II 

112TH CONGRESS 

1ST SESSION S. 942 

To provide for improved investment in national transportation infrastructure. 

IN THE SENATE OF THE UNITED STATES 

MAY 10, 2011 

Mrs. MURRAY (for herself, Ms. COLLINS, and Mr. DURBIN) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation 

A BILL 

To provide for improved investment in national 

transportation infrastructure. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Transportation Infra5 structure Grants and Economic Reinvestment Act’’. 

6 SEC. 2. DEFINITIONS. 

7 In this Act: 

8 (1) ELIGIBLE ENTITY.—The term ‘‘eligible enti9 ty’’ means— 

10 (A) a State; 

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1 (B) a local government; 

2 (C) a transit agency; and 

3 (D) 2 or more of the entities described in 

4 subparagraphs (A) through (C), working in col5 laboration. 

6 (2) ELIGIBLE PROJECT.— 

7 (A) IN GENERAL.—The term ‘‘eligible 

8 project’’ means a transportation project that, as 

9 determined by the Secretary, would have a sig10 nificant beneficial impact on a State, a metro11 politan area, a region, or the United States. 

12 (B) INCLUSIONS.—The term ‘‘eligible 

13 project’’ includes— 

14 (i) a highway or bridge project eligible 

15 for funding under chapter 1 of title 23, 

16 United States Code; 

17 (ii) a public transportation project eli18 gible for funding under chapter 53 of title 

19 49, United States Code; 

20 (iii) a passenger or freight rail trans21 portation project; and 

22 (iv) a port infrastructure project. 

23 (3) ELIGIBLE PROJECT COSTS.— 

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1 (A) IN GENERAL.—The term ‘‘eligible 

2 project costs’’ means costs relating to an eligi3 ble project, such as the costs of— 

4 (i) development phase activities, in5 cluding planning, feasibility analysis, rev6 enue forecasting, environmental review, 

7 permitting, preliminary engineering and 

8 design work, and other preconstruction ac9 tivities; 

10 (ii) construction, reconstruction, reha11 bilitation, replacement, and acquisition of 

12 real property (including land related to the 

13 eligible project and improvements to land), 

14 environmental mitigation, construction con15 tingencies, and acquisition of equipment; 

16 and 

17 (iii) capitalized interest necessary to 

18 meet market requirements, reasonably re19 quired reserve funds, capital issuance ex20 penses, and other carrying costs during 

21 construction. 

22 (B) EXCLUSION.—The term ‘‘eligible 

23 project costs’’ does not include the costs of 

24 dredging activities. 

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1 (4) FEDERAL CREDIT INSTRUMENT.—The term 

2 ‘‘Federal credit instrument’’ means a secured loan 

3 or loan guarantee authorized to be made available 

4 under this Act with respect to an eligible project. 

5 (5) INVESTMENT-GRADE RATING.—The term 

6 ‘‘investment-grade rating’’ means a rating of BBB 

7 minus, Baa3, bbb minus, BBB (low), or higher as8 signed by a rating agency to project obligations. 

9 (6) LENDER.—The term ‘‘lender’’ means any 

10 non-Federal qualified institutional buyer (as defined 

11 in section 230.144A(a) of title 17, Code of Federal 

12 Regulations (or any successor regulation), known as 

13 Rule 144A(a) of the Securities and Exchange Com14 mission and issued under the Securities Act of 1933 

15 (15 U.S.C. 77a et seq.)), including— 

16 (A) a qualified retirement plan (as defined 

17 in section 4974(c) of the Internal Revenue Code 

18 of 1986) that is a qualified institutional buyer; 

19 and 

20 (B) a governmental plan (as defined in 

21 section 414(d) of the Internal Revenue Code of 

22 1986) that is a qualified institutional buyer. 

23 (7) LOAN GUARANTEE.—The term ‘‘loan guar24 antee’’ means any guarantee or other pledge by the 

25 Secretary to pay all or part of the principal of and 

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1 interest on a loan or other debt obligation issued by 

2 an obligor and funded by a lender. 

3 (8) OBLIGOR.—The term ‘‘obligor’’ means a 

4 party primarily liable for payment of the principal of 

5 or interest on a Federal credit instrument, which 

6 party may be a corporation, partnership, joint ven7 ture, trust, or governmental entity, agency, or in8 strumentality. 

9 (9) PROJECT OBLIGATION.—The term ‘‘project 

10 obligation’’ means any note, bond, debenture, or 

11 other debt obligation issued by an obligor in connec12 tion with the financing of an eligible project, other 

13 than a Federal credit instrument. 

