The Financial Crisis Takes a Toll on the Turnpike Authority
The fallout from the subprime mortgage collapse has hit Boston hard. Entire neighborhoods have been abandoned by homeowners who fell behind on their payments, and the economic impact of questionable loans is spreading beyond the real estate market. Now the Turnpike Authority is in trouble with a variable-rate loan, and it can’t walk away from the 138-mile roadway it’s responsible for.
Back in 2001, the agency got a one-time $29.1 million cash payment by taking out three loans. Now the agency is beginning to pay the money back, with huge amounts of interest and fees.
Based on Monday’s interest rates, the monthly payments are currently $336,000, [Turnpike director Alan] LeBovidge said. They would increase to an estimated $857,000 in July and to more than $2 million in January, assuming that UBS exercises its third contract and that the authority is unable to refinance.
And you thought your mortgage payments were bad.
On a positive note, the Turnpike board is optimistic that it can find a way to refinance the loans before the monthly payments balloon in January. It may also recoup some of its losses by establishing tolls on parts of the highway system that are currently free. Naturally.
But the news isn’t all bad for Turnpike drivers. Sure, you’ve got to contend with “captive advertising” and the possibility of higher tolls, but you may be able to legally use the U-turn ramp in Allston. Of course, you’ll have to pay a toll for the privilege.