---
kind: "range"
citation: "23 U.S.C. §§ 602–609"
title: "23"
from: "602"
to: "609"
count: 8
release: "119-102"
url: "https://uscodex.org/usc/23/602..609"
---

# §602. Determination of eligibility and project selection

- (a) **Eligibility.—**
  - (1) **In general.—** A [project](/usc/23/101.md?p=a-20) shall be eligible to receive credit assistance under the TIFIA program if—
    - (A) the entity proposing to carry out the [project](/usc/23/101.md?p=a-20) submits a letter of interest prior to submission of a formal application for the [project](/usc/23/101.md?p=a-20); and
    - (B) the [project](/usc/23/101.md?p=a-20) meets the criteria described in this subsection.
  - (2) **Creditworthiness.—**
    - (A) **In general.—** To be eligible for assistance under the TIFIA program, a [project](/usc/23/101.md?p=a-20) shall satisfy applicable creditworthiness standards, which, at a minimum, shall include—
      - (i) a rate covenant, if applicable;
      - (ii) adequate coverage requirements to ensure repayment;
      - (iii) an investment grade rating from at least 2 rating agencies on debt senior to the Federal credit instrument; and
      - (iv) an investment-grade rating from at least 2 rating agencies on the Federal credit instrument, subject to the condition that, with respect to [clause (iii)](#a-2-A-iii), if the total amount of the senior debt and the Federal credit instrument is less than $150,000,000, 1 rating agency opinion for each of the senior debt and Federal credit instrument shall be sufficient.
    - (B) **Senior debt.—** Notwithstanding [subparagraph (A)](#a-2-A), in a case in which the Federal credit instrument is senior debt, the Federal credit instrument shall be required to receive an investment grade rating from at least 2 rating agencies, unless the total amount of other senior debt and the Federal credit instrument is less than $150,000,000, in which case 1 rating agency opinion shall be sufficient.
  - (3) **Inclusion in transportation plans and programs.—** A [project](/usc/23/101.md?p=a-20) shall satisfy the applicable planning and programming requirements of sections [134](/usc/23/134.md) and [135](/usc/23/135.md) at such time as an agreement to make available a Federal credit instrument is entered into under the TIFIA program.
  - (4) **Application.—** A [State](/usc/23/101.md?p=a-28), local government, [public authority](/usc/23/101.md?p=a-22), public-private partnership, or any other legal entity undertaking the [project](/usc/23/101.md?p=a-20) and authorized by the [Secretary](/usc/23/101.md?p=a-27) shall submit a [project](/usc/23/101.md?p=a-20) application that is acceptable to the [Secretary](/usc/23/101.md?p=a-27).
  - (5) **Eligible project cost parameters.—**
    - (A) **In general.—** Except as provided in [subparagraph (B)](#a-5-B), a [project](/usc/23/101.md?p=a-20) under the TIFIA program shall have eligible [project](/usc/23/101.md?p=a-20) costs that are reasonably anticipated to equal or exceed the lesser of—
      - (i) $50,000,000; and
      - (ii) 33⅓ percent of the amount of Federal [highway](/usc/23/101.md?p=a-11) funds apportioned for the most recently completed fiscal year to the [State](/usc/23/101.md?p=a-28) in which the [project](/usc/23/101.md?p=a-20) is located.
    - (B) **Exceptions.—**
      - (i) **Intelligent transportation systems.—** In the case of a [project](/usc/23/101.md?p=a-20) principally involving the installation of an intelligent transportation system, eligible [project](/usc/23/101.md?p=a-20) costs shall be reasonably anticipated to equal or exceed $15,000,000.
      - (ii) **Transit-oriented development projects.—** In the case of a [project](/usc/23/101.md?p=a-20) described in [section 601(a)(12)(E)](/usc/23/601.md?p=a-12-E), eligible [project](/usc/23/101.md?p=a-20) costs shall be reasonably anticipated to equal or exceed $10,000,000.
      - (iii) **Rural projects.—** In the case of a rural infrastructure [project](/usc/23/101.md?p=a-20) or a [project](/usc/23/101.md?p=a-20) capitalizing a rural [projects](/usc/23/101.md?p=a-20) fund, eligible [project](/usc/23/101.md?p=a-20) costs shall be reasonably anticipated to equal or exceed $10,000,000, but not to exceed $100,000,000.
      - (iv) **Local infrastructure projects.—** Eligible [project](/usc/23/101.md?p=a-20) costs shall be reasonably anticipated to equal or exceed $10,000,000 in the case of a [project](/usc/23/101.md?p=a-20) or program of [projects](/usc/23/101.md?p=a-20)—
        - (I) in which the applicant is a local government, [public authority](/usc/23/101.md?p=a-22), or instrumentality of local government;
        - (II) located on a facility owned by a local government; or
        - (III) for which the [Secretary](/usc/23/101.md?p=a-27) determines that a local government is substantially involved in the development of the [project](/usc/23/101.md?p=a-20).
  - (6) **Dedicated revenue sources.—** The applicable Federal credit instrument shall be repayable, in whole or in part, from—
    - (A) tolls;
    - (B) user fees;
    - (C) payments owing to the obligor under a public-private partnership; or
    - (D) other dedicated revenue sources that also secure or fund the [project](/usc/23/101.md?p=a-20) obligations.
  - (7) **Public sponsorship of private entities.—** In the case of a [project](/usc/23/101.md?p=a-20) that is undertaken by an entity that is not a [State](/usc/23/101.md?p=a-28) or local government or an agency or instrumentality of a [State](/usc/23/101.md?p=a-28) or local government, the [project](/usc/23/101.md?p=a-20) that the entity is undertaking shall be publicly sponsored as provided in [paragraph (3)](#a-3).
  - (8) **Applications where obligor will be identified later.—** A [State](/usc/23/101.md?p=a-28), local government, agency or instrumentality of a [State](/usc/23/101.md?p=a-28) or local government, or [public authority](/usc/23/101.md?p=a-22) may submit to the [Secretary](/usc/23/101.md?p=a-27) an application under [paragraph (4)](#a-4), under which a private party to a public-private partnership will be—
    - (A) the obligor; and
    - (B) identified later through completion of a procurement and selection of the private party.
  - (9) **Beneficial effects.—** The [Secretary](/usc/23/101.md?p=a-27) shall determine that financial assistance for the [project](/usc/23/101.md?p=a-20) under the TIFIA program will—
    - (A) foster, if appropriate, partnerships that attract public and private investment for the [project](/usc/23/101.md?p=a-20);
    - (B) enable the [project](/usc/23/101.md?p=a-20) to proceed at an earlier date than the [project](/usc/23/101.md?p=a-20) would otherwise be able to proceed or reduce the lifecycle costs (including debt service costs) of the [project](/usc/23/101.md?p=a-20); and
    - (C) reduce the contribution of Federal grant assistance for the [project](/usc/23/101.md?p=a-20).
  - (10) **Project readiness.—**
    - (A) **In general.—** Except as provided in [subparagraph (B)](#a-10-B), to be eligible for assistance under the TIFIA program, the applicant shall demonstrate a reasonable expectation that the contracting process for [construction](/usc/23/101.md?p=a-4) of the [project](/usc/23/101.md?p=a-20) can commence by no later than 90 days after the date on which a Federal credit instrument is obligated for the [project](/usc/23/101.md?p=a-20) under the TIFIA program.
