(The following statement was released by the rating agency)NEW YORK, March 10 (Fitch) Fitch Ratings has affirmed LBJ Infrastructure Group, LLC's (LBJ) approximately $615 million senior lien revenue bonds series 2010 issued by the Texas Private Activity Bond (PAB) Surface Transportation Corporation and $850 million Transportation Infrastructure Finance and Innovation Act (TIFIA) loan at 'BBB-', with a Stable Outlook.The affirmation reflects Fitch's expectation that the project will be delivered broadly on schedule and on budget. Segment 3 was delivered on time and segments 1 and 2 remain on or ahead of schedule. Regional macroeconomic demographics and development in the Dallas-Fort Worth metropolitan area is broadly in line with Fitch's expectations at closing.  Corridor traffic and congestion levels continue to support Fitch's base and rating case traffic and revenue assumptions.KEY RATING DRIVERS:Moderate Completion Risk:Construction is occurring in an operating environment, which necessitates keeping the majority of general purpose lanes (GPLs) open during most daytime periods. Other project responsibilities include the construction of complex connecting and overpass features. The fixed-price turn-key contract has adequate protections that mitigate completion risk at the current rating level and completion risk is further mitigated by the advanced stage and the large proportion of costs already outlaid, as well as security package features such as a performance bond. Completion Risk:  Mid-RangeStrategic Asset Location with Competing Alternatives: The facility is strategically located in a highly congested area north of Dallas and near the Dallas-Fort Worth Airport. This strategic location is further enhanced by the solid economic profile of the service area, which has benefited from considerable population and employment growth over the last decade. However, the presence of free alternative competing GPLs directly next to the managed lanes (MLs) could materially affect the congestion on the GPLs.  Revenue - Volume: Mid-RangeStrong Rate-Making Flexibility but Uncertain Price Sensitivity: Demonstrated traffic congestion in both directions during weekday a.m. and p.m. peak periods, weekday inter-peak, and weekend daytime would normally provide strong ratemaking ability, although there is a limited amount of meaningful history for this type of asset class. Assumed operation close to the point of revenue maximization caps the assessment at midrange. Revenue - Price: Mid-RangeInfrastructure Renewal and Replacement: Upon completion, the project will have four to six new MLs, significantly increasing the capacity of the existing road, and one-way frontage roads will be added. The project contains adequate mechanisms to assess and address infrastructure requirements on an ongoing basis through the life of the debt. Infra/Renewal: Mid-RangeDebt Structure: The senior PABs plus TIFIA loan structure is typical for this project type. Debt is all fixed-rate with no refinance risk. While the leverage and debt service coverage tests in the equity contribution agreement are weak, equity contributions are backed by a letter of credit.  Debt Structure: StrongerModerate Financial Flexibility and High Leverage: The project has an estimated $23 million total debt per lane mile (senior debt plus TIFIA loan), despite significant public contributions and sponsor equity. In addition, net debt-to-cash flow available for debt service is high in 2016 at 25x. No future borrowing is expected. RATING SENSITIVITIES:-- Material construction delays or cost over-runs that affect projected cover ratios and financial flexibility through the operational phase;-- Sustained material traffic underperformance, or inability to raise tolls close to forecast levels once operational that signifies more than ramp-up-related issues, or a significantly prolonged ramp-up period that stretches liquidity/flexibility support;-- Operating and capital expenditures during the operational period significantly above expectations that cause financial flexibility to be reduced and a lower coverage profile;-- Sustained material traffic and/or toll rate overperformance that results in a coverage profile significantly above Fitch expectations.SECURITY: The bonds are secured by net toll revenues generated from the IH-635 ML project in Dallas, TX.CREDIT UPDATE:The LBJ freeway (IH-635) project is currently in the fourth year of a five-year construction period. Upon completion, the project will include an eight-lane GPL freeway, a four- to six-lane ML facility, and a continuous two- to three-lane frontage road system with access ramps. As of January 2014, the total value of work completed for design and construction is $1,537.6 million, approximately 74.1% of the total project cost. Segment 3, which represents the easternmost section of the ML project, reached completion on Dec. 14, 2014, and is now operational; segment 1, which is the westernmost section of the project relating to the MLs being built on IH 35E, is expected to be delivered during 2014; segment 2, which comprises the middle section of the road, is the longest section and also involves the most complex construction, is not expected to be completed until close to scheduled completion in December 2015, but currently remains on schedule and on budget.The project is scheduled to be fully operational by December 2015. To the extent that completion is later than anticipated, Fitch believes the liquidated damages provision in the design build contract will help cover the project's fixed expense obligations.Contact:Primary AnalystSaavan GatfieldSenior Director+1-212-908-0542Fitch Ratings, Inc.One State Street PlazaNew York, NY 10004Secondary AnalystSeth LehmanSenior Director+1-212-908-0755Committee ChairpersonChad LewisSenior Director+1-212-908-0886Media Relations: Elizabeth Fogerty, New York, Tel: +1 (212) 908 0526, Email: elizabeth.fogerty@fitchratings.com.Additional information is available at '
  www.fitchratings.com'
 Related Research: --Rating Criteria for Infrastructure and Project Finance, 11 July 2012--Rating Criteria for Toll Roads, Bridges, and Tunnels - 16 October 2013Applicable Criteria and Related Research: Rating Criteria for Infrastructure and Project Finance
  http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=682867
 Rating Criteria for Toll Roads, Bridges and Tunnels
  http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=720736
 Additional Disclosure Solicitation Status 
  http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=823156
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