TIFIA Credit Program Overview Transportation Infrastructure Finance and Innovation Act (TIFIA) Updated September 27, 2006
Background on TIFIA Strategic goal to leverage limited Federal resources and stimulate private capital investment in transportation infrastructure by providing credit assistance in the form of direct loans, loan guarantees, and standby lines of credit (rather than grants) to projects of national or regional significance. Key objectives 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 1
Background on TIFIA (continued) Major requirements Large surface transportation projects ($50M generally, $15M for intelligent transportation systems ITS) TIFIA contribution limited to 33 percent Senior debt must be rated investment grade Dedicated revenues for repayment Applicable Federal requirements (Civil Rights, NEPA, Uniform Relocation, Titles 23/49) Public or private highway, transit, rail and port projects are eligible to apply for TIFIA assistance Application process project sponsors must submit proposals, including financial plans, to USDOT for consideration. 2
Eligible TIFIA Sponsors and Projects Highways and Bridges State Governments Intelligent Transportation Systems Intermodal Connectors Private Firms Special Authorities Transit Vehicles and Facilities Intercity Buses and Facilities Local Governments Freight Transfer Facilities Transportation Improvement Districts Passenger Rail Vehicles and Facilities 3
Statutory Selection Criteria Weighting (percentage amounts) Private Participation 20.0% Environmental Impact 20.0% National or Regional Significance 20.0% Project Acceleration 12.5% Credit Worthiness 12.5% Use of New Technologies 5.0% Reduced Federal Grant Assistance 5.0% Consumption of Budget Authority 5.0% 4
Program Implementation: Selection & Funding of a TIFIA Project 1 1 Sponsor Submits Sponsor Submits Letter of Interest to Letter of Interest to the DOT the DOT 2 2 Sponsor Prepares and Sponsor Prepares and Submits Application to Submits Application to the DOT the DOT 3 3 DOT Staff Prepare DOT Staff Prepare Preliminary Evaluation Preliminary Evaluation and Arrange Sponsor and Arrange Sponsor Presentation Presentation 5 5 DOT Credit Council Provides DOT Credit Council Provides Recommendations to the Recommendations to the Secretary, who Selects Secretary, who Selects Projects to Receive TIFIA Projects to Receive TIFIA Credit Assistance Credit Assistance 4 4 DOT Staff Prepare Final Evaluation DOT Staff Prepare Final Evaluation and Make Recommendation to and Make Recommendation to DOT Credit Council DOT Credit Council 6 6 The DOT Issues The DOT Issues Term Sheet and Term Sheet and Obligates Funds Obligates Funds 7 7 The DOT Executes The DOT Executes Credit Agreement and Credit Agreement and Disburses Funds Disburses Funds 5
TIFIA Documentation Requirements MAJOR REQUIREMENTS Preliminary rating opinion letter obtained Draft EIS circulated (or Categorical Exclusion or FONSI obtained) Project consistent with state transportation plan and, if applicable, included in metropolitan transportation plan ROD obtained Project included in STIP Investmentgrade rating on senior debt submitted prior to anticipated closing date APPLICATIONS, APPROVALS, AND FUNDING Project selection made Letter of interest provided Application submitted Term sheet issued Funding obligated Credit agreement executed Funds disbursed according to terms 6
TIFIA Program Fees The TIFIA JPO will require each applicant to pay a non-refundable application fee of $30,000. In addition each borrower will be required to pay a credit processing fee equal to a portion of the costs incurred by the TIFIA JPO in negotiating the credit agreement. This fee will typically range from $100,000- $300,000. Borrowers will also be required to pay a $11,000 loan servicing fee annually. 7
