As background, Indian River County has appealed Federal Judge Cooper’s decision in favor of Brightline at a cost of $400,000 to IRC. One of their claims is that the PABs are designed as highway bonds and not rail bonds. If the Judge’s decision is overturned and the $1.7B Private Activity Bonds (PAB) have been sold, these bonds will be recalled.
If they have not been purchased, bondholders will have to factor in the possibility that these bonds may be recalled at a future date.
Additionally, there is little equity supporting these bonds and with the withdrawal of the Virgin IOP, there is none insight. Also, Virgin has pledged in their last PAB sale of $600mm that these original bonds would be redeemed in the next bond sale.
This financial structure of debt upon debt with little equity cannot be sustained.
Stand by because underneath it all, there is a lack of ridership which becomes more apparent every day.