Infra Insight Blog : written by Nossaman LLP Infrastructure attorneys, covers infrastructure project delivery, including Public-Private Partnerships, Operations & Management Agreements, policy, and news.

On Nov. 3, 2011 the TIFIA Joint Program Office announced availability of limited funding for TIFIA credit assistance for fiscal year 2012 and invited submission of letters of interest (LOIs) by Dec. 30, 2011.  While we are aware of no official announcement, sources inform us that the TIFIA JPO received LOIs from 26 project sponsors seeking over $13 billion in credit assistance to finance almost $36 billion in new infrastructure investment.

This current interest continues a three-year trend in strong demand for TIFIA credit assistance, and, so far anyway, a limited amount of available subsidies.  The TIFIA program only has $110 million in TIFIA subsidies available for fiscal year 2012, capable of supporting approximately $1.1 billion in credit assistance.  According to our math, the LOIs represent demand of almost twelve times the available appropriation for the program.

The pending Senate federal reauthorization bill would increase annual TIFIA subsidies to $1 billion.  Reports indicate that the House Transportation and Infrastructure Committee will include the same sharp increase in the TIFIA program in its reauthorization bill.

A multimodal working group is evaluating the LOIs.  Transportation Secretary Ray LaHood reportedly wants decisions issued on the LOIs in March or April.  Unfortunately, once again the vast majority of projects will be turned down or invited to apply for far less support than requested.

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This morning, U.S. Department of Transportation (USDOT) Secretary Ray LaHood announced the winners of the extremely competitive TIGER III grant application cycle.  Forty-six projects in 33 states will share $511 million in grant funds.  The announcement was made several months earlier than the originally scheduled date.

As has been the case with the previous two rounds of TIGER grants, this cycle was wildly oversubscribed.  According to the announcement, USDOT received 848 project applications from all 50 states, Puerto Rico, and Washington, DC, requesting a total of $14.29 billion, far exceeding the amount available under the TIGER III program. 

“The overwhelming demand for these grants clearly shows that communities across the country can’t afford to wait any longer for Congress to put Americans to work building the transportation projects that are critical to our economic future,” said Secretary LaHood. “That’s why we’ve taken action to get these grants out the door quickly, and that is why we will continue to ask Congress to make the targeted investments we need to create jobs, repair our nation’s transportation systems, better serve the traveling public and our nation’s businesses, factories and farms, and make sure our economy continues to grow."

Of the grants awarded, only three included payments to support TIFIA loans.  The projects that will receive TIFIA payments are the SR-91 Corridor Improvement Project managed lanes being developed by the Riverside County Transportation Commission; Virginia DOT’s I-95 HOT Lanes; and Dallas Area Rapid Transit’s Orange Line Extension.

TIGER grants are awarded to transportation projects that have significant national or regional impact.  USDOT allocated the TIGER III funds to transportation projects in both urban and rural areas.  The funding was distributed between a broad array of road and bridge, transit, port and freight rail projects.  The three rounds of TIGER grants have resulted in an award of over $2.6 billion for critical transportation funding.

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