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Transportation Infrastructure Finance and Innovation Act (TIFIA)

Year 2013 2014
Authorization $ 750 M $ 1.0 B

Program purpose

The Transportation Infrastructure Finance and Innovation Act (TIFIA) Program provides Federal credit assistance to eligible surface transportation projects, including highway, transit, intercity passenger rail, some types of freight rail, and intermodal freight transfer facilities. The program is designed to fill market gaps and leverage substantial private co-investment by providing projects with supplemental or subordinate debt.

Statutory citation(s): MAP-21 §2002; 23 USC 601-609

Funding features

Funded by contract authority and reimbursed from the Highway Account of the Highway Trust Fund, to remain available until expended. Funds are subject to the overall Federal-aid obligation limitation.

Program products

The TIFIA credit program may provide to States (including D.C. and Puerto Rico), localities, or other public authorities, as well as private entities undertaking projects sponsored by public authorities, three types of financial assistance:

MAP-21 also newly authorizes "master credit agreements," under which DOT may make a contingent commitment of future TIFIA assistance (subject to the availability of future funding) for a program of projects secured by a common revenue pledge.

Federal share

TIFIA credit assistance may cover the following portions of the total cost of a project:

Eligible activities

Project type

Most types of projects retain their previous TIFIA eligibility:

Project costs

To receive TIFIA assistance, a project must have costs that equal or exceed at least one of the following:

Multiple related TIFIA-eligible projects may be grouped in order to meet one of these cost thresholds as long as the projects' credit assistance is secured by a common pledge. [23 USC 601(a)(12)(D)(iv)]

Refinancings

MAP-21 continues the ability to use TIFIA to refinance an earlier TIFIA interim construction loan, or to refinance existing project debt in order to provide addition funding capacity for TIFIA-eligible projects.

Other provisions

Application process

MAP-21 requires DOT to establish a rolling application process for providing TIFIA credit assistance to eligible projects on terms acceptable to DOT.

Repayment of Federal assistance

TIFIA assistance must be repaid through dedicated revenue sources that secure project obligations, such as tolls, other user fees, or payments received under a public-private partnership agreement. Repayment of a TIFIA loan must begin by five years after the substantial completion of the project, and the loan must be fully repaid within 35 years after the project's substantial completion or by the end of the useful life of the asset being financed, if that life is less than 35 years.

Provisions related to rural projects

Investment grade rating

Debt senior to the Federal credit instrument (or the Federal credit instrument, if it is the senior debt) must generally receive an investment-grade rating from at least two rating agencies.

Nonsubordination

In most cases a TIFIA loan may not be subordinated to other debt in the event of project bankruptcy, insolvency, or liquidation. However, TIFIA loans may be subordinated in some circumstances in which a public agency has outstanding senior bonds under a preexisting indenture.

Limited buydowns

MAP-21 allows project sponsors to "buy down" their TIFIA interest rate if that rate has increased between the date of submission of a project application and the execution of the TIFIA agreement.

Funding redistribution

Each April 1 (beginning in 2014), DOT will distribute among the States any remaining unobligated and uncommitted TIFIA balance in excess of 75% of the amount authorized for TIFIA for that fiscal year.

Page last modified on September 12, 2013.
Federal Highway Administration | 1200 New Jersey Avenue, SE | Washington, DC 20590 | 202-366-4000