USDOT expands financing programme to advance transit-oriented development projects
The expansion of the financing programme will make it more affordable for communities across the U.S. to bring their transit and transit-orientated development projects to reality, improving connectivity and access to job opportunities.
U.S. Transportation Secretary Pete Buttigieg has announced that the U.S. Department of Transportation’s (USDOT) Build America Bureau will offer low-cost and flexible financing for transit and transit-oriented development (TOD) projects at the maximum level authorised under law.
USDOT’s Transportation Infrastructure Finance and Innovation Act (TIFIA) programme is designed to help project sponsors reduce costs and speed the delivery of infrastructure projects, which saves taxpayer money and improves transportation in communities. This new initiative, TIFIA 49, authorises borrowing up to 49 per cent of eligible project costs for projects that meet certain eligibility requirements, helping more projects get off the ground. With a few exceptions, TIFIA loans have historically been capped at 33 per cent of eligible project costs.
“There are countless promising transportation projects with the potential to better connect people to housing, jobs, schools and more – but that never get off the ground because of a lack of financing,” said U.S. Transportation Secretary Pete Buttigieg. “The Department of Transportation has long offered flexible, low-cost financing to help bring some of those ideas to life, and now, with TIFIA 49, we’ll be able to support more of them than ever, and lower costs for taxpayers.”
Sponsors of projects that include the activities listed below would be deemed eligible to apply for loans up to 49 per cent of project costs under the TIFIA 49 initiative:
- Projects that are eligible for assistance under Chapter 53 of Title 49, U.S. Code
- Projects that construct or improve public transportation systems, including any capital project or associated improvement eligible for Federal Transit Administration funding, such as infrastructure and vehicles for bus, subway, light rail, commuter rail, trolley, or ferry systems.
- Projects that are eligible for assistance under 23 U.S.C. §601(a)(12)(E)
- Joint development projects that involve co-ordinated improvement of transit infrastructure and non-transit facilities, including commercial and residential projects, that have mutual benefits and shared costs between transit agencies and developers.
Until now, the only projects eligible for financing of up to 49 per cent included rural projects, as well as INFRA, Mega and Rural Grant “Extra” projects, which are highly-rated projects that were not granted discretionary funds due to limited resources.
The Build America Bureau will conduct regular data-based assessments of the initiative’s effectiveness through key performance indicators (KPIs) and will make changes as appropriate. In addition to financing, the Bureau also provides technical assistance for project sponsors and plans to expand outreach and technical assistance capabilities to assist project sponsors to take full advantage of this initiative.
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