14 (10) RATING AGENCY.—The term ‘‘rating agen15 cy’’ means a credit rating agency registered with the 

16 Securities and Exchange Commission as a nationally 

17 recognized statistical rating organization (as defined 

18 in section 3(a) of the Securities Exchange Act of 

19 1934 (15 U.S.C. 78c(a))). 

20 (11) RURAL AREA.—The term ‘‘rural area’’ 

21 means any area not in an urbanized area (as that 

22 term is defined by the Census Bureau). 

23 (12) SECRETARY.—The term ‘‘Secretary’’ 

24 means the Secretary of Transportation. 

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1 (13) SECURED LOAN.—The term ‘‘secured 

2 loan’’ means a direct loan or other debt obligation 

3 issued by an obligor and funded by the Secretary in 

4 connection with the financing of an eligible project. 

5 (14) STATE.—The term ‘‘State’’ means— 

6 (A) any of the 50 States; or 

7 (B) the District of Columbia. 

8 (15) SUBSIDY AMOUNT.—The term ‘‘subsidy 

9 amount’’ means the amount of budget authority suf10 ficient to cover the estimated long-term cost to the 

11 Federal Government of a Federal credit instrument, 

12 calculated on a net present value basis, excluding 

13 administrative costs and any incidental effects on 

14 governmental receipts or outlays in accordance with 

15 the provisions of the Federal Credit Reform Act of 

16 1990 (2 U.S.C. 661 et seq.). 

17 (16) SUBSTANTIAL COMPLETION.—The term 

18 ‘‘substantial completion’’ means the opening of an 

19 eligible project to vehicular or passenger traffic. 

20 SEC. 3. NATIONAL INFRASTRUCTURE INVESTMENT PRO21 GRAM. 

22 (a) PROGRAM.—Not later than 1 year after the date 

23 of enactment of this Act, the Secretary shall by regulation 

24 establish a program under which the Secretary shall pro25 vide grants, secured loans, and loan guarantees on a commstockstill on DSKH9S0YB1PROD with BILLS

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1 petitive basis, to eligible entities for use in carrying out 

2 eligible projects. 

3 (b) GRANT REQUIREMENTS.— 

4 (1) AMOUNT.—Except as provided in paragraph 

5 (5)(B)(i), a grant or secured loan provided under 

6 this Act shall be in an amount that is not less than 

7 $10,000,000 and not greater than $500,000,000. 

8 (2) GEOGRAPHICAL DISTRIBUTION; BALANCE; 

9 INVESTMENT.—In providing grants and Federal 

10 credit instruments under this Act, the Secretary 

11 shall take such measures as are necessary to ensure, 

12 to the maximum extent practicable— 

13 (A) an equitable geographical distribution 

14 of funds; 

15 (B) an appropriate balance in addressing 

16 the needs of urban and rural areas; and 

17 (C) investment in a variety of transpor18 tation modes. 

19 (3) MAXIMUM PERCENTAGE PER STATE.—Not 

20 more than 25 percent of the amounts made available 

21 to provide grants and Federal credit instruments 

22 under this Act for a fiscal year may be provided for 

23 eligible projects in a State. 

24 (4) FEDERAL SHARE.— 

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1 (A) IN GENERAL.—Except as provided in 

2 paragraph (5)(B)(ii), the Federal share of the 

3 cost of carrying out any eligible project funded 

4 by a grant or secured loan under this Act shall 

5 be, at the option of the eligible entity receiving 

6 the grant, up to 80 percent. 

7 (B) PRIORITY.—In providing grants and 

8 secured loans under this Act, the Secretary 

9 shall give priority to eligible projects that re10 quire a contribution of Federal funds in order 

11 to complete an overall financing package for the 

12 eligible projects. 

13 (5) ELIGIBLE PROJECTS IN RURAL AREAS.— 

14 (A) IN GENERAL.—Not less than 20 per15 cent of the amounts made available to provide 

16 grants under this Act for a fiscal year shall be 

17 provided for eligible projects located in rural 

18 areas. 

19 (B) MINIMUM GRANT AMOUNT; FEDERAL

20 SHARE.—With respect to an eligible project lo21 cated in a rural area— 

22 (i) the minimum amount of a grant or 

23 secured loan provided under this Act shall 

24 be $1,000,000; and 

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1 (ii) the Secretary may increase the 

2 Federal share of the cost of carrying out 

3 the eligible project up to 100 percent. 

