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42 T R A N S P O RTAT I O N F I N A N C E solution in search of a problem." First, the projects have Federal revolving loan funds, the most common of to be identified; then the tools to make them happen are which are SIBs, and developed. McPherson also described a philosophical Tax code incentives. evolution: from a pure financing perspective, bonding for a project costs more. From a DOT perspective, an invest- Seltzer's discussion of the advantages and disadvan- ment is made to reap some of the increased value. The tages of each of these forms of federal credit assistance challenge is to identify the projects and communicate the from the perspective of the three legs of the finance benefits that really need to be communicated. Once the stool set the stage for a showcasing of two TIFIA proj- focus centers on the goal to be achieved, the leadership ects by the subsequent speakers. will understand it and the politicians will support it. In discussing the potential for longer GARVEEs (20 to 30 years, for instance), it was noted that the fear related Central Texas Turnpike Project to reauthorization is growing smaller and that the prospects for longer GARVEE financings are improving. Phillip E. Russell Phillip E. Russell discussed the Central Texas Turnpike SESSION 3: TOOLS AND TECHNIQUES TO MEET Project, a massive $3.6 billion toll project that is being PROJECT FUNDING CHALLENGES supported by a $916 million direct TIFIA loan, the largest awarded to date under the TIFIA program. The Suzanne H. Sale, Federal Highway Administration project as described by Russell actually represents four (Moderator) projects in one. The financial plan incorporates a mix of Ron Marino, Salomon Smith Barney (Discussant) tools and approaches, including revenue bonds and David Seltzer, Mercator Advisors LLC bond anticipation notes, as well as a substantial contri- Phillip E. Russell, Texas Turnpike Authority bution from the cities and counties that will enjoy the Charles McNeely, City of Reno, Nevada project's benefits. The project is the single largest toll James Preusch, Infra-Trans, LLC road project in the nation, the majority of which is being delivered through an exclusive development agreement. Suzanne H. Sale Suzanne H. Sale served as moderator for this session and Reno Transportation Rail Access Corridor Project began by describing the backlog of needs against shrink- ing resources and the competition for those resources. Charles McNeely She described a decade of success turning concepts into tools that are in use. She also noted the importance of Charles McNeely followed with a description of the having flexible tools to meet state-specific needs. Reno Transportation Rail Access Corridor (ReTRAC) project in Reno, Nevada. In contrast to the TIFIA project in Texas, ReTRAC is being supported by the smallest Role of Federal Credit: Transportation Infrastructure TIFIA loan awarded to date. The project, which involves Finance and Innovation Act and Beyond dropping an existing freight rail right-of-way into a trench under downtown Reno, is the result of an extra- David Seltzer ordinary effort to build a partnership among some seem- ingly unlikely allies: the city of Reno, the state of Nevada, David Seltzer began with a discussion of the role of fed- the federal government, and, perhaps most critically, the eral credit assistance in funding large projects. He business community, including Union Pacific Railroad. described a finance "stool"--which he hopes will some- day replace the by-now-familiar finance pyramid--with three balanced legs. These legs represent the perspectives Freight Infrastructure Bank Proposal of the project sponsor, federal policy, and investors in determining which form of federal credit assistance is James Preusch best matched to the specific financing needs of a project. Seltzer described four basic forms of federal credit: The final speaker for this session was James Preusch, who addressed an emerging concept that would help fund Securitizing federal receivables, including freight and intermodal needs currently facing substantial GARVEEs and grant anticipation notes, hurdles in assembling a plan of finance. Direct federal credit, most notably the Transportation The National Freight Security Infrastructure Bank, as Infrastructure Finance and Innovation Act (TIFIA), described by Preusch, would create a new revenue source