**Dulles Corridor Metrorail Project -- Extension to Wiehle Avenue**

**Northern Virginia**

(November 2006)

The Virginia Department of Rail and Public Transportation (DRPT) in
cooperation with the Washington Metropolitan Area Transit Authority
(WMATA) is proposing to construct an 11.6-mile extension of the region's
Metrorail system from west of the existing East Falls Church Metrorail
station through the large Tysons Corner employment and retail center to
Wiehle Avenue in the Reston area of Fairfax County. The project will be
operated as a separate Metrorail line under a new service configuration
that terminates in Washington DC at the existing Stadium Armory
Metrorail station. The proposed project scope includes construction of
five new stations, a major park-and-ride lot at Wiehle Avenue, and
expanded storage capacity at WMATA's West Falls Church rail yard. The
project also includes the purchase of 64 heavy rail vehicles. The
extension would be operated by WMATA, with trains operating at seven
minute peak frequencies from the Wiehle Avenue station through East
Falls Church, continuing along the existing Metrorail Orange Line track
east through Arlington County, downtown Washington DC, Capitol Hill, and
terminating at Stadium Armory. The 11.6-mile extension is the first
phase of a proposed 23.1-mile extension of Metrorail west to Dulles
International Airport and Loudoun County.

The Tysons Corner area contains over 25 million square feet of office
space and 110,000 employees. Redevelopment and expansion of the major
retail and office development is underway. The Reston area also contains
significant mixed-use development, with a substantial employment base
and large residential population, many of whom commute to employment
sites in Washington D.C. The primary transportation arteries that serve
this rapidly growing area are Routes 267 (the Dulles Toll Road) and 7,
both of which experience significant congestion during peak hours. The
proposed Metrorail extension would expand transportation capacity to and
from Reston and the Tysons Corner regional activity centers, (including
reverse commute trips) while providing a direct rail link for commuters
from northwest Fairfax and Loudoun Counties to employment opportunities
in Tysons Corner, the Rosslyn - Ballston corridor, downtown Washington
DC, and other locations adjacent to stations along the 106-mile
Metrorail system.

+------------------------------------+---------------------------------+
| **Summary Description**            |                                 |
+------------------------------------+---------------------------------+
| **Proposed Project:**              | Heavy Rail                      |
+------------------------------------+---------------------------------+
| ** **                              | 11.6 Miles                      |
|                                    |                                 |
|                                    | 5 Stations                      |
+------------------------------------+---------------------------------+
| **Total Capital Cost (\$YOE):**    | \$2,065.00 Million (includes    |
|                                    | \$50.00 million in finance      |
|                                    | costs)                          |
+------------------------------------+---------------------------------+
| **Section 5309 New Starts Share    | \$900.00 Million (43.6%)        |
| (\$YOE):**                         |                                 |
+------------------------------------+---------------------------------+
| **Annual Forecast Year Operating   | \$83.58 Million                 |
| Cost:**                            |                                 |
+------------------------------------+---------------------------------+
| **Ridership Forecast (2030):**     | 85,700 Average Weekday          |
|                                    | Boardings                       |
+------------------------------------+---------------------------------+
| ** **                              | 18,400 Daily New Riders         |
+------------------------------------+---------------------------------+
| **Opening Year Ridership Forecast  | 69,600 Average Weekday          |
| (2012):**                          | Boardings                       |
+------------------------------------+---------------------------------+
| **FY 2008 Local Financial          | # Medium                        |
| Commitment Rating:**               |                                 |
+------------------------------------+---------------------------------+
| **FY 2008 Project Justification    | **Medium**                      |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+
| **FY 2008 Overall Project          | **Medium**                      |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+

The project's final cost estimate is dependent upon negotiations between
DRPT and Dulles Transit Partners (DTP), the design-build consortium
which is preparing the final cost estimate and would construct the
project. These negotiations may result in changes to the project's cost,
financial plan, and project rating.