4 (6) SET-ASIDES FOR CERTAIN COSTS, 

5 PROJECTS, AND TRANSFERS.—Of the amounts made 

6 available under this Act for a fiscal year, the Sec7 retary may— 

8 (A) use not more than 25 percent to pay 

9 the subsidy and administrative costs of secured 

10 loans and loan guarantees for eligible projects; 

11 (B) use an amount not to exceed 

12 $20,000,000 for grants that pay for the plan13 ning, preparation, or design of eligible projects; 

14 and 

15 (C) use an amount not to exceed 

16 $35,000,000 to fund the provision and over17 sight of grants under this Act, including trans18 fers of funds from that amount to the Adminis19 trators of the Federal Highway Administration, 

20 the Federal Transit Administration, the Fed21 eral Railroad Administration, and the Federal 

22 Maritime Administration to fund the provision 

23 and oversight of grants under this Act for eligi24 ble projects under the administrative jurisdic25 tion of those agencies. 

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1 (c) SELECTION AMONG ELIGIBLE PROJECTS.— 

2 (1) ESTABLISHMENT.—The Secretary shall es3 tablish criteria for use in selecting among eligible 

4 projects to receive funding under this Act. 

5 (2) SELECTION CRITERIA.— 

6 (A) PRIMARY SELECTION CRITERIA.—The 

7 Secretary shall select among eligible projects by 

8 evaluating the extent to which an eligible 

9 project provides significant benefits to a State, 

10 a metropolitan area, a region, or the United 

11 States, including the extent to which an eligible 

12 project— 

13 (i) improves the safety of transpor14 tation facilities and systems; 

15 (ii) improves the condition of existing 

16 transportation facilities and systems; 

17 (iii) contributes to economic competi18 tiveness over the medium- to long-term; 

19 (iv) improves the environment, im20 proves energy efficiency, reduces depend21 ence on oil, or reduces greenhouse gas 

22 emissions; and 

23 (v) improves access to transportation 

24 facilities and systems. 

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1 (B) SECONDARY SELECTION CRITERIA.— 

2 In addition to considering the primary selection 

3 criteria described in subparagraph (A), the Sec4 retary shall consider the extent to which a 

5 project— 

6 (i) uses innovative strategies or tech7 nologies to pursue any of those primary se8 lection criteria; and 

9 (ii) demonstrates strong collaboration 

10 among a broad range of participants, or 

11 the integration of transportation with 

12 other public service efforts. 

13 (C) FEDERAL CREDIT INSTRUMENTS.—In 

14 selecting among eligible projects to receive Fed15 eral credit instruments, the Secretary shall con16 sider the creditworthiness of each eligible 

17 project, including a determination by the Sec18 retary that any financing for the eligible project 

19 has appropriate security features, such as a 

20 rate covenant, to ensure repayment. 

21 (d) APPLICATION REQUIREMENT.— 

22 (1) IN GENERAL.—The Secretary shall require 

23 that each application for a grant or Federal credit 

24 instrument under this Act include an analysis of 

25 project benefits and costs. 

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1 (2) FEDERAL CREDIT INSTRUMENTS.—For pur2 poses of subsection (c)(2)(C), the Secretary shall re3 quire each eligible project applicant to provide a pre4 liminary rating opinion letter from at least 1 rating 

5 agency indicating that the senior project obligations, 

6 which may be the Federal credit instrument, have 

7 the potential to achieve an investment-grade rating. 

8 (e) FEDERAL REQUIREMENTS.—The following provi9 sions of law shall apply to funds made available under this 

10 Act and eligible projects carried out using those funds: 

11 (1) Subchapter IV of chapter 31 of title 40, 

12 United States Code. 

13 (2) Title VI of the Civil Rights Act of 1964 (42 

14 U.S.C. 2000d et seq.). 

15 (3) The National Environmental Policy Act of 

16 1969 (42 U.S.C. 4321 et seq.). 

17 (4) The Uniform Relocation Assistance and 

18 Real Property Acquisition Policies Act of 1970 (42 

19 U.S.C. 4601 et seq.). 

20 (f) TRANSPARENCY.— 

21 (1) IN GENERAL.—The Secretary shall include 

22 in any notice of funding availability a full descrip23 tion of how applications will be evaluated against all 

24 selection criteria. 

