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Need cash? Oregon Transportation Infrastructure Bank may be able to help
04/19/2012
Most local governments come to ODOT seeking grants for projects. But when local governments have a funding source identified—such as future urban renewal resources or gas tax revenue—but won’t have the money in hand for a few years, a loan from the Oregon Transportation Infrastructure Bank (OTIB) may be just what is needed to get a project underway quickly rather than having to wait until the funding trickles in.
 
The OTIB is a statewide revolving loan fund administered by ODOT that is designed to promote innovative financing solutions for transportation needs. The OTIB is attractive to local governments because it offers loans at very competitive rates; most active loans have interest rates at or below four percent. Most local governments post future distributions from the State Highway Fund as collateral and use these funds to pay back the loan. An OTIB loan is typically used to move a project to construction sooner than if a local government had to stockpile the cash prior to undertaking the project.
 
“The OTIB is a great tool for local governments,” said Tom Meek, who manages the bank.  “We’re able to give loans at very low interest rates that can jump-start projects that might otherwise take years to go to construction.  And we’ve never had a default.”

Clackamas County, which has been among the biggest loan recipients from the OTIB, seconded Meek’s notion. According to Cam Gilmour, director of the county’s Department of Transportation and Development, “Two OTIB loans completed the funding for two major county arterials, avoiding the cost of delaying construction while expediting benefits to motorists, businesses and residences served by these new roads.”
 
The OTIB provides loans to local governments, including cities, counties, transit districts, port authorities, other special service districts, as well as tribal governments, state agencies, and private for-profit and not-for-profit entities.  Most OTIB loans have been to local governments for road projects, but the OTIB can provide loans for other types of projects as well, including transit and bicycle/pedestrian projects. 
 
 
As of the end of federal FY 2011, the OTIB had 15 loans with an outstanding balance of $26.1 million. Between its inception and September 30, 2011, an additional 14 loans totaling $17.6 million have been originated and paid off. Most OTIB loan requests have come in for highway projects, but other modes have received loans as well. The OTIB ended Federal Fiscal Year (FFY) 2011 with a cash balance of $26.6 million across six accounts. Most of this was in the three accounts for highway projects, with $2.4 million available in the two transit accounts.
 
For more information on the OTIB, visit the bank’s website.