TIFIA Projects (TIFIA Instruments in Millions) Reno Rail Corridor Retired - paid in full $51 Staten Island Ferries Retired paid in full $159 Moynihan Station $160 Warwick Intermodal Station $42 SR 125 Toll Road $140 Total TIFIA Assistance: $3.2 Billion Total Project Investment: $13.2 Billion US 183-A Turnpike $66 Central Texas Turnpike $917 LA-1 $66 Miami Intermodal Center Rental Car Facility $170 Washington Metro CIP $600 Cooper River Bridge Retired - refinanced $215 Tren Urbano Retired - paid in full $300 PR FDOT Program Elements Retired paid in full $269 8
TIFIA Portfolio (In Millions) TIFIA Number Project Project Project Instrument Credit Senior debt TIFIA Revenue Type Cost Type Amount obligations loan Pledge Active Credit Agreements 19991002b Miami Intermodal Center RCF Intermodal a Direct Loan 170.000 * BBB User Charges 19991005 Washington Metro CIP Transit 2,324 Guarantee 600.000 A- BBB Interjurisdictional Funding Agreements 20011001 Central Texas Turnpike Highway 3,700 Direct Loan 916.760 BBB+ BB User Charges 20031002 SR 125 Toll Road Highway 629 Direct Loan 140.000 BBB- BB+ User Charges 20051001 183 A Toll Road Highway 331 Direct Loan 66.000 BBB- BB User Charges 20051002 LA-1 Highway 247 Direct Loan 66.000 A- BB User Charges 20061001 Warwick Intermodal Station Intermodal 182 Direct Loan 42.000 BBB+ BBB- User Charges Total $2,000.760 Commitments Awaiting Credit Agreements 19991004a Moynihan Station Passenger Rail 800 Direct Loan 140.000 Lease Income 19991004b Moynihan Station Passenger Rail b Line of Credit 20.000 Lease Income Total $160.000 Retired Credit Agreements 19991006 Tren Urbano (PR) Transit 2,250 Direct Loan 300.000 BBB+ BBB- Tax Revenues 20001003 Cooper River Bridge Highway 668 Direct Loan 215.000 BBB- BBB- Infrastructure Bank Loan Repayments 20001004 Staten Island Ferries Transit 482 Direct Loan 159.225 A+ A+ Tobacco Settlement Revenues 20011002a Reno Rail Corridor Intermodal 280 Direct Loan 50.500 BBB BB Room and Sales Tax 19991002a Miami Intermodal Center FDOT Intermodal $1,349 Direct Loan $ 269.076 * A- Tax Revenues Total $993.801 Total All Categories $13,242 $3,154.561 Note: Project costs and credit ratings as of TIFIA financial closing Footnotes a b Project Cost included in TIFIA Number 19991002a Project Cost included in TIFIA Number 19991004a * TIFIA is the only project debt 9
TIFIA JPO Organizational Framework Secretary of Transportation Asst. Secy. for Budget and Programs/CFO (Chair) Under Secy. of Transportation For Policy General Counsel DOT Credit Council Asst Secy. for Transportation Policy Director of OSDBU Federal Transit Administrator Federal Highway Administrator Federal Railroad Administrator Maritime Administrator Chief Financial Officer TIFIA Joint Program Office 10
TIFIA Oversight: Credit Instrument Life Cycle Construction Oversight and Performance Monitoring Design / Construction On-site inspections Periodic meetings Disbursement approvals Project acceptance Substantial Completion Operations/Post Construction Performance reporting Revenue realization Change reporting Compliance with credit agreement Financial Closing Construction Risk Performance Risk Exposure (Decreases over Time) Final Maturity 11
Contact: TIFIA Joint Program Office (HCF-50) U.S. Department of Transportation Room 4310 400 Seventh Street, SW Washington, DC 20590 fax: (202) 366-2908 http://tifia.fhwa.dot.gov Mark Sullivan, Chief (202) 366-5785 mark.sullivan@.dot.gov Robert C. Brown, Capital Markets Advisor (202) 366-6813 robert.c.brown@dot.gov Duane Callender, Project Finance Coordinator (202) 366-9644 duane.callender@dot.gov Lisa Floyd, Budget Analyst (202) 366-9649 lisa.floyd@dot.gov Cheryl Jones, Project Finance Advisor (202) 366-0317 cheryl.jones@dot.gov Suzanne Sale, Senior Financial Advisor (602) 379-4014 suzanne.sale@dot.gov 12