With more and more commercial trucks hitting the road each month, the DOT has announced a new loan program that may improve vital transportation infrastructure across the nation.
The U.S. Department of Transportation has announced the availability of up to $17 billion in loans for critical infrastructure projects across the country as a result of the recently enacted surface transportation bill.
The announcement comes at a time when the commercial trucking industry is showing signs of significant growth and trucking officials have regularly asked for more investments in highway infrastructure to help keep up with the growing number of trucks hitting the road each year.
In the announcement of available funding, U.S. Transportation Secretary Ray LaHood encouraged states and cities across the country to submit letters of interest for the Transportation Infrastructure Finance and Innovation Act program, which provides direct loans, loan guarantees and standby lines of credit to major infrastructure projects with the potential to create jobs and spur economic development and growth.
“Americans have always done big things – not in spite of hard times, but as a means of overcoming them,” said LaHood in the press release. “These investments will help cities and states create jobs right away, building the big transportation projects we need to make sure our economy continues to grow and prosper.”
Over $1.7 billion was provided in the recently enacted surface transportation bill, known as MAP-21. The funding will go towards capital over two years for the TIFIA credit assistance program, up from $120 million in fiscal year 2012, making it the largest transportation infrastructure finance fund in the department’s history.
Each dollar of federal funds can provide about $10 in TIFIA credit assistance, meaning $17 billion in loans through TIFIA, which in turn can leverage $20-$30 billion in transportation infrastructure investment. Altogether, the expanded federal loan program could result in up to $50 billion in federal, state, local and private sector investment for critical transportation projects across the country.
A wide range of critical transportation projects is eligible for the funding, including everything from highway and passenger rail projects to public transit and international bridges and tunnels. Because of the flexibility provided by the TIFIA programs, many qualified large-scale projects that otherwise might be delayed or shelved can move forward quickly.
In addition to announcing the availability of the expanded TIFIA funding, LaHood also announced the establishment of the Project Finance Center to help state and local government project sponsors analyze financial options for highway, transit, rail, intermodal and other surface transportation projects facing funding challenges. DOT said that through the PFC, it will have an opportunity to provide technical assistance to state and local sponsors of surface transportation projects seeking financial support, making it easier for communities to build the transportation projects they need.