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Federal Tools for Financing Idle Reduction

Federal Tools for Financing Idle Reduction. Federal Highway Administration National Resource Center Jennifer R. Mayer Jennifer.mayer@fhwa.dot.gov (415)744-2634. Innovative Financial Tools. State-Based Tools CMAQ funds State Infrastructure Banks (SIBs) Section 129 Loans GARVEEs

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Federal Tools for Financing Idle Reduction

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  1. Federal Tools for Financing Idle Reduction Federal Highway Administration National Resource Center Jennifer R. Mayer Jennifer.mayer@fhwa.dot.gov (415)744-2634

  2. Innovative Financial Tools • State-Based Tools • CMAQ funds • State Infrastructure Banks (SIBs) • Section 129 Loans • GARVEEs Federal-Based Tools Transportation Infrastructure Finance and Innovation Act (TIFIA)

  3. Common Aspects of Tools • Must be eligible for federal funds under Title 23 of the United States Code (typically CMAQ) • Must follow federal requirements (although some flexibility for private projects) • All roads usually lead to state DOTs except for TIFIA

  4. State Infrastructure Banks • State DOTs often have these banks, which are a federally-capitalized fund source of low-cost financing for eligible projects • Maximum loan term is 35 years; interest rate set by state • Can make a large project affordable for a nonprofit or local community (I.e., $200,000 over 30 years at 5% interest = a mortgage payment).

  5. 1 3 4 Flow of Funds – State Infrastructure Banks 2 Repayments Initial Federal Aid (80%) Loans Initial Projects Capitalization Grants Second Round SIB Second Round Projects Loans State funds (20%) • Products Available: • Direct Loans • Credit Enhancements • Other Repayments

  6. SECTION 129 LOAN EXAMPLE PROJECT SPONSOR $10 million loan $ 8 million Federal-aid $ 2 million match Repayments from any dedicated source STATE DOT *Can use repayments for any Title 23 project

  7. GARVEEs • Permits states to borrow against future Federal-aid funding • States pay debt payments with Federal aid • Also spreads out cost of expensive projects over many years

  8. TIFIA (Direct Federal Credit) • Transportation Infrastructure Finance and Innovation Act (TIFIA) • Currently limited to $100 million or greater size (proposed $50 million) • CMAQ-eligible projects can apply (and have!)

  9. For More Information • Contact your local FHWA Division Office (one in every state capital) • For financial questions, contact Jennifer Mayer at the FHWA National Resource Center, (415)744-2634, jennifer.mayer@fhwa.dot.gov

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