**Project Development History and Current Status**

Following years of study, a phased bus/rail system in the Dulles
corridor was adopted into the region's long range plan in October 1999.
In March 2000, FTA approved initiation of preliminary engineering (PE)
for the Dulles Corridor Bus Rapid Transit Project. Upon completion of a
Draft Environmental Impact Statement (EIS) in November 2002, a 23.1-mile
Metrorail extension to Route 772 in Loudoun County replaced BRT as the
locally preferred alternative (LPA). Due to funding concerns, DRPT and
WMATA identified a project terminating at Wiehle Avenue as the first
phase of implementation of the LPA. FTA approved a Supplemental Draft
EIS in October 2003 reflecting this termini. FTA approved DRPT's request
to initiate PE for the Extension to Wiehle Avenue project in June 2004.
DRPT received a Record of Decision on the Final EIS for both this
project and the full LPA in April 2005.

In March 2006, the Commonwealth of Virginia accepted the Metropolitan
Washington Airports Authority's (MWAA) proposal to assume control of the
Dulles Toll Road and responsibility for construction of the project.
Such authority is intended to enable MWAA to accelerate implementation
of not only the Metrorail Extension to Wiehle Avenue but the full LPA,
using toll road revenues. In mid-2006, project development activities
were put on hold while the Commonwealth considered implementation of a
large-bore tunnel for a 4.5-mile segment of the project through Tysons
Corner. In September 2006, the Commonwealth decided to retain the
original project configuration. DRPT has re-initiated further design
work and completed an environmental assessment in November 2006 to
accommodate other minor scope changes. The process for transferring the
control of the project to MWAA is underway, and DTP's cost estimate for
the project expected in early 2007. Final design approval is anticipated
in Spring 2007.

**Significant Changes Since FY 2007 Evaluation** (**November** **2005**)

The capital cost of the project has increased by \$224 million, as a
result of greater detail obtained during preliminary engineering, the
addition of finance costs, and the refinement of real estate and utility
requirements. The Washington Metropolitan Council of Governments adopted
a new regional land use forecast that assumes higher-density future land
use in the Tyson's Corner area, and the project's updated travel
forecasts reflect this increased density.

**[Project Justification Rating: Medium]{.underline}**

The project is rated *Medium* for project justification based on a
*Medium-Low* rating for cost effectiveness and a *Medium* rating for
transit-supportive land use.

####### *Cost Effectiveness Rating: Medium-Low* 

The *Medium-Low* cost effectiveness rating reflects the level of
travel-time benefits (19,700 hours each weekday) relative to the
project's annualized costs.

+------------------------------------------+---------------------------+
| **Cost Effectiveness**                   |                           |
+------------------------------------------+---------------------------+
| Cost per Hour of Transportation System   | **[New Start vs.          |
| User Benefit                             | Baseline]{.underline}**   |
|                                          |                           |
| Incremental Cost per Incremental Trip    | \$24.96\*                 |
|                                          |                           |
|                                          | \$26.80                   |
+------------------------------------------+---------------------------+

####### \* Indicates that measure is a component of Cost Effectiveness rating.

Over 50 percent of project travel-time benefits result from additional
off-peak rail service provided between the East Falls Church and Stadium
Armory Metrorail stations. Substantial travel-time benefits are also
attributable to trips originating in Reston destined for downtown
Washington DC and other destinations adjacent to the regional Metrorail
system, as well as reverse commute trips to Tysons Corner.

The project's current level of cost contingency is considered low, as is
the assumed inflation rate and estimate of finance costs. Under the
project's current design-build approach, the capital cost estimate for
the project will be finalized prior to its advancement into final
design.

***Transit-Supportive Land Use Rating: Medium***

The *Medium* land use rating reflects the *Medium-High* ratings assigned
to transit-supportive land use plans and policies and the performance of
those plans and policies, and the *Medium-Low* rating assigned to
existing land use.

**Existing Land Use: Medium-Low**

-   Land use around proposed stations is highly oriented toward large
    office and retail developments designed for automobile commuting.
    Just under 76,000 jobs are located within ½ mile of the proposed
    stations and approximately 12,500 residents live within ½ mile of
    the stations.