    - (B) **Rural projects fund.—** In the case of a [project](/usc/23/101.md?p=a-20) capitalizing a rural [projects](/usc/23/101.md?p=a-20) fund, the [State](/usc/23/101.md?p=a-28) infrastructure bank shall demonstrate, not later than 2 years after the date on which a secured loan is obligated for the [project](/usc/23/101.md?p=a-20) under the TIFIA program, that the bank has executed a loan agreement with a borrower for a rural infrastructure [project](/usc/23/101.md?p=a-20) in accordance with [section 610](/usc/23/610.md). After the demonstration is made, the bank may draw upon the secured loan. At the end of the 2-year period, to the extent the bank has not used the loan commitment, the [Secretary](/usc/23/101.md?p=a-27) may extend the term of the loan or withdraw the loan commitment.
  - (11) **Public-private partnerships.—** In the case of a [project](/usc/23/101.md?p=a-20) to be carried out through a public-private partnership, the public partner shall have—
    - (A) conducted a value for money analysis or similar comparative analysis; and
    - (B) determined the appropriateness of the public-private partnership agreement.
- (b) **Selection Among Eligible Projects.—**
  - (1) **Establishment.—** The [Secretary](/usc/23/101.md?p=a-27) shall establish a rolling application process under which [projects](/usc/23/101.md?p=a-20) that are eligible to receive credit assistance under [subsection (a)](#a) shall receive credit assistance on terms acceptable to the [Secretary](/usc/23/101.md?p=a-27), if adequate funds are available to cover the subsidy costs associated with the Federal credit instrument.
  - (2) **Master credit agreements.—**
    - (A) **Program of related projects.—** The [Secretary](/usc/23/101.md?p=a-27) may enter into a master credit agreement for a program of related [projects](/usc/23/101.md?p=a-20) secured by a common security pledge on terms acceptable to the [Secretary](/usc/23/101.md?p=a-27).
    - (B) **Adequate funding not available.—** If the [Secretary](/usc/23/101.md?p=a-27) fully obligates funding to eligible [projects](/usc/23/101.md?p=a-20) for a fiscal year and adequate funding is not available to fund a credit instrument, a [project sponsor](/usc/23/203.md?p=e-1-C) of an eligible [project](/usc/23/101.md?p=a-20) may elect to enter into a master credit agreement and wait to execute a credit instrument until the fiscal year for which additional funds are available to receive credit assistance.
  - (3) **Preliminary rating opinion letter.—** The [Secretary](/usc/23/101.md?p=a-27) shall require each [project](/usc/23/101.md?p=a-20) applicant to provide a preliminary rating opinion letter from at least 1 rating agency—
    - (A) indicating that the senior obligations of the [project](/usc/23/101.md?p=a-20), which may be the Federal credit instrument, have the potential to achieve an investment-grade rating; and
    - (B) including a preliminary rating opinion on the Federal credit instrument.
- (c) **Federal Requirements.—**
  - (1) **In general.—** In addition to the requirements of this title for [highway](/usc/23/101.md?p=a-11) [projects](/usc/23/101.md?p=a-20), the requirements of [chapter 53](/usc/49/chstIII-ch53.md) of title 49 for transit [projects](/usc/23/101.md?p=a-20), the requirements of [section 5333(a) of title 49](/usc/49/5333.md?p=a) for rail [projects](/usc/23/101.md?p=a-20), and the requirements of sections [47112(b)](/usc/49/47112.md?p=b) and [50101](/usc/49/50101.md) of title 49 for airport-related [projects](/usc/23/101.md?p=a-20), the following provisions of law shall apply to funds made available under the TIFIA program and [projects](/usc/23/101.md?p=a-20) assisted with those funds:
    - (A) Title VI of the Civil Rights Act of 1964 ([42 U.S.C. 2000d](/usc/42/2000d.md) et seq.).
    - (B) The National Environmental Policy Act of 1969 ([42 U.S.C. 4321](/usc/42/4321.md) et seq.).
    - (C) The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 ([42 U.S.C. 4601](/usc/42/4601.md) et seq.).
  - (2) **NEPA.—** No funding shall be obligated for a [project](/usc/23/101.md?p=a-20) that has not received an environmental categorical exclusion, a finding of no significant impact, or a record of decision under the National Environmental Policy Act of 1969 ([42 U.S.C. 4321](/usc/42/4321.md) et seq.).
  - (3) **Payment and performance security.—**
    - (A) **In general.—** The [Secretary](/usc/23/101.md?p=a-27) shall ensure that the design and [construction](/usc/23/101.md?p=a-4) of a [project](/usc/23/101.md?p=a-20) carried out with assistance under the TIFIA program shall have appropriate payment and performance security, regardless of whether the obligor is a [State](/usc/23/101.md?p=a-28), local government, agency or instrumentality of a [State](/usc/23/101.md?p=a-28) or local government, [public authority](/usc/23/101.md?p=a-22), or private party.
    - (B) **Written determination.—** If payment and performance security is required to be furnished by applicable [State](/usc/23/101.md?p=a-28) or local statute or regulation, the [Secretary](/usc/23/101.md?p=a-27) may accept such payment and performance security requirements applicable to the obligor if the Federal interest with respect to Federal funds and other [project](/usc/23/101.md?p=a-20) risk related to design and [construction](/usc/23/101.md?p=a-4) is adequately protected.
    - (C) **No determination or applicable requirements.—** If there are no payment and performance security requirements applicable to the obligor, the security under [section 3131(b) of title 40](/usc/40/3131.md?p=b) or an equivalent [State](/usc/23/101.md?p=a-28) or local requirement, as determined by the [Secretary](/usc/23/101.md?p=a-27), shall be required.
- (d) **Application Processing Procedures.—**
  - (1) **Processing timelines.—** Except in the case of an application described in [subsection (a)(8)](#a-8) and to the maximum extent practicable, the [Secretary](/usc/23/101.md?p=a-27) shall provide an applicant with a specific estimate of the timeline for the approval or disapproval of the application of the applicant, which, to the maximum extent practicable, the [Secretary](/usc/23/101.md?p=a-27) shall endeavor to complete by not later than 150 days after the date on which the applicant submits a letter of interest to the [Secretary](/usc/23/101.md?p=a-27).
  - (2) **Notice of complete application.—** Not later than 30 days after the date of receipt of an application under this section, the [Secretary](/usc/23/101.md?p=a-27) shall provide to the applicant a written notice to inform the applicant whether—
    - (A) the application is complete; or
    - (B) additional information or materials are needed to complete the application.
  - (3) **Approval or denial of application.—** Not later than 60 days after the date of issuance of the written notice under [paragraph (2)](#d-2), the [Secretary](/usc/23/101.md?p=a-27) shall provide to the applicant a written notice informing the applicant whether the [Secretary](/usc/23/101.md?p=a-27) has approved or disapproved the application.
- (e) **Development Phase Activities.—** Any credit instrument secured under the TIFIA program may be used to finance up to 100 percent of the cost of development phase activities as described in [section 601(a)(2)(A)](/usc/23/601.md?p=a-2-A).

