Transportation leadership you can trust. presented to Talking Freight Seminar presented by Iris N. Ortiz Cambridge Systematics, Inc. September 20, 2006 Financing Freight Infrastructure A Guidebook to Federal Funding and Financing Tools for Freight Projects

1 Agenda About the Guidebook Case Studies

2 Freight Financing Issues Public investment on private infrastructure Public-private partnerships Regional/multijurisdictional scope of issues Some require unique blending of funding sources and financing techniques

3 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

4 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

5 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

6 Case Studies Guidebook includes about 50 case studies Types of projects Highway Rail Airport expansion Port Intermodal/storage facilities

7 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

8 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.

9 Dixie Siding Funding 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

10 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

11 ReTRAC Funding 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

12 ReTRAC Sources 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

13 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

14 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

15 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

16 Lessons Learned Funding follow benefits Agreements are reached only after major obstacles are addressed Cash contributions not the only “revenue source”

17 Next Steps Guidebook – Fall 2006 Develop a freight financing course – Winter 2006/07 Course delivery – TBD

18 Contact Information Iris N. Ortiz 100 CambridgePark Drive Suite 400 Cambridge, MA Phone: