October 7, Introduction to the TIFIA Credit Program

Transcription

1 October 7, 2015 Introduction to the TIFIA Credit Program

2 Types of Credit Assistance 2 Secured (Direct) Loan Maximum term of 35 years from substantial completion Repayments must start 5 years after substantial completion Loan Guarantee Guarantees a project sponsor s repayments to non-federal lender Loan repayments to lender must commence no later than 5 years after substantial completion of project Line of Credit Contingent loan available for draws as needed up to 10 years after substantial completion of project

3 TIFIA Program Objectives 3 Leverage limited Federal resources and stimulate Capital Market investment Facilitate projects with significant public benefits Encourage new revenue streams and private participation Fill capital market gaps for secondary/subordinate capital Be a flexible, patient investor willing to take on investor concerns about investment horizon, liquidity, predictability and risk Limit Federal exposure by relying on market discipline

4 Benefits of TIFIA 4 Long term, fixed cost, permanent, up-front financing Borrower must be minimum investment grade Non recourse financing project cash flow supported Funds drawn as needed Senior or Subordinate Lien Flexible amortization Low Interest Rate - No pre-payment penalty 2.86% on 10/1/15 Low interest rates

5 Eligible Sponsors and Projects 5 ELIGIBLE SPONSORS State Governments Private Firms Special Authorities Local Governments Transportation Improvement Districts ELIGIBLE PROJECTS Highways and Bridges Intelligent Transportation Systems Intermodal Connectors Transit Vehicles and Facilities Intercity Buses and Facilities Freight Transfer Facilities Passenger Rail Vehicles and Facilities

6 TIFIA Requirements 6 Minimum anticipated project costs > $50M 33% of reasonably anticipated eligible project costs unless the sponsor provides a compelling justification for up to 49% Senior debt must receive 2 investment grade ratings (BBB-/Baa3) from nationally recognized credit rating agencies The project must be included in the relevant State s transportation planning and programming cycle The project must have a dedicated revenue source, such as tolls or other user fees, that are pledged to secure debt service payments for both the TIFIA and senior debt financing

7 7 States with Executed Credit Agreements (TIFIA Instruments in $ millions as of 07/2015)

8 8 Revenue Pledges User-backed Financings Pledged Revenues Miami Intermodal Center RCF Rental car customer facility charges South Bay Expressway Facility tolls Central Texas Turnpike Facility tolls Warwick Intermodal Station Rental car customer facility charges Pocahontas Parkway Facility tolls I 495 Capital Beltway/Hot Lanes Facility Tolls SH-130 (Segments 5-6) Facility Tolls Intercounty Connector Facility Tolls Triangle Expressway Facility Tolls North Tarrant Express Facility Tolls Tax-backed Financings Pledged Taxes Miami Intermodal Center GP State fuels excise taxes Washington Metro CIP Local government contributions Tren Urbano Various commonwealth taxes Cooper River Bridge State and county contributions Transbay Transit Center Tax increment financing Denver Union Station Local sales taxes and tax increment financing Other Pledged Payments Staten Island Ferries and Terminals Tobacco settlement payments Port of Miami Tunnel Availability Payments I-595 Corridor Roadway Improvements Availability Payments

9 TIFIA LOI Review and P3 Projects 9 Public sponsor may submit a LOI on behalf of concessionaire and ultimate borrower TIFIA will: Work with public sponsor upfront on indicative terms that can be provided to P3 bidders Engage earlier in the project development cycle Concessionaire s plan of finance and application must still be evaluated before loan agreement can be negotiated

10 Requirements of Creditworthiness 10 Financial Plan Financial Model Revenue Pledged to TIFIA Indicative Rating $100,000+ down payment towards costs