# §603. Secured loans

- (a) **In General.—**
  - (1) **Agreements.—** Subject to paragraphs [(2)](#a-2) and [(3)](#a-3), the [Secretary](/usc/23/101.md?p=a-27) may enter into agreements with 1 or more obligors to make secured loans, the proceeds of which shall be used—
    - (A) to finance eligible [project](/usc/23/101.md?p=a-20) costs of any [project](/usc/23/101.md?p=a-20) selected under [section 602](/usc/23/602.md);
    - (B) to refinance interim [construction](/usc/23/101.md?p=a-4) financing of eligible [project](/usc/23/101.md?p=a-20) costs of any [project](/usc/23/101.md?p=a-20) selected under [section 602](/usc/23/602.md);
    - (C) to refinance existing Federal credit instruments for rural infrastructure [projects](/usc/23/101.md?p=a-20); or
    - (D) to refinance long-term [project](/usc/23/101.md?p=a-20) obligations or Federal credit instruments, if the refinancing provides additional funding capacity for the completion, enhancement, or expansion of any [project](/usc/23/101.md?p=a-20) that—
      - (i) is selected under [section 602](/usc/23/602.md); or
      - (ii) otherwise meets the requirements of [section 602](/usc/23/602.md).
  - (2) **Limitation on refinancing of interim construction financing.—** A loan under [paragraph (1)](#a-1) shall not refinance interim [construction](/usc/23/101.md?p=a-4) financing under [paragraph (1)(B)](#a-1-B)—
    - (A) if the maturity of such interim [construction](/usc/23/101.md?p=a-4) financing is later than 1 year after the substantial completion of the [project](/usc/23/101.md?p=a-20); and
    - (B) later than 1 year after the date of substantial completion of the [project](/usc/23/101.md?p=a-20).
  - (3) **Risk assessment.—** Before entering into an agreement under this subsection, the [Secretary](/usc/23/101.md?p=a-27), in consultation with the Director of the Office of Management and Budget, shall determine an appropriate capital reserve subsidy amount for each secured loan, taking into account each rating letter provided by an agency under [section 602(b)(3)(B)](/usc/23/602.md?p=b-3-B).
- (b) **Terms and Limitations.—**
  - (1) **In general.—** A secured loan under this section with respect to a [project](/usc/23/101.md?p=a-20) shall be on such terms and conditions and contain such covenants, representations, warranties, and requirements (including requirements for audits) as the [Secretary](/usc/23/101.md?p=a-27) determines to be appropriate.
  - (2) **Maximum amount.—**
    - (A) **In general.—** Except as provided in [subparagraph (B)](#b-2-B), the amount of a secured loan under this section shall not exceed the lesser of 49 percent of the reasonably anticipated eligible [project](/usc/23/101.md?p=a-20) costs or if the secured loan does not receive an investment grade rating, the amount of the senior [project](/usc/23/101.md?p=a-20) obligations.
    - (B) **Rural projects fund.—** In the case of a [project](/usc/23/101.md?p=a-20) capitalizing a rural [projects](/usc/23/101.md?p=a-20) fund, the maximum amount of a secured loan made to a [State](/usc/23/101.md?p=a-28) infrastructure bank shall be determined in accordance with [section 602(a)(5)(B)(iii)](/usc/23/602.md?p=a-5-B-iii).
  - (3) **Payment.—** A secured loan under this section—
    - (A) shall—
      - (i) be payable, in whole or in part, from—
        - (I) tolls;
        - (II) user fees;
        - (III) payments owing to the obligor under a public-private partnership;
        - (IV) other dedicated revenue sources that also secure the senior [project](/usc/23/101.md?p=a-20) obligations; or
        - (V) in the case of a secured loan for a [project](/usc/23/101.md?p=a-20) capitalizing a rural [projects](/usc/23/101.md?p=a-20) fund, any other dedicated revenue sources available to a [State](/usc/23/101.md?p=a-28) infrastructure bank, including repayments from loans made by the bank for rural infrastructure [projects](/usc/23/101.md?p=a-20); and
      - (ii) include a rate covenant, coverage requirement, or similar security feature supporting the [project](/usc/23/101.md?p=a-20) obligations; and
    - (B) may have a lien on revenues described in [subparagraph (A)](#b-3-A), subject to any lien securing [project](/usc/23/101.md?p=a-20) obligations.
  - (4) **Interest rate.—**
    - (A) **In general.—** Except as provided in subparagraphs [(B)](#b-4-B) and [(C)](#b-4-C), the interest rate on a secured loan under this section shall be not less than the yield on United States Treasury securities of a similar maturity to the maturity of the secured loan on the date of execution of the loan agreement.
    - (B) **Rural infrastructure projects.—**
      - (i) **In general.—** The interest rate of a loan offered to a rural infrastructure [project](/usc/23/101.md?p=a-20) or a rural [projects](/usc/23/101.md?p=a-20) fund under the TIFIA program shall be at ½ of the Treasury Rate in effect on the date of execution of the loan agreement.
      - (ii) **Application.—** The rate described in [clause (i)](#b-4-B-i) shall only apply to any portion of a loan the subsidy cost of which is funded by amounts set aside for rural infrastructure [projects](/usc/23/101.md?p=a-20) and rural [project](/usc/23/101.md?p=a-20) funds under [section 608(a)(3)(A)](/usc/23/608.md?p=a-3-A).
    - (C) **Limited buydowns.—** The interest rate of a secured loan under this section may not be lowered by more than the lower of—
      - (i) 1½ percentage points (150 basis points); or
      - (ii) the amount of the increase in the interest rate.
  - (5) **Maturity date.—**
