By Timothy Cama, Staff Reporter This story appears in the Aug. 6 print edition of Transport Topics.
The Obama administration is making up to $17 billion available for transportation infrastructure project loans, thanks to a provision in the new transportation law, the Department of Transportation announced.
Under the law signed into law by President Obama, $1.75 billion is available over the next two years for the Transportation Infrastructure Finance and Innovation Act program, DOT said. Because each dollar of funding can be used for about $10 in loans, DOT soon will make $17 billion available for loans, loan guarantees and lines of credit.
“TIFIA offers flexible terms and gives many qualified, large-scale projects the extra boost they need to break ground and put people back to work,” Transportation Secretary Ray LaHood told reporters July 27. “This is a sign that in a time of fiscal austerity, we can still do big things.”
Through additional leveraging, the money could lead to up to $50 billion in infrastructure investment, LaHood said, adding that it is the largest infrastructure loan program in DOT history.
TIFIA started in 2008 and had $120 million of funding in the most recent year. The program has been used in 27 projects so far, where DOT has used $9.2 billion to leverage more than $36.4 billion in funding.
A wide range of projects is eligible for TIFIA financing, such as highways, bridges, tunnels and transit.
The funds have been used in projects such as the South Bay Expressway in California, the Port of Miami tunnel in Florida, the Intercounty Connector in Maryland, the Central Texas Turnpike System and the Triangle Expressway in North Carolina.
“We’re going to be looking for projects that are of national significance where folks are working together,” LaHood said.
The transportation law provides $750 million in fiscal 2013 and $1 billion in 2014 for the program. Though the increase does not take effect until Oct. 1, DOT has started taking applications for the expanded program.
The Senate proposed last year to expand TIFIA, which supporters saw as a program that could increase transportation investment without a great deal of federal spending. Democrats have supported creation of a national infrastructure bank as another financing option, but Republicans pushed back, and that did not make it into the final highway bill that both chambers agreed on (10-17, p. 7).
In addition to the funding increase, the law signed last month allows government entities to use TIFIA financing for up to 49% of a project’s cost, up from the previous limit of 33%. The remainder of the funding must come from other sources.
In a statement after the highway bill passed, New York Gov. Andrew Cuomo (D) said the program could increase the funding prospects for replacing the Tappan Zee Bridge, which carries Interstate 87 over the Hudson River.
“New York is in a group of projects that received strong ratings on their applications for TIFIA funding, which was dramatically increased in this legislation,” Cuomo said in a statement.
Los Angeles Mayor Antonio Villaraigosa (D) said that the expanded TIFIA could help a number of southern California projects get off the ground.