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1 (2) CONSULTATIONS ON DECISIONS.—After 

2 provision of grants and credit assistance under this 

3 Act for a fiscal year, the Secretary (or a designee) 

4 shall be available to meet with any applicant, at a 

5 time and place that is mutually acceptable to the 

6 Secretary and the applicant, to review the applica7 tion of the applicant. 

8 SEC. 4. SECURED LOANS AND LOAN GUARANTEES. 

9 (a) IN GENERAL.— 

10 (1) AGREEMENTS.—Subject to paragraphs (2) 

11 and (3), the Secretary may enter into arrangements 

12 with 1 or more obligors to make secured loans, the 

13 proceeds of which shall be used to finance eligible 

14 project costs of any eligible project selected to re15 ceive funding under this Act. 

16 (2) RISK ASSESSMENT.—Before entering into 

17 an agreement under this subsection, the Secretary, 

18 in consultation with the Director of the Office of 

19 Management and Budget and each rating agency 

20 providing a preliminary rating opinion letter under 

21 section 3(d)(2), shall determine an appropriate cap22 ital reserve subsidy amount for each secured loan, 

23 taking into account the letter. 

24 (3) INVESTMENT-GRADE RATING REQUIRE25 MENT.—The execution of a secured loan under this 

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1 Act shall be contingent on the senior project obliga2 tions receiving an investment-grade rating. 

3 (b) TERMS AND LIMITATIONS.— 

4 (1) IN GENERAL.—A secured loan under this 

5 Act with respect to an eligible project shall be on 

6 such terms and conditions and contain such cov7 enants, representations, warranties, and require8 ments (including requirements for audits) as the 

9 Secretary determines appropriate. 

10 (2) MAXIMUM AMOUNT.—If a secured loan 

11 under this Act does not receive an investment grade 

12 rating, the amount of the secured loan shall not ex13 ceed the lesser of— 

14 (A) 80 percent of the reasonably antici15 pated eligible project costs; and 

16 (B) the amount of the senior project obli17 gations. 

18 (3) PAYMENT.—The secured loan— 

19 (A) shall— 

20 (i) be payable, in whole or in part, 

21 from tolls, user fees, or other dedicated 

22 revenue sources that also secure the senior 

23 project obligations; and 

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1 (ii) include a rate covenant, coverage 

2 requirement, or similar security feature 

3 supporting the project obligations; and 

4 (B) may have a lien on revenues described 

5 in subparagraph (A) subject to any lien secur6 ing project obligations. 

7 (4) INTEREST RATE.—The interest rate on the 

8 secured loan shall be not less than the yield on 

9 United States Treasury securities of a similar matu10 rity to the maturity of the secured loan on the date 

11 of execution of the loan agreement. 

12 (5) MATURITY DATE.—The final maturity date 

13 of the secured loan shall be not later than 35 years 

14 after the date of substantial completion of the eligi15 ble project. 

16 (6) NONSUBORDINATION.—The secured loan 

17 shall not be subordinated to the claims of any holder 

18 of project obligations in the event of bankruptcy, in19 solvency, or liquidation of the obligor. 

20 (7) FEES.—The Secretary may establish fees at 

21 a level sufficient to cover all or a portion of the costs 

22 to the Federal Government of making a secured loan 

23 under this Act. 

24 (8) NON-FEDERAL SHARE.—The proceeds of a 

25 secured loan under this Act may be used to provide 

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1 any non-Federal share of eligible project costs re2 quired under chapter 1 of title 23, or chapter 53 of 

3 title 49, United States Code, if the loan is repayable 

4 using non-Federal funds. 

5 (c) REPAYMENT.— 

6 (1) SCHEDULE.—The Secretary shall establish 

7 a repayment schedule for each secured loan under 

8 this Act based on the projected cash flow from eligi9 ble project revenues and other repayment sources. 

10 (2) COMMENCEMENT.—Scheduled loan repay11 ments of principal or interest on a secured loan 

12 under this Act shall commence not later than 5 

13 years after the date of substantial completion of the 

14 eligible project. 

15 (3) DEFERRED PAYMENTS.— 

16 (A) AUTHORIZATION.—If, at any time 

17 after the date of substantial completion of the 

18 eligible project, the eligible project is unable to 

19 generate sufficient revenues to pay the sched20 uled loan repayments of principal and interest 

21 on the secured loan, the Secretary may, subject 

22 to subparagraph (C), allow the obligor to add 

23 unpaid principal and interest to the outstanding 

24 balance of the secured loan. 

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1 (B) INTEREST.—Any payment deferred 

2 under subparagraph (A) shall— 

3 (i) continue to accrue interest in ac4 cordance with subsection (b)(4) until fully 

5 repaid; and 

6 (ii) be scheduled to be amortized over 

7 the remaining term of the loan. 