    - (A) **In general.—** Except as provided in subparagraphs [(B)](#b-5-B) and [(C)](#b-5-C), the final maturity date of the secured loan shall be the lesser of—
      - (i) 35 years after the date of substantial completion of the [project](/usc/23/101.md?p=a-20); and
      - (ii) if the useful life of the capital asset being financed is of a lesser period, the useful life of the asset.
    - (B) **Rural projects fund.—** In the case of a [project](/usc/23/101.md?p=a-20) capitalizing a rural [projects](/usc/23/101.md?p=a-20) fund, the final maturity date of the secured loan shall not exceed 35 years after the date on which the secured loan is obligated.
    - (C) **Long lived assets.—** In the case of a capital asset with an estimated life of more than 50 years, the final maturity date of the secured loan shall be the lesser of—
      - (i) 75 years after the date of substantial completion of the [project](/usc/23/101.md?p=a-20); or
      - (ii) 75 percent of the estimated useful life of the capital asset.
  - (6) **Nonsubordination.—**
    - (A) **In general.—** Except as provided in [subparagraph (B)](#b-6-B), the secured loan shall not be subordinated to the claims of any holder of [project](/usc/23/101.md?p=a-20) obligations in the event of bankruptcy, insolvency, or liquidation of the obligor.
    - (B) **Preexisting indenture.—**
      - (i) **In general.—** The [Secretary](/usc/23/101.md?p=a-27) shall waive the requirement under [subparagraph (A)](#b-6-A) for a public agency borrower that is financing ongoing capital programs and has outstanding senior bonds under a preexisting indenture, if—
        - (I) the secured loan is rated in the A category or higher;
        - (II) the secured loan is secured and payable from pledged revenues not affected by [project](/usc/23/101.md?p=a-20) performance, such as a tax-backed revenue pledge or a system-backed pledge of [project](/usc/23/101.md?p=a-20) revenues; and
        - (III) the TIFIA program share of eligible [project](/usc/23/101.md?p=a-20) costs is 33 percent or less.
      - (ii) **Limitation.—** If the [Secretary](/usc/23/101.md?p=a-27) waives the nonsubordination requirement under this subparagraph—
        - (I) the maximum credit subsidy to be paid by the Federal Government shall be not more than 10 percent of the principal amount of the secured loan; and
        - (II) the obligor shall be responsible for paying the remainder of the subsidy cost, if any.
  - (7) **Fees.—** The [Secretary](/usc/23/101.md?p=a-27) may establish fees at a level sufficient to cover all or a portion of the costs to the Federal Government of making a secured loan under this section.
  - (8) **Non-federal share.—** The proceeds of a secured loan under the TIFIA program may be used for any non-Federal share of [project](/usc/23/101.md?p=a-20) costs required under this title or [chapter 53](/usc/49/chstIII-ch53.md) of title 49, if the loan is repayable from non-Federal funds.
  - (9) **Maximum federal involvement.—**
    - (A) **In general.—** The total Federal assistance provided for a [project](/usc/23/101.md?p=a-20) receiving a loan under the TIFIA program shall not exceed 80 percent of the total [project](/usc/23/101.md?p=a-20) cost.
    - (B) **Rural projects fund.—** A [project](/usc/23/101.md?p=a-20) capitalizing a rural [projects](/usc/23/101.md?p=a-20) fund shall satisfy [subparagraph (A)](#b-9-A) through compliance with the Federal share requirement described in [section 610(e)(3)(B)](/usc/23/610.md?p=e-3-B).
- (c) **Repayment.—**
  - (1) **Schedule.—** The [Secretary](/usc/23/101.md?p=a-27) shall establish a repayment schedule for each secured loan under this section based on—
    - (A) the projected cash flow from [project](/usc/23/101.md?p=a-20) revenues and other repayment sources; and
    - (B) the useful life of the [project](/usc/23/101.md?p=a-20).
  - (2) **Commencement.—** Scheduled loan repayments of principal or interest on a secured loan under this section shall commence not later than 5 years after the date of substantial completion of the [project](/usc/23/101.md?p=a-20).
  - (3) **Deferred payments.—**
    - (A) **In general.—** If, at any time after the date of substantial completion of the [project](/usc/23/101.md?p=a-20), the [project](/usc/23/101.md?p=a-20) is unable to generate sufficient revenues to pay the scheduled loan repayments of principal and interest on the secured loan, the [Secretary](/usc/23/101.md?p=a-27) may, subject to [subparagraph (C)](#c-3-C), allow the obligor to add unpaid principal and interest to the outstanding balance of the secured loan.
    - (B) **Interest.—** Any payment deferred under [subparagraph (A)](#c-3-A) shall—
      - (i) continue to accrue interest in accordance with [subsection (b)(4)](#b-4) until fully repaid; and
      - (ii) be scheduled to be amortized over the remaining term of the loan.
    - (C) **Criteria.—**
      - (i) **In general.—** Any payment deferral under [subparagraph (A)](#c-3-A) shall be contingent on the [project](/usc/23/101.md?p=a-20) meeting criteria established by the [Secretary](/usc/23/101.md?p=a-27).
      - (ii) **Repayment standards.—** The criteria established pursuant to [clause (i)](#c-3-C-i) shall include standards for reasonable assurance of repayment.
  - (4) **Prepayment.—**
    - (A) **Use of excess revenues.—**
      - (i) **In general.—** Except as provided in [clause (ii)](#c-4-A-ii), any excess revenues that remain after satisfying scheduled debt service requirements on the [project](/usc/23/101.md?p=a-20) obligations and secured loan and all deposit requirements under the terms of any trust agreement, bond resolution, or similar agreement securing [project](/usc/23/101.md?p=a-20) obligations may be applied annually to prepay the secured loan without penalty.