-   The project provides direct rail access to the region's central
    business district, which contains over 670,000 jobs.

-   Existing developments within Tysons Corner generally feature large
    setbacks with minimal walkways. Sidewalks are provided at about 60
    percent of approaches to intersections, and all stations are located
    on major auto routes.

-   Daily parking rates have gradually been instituted in the core of
    Tysons Corner, but remain rare and run only as high as \$5 a day,
    while parking in Reston is typically free. Parking in the
    Washington, DC CBD costs up to \$15 per day.

**Transit-Supportive Plans and Policies: Medium-High**

-   Tysons Corner is an attractive area for commercial development, and
    is expecting up to 40 percent increases in development over the next
    25 years. Fairfax County has established a special tax district to
    support the rail system, and is permitting higher development
    densities in areas surrounding proposed stations. Higher density
    development allowed in rail station areas is considered an incentive
    for transit-oriented development on the few remaining vacant parcels
    and for redevelopment of some of the existing low-density strip
    malls in the corridor.

-   Fairfax County has begun the planning process needed to make the
    area more transit-supportive. Both regional and local plans focus
    high-density development in Tysons Corner and, specifically,
    adjacent to the proposed rail stations.

-   Fairfax County uses the proffer system and bonus/incentive zoning to
    control and direct development. Additional densities of floor area
    ratios (FAR) of 1.0 -- 2.5 are allowed within 1000 feet of station
    platforms compared to allowed FARs of 0.6 -- 1.0 beyond 1,600 feet
    of proposed stations.

-   Policies also support more mixed-use and residential development
    with a 3:1 density bonus for developments with at least one third
    residential use. Parking reductions are also offered to development
    adjacent to transit.

-   Adopted urban design guidelines require new developments to be
    designed with a pedestrian-friendly layout and to provide
    streetscape amenities. They include provisions to minimize building
    setbacks and parking in front of buildings, to develop and enlarge a
    pedestrian network of sidewalks and plazas, and to provide
    pedestrian lighting and street furniture. Enforcement of
    requirements for transit-supportive layouts and improvements to
    pedestrian infrastructure by developers will be key to attaining
    high rates of transit use in the corridor.

**Performance and Impacts of Policies:** **Medium-High**

-   Several aging office buildings near the proposed Tysons East station
    have been demolished, and construction is underway for office/mixed
    use around the proposed station site. The developer will provide
    improved access to the station site and is orienting the development
    layout towards the station.

-   Areas adjacent to Metrorail stations throughout WMATA's system have
    experienced dense, mixed-use development, including the
    Rosslyn-Ballston corridor, Crystal City, Bethesda, and Silver
    Spring.

