AASHTO Journal, 10 November 2016
The Texas Department of Transportation received a $285 million, long-term, low-interest federal loan from the USDOT’s “TIFIA” credit program to help finance an expansion of Interstate 35E in the Dallas area, which TxDOT said is one of the state’s most congested highways.
The agency said the Transportation Infrastructure Finance and Innovation Act loan will go toward a section of I-35E known as the “35Express” project from Denton to Dallas, which includes adding tolled express lanes and rebuilding a 28-mile section of I-35E between I-635 in Dallas to U.S. 380 in the nearby city of Denton.
The route serves rapidly growing areas of southern and central Denton County as well as the major Dallas suburbs immediately north of I-635, TxDOT said.
“Receiving this TIFIA loan from the federal government is great news for the region and the state,” said Texas Transportation Commissioner Jeff Austin. “The construction cost index – a measure of inflation – is typically much higher than the interest rate on these type of loans, so again Texas is demonstrating that TIFIA is a great tool to deliver necessary road projects now that would cost a great deal more to deliver in the future.”
TIFIA loans can extend to 35 years after a project is substantially completed or over the useful life of a project, with annual interest rates often set at the federal government’s own cost of borrowing. The Fitch debt rating service said TxDOT’s all-in interest rate was 2.58 percent.
The state plans to take on the 35Express project in two phases. The first, which will use the USDOT loan, will cost $1.4 billion and should be complete in late 2017, the agency said. The second phase, costing $3.4 billion, “is planned to begin in approximately 5-10 years when funds become available,” TxDOT said.
The USDOT said the project’s first phase covers a northern segment that runs from Turbeville Road to U.S. 380. The improvements include building one more general purpose lane in each direction and two reversible tolled lanes.
The toll lanes “will be priced according to time of day and will be shifted in the direction of heavy traffic flow during peak times to relieve congestion,” a USDOT announcement said.
The project also includes various frontage road, interchange and ramp additions and upgrades, especially along the Lake Lewisville section, and will build a new bridge over the lake.
Andrew Right, acting director of the USDOT’s Build America Bureau, which administers the TIFIA credit, said: “By leveraging a loan from the bureau, more projects like the I-35E can become viable.”
Before the state received the TIFIA loan, TxDOT said that it along with Denton County and the North Central Texas Council of Governments authorized $285 million of financial security, in the form of regional toll revenue funds, to keep the project moving. Now that the loan has come through, those local funds will be available for other Denton County transportation needs.
“The loan from the federal government is a real shot in the arm for several individual projects that are part of the major construction along I-35 through Denton County,” said Texas Transportation Commissioner Victor Vandergriff. “Securing these additional resources means quicker completion to building and improving general purpose lanes, interchanges, frontage roads and bridges that will help keep traffic moving in this ever-growing part of North Texas.”
“We are extremely pleased about the TIFIA loan approval. We were confident that the loan would be approved for this critical project for Denton County,” said Denton County Judge Mary Horn. Denton County also contributed an additional $534 million in regional/county funds that went directly to project construction.
“This project, which is the gateway to Denton County, will dramatically enhance the economic growth of not only Denton County, but the entire north Texas region,” Horn said.