      - (ii) **Certain applicants.—** In the case of a secured loan or other secured Federal credit instrument provided after the date of enactment of the Surface Transportation Reauthorization Act of 2021, if the obligor is a governmental entity, agency, or instrumentality, the obligor shall not be required to prepay the secured loan or other secured Federal credit instrument with any excess revenues described in [clause (i)](#c-4-A-i) if the obligor enters into an agreement to use those excess revenues only for purposes authorized under this title or [title 49](/usc/49.md).
    - (B) **Use of proceeds of refinancing.—** The secured loan may be prepaid at any time without penalty from the proceeds of refinancing from non-Federal funding sources.
- (d) **Sale of Secured Loans.—**
  - (1) **In general.—** Subject to [paragraph (2)](#d-2), as soon as practicable after substantial completion of a [project](/usc/23/101.md?p=a-20) and after notifying the obligor, the [Secretary](/usc/23/101.md?p=a-27) may sell to another entity or reoffer into the capital markets a secured loan for the [project](/usc/23/101.md?p=a-20) if the [Secretary](/usc/23/101.md?p=a-27) determines that the sale or reoffering can be made on favorable terms.
  - (2) **Consent of obligor.—** In making a sale or reoffering under [paragraph (1)](#d-1), the [Secretary](/usc/23/101.md?p=a-27) may not change the original terms and conditions of the secured loan without the written consent of the obligor.
- (e) **Loan Guarantees.—**
  - (1) **In general.—** The [Secretary](/usc/23/101.md?p=a-27) may provide a loan guarantee to a lender in lieu of making a secured loan under this section if the [Secretary](/usc/23/101.md?p=a-27) determines that the budgetary cost of the loan guarantee is substantially the same as that of a secured loan.
  - (2) **Terms.—** The terms of a loan guarantee under [paragraph (1)](#e-1) shall be consistent with the terms required under this section for a secured loan, except that the rate on the guaranteed loan and any prepayment features shall be negotiated between the obligor and the lender, with the consent of the [Secretary](/usc/23/101.md?p=a-27).
- (f) **Streamlined Application Process.—**
  - (1) **In general.—** Not later than 180 days after the date of enactment of the FAST Act, the [Secretary](/usc/23/101.md?p=a-27) shall make available an expedited application process or processes available at the request of entities seeking secured loans under the TIFIA program that use a set or sets of conventional terms established pursuant to this section.
  - (2) **Terms.—** In establishing the streamlined application process required by this subsection, the [Secretary](/usc/23/101.md?p=a-27) may include terms commonly included in prior credit agreements and allow for an expedited application period, including—
    - (A) the secured loan is in an amount of not greater than $100,000,000;
    - (B) the secured loan is secured and payable from pledged revenues not affected by [project](/usc/23/101.md?p=a-20) performance, such as a tax-backed revenue pledge, tax increment financing, or a system-backed pledge of [project](/usc/23/101.md?p=a-20) revenues; and
    - (C) repayment of the loan commences not later than 5 years after disbursement.
  - (3) **Additional terms for expedited decisions.—**
    - (A) **In general.—** Not later than 120 days after the date of enactment of this paragraph, the [Secretary](/usc/23/101.md?p=a-27) shall implement an expedited decision timeline for public agency borrowers seeking secured loans that meet—
      - (i) the terms under [paragraph (2)](#f-2); and
      - (ii) the additional criteria described in [subparagraph (B)](#f-3-B).
    - (B) **Additional criteria.—** The additional criteria referred to in [subparagraph (A)(ii)](#f-3-A-ii) are the following:
      - (i) The secured loan is made on terms and conditions that substantially conform to the conventional terms and conditions established by the National Surface Transportation Innovative Finance Bureau.
      - (ii) The secured loan is rated in the A category or higher.
      - (iii) The TIFIA program share of eligible [project](/usc/23/101.md?p=a-20) costs is 33 percent or less.
      - (iv) The applicant demonstrates a reasonable expectation that the contracting process for the [project](/usc/23/101.md?p=a-20) can commence by not later than 90 days after the date on which a Federal credit instrument is obligated for the [project](/usc/23/101.md?p=a-20) under the TIFIA program.
      - (v) The [project](/usc/23/101.md?p=a-20) has received a categorical exclusion, a finding of no significant impact, or a record of decision under the National Environmental Policy Act of 1969 ([42 U.S.C. 4321](/usc/42/4321.md) et seq.).
    - (C) **Written notice.—** The [Secretary](/usc/23/101.md?p=a-27) shall provide to an applicant seeking a secured loan under the expedited decision process under this paragraph a written notice informing the applicant whether the [Secretary](/usc/23/101.md?p=a-27) has approved or disapproved the application by not later than 180 days after the date on which the [Secretary](/usc/23/101.md?p=a-27) submits to the applicant a letter indicating that the National Surface Transportation Innovative Finance Bureau has commenced the creditworthiness review of the [project](/usc/23/101.md?p=a-20).

# §604. Lines of credit

- (a) **In General.—**
  - (1) **Agreements.—** Subject to [paragraphs (2) through (4)](#a-2..a-4), the [Secretary](/usc/23/101.md?p=a-27) may enter into agreements to make available to 1 or more obligors lines of credit in the form of direct loans to be made by the [Secretary](/usc/23/101.md?p=a-27) at future dates on the occurrence of certain events for any [project](/usc/23/101.md?p=a-20) selected under [section 602](/usc/23/602.md).
  - (2) **Use of proceeds.—** The proceeds of a line of credit made available under this section shall be available to pay debt service on [project](/usc/23/101.md?p=a-20) obligations issued to finance eligible [project](/usc/23/101.md?p=a-20) costs, extraordinary repair and replacement costs, operation and [maintenance](/usc/23/101.md?p=a-13) expenses, and costs associated with unexpected Federal or [State](/usc/23/101.md?p=a-28) environmental restrictions.
  - (3) **Risk assessment.—** Before entering into an agreement under this subsection, the [Secretary](/usc/23/101.md?p=a-27), in consultation with the Director of the Office of Management and Budget and each rating agency providing a preliminary rating opinion letter under [section 602(b)(3)](/usc/23/602.md?p=b-3), shall determine an appropriate capital reserve subsidy amount for each line of credit, taking into account the rating opinion letter.
  - (4) **Investment-grade rating requirement.—** The funding of a line of credit under this section shall be contingent on the senior obligations of the [project](/usc/23/101.md?p=a-20) receiving an investment-grade rating from 2 rating agencies.
- (b) **Terms and Limitations.—**
  - (1) **In general.—** A line of credit under this section with respect to a [project](/usc/23/101.md?p=a-20) shall be on such terms and conditions and contain such covenants, representations, warranties, and requirements (including requirements for audits) as the [Secretary](/usc/23/101.md?p=a-27) determines to be appropriate.
  - (2) **Maximum amounts.—** The total amount of a line of credit under this section shall not exceed 33 percent of the reasonably anticipated eligible [project](/usc/23/101.md?p=a-20) costs.
  - (3) **Draws.—** Any draw on a line of credit under this section shall—
    - (A) represent a direct loan; and
    - (B) be made only if net revenues from the [project](/usc/23/101.md?p=a-20) (including capitalized interest, but not including reasonably required financing reserves) are insufficient to pay the costs specified in [subsection (a)(2)](#a-2).
  - (4) **Interest rate.—** Except as provided in subparagraphs [(B)](/usc/23/603.md?p=b-4-B) and [(C)](/usc/23/603.md?p=b-4-C) of section 603(b)(4), the interest rate on a direct loan resulting from a draw on the line of credit shall be not less than the yield on 30-year United States Treasury securities, as of the date of execution of the line of credit agreement.
  - (5) **Security.—** A line of credit issued under this section—
    - (A) shall—
      - (i) be payable, in whole or in part, from—
        - (I) tolls;
        - (II) user fees;
        - (III) payments owing to the obligor under a public-private partnership; or
        - (IV) other dedicated revenue sources that also secure the senior [project](/usc/23/101.md?p=a-20) obligations; and
      - (ii) include a rate covenant, coverage requirement, or similar security feature supporting the [project](/usc/23/101.md?p=a-20) obligations; and
    - (B) may have a lien on revenues described in [subparagraph (A)](#b-5-A), subject to any lien securing [project](/usc/23/101.md?p=a-20) obligations.
  - (6) **Period of availability.—** The full amount of a line of credit under this section, to the extent not drawn upon, shall be available during the 10-year period beginning on the date of substantial completion of the [project](/usc/23/101.md?p=a-20).
  - (7) **Rights of third-party creditors.—**
    - (A) **Against federal government.—** A third-party creditor of the obligor shall not have any right against the Federal Government with respect to any draw on a line of credit under this section.
    - (B) **Assignment.—** An obligor may assign a line of credit under this section to—
      - (i) 1 or more lenders; or
      - (ii) a trustee on the behalf of such a lender.
  - (8) **Nonsubordination.—**
    - (A) **In general.—** Except as provided in [subparagraph (B)](#b-8-B), a direct loan under this section shall not be subordinated to the claims of any holder of [project](/usc/23/101.md?p=a-20) obligations in the event of bankruptcy, insolvency, or liquidation of the obligor.
    - (B) **Pre-existing indenture.—**
      - (i) **In general.—** The [Secretary](/usc/23/101.md?p=a-27) shall waive the requirement of [subparagraph (A)](#b-8-A) for a public agency borrower that is financing ongoing capital programs and has outstanding senior bonds under a preexisting indenture, if—
        - (I) the line of credit is rated in the A category or higher;
        - (II) the TIFIA program loan resulting from a draw on the line of credit is payable from pledged revenues not affected by [project](/usc/23/101.md?p=a-20) performance, such as a tax-backed revenue pledge or a system-backed pledge of [project](/usc/23/101.md?p=a-20) revenues; and
        - (III) the TIFIA program share of eligible [project](/usc/23/101.md?p=a-20) costs is 33 percent or less.
      - (ii) **Limitation.—** If the [Secretary](/usc/23/101.md?p=a-27) waives the nonsubordination requirement under this subparagraph—
        - (I) the maximum credit subsidy to be paid by the Federal Government shall be not more than 10 percent of the principal amount of the secured loan; and
        - (II) the obligor shall be responsible for paying the remainder of the subsidy cost.
  - (9) **Fees.—** The [Secretary](/usc/23/101.md?p=a-27) may establish fees at a level sufficient to cover all or a portion of the costs to the Federal Government of providing a line of credit under this section.
  - (10) **Relationship to other credit instruments.—** A [project](/usc/23/101.md?p=a-20) that receives a line of credit under this section also shall not receive a secured loan or loan guarantee under [section 603](/usc/23/603.md) in an amount that, combined with the amount of the line of credit, exceeds 49 percent of eligible [project](/usc/23/101.md?p=a-20) costs.
- (c) **Repayment.—**
  - (1) **Terms and conditions.—** The [Secretary](/usc/23/101.md?p=a-27) shall establish repayment terms and conditions for each direct loan under this section based on—
    - (A) the projected cash flow from [project](/usc/23/101.md?p=a-20) revenues and other repayment sources; and
    - (B) the useful life of the asset being financed.
  - (2) **Timing.—** All repayments of principal or interest on a direct loan under this section shall be scheduled—
    - (A) to commence not later than 5 years after the end of the period of availability specified in [subsection (b)(6)](#b-6); and
    - (B) to conclude, with full repayment of principal and interest, by the date that is 25 years after the end of the period of availability specified in [subsection (b)(6)](#b-6).