####### Other Project Justification Criteria 

+------------------------------------------+--------------+------------+
| **Mobility Improvements Rating:          |              |            |
| Medium-Low**                             |              |            |
+------------------------------------------+--------------+------------+
| **[Within ½-mile radius of boarding      | 75,900       |            |
| areas]{.underline}:**                    |              |            |
|                                          | 119,000      |            |
| Existing Employment                      |              |            |
|                                          | 200 (4%)     |            |
| Projected Employment (2030)              |              |            |
|                                          | 15,200\*     |            |
| Low Income Households (% of total HH)    |              |            |
|                                          | 50\*         |            |
| **[Average Per Station]{.underline}:**   |              |            |
|                                          | **[New Start |            |
| Employment                               | vs.          |            |
|                                          | Baseline]{.  |            |
| Low Income Households                    | underline}** |            |
|                                          |              |            |
| **Transportation System User Benefit Per | 1.88\*       |            |
| Project Passenger Mile (Minutes)**       |              |            |
+------------------------------------------+--------------+------------+
| **Environmental Benefits Rating: High**  |              |            |
+------------------------------------------+--------------+------------+
| **[Criteria Pollutant (Reduction in      | **[New Start |            |
| tons)]{.underline}**                     | vs.          |            |
|                                          | Baseline]{.  |            |
| > Carbon Monoxide (CO)                   | underline}** |            |
| >                                        |              |            |
| > Nitrogen Oxide (NO~x~)                 | 265          |            |
| >                                        |              |            |
| > Volatile Organic Compounds (VOC)       | 41           |            |
| >                                        |              |            |
| > Particulate Matter (PM~10~)            | 20           |            |
| >                                        |              |            |
| > Carbon Dioxide (CO~2~)                 | 13           |            |
|                                          |              |            |
| **[Criteria Pollutant                    | 19,500       |            |
| Status]{.underline}**                    |              |            |
|                                          | **[EPA       |            |
| > Carbon Monoxide (CO)                   | De           |            |
| >                                        | signation]{. |            |
| > Particulate Matter (PM~2.5~)           | underline}** |            |
| >                                        |              |            |
| > 8-Hour Ozone (O~3~)                    | Maintenance  |            |
|                                          | Area\*       |            |
| **Annual Energy Savings (million British |              |            |
| Thermal Units)**                         | No           |            |
|                                          | n-Attainment |            |
|                                          | Area\*       |            |
|                                          |              |            |
|                                          | Moderate     |            |
|                                          | No           |            |
|                                          | n-Attainment |            |
|                                          | Area\*       |            |
|                                          |              |            |
|                                          | 193,500      |            |
+------------------------------------------+--------------+------------+
| **Operating Efficiencies Rating:         |              |            |
| Medium**                                 |              |            |
+------------------------------------------+--------------+------------+
| **System Operating Cost per**            | > **         | **[New     |
|                                          | [Baseline]{. | Start]{.un |
| **Passenger Mile (current year           | underline}** | derline}** |
| dollars)**                               | >            |            |
|                                          | > 0.196\*    | \$0.198\*  |
+------------------------------------------+--------------+------------+

\* Indicates that measure is a component of rating for each criterion.

N/A indicates information was not available for this entry.

# [Local Financial Commitment Rating: Medium]{.underline}

The *Medium* local financial commitment rating is based on the *Medium*
rating for the capital finance plan and the *Medium-High* ratings for
the New Starts share of project costs and the operating finance plan.

####### *Section 5309 New Starts Share of Total Project Costs: 44%* 

####### *Rating: Medium-High*

DRPT is requesting an approximately 44 percent New Starts share of total
project costs, which results in a *Medium-High* rating for this measure.

+-------------------------+-----------------------+--------------------+
| **Locally Proposed      |                       |                    |
| Financial Plan**        |                       |                    |
+-------------------------+-----------------------+--------------------+
| **[Source of            | **[Total Funds        | **[Percent of      |
| Funds]{.underline}**    | (\$mi                 | To                 |
|                         | llion)]{.underline}** | tal]{.underline}** |
+-------------------------+-----------------------+--------------------+
| **Federal:**            | \$900.00              | 43.6%              |
|                         |                       |                    |
| Section 5309 New Starts | \$145.00              | 7.0%               |
|                         |                       |                    |
| TIFIA Direct Loan       |                       |                    |
| Revenues                |                       |                    |
+-------------------------+-----------------------+--------------------+
| **State:**              | \$51.70               | 2.5%               |
|                         |                       |                    |
| Virginia Transportation | \$386.03              | 18.7%              |
| Act 2000                |                       |                    |
|                         |                       |                    |
| Dulles Toll Road        |                       |                    |
| Revenues                |                       |                    |
+-------------------------+-----------------------+--------------------+
| **Local:**              | \$400.00              | 19.4%              |
|                         |                       |                    |
| Fairfax County          | \$182.73              | 8.8%               |
| Transportation          |                       |                    |
|                         |                       |                    |
| Improvement District    |                       |                    |
|                         |                       |                    |
| Fairfax County General  |                       |                    |
| Fund Revenues or Tax    |                       |                    |
| Proceeds                |                       |                    |
+-------------------------+-----------------------+--------------------+
| **Total:**              | **\$2,065.00**        | 100.0%             |
+-------------------------+-----------------------+--------------------+

**NOTE**: The financial plan reflected in this table has been developed
by the project sponsor and does not reflect a commitment by DOT or FTA.
The sum of the figures may differ from the total as listed due to
rounding.

