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: iortiz@camsys.com