# §605. Program administration

- (a) **Requirement.—** The [Secretary](/usc/23/101.md?p=a-27) shall establish a uniform system to service the Federal credit instruments made available under the TIFIA program.
- (b) **Fees.—** The [Secretary](/usc/23/101.md?p=a-27) may collect and spend fees, contingent on authority being provided in appropriations Acts, at a level that is sufficient to cover—
  - (1) the costs of services of expert firms retained pursuant to [subsection (d)](#d); and
  - (2) all or a portion of the costs to the Federal Government of servicing the Federal credit instruments.
- (c) **Servicer.—**
  - (1) **In general.—** The [Secretary](/usc/23/101.md?p=a-27) may appoint a financial entity to assist the [Secretary](/usc/23/101.md?p=a-27) in servicing the Federal credit instruments.
  - (2) **Duties.—** A servicer appointed under [paragraph (1)](#c-1) shall act as the agent for the [Secretary](/usc/23/101.md?p=a-27).
  - (3) **Fee.—** A servicer appointed under [paragraph (1)](#c-1) shall receive a servicing fee, subject to approval by the [Secretary](/usc/23/101.md?p=a-27).
- (d) **Assistance From Expert Firms.—** The [Secretary](/usc/23/101.md?p=a-27) may retain the services of expert firms, including counsel, in the field of municipal and [project](/usc/23/101.md?p=a-20) finance to assist in the underwriting and servicing of Federal credit instruments.
- (e) **Expedited Processing.—** The [Secretary](/usc/23/101.md?p=a-27) shall implement procedures and measures to economize the time and cost involved in obtaining approval and the issuance of credit assistance under the TIFIA program.
- (f) **Assistance to Small Projects.—**
  - (1) **Reservation of funds.—** Of the funds made available to carry out the TIFIA program for each fiscal year, and after the set aside under [section 608(a)(6)](/usc/23/608.md?p=a-6), not less than $2,000,000 shall be made available for the [Secretary](/usc/23/101.md?p=a-27) to use in lieu of fees collected under [subsection (b)](#b) for [projects](/usc/23/101.md?p=a-20) under the TIFIA program having eligible [project](/usc/23/101.md?p=a-20) costs that are reasonably anticipated not to equal or exceed $75,000,000.
  - (2) **Release of funds.—** Any funds not used under [paragraph (1)](#f-1) in a fiscal year shall be made available on October 1 of the following fiscal year to provide credit assistance to any [project](/usc/23/101.md?p=a-20) under the TIFIA program.

# §606. State and local permits


The provision of credit assistance under the TIFIA program with respect to a [project](/usc/23/101.md?p=a-20) shall not—

- (1) relieve any recipient of the assistance of any obligation to obtain any required [State](/usc/23/101.md?p=a-28) or local permit or approval with respect to the [project](/usc/23/101.md?p=a-20);
- (2) limit the right of any unit of [State](/usc/23/101.md?p=a-28) or local government to approve or regulate any rate of return on private equity invested in the [project](/usc/23/101.md?p=a-20); or
- (3) otherwise supersede any [State](/usc/23/101.md?p=a-28) or local law (including any regulation) applicable to the [construction](/usc/23/101.md?p=a-4) or operation of the [project](/usc/23/101.md?p=a-20).

# §607. Regulations


The [Secretary](/usc/23/101.md?p=a-27) may promulgate such regulations as the [Secretary](/usc/23/101.md?p=a-27) determines to be appropriate to carry out the TIFIA program.


