Metra Exploring Financing Options to Repair Bridges

Courtesy of Metra

CHICAGO - Metra will explore financing options to support repairing its bridges, including the Railroad Rehabilitation & Improvement Financing (RRIF) program.

Metra says it will finance “to supplement its capital budget,” according to the release. Metra owns 446 bridges, half of which are more than a century old. 30% are more than 75 years old. While these bridges are safe, Metra says they are past their life span and are becoming more costly to maintain. Currently, Metra receives funding from local, state, and federal sources. However, it states its needs are becoming greater than current funding allows. Its five-year plan identified $5.4 billion in necessary work, but there is only $2.1 billion in funds available.

Metra Executive Director and CEO Jim Derwinski said, “There is no way around it – these bridges must be replaced or rehabilitated, and they must be replaced soon, before our operations are impacted. . . Because this need is so urgent, we believe we must explore all our options, including financing to address it.”

The 11 bridges that this money would fund to replace are located on the UP North Line between Fullerton and Addison. Additionally, it would be used to rebuild the bridge over Grand Avenue on the Milwaukee District lines and the bridge over the North Branch of the Chicago River on the Milwaukee District North Line. The bridge over North Branch on the Chicago River on the MD-N in Rondout could be expanded, and Metra could also rehabilitate the bridge over Hickory Creek on the Rock Island Line. The bridge over 96th Avenue on the Rock Island Line in Mokena would also be rebuilt. These were chosen because the design process is at or near completion.

According to the release, it has the authority “to issue revenue bonds but is instead considering borrowing an estimated $230 million from the federal Railroad Rehabilitation & Improvement Financing (RRIF) program.” This program has a low interest rate, and interest does not accrue until the proceeds are drawn. It also has up to a 35-year repayment period and is deferrable for five years after most of the project has been completed. According to the USDOT, the funding can be used to “acquire, improve, or rehabilitate intermodal or rail equipment or facilities, including track, components of track, bridges, yards, buildings and shops, including the installation of positive control systems.” Metra’s repayment is estimated at around $15-$20 million a year and “would come from Metra’s normal operating fund sources, primarily fares and regional sales taxes.” The process to apply and close on a RRIF loan is expected to take a year with the first few months taken to submit and finalize a letter of interest with the USDOT’s Build America Bureau (BAB).