APPENDIX D

Federal Funding

Appendix D, a companion to Chapter 8, describes each federal funding program and includes detailed tables of matching requirements, eligibility, funding amounts through FY 2026, and typical award size. Readers are also encouraged to consult the U.S. DOT website for current information on grant programs (https://www.transportation.gov/grants).

General Formula and Grant Programs

Table D-1 presents an overview of the program type, matching requirements, eligibility, funding amount through FY 2026, and typical award size for each of the general programs. General programs can utilize funding for a variety of multimodal transportation projects and, overall, provide the greatest range of eligible activities of the program types. Moreover, seven of the nine general programs can be used to fund the planning, design, or construction phase of a project. The general programs are split between four formula programs and five discretionary grant programs.

FHWA Surface Transportation Block Grant Program

FHWA distributes Surface Transportation Block Grant (STBG) funds to states and metropolitan planning organizations (MPOs) using a highway-based funding formula. STBG is a flexible funding source for a range of transportation projects. Newly eligible activities added through the IIJA include projects that facilitate intermodal connections between emerging transportation technologies, electric vehicle (EV) charging infrastructure projects, and projects for the construction of bus rapid transit corridors.

The STBG is the most well-funded of the general funding programs applicable to intermodal passenger facilities, with the IIJA allocating a little over $14 billion in STBG funding annually through 2026. Nearly every aspect of planning, designing, and constructing an intermodal passenger facility qualifies for funding from the STBG program. STBG guidance specifically highlights multimodal projects that improve public transportation access, including transit capital projects, pedestrian and bicycle projects, and ferry boat and terminal projects.

FHWA Congestion Mitigation and Air Quality Program

FHWA administers the Congestion Mitigation and Air Quality (CMAQ) program with an approximate total of $2.5 billion in annual funding apportioned as a lump sum among the states. CMAQ funds transportation projects and programs to reduce congestion and improve air quality in designated air quality maintenance or non-attainment areas for carbon monoxide or ozone. The IIJA expanded the eligible activities for the CMAQ program to include shared mobility (e.g., bikeshare and scooter share).

CMAQ funding levels are based on the population in the non-attainment and maintenance areas of the state and the severity of air quality ratings. By formula, CMAQ funding levels increase to address worsening regional air quality ratings. Quantifying the ability to reduce congestion and improve air quality in the region allows intermodal passenger facilities to leverage CMAQ funding. Transit facilities (e.g., stations, terminals, transfer facilities) are highlighted as an eligible category in the CMAQ guidance, along with new transit vehicles (e.g., diesel engine retrofits). Constructing bicycle and pedestrian facilities and installing traffic calming measures are also among the eligible activities that intermodal passenger facilities qualify for.

U.S. DOT Rebuilding American Infrastructure with Sustainability and Equity Grant Program

The Rebuilding American Infrastructure with Sustainability and Equity (RAISE) grant program, formerly known as BUILD or TIGER, is a highly competitive DOT grant program. RAISE supports the capital costs of road, rail, transit, and multimodal projects that have a significant impact on the nation, a region, or a metropolitan area.

The RAISE program is extremely competitive. Broad support and local consensus, including support from the business community, various interest groups (e.g., environmental, labor, economic development), and elected officials at the federal, state, and local levels are key requirements to being competitively positioned for RAISE funding. DOT also prefers projects that have completed considerable project development (e.g., finalized environmental clearance) and secured commitments of matching non-federal funding.

The eligible project categories relevant to intermodal passenger facilities include public transportation, passenger and freight rail, port infrastructure, and surface transportation components of an airport project.

FHWA Carbon Reduction Program

The Carbon Reduction program was established by the IIJA as a formula grant program to states to reduce transportation emissions or aid in the development of carbon reduction strategies. The IIJA has apportioned approximately $1.3 billion annually to this program through FY 2026.

Intermodal passenger facilities qualify for funding from the Carbon Reduction program under several eligible activities. Eligible public transportation projects include bus rapid transit corridors and bus passenger loading facilities. Moreover, projects for on- and off-road trail facilities for pedestrians, bicyclists, and other nonmotorized forms of transportation qualify and may include shared mobility projects. The construction and operation of zero-emission vehicle charging infrastructure are also included as part of the program.

U.S. DOT National Infrastructure Project Assistance Program

The National Infrastructure Project Assistance grant program, commonly referred to as MEGA, was created to support large projects that are difficult to fund even though they provide national or regional economic, mobility, or safety benefits. This new program was enacted as part of the IIJA. DOT announced that $1 billion will be made available annually through FY 2026. Fifty percent of funds were made available for projects greater than $500 million and 50% for projects between $100 million and $500 million in cost.

MEGA is now part of the Multimodal Project Discretionary Grant (MPDG) opportunity, which is a combined solicitation. The other grant programs included in the MPDG are the

U.S. DOT Strengthening Mobility and Revolutionizing Transportation Grant Program

The Strengthening Mobility and Revolutionizing Transportation (SMART) grant program provides discretionary grants to help drive technology innovations in transportation. This program was introduced as part of the IIJA, which authorized $100 million annually in competitive grants through 2026.

The U.S. DOT notes that priority will be given to projects focused on advanced smart city or community technologies and systems to improve transportation efficiency and safety. The focus on technological innovations means that intermodal passenger facilities can use SMART funding for related projects such as implementing mobility as a service, last