# §608. Funding

- (a) **Funding.—**
  - (1) **Spending and borrowing authority.—** Spending and borrowing authority for a fiscal year to enter into Federal credit instruments shall be promptly apportioned to the [Secretary](/usc/23/101.md?p=a-27) on a fiscal-year basis.
  - (2) **Reestimates.—** If the subsidy cost of a Federal credit instrument is reestimated, the cost increase or decrease of the reestimate shall be borne by, or benefit, the general fund of the Treasury, consistent with section 504(f) of the Congressional Budget Act of 1974 ([2 U.S.C. 661c(f)](/usc/2/661c.md?p=f)).
  - (3) **Rural set-aside.—**
    - (A) **In general.—** Of the total amount of funds made available to carry out the TIFIA program for each fiscal year, not more than 10 percent shall be set aside for rural infrastructure [projects](/usc/23/101.md?p=a-20) or rural [projects](/usc/23/101.md?p=a-20) funds.
    - (B) **Reobligation.—** Any amounts set aside under [subparagraph (A)](#a-3-A) that remain unobligated by June 1 of the fiscal year for which the amounts were set aside shall be available for obligation by the [Secretary](/usc/23/101.md?p=a-27) on [projects](/usc/23/101.md?p=a-20) other than rural infrastructure [projects](/usc/23/101.md?p=a-20) or rural [projects](/usc/23/101.md?p=a-20) funds.
  - (4) **Limitation for certain projects.—**
    - (A) **Transit-oriented development projects.—** For each fiscal year, the [Secretary](/usc/23/101.md?p=a-27) may use to carry out [projects](/usc/23/101.md?p=a-20) described in [section 601(a)(12)(E)](/usc/23/601.md?p=a-12-E) not more than 15 percent of the amounts made available to carry out the TIFIA program for that fiscal year.
    - (B) **Airport-related projects.—** The [Secretary](/usc/23/101.md?p=a-27) may use to carry out [projects](/usc/23/101.md?p=a-20) described in [section 601(a)(12)(G)](/usc/23/601.md?p=a-12-G)—
      - (i) for each fiscal year, not more than 15 percent of the amounts made available to carry out the TIFIA program under the Surface Transportation Reauthorization Act of 2021 for that fiscal year; and
      - (ii) for the period of fiscal years 2022 through 2026, not more than 15 percent of the unobligated carryover balances (as of October 1, 2021).
  - (5) **Availability.—** Amounts made available to carry out the TIFIA program shall remain available until expended.
  - (6) **Administrative costs.—** Of the amounts made available to carry out the TIFIA program, the [Secretary](/usc/23/101.md?p=a-27) may use not more than $10,000,000 for each of fiscal years 2022 through 2026 for the administration of the TIFIA program.
- (b) **Contract Authority.—**
  - (1) **In general.—** Notwithstanding any other provision of law, execution of a term sheet by the [Secretary](/usc/23/101.md?p=a-27) of a Federal credit instrument that uses amounts made available under the TIFIA program shall impose on the United States a contractual obligation to fund the Federal credit investment.
  - (2) **Availability.—** Amounts made available to carry out the TIFIA program for a fiscal year shall be available for obligation on October 1 of the fiscal year.

# §609. Reports to Congress

- (a) **In General.—** On June 1, 2012, and every 2 years thereafter, the [Secretary](/usc/23/101.md?p=a-27) shall submit to Congress a report summarizing the financial performance of the [projects](/usc/23/101.md?p=a-20) that are receiving, or have received, assistance under the TIFIA program, including a recommendation as to whether the objectives of the TIFIA program are best served by—
  - (1) continuing the program under the authority of the [Secretary](/usc/23/101.md?p=a-27);
  - (2) establishing a Federal corporation or federally sponsored enterprise to administer the program; or
  - (3) phasing out the program and relying on the capital markets to fund the types of infrastructure investments assisted by the TIFIA program without Federal participation.
- (b) **Application Process Report.—**
  - (1) **In general.—** Not later than December 1, 2012, and annually thereafter, the [Secretary](/usc/23/101.md?p=a-27) shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Environment and Public Works of the Senate a report that includes a list of all of the letters of interest and applications received from [project sponsors](/usc/23/203.md?p=e-1-C) for assistance under the TIFIA program during the preceding fiscal year.
  - (2) **Inclusions.—**
    - (A) **In general.—** Each report under [paragraph (1)](#b-1) shall include, at a minimum, a description of, with respect to each letter of interest and application included in the report—
      - (i) the date on which the letter of interest or application was received;
      - (ii) the date on which a notification was provided to the [project sponsor](/usc/23/203.md?p=e-1-C) regarding whether the application was complete or incomplete;
      - (iii) the date on which a revised and completed application was submitted (if applicable);
      - (iv) the date on which a notification was provided to the [project sponsor](/usc/23/203.md?p=e-1-C) regarding whether the [project](/usc/23/101.md?p=a-20) was approved or disapproved; and
      - (v) if the [project](/usc/23/101.md?p=a-20) was not approved, the reason for the disapproval.
    - (B) **Correspondence.—** Each report under [paragraph (1)](#b-1) shall include copies of any correspondence provided to the [project sponsor](/usc/23/203.md?p=e-1-C) in accordance with [section 602(d)](/usc/23/602.md?p=d).
- (c) **Status Reports.—**
  - (1) **In general.—** The [Secretary](/usc/23/101.md?p=a-27) shall publish on the website for the TIFIA program—
    - (A) on a monthly basis, a current status report on all submitted letters of interest and applications received for assistance under the TIFIA program; and
    - (B) on a quarterly basis, a current status report on all approved applications for assistance under the TIFIA program.
  - (2) **Inclusions.—** Each monthly and quarterly status report under [paragraph (1)](#c-1) shall include, at a minimum, with respect to each [project](/usc/23/101.md?p=a-20) included in the status report—
    - (A) the name of the party submitting the letter of interest or application;
    - (B) the name of the [project](/usc/23/101.md?p=a-20);
    - (C) the date on which the letter of interest or application was received;
    - (D) the estimated [project](/usc/23/101.md?p=a-20) eligible costs;
    - (E) the type of credit assistance sought; and
    - (F) the anticipated fiscal year and quarter for closing of the credit assistance.