U.S. Department of Transportation Announces $255 Million Loan for New Railcars to Improve Transit Service in Chicago
WASHINGTON – U.S. Transportation Secretary Anthony Foxx today announced the closing of a $255 million Transportation Infrastructure Finance and Innovation Act (TIFIA) loan to the Chicago Transit Authority (CTA) to buy new railcars, helping to modernize one of the oldest and busiest transit systems in the country.
“Every Chicagoan knows how important the L is for accessing jobs, education and opportunity in the city and throughout the region,” said Secretary Foxx. “This funding will bring state-of-the-art railcars to serve Chicago’s communities, helping to expand economic opportunity and socioeconomic mobility throughout the Chicago area.”
CTA will use the TIFIA loan to purchase 490 railcars, replacing nearly one-third of the aging railcars in its entire fleet. The new rail cars will help meet growing ridership demand and improve security with up-to-date technology. Modernizing CTA’s rail fleet also will improve the reliability of transit service and give passengers a smoother, more comfortable ride. Along with these benefits to riders, replacing old cars with new technologically advanced vehicles will help CTA reduce energy and maintenance costs.
“We are proud to partner with CTA to improve transit service for residents and visitors in this vibrant city,” said FTA Acting Administrator Therese McMillan. “These modern, technologically advanced railcars will make a huge difference for thousands of riders who need and deserve reliable transit options as they take advantage of all Chicago has to offer.”
The U.S. Department of Transportation previously provided CTA with $199 million in TIFIA loans for a track upgrade project and a bus and rail terminal rehabilitation. In February 2015, the DOT announced the closing of a $120 million TIFIA loan for improvements to the Blue Line to upgrade tracks and stations between the downtown Loop and Chicago O’Hare International Airport. In addition to the TIFIA loan, CTA received $16 million in DOT’s Transportation Investment Generating Economic Recovery (TIGER) funds awarded in 2011. In April 2014, the DOT announced the closing of a $79 million TIFIA loan for the rehabilitation of the 95th Street Bus and Rail Terminal. In addition to the TIFIA loan, CTA received $20 million in TIGER funds awarded in 2012 for the project.
The TIFIA program seeks to advance critical transportation infrastructure nationwide by leveraging federal, state, local, and private sector funding sources. Under the TIFIA program, the DOT provides secured direct loans, lines of credit, and loan guarantees to public and private applicants for eligible surface transportation projects. TIFIA can finance transportation projects such as highway, transit and passenger rail; as well as certain freight and port facilities; surface transportation facilities at airports; and other transportation improvements.
The TIFIA program maximizes limited federal resources to deliver large infrastructure investments. Historically, TIFIA has supported total infrastructure investment of about four times the amount of total credit assistance it has made available. Since program inception, TIFIA has approved 62 loans totaling more than $23 billion to stimulate over $83 billion of transportation infrastructure investments throughout the United States.
The DOT recently announced new funding availability in the TIFIA program as well as changes to the program made in the most recent surface transportation funding authorization, the Fixing America’s Surface Transportation (FAST) Act. Further details are available here.
In July 2014, Secretary Foxx established the Department’s Build America Transportation Investment Center (BATIC). BATIC is a one-stop-shop for states, municipalities, and project sponsors looking to utilize federal transportation expertise, apply for federal transportation credit programs, and explore ways to access private capital in public private partnerships. Since launching the BATIC, USDOT has provided credit and financing support to projects representing billions of dollars in infrastructure investment. BATIC is helping to advance projects like the CTA railcar purchase more efficiently through the review process.