8 (C) CRITERIA.— 

9 (i) IN GENERAL.—Any payment defer10 ral under subparagraph (A) shall be con11 tingent on the eligible project meeting cri12 teria established by the Secretary. 

13 (ii) REPAYMENT STANDARDS.—The 

14 criteria established under clause (i) shall 

15 include standards for reasonable assurance 

16 of repayment. 

17 (4) PREPAYMENT.— 

18 (A) USE OF EXCESS REVENUES.—Any ex19 cess revenues that remain after satisfying 

20 scheduled debt service requirements on the 

21 project obligations and secured loan and all de22 posit requirements under the terms of any trust 

23 agreement, bond resolution, or similar agree24 ment securing project obligations may be apmstockstill on DSKH9S0YB1PROD with BILLS

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1 plied annually to prepay the secured loan with2 out penalty. 

3 (B) USE OF PROCEEDS OF REFI4 NANCING.—The secured loan may be prepaid at 

5 any time without penalty from the proceeds of 

6 refinancing from non-Federal funding sources. 

7 (d) SALE OF SECURED LOANS.— 

8 (1) IN GENERAL.—Subject to paragraph (2), as 

9 soon as practicable after substantial completion of 

10 an eligible project and after notifying the obligor, 

11 the Secretary may sell to another entity or reoffer 

12 into the capital markets a secured loan for the eligi13 ble project if the Secretary determines that the sale 

14 or reoffering can be made on favorable terms. 

15 (2) CONSENT OF OBLIGOR.—In making a sale 

16 or reoffering a secured loan under paragraph (1), 

17 the Secretary may not change the original terms and 

18 conditions of the secured loan without the written 

19 consent of the obligor. 

20 (e) LOAN GUARANTEES.— 

21 (1) IN GENERAL.—The Secretary may provide a 

22 loan guarantee to a lender in lieu of making a se23 cured loan if the Secretary determines that the 

24 budgetary cost of the loan guarantee is substantially 

25 the same as that of a secured loan. 

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1 (2) TERMS.—The terms of a guaranteed loan 

2 shall be consistent with the terms that apply to a se3 cured loan under this Act, except that the rate on 

4 the guaranteed loan and any prepayment features 

5 shall be negotiated between the obligor and the lend6 er, with the consent of the Secretary. 

7 (f) ADMINISTRATION OF FEDERAL CREDIT INSTRU8 MENTS.— 

9 (1) IN GENERAL.—The Secretary shall establish 

10 a uniform system to service the Federal credit in11 struments made available under this Act. 

12 (2) FEES.—The Secretary may collect and 

13 spend fees, contingent upon authority being provided 

14 in appropriations Acts, at a level that is sufficient to 

15 cover— 

16 (A) the costs of services of expert firms re17 tained pursuant to paragraph (4); and 

18 (B) all or a portion of the costs to the 

19 Federal Government of servicing the Federal 

20 credit instruments under this Act. 

21 (3) SERVICER.— 

22 (A) IN GENERAL.—The Secretary may ap23 point a financial entity to assist the Secretary 

24 in servicing Federal credit instruments under 

25 this Act. 

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1 (B) DUTIES.—The servicer shall act as the 

2 agent for the Secretary. 

3 (C) FEE.—The servicer shall receive a 

4 servicing fee, subject to approval by the Sec5 retary. 

6 (4) ASSISTANCE FROM EXPERT FIRMS.—The 

7 Secretary may retain the services of expert firms, in8 cluding counsel, in the field of municipal and project 

9 finance, to assist in the underwriting and servicing 

10 of Federal credit instruments. 

11 SEC. 5. STATE AND LOCAL PERMITS. 

12 Financial assistance under this Act with respect to 

13 an eligible project shall not— 

14 (1) relieve any recipient of the assistance of any 

15 obligation to obtain any required State or local per16 mit or approval with respect to the eligible project; 

17 (2) limit the right of any unit of State or local 

18 government to approve or regulate any rate of re19 turn on private equity invested in the eligible 

20 project; or 

21 (3) otherwise supersede any State or local law 

22 (including any regulation) applicable to the construc23 tion or operation of the eligible project. 

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1 SEC. 6. AUTHORIZATION OF APPROPRIATIONS. 

2 There are authorized to be appropriated to carry out 

3 this Act such sums as are necessary for each of fiscal 

4 years 2012 through 2018. 

Æ 

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