# *Capital Finance Plan Rating: Medium* 

The capital finance plan is rated *Medium*, based upon the average of
the ratings assigned to each of the subfactors listed below. The
commitment of capital funds is rated *High*; the completeness subfactor
is rated Medium-High, the capital cost estimate and planning assumptions
subfactor is rated *Medium-Low;* and the remaining subfactors are rated
*Medium*.

#### Agency Capital Condition: Medium

-   The average age of WMATA's bus fleet is 8.7 years, which is
    significantly older than the industry average.

-   The Commonwealth of Virginia's excellent bond ratings are as
    follows: Moody's Investors Service AAA.

#### Completeness of Capital Plan: Medium-High

-   The capital plan was complete and included a 20-year cash flow
    statement, more than five years of historical data, identification
    of key assumptions, a moderate level of detail, a sensitivity
    analysis, and a long-term forecast of capital costs and funding for
    the WMATA system.

#### Commitment of Capital Funds: High

-   Over 70 percent of non-New Starts funding is committed or budgeted.
    Sources of funds include a property tax levied in a Transportation
    Improvement District (TID) that encompasses the corridor served by
    the project, toll revenue from the Dulles Toll Road, general fund
    revenues from Fairfax County, and the Commonwealth's Transportation
    Act of 2000.

#### Capital Funding Capacity: Medium

-   The project's financial plan shows projected cash balances, reserve
    accounts, and/or access to credit through the Commonwealth of
    Virginia that would allow DRPT to cover cost increases or funding
    shortfalls of about one-third of project costs. However, because
    this reflects the Commonwealth's entire net debt capacity, it is not
    reasonable to expect it would all be available to the project.
    Nonetheless, there is sufficient capacity to warrant a *Medium*
    rating.

#### Capital Cost Estimate and Planning Assumptions: Medium-Low

### Capital cost contingencies are low for a project at this stage of development.

### The financial plan shows WMATA's infrastructure renewal needs being met over the long-term, but relies on a tripling of annual local capital funds.

#### *Operating Finance Plan Rating: Medium-High* 

WMATA will operate the project. The operating finance plan is rated
*Medium-High*, based upon the average of the ratings of the five
subfactors listed below. The operating condition and commitment of
operating funds subfactors are rated *High*; the remaining subfactors
are rated *Medium*.

#### Agency Operating Condition: High

-   WMATA's current ratio of assets to liabilities as reported in the
    2004 audited financial statement is 2.3.

-   WMATA is in very good operating financial condition. In the past
    five years there have been no cash flow shortages in the operating
    plan, while service has expanded.

#### Completeness of Operating Plan: Medium

-   The operating plan was reasonably complete and included a 20-year
    cash flow projection, limited historical data, and a moderate level
    of detail. Operating subsidies that are forecast to be paid by each
    WMATA pact jurisdiction are not separately identified in the
    financial plan.

#### Commitment of Operating Funds: High

-   All operating funding is considered committed. This reflects a
    requirement of the WMATA compact that each jurisdiction pay a share
    of operating costs based on an explicit formula.

#### Operating Funding Capacity: Medium

-   The project's financial plan does not show projected cash balances,
    reserve accounts, and/or access to credit. Because the operating
    plan is fiscally balanced (i.e., no operating surpluses or
    shortfalls), the agency's current working capital would not be
    diminished and would be sufficient to fund 50 percent of operating
    cost.

#### Operating Cost Estimates and Planning Assumptions: Medium

-   Although the forecasts of operating and maintenance costs and
    passenger revenues are slightly conservative, they are offset by
    greater-than-historical growth in the operating subsidy to be
    provided by local jurisdictions.

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