30 different well-known institutional investors, including between 5 to 10 California municipal bond funds."
The bond sale produced total proceeds of $199,172,032, with SMART’s overall interest costs of just above 3.3 percent, and yields ranging from 1 percent to 3.4 percent for investors.
“It’s hard to imagine a better result for the project and the taxpayers of Sonoma and Marin,” Mansourian said.