WASHINGTON — The U.S. Department of Transportation is expanding a loan program to benefit short line and regional railroads.
On Dec. 12, U.S. Transportation Secretary Elaine L. Chao announced the Railroad Rehabilitation and Investment Financing Express program (RRIF Express) was accepting loan applications for projects that will specifically modernize the freight rail network in rural areas. The pilot program is targeted specifically at smaller railroads and is an expansion of a program established in the early 2000s. The RRIF Express will be managed by the Build America Bureau of the Department of Transportation.
“This new financing program will strengthen the short line and regional railroad system, promote economic growth in rural communities, and boost America’s economic competitiveness,” Chao says.
The new program calls for expedited handling of all loan requests.
Projects eligible for the low-interest loans include track improvement, bridge improvements, rolling stock acquisition, planning and designing and refinancing non-federal debt. There are no application fees or credit risk premiums.
In the past, the RRIF program has given loans to Class I, regional, and commuter railroads. Earlier this year, Dallas Area Rapid Transit received a $908 million loan to fund its Cotton Belt Corridor Regional Rail Project and the Port of Everett, Wash., got a $5.9 million loan for rail improvements.
Chuck Baker, president of the American Short Line and Regional Railroad Association, says his organization is excited about what the new loan program could accomplish.
“We’re so pleased that this administration is launching a serious and smart effort to make the RRIF program work for smaller operators,” Baker says. “Access to long-term low-cost capital is a challenge in this industry, especially for railroads serving small-town America. RRIF can be an effective solution, but only if it can be reliably and quickly accessed; this express program shows great promise for meeting that need.”
Additional information can be found online.
True, John Rice
John Rice,
With one difference, they eventually get repaid…and we should be changing them from loans to grants anyways, it promotes economic development in rural areas.
The college student loan of the railroad world.