U.S. DOT announces $17 billion in transportation financing

U.S. Transportation Secretary Ray LaHood today announced the availability of up to $17 billion in federal loans for major transportation infrastructure projects.

The expanded funding, which will be made available through the federal Transportation Infrastructure Finance and Innovation Act (TIFIA) program, was incorporated into an 18-month extension of the surface transportation bill, MAP-21, passed by Congress June 29.

Under the TIFIA program, the U.S. Department of Transportation provides direct loans, loan guarantees and standby lines of credit to major infrastructure projects ”“ typically those costing upwards of $50 million ”“ that promise to spur job creation and economic activity.

The New York State Thruway Authority in December 2011 submitted a letter of interest for TIFIA assistance in financing a new, $5 billion Tappan Zee Bridge.

The state was not selected by the Transportation Department to apply for TIFIA assistance as part of the current round of funding, due in large part to the limited funds that were available. State officials have said they would submit a second letter of interest after Congress re-authorized the program.

MAP-21 ”“ short for Moving Ahead for Progress in the 21st Century ”“ calls for $750 million in TIFIA funding to be made available during the federal government”™s 2013 fiscal year, which begins Oct. 1, 2012, and for $1 billion in funding to be made available for the 2014 fiscal year.

Each dollar of federal funding can provide approximately $10 in TIFIA credit assistance, according to the Transportation Department.

LaHood said in a July 27 conference call with reporters that the $17 billion in available federal financing is projected to spur another $20 to $30 billion in public and private investment.

“Altogether, the expanded loan program could result in up to $50 billion in public and private investment to put toward addressing infrastructure needs across the country,” LaHood said.

LaHood also announced the creation of the Project Finance Center to help state and local government project sponsors to analyze financial options for highway, transit, rail and other surface transportation projects.

All project sponsors seeking to apply for TIFIA credit assistance must first submit a letter of interest to the Transportation Department, with all letters accepted on a rolling basis.

Project sponsors that have previously submitted letters of interest for a prior fiscal year”™s funding must submit a new letter of interest in order to be considered for future funding.

To date, the TIFIA program has used $9.2 billion in funding to leverage more than $36.4 billion in private capital and other investments that have helped to construct 27 major transportation projects nationwide, LaHood said.

“From the Erie Canal to the interstate highway system, we”™ve invested in our infrastructure as a way of giving the next generation a better future,” LaHood said.