Bucking the traditional 33 percent cost coverage of such matters, the United States Department of Transportation (DOT) announced this week that it granted a $41.55 million loan to the Oklahoma Department of Transportation (ODOT) for its Rural Two-Lane Advancement and Management Plan (RAAMP).
These funds represent 49 percent of the $85.97 million in total eligible costs for the RAAMP project, a compilation of eight projects in Oklahoma. It includes nearly 27 miles of eight-foot shoulders and asphalt resurfacing and 6.4 miles of roadway reconstruction – improvements that focus on improving safety. Funding was provided through Transportation Infrastructure Finance and Innovation Act loans (TIFIA loans).
“Over the last five years, 38 percent of all serious and fatal crashes in Oklahoma have occurred on rural roads with no shoulders,” Deputy Transportation Secretary Polly Trottenberg said. “US DOT is proud to support the RAAMP program to help address safety issues and save lives in Oklahoma.”
The TIFIA Rural Project Initiative targets improvements to transportation infrastructure in rural America. Projects between $10 million and $100 million in areas with populations smaller than 150,000 people are eligible for financing under the scheme. Its advantages are for loans of up to 49 percent of the project’s eligible costs, compared to the 33 percent offered by traditional TIFIA loans. It will also grant Oklahoma a fixed interest rate on its loan equal to one-half of the U.S. treasury rate of equivalent maturity of the loan and the time of closing.
“The Bureau’s Rural Project Initiative provides flexibility to deliver much-needed improvements sooner with very favorable financing terms,” Morteza Farajian, Build America Bureau executive director, said. “This is our fifth RPI loan closed at half the Treasury rate, which saves project sponsors money and avoids escalating costs that make the projects more and more unattainable.”