Transit Public-Private Partnerships: Legal Issues (2014) / Chapter Skim
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Pages 40-46
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From page 40... ...
40 which the indebtedness was incurred upon the retirement of such indebtedness; and (5) the corporation must have been approved by the state or a political subdivision thereof, either of which must also have approved the specific obligations issued by the corporation.497 One of the important tests that a 63-20 nonprofit corporation must meet is that the government agency must have "a beneficial interest in the corporation while the indebtedness remains outstanding." A governmental unit may acquire a beneficial interest by: (1)
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41 TIFIA.510 TIFIA continues to be a source of credit assistance for surface transportation projects, such as transit projects, intercity passenger bus or rail facilities, and vehicles and facilities for intermodal interchange or transfer.511 TIFIA finances development-phase activities, construction costs, and necessary financing costs.512 Under TIFIA, projects secured by the same revenue stream may be considered eligible.513 MAP-21 increased the authorized amount of credit assistance, changed the maximum potential for TIFIA credit from 33 to 49 percent of the total cost of development, introduced a new rolling application process, and authorized the use of tolls and user fees as sources for repayment of TIFIA's forms of credit assistance.514 In regard to guidance on TIFIA since MAP-21, a USDOT/FHWA Web site, updated as of September 12, 2013, advises that "the TIFIA letter of interest process has been adjusted to reflect changes authorized in MAP-21."515 USDOT states that the department "will review TIFIA letters of interest to assess project eligibility, creditworthiness, and its inclusion in the TIP and STIP," and that "[r] eview of the project's creditworthiness will include a Departmental request for an indicative rating on the TIFIA loan and the financial plan for the project."516 Furthermore, the department advised that "[p]
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42 old under § 602."522 Eligible projects receive assistance as long as funds are available, and if funds are exhausted, eligible projects may receive funding in the succeeding year when funding is available again. Eligible costs include substantially everything paid by or on account of an obligor for a project, such as the costs of the development phase;523 construction, reconstruction, rehabilitation, and replacement;524 acquisition of real property (including land relating to the project and improvements to land)
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43 senior debt obligations and one rating for the TIFIA debt obligations.542 It is important to note that no TIFIA funding will be "obligated" if a project has not received an environmental categorical exclusion, a FONSI, or a ROD under NEPA.543 Title VI of the Civil Rights Act of 1964 and the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 also are applicable to the TIFIA program.544 As noted, secured loans are one of the forms of credit assistance authorized by TIFIA. The Secretary of Transportation may enter into agreements with one or more obligors to make secured loans to finance the eligible costs of a project selected under § 602 of TIFIA.545 TIFIA's funding also may be used to refinance existing federal credit instruments for rural infrastructure projects or to refinance other long-term obligations or federal credit instruments "if the refinancing provides additional funding capacity for the completion, enhancement, or expansion of any project" selected or otherwise eligible under § 602.546 A secured loan provided under TIFIA must be payable in whole or in part from tolls, user fees, or payments owing to the obligor pursuant to a PPP or from other dedicated sources of revenue that also secure the project's senior obligations.547 The proceeds of a secured TIFIA loan may be used for any nonfederal share of project costs under Title 23 or Chapter 53 of Title 49 if the loan is repayable from nonfederal funds.548 The total federal assistance provided on a project receiving a TIFIA loan may not exceed 80 percent of the total project cost.549 All repayments of principal and interest on a direct loan are to commence not later than 5 years after the end of the period of availability specified in subsection (b)
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44 Two TIFIA loans were obtained for the Miami Intermodal Center, the first for $269 million (June 2000) and the second for $170 million (April 2005; later increased by $100 million in August 2007)
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45 two separate accounts that may be used to leverage funds. SIBs enhance the feasibility of projects by providing loans and other credit assistance to public or private entities having projects that are eligible for assistance under federal and state law.573 Because a SIB is a revolving fund -- lending funds for projects while receiving loan repayments -- it is able to finance more projects.
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46 of Miami Tunnel reportedly is financed partly by a group of banks.591 D Private Funding As recently as 2009, no New Starts program using one of two alternative project delivery methods had obtained any private financing.592 MAP21 requires FTA to document private enterprise participation in public transportation and improvement programs under 49 U.S.C.
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