The U.S. Department of Transport (USDOT) will launch a new pilot programme to expedite long-term, low-cost loans for America’s short line and regional freight railways. The loans will be provided through the rail rehabilitation and investment financing express (RRIF Express) fund aimed at reducing the time and costs associated with securing loans to modernize aging freight rail infrastructure. In addition to expedited handling of loan requests, the programme provides up to USD 26 million.
“This new financing programme will strengthen the short line and regional rail system, promote economic growth in rural communities, and boost America’s economic competitiveness,” U.S. Transportation Secretary, Elaine Chao, said.
For qualified applicants, the new programme will significantly cut credit risk premium costs and advisor fees, costs that borrowers would otherwise have to pay in the traditional RRIF programme.
Letters of Interest will be accepted from January 12, 2020 and ending April 11, 2020.
The Build America Bureau will administer this new programme to support economic activity and improve the safety, capacity, and reliability of this crucial freight transport sector.
Short line and regional railways operate over 75,639 route km in the U.S. As the first and last mile of freight rail service, short lines transport the goods and materials that consumers and businesses rely on every day.
“Access to long-term low-cost capital is a challenge in this industry, especially for railways serving small town America. The RRIF can be an effective solution, but only if it can be reliably and quickly accessed; this express program shows great promise for meeting that need,” said Chuck Baker, the President of American Short Line and Regional Railroad Association.