Green bonds solidify final piece of funding for Mid-Coast Trolley project

The San Diego Association of Governments (SANDAG) has issued $335 million of its Series 2019 Capital Grant Receipt Revenue Bonds to help finance the construction of the Mid-Coast Trolley Project. The bonds will accelerate SANDAG’s receipt of an approximately $1.04 billion grant with the Federal Transit Administration under the Capital Investment Grant (CIG) program.

“The bonds were issued at a low borrowing cost, which will allow us to maximize the use of federal dollars for the project,” said SANDAG Chair and Poway Mayor Steve Vaus. “The Mid-Coast Trolley project is the largest transit project in the San Diego region’s history, and once complete, San Diegans will feel the positive impact for generations to come.”

The Series 2019 Bonds were issued on July 30 in a total par amount of $335 million, maturing from 2023 through 2027, with an estimated all-in borrowing cost of 1.91 percent. The bonds were designated as “Green” given the significant benefit the Mid-Coast Trolley Project is expected to have in reducing emissions in the San Diego region. 

The Mid-Coast Trolley Project, which is currently under construction, will add nine new stations and extend San Diego Trolley service for 11 miles from Old Town to UC San Diego and University City. It is expected to begin service in late 2021.

The cost of the $2.1 billion project is being split between the federal New Starts Program, which has committed $1.04 billion, and the region’s TransNet program, the local half-cent sales tax for transportation administered by SANDAG.  The Series 2019 Bonds are expected to represent the final piece of financing required to successfully deliver the Mid-Coast Trolley Project to the region.