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Transportation leadership you can trust.
presented topresented to
Talking Freight SeminarTalking Freight Seminar
presented bypresented by
Iris N. OrtizIris N. OrtizCambridge Systematics, Inc.Cambridge Systematics, Inc.
September 20, 2006September 20, 2006
Financing Freight InfrastructureA Guidebook to Federal Fundingand Financing Tools for Freight Projects
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Agenda
About the Guidebook
Case Studies
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Freight Financing Issues
Public investment on private infrastructure
• Public-private partnerships
Regional/multijurisdictional scope of issues
Some require unique blending of funding sourcesand financing techniques
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Objective and Structure
Objective – Develop a guide that will provide information and descriptions of available Federal funding sources and financing tools to support freight investments
Guidebook structure
• Funding and financing tools
• Case studies
Phases II and III – Freight financing course development and delivery
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Federal Funding and Financing Tools
Funding (partial list)
• Traditional – NHS, STP
• Mode Specific/Special Grants – CMAQ, Bridge, Rail-Highway Crossing, Harbor Maintenance, Airport Improvement Program
• Discretionary and HPP
Financing Tools – TIFIA, SIBs, RRIF, GARVEE, PAB
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Non-Federal Funding Methods and Financing Tools
Funding sources• User fees/tolls
• Dedicated taxes
• Special taxing and assessment districts
• Equity and in-kind contributions
Financing tools• Public debt
• Tax-exempt/private activity bonds
Institutional arrangements• Joint development
• Public-private partnerships
• Tax-exempt corporations/63-20 corporations
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Case Studies
Guidebook includes about 50 case studies
Types of projects
• Highway
• Rail
• Airport expansion
• Port
• Intermodal/storage facilities
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Case Studies
Dixie Siding (Indianapolis, IN) – $1.5 million
Southern Tier Extension Railroad Restoration (Hornell, NY to Corry, PA) – $38 million
ReTRAC (Reno, NV) – $280 million
Sheffield Flyover/Argentine Connection (Kansas City, MO-KS) – $60 million to $74 million
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Dixie Siding
One-mile long rail siding constructed south of the West Avenue highway-rail crossing to store empty coal trains
Completed in 2003
Source: Indianapolis MPO.
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Dixie SidingFunding
Funding partners – Indiana Railroad Company, Indiana DOT, Indianapolis MPO, FHWA
Funding/financing mechanisms
• Indiana Railroad Company – $815,000
• INDOT Industrial Rail Service Fund grant – $200,000
• CMAQ – $480,000
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Reno Transportation Rail Access Corridor (ReTRAC)
Project description – 33-foot deep trench to separate auto traffic from rail in downtown Reno; 11 bridges to provide crossings over the trench
Project cost – $280 million
Project sponsors/partners
• City of Reno
• Union Pacific
• FHWA
Source: City of Reno
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ReTRACFunding
City of Reno G.O. Bonds, 40%
$111.5 Million
UP, 6%
$17 Million
City of Reno, 28%
$79.6 Million TIFIA, 18%
$50.5 Million
TEA-21, 8%
$21.3 Million
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ReTRACSources to Repay Debt
1/8% Sales Tax and 1% Hotel Tax, 46%
$50.5 Million
Air Rights, 5%
$5 Million
Lease Income, 32%
$34 Million
Assessment District, 17%
$18 Million
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Sheffield Flyover and Argentine Connection
Location – Kansas City, Kansas-Missouri
Project type – Rail crossing separation
Project cost
• Sheffield Flyover – $74 million
• Argentine Connection – $59.8 million
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Sheffield Flyover
Completed in 2000
Sheffield Junction was the third busiest rail crossing in the country
Travel time savings of 25 minutes (trains)
Financing strategy
• Creation of nonprofit transportation corporation
• Issue bonds; tax-exempt status from property tax
• Railroads (BNSF, UP, and Kansas City Southern) pay back debt
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Argentine Connection
Completed in 2004
Santa Fe Junction located at state border
Increased rail capacity
Financing strategy
• Missouri created another transportation corporation to issue bonds ($46.3 million)
• Unified Government of Kansas City/Wyandotte County issued bonds to fund the Kansas portion of the project ($13.5 million)
• Kansas City Railway Terminal responsible for debt service payments
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Lessons Learned
Funding follow benefits
Agreements are reached only after major obstacles are addressed
Cash contributions not the only “revenue source”
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Next Steps
Guidebook – Fall 2006
Develop a freight financing course – Winter 2006/07
Course delivery – TBD
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Contact Information
Iris N. Ortiz
100 CambridgePark Drive Suite 400Cambridge, MA 02141
Phone: 617-354-0167
E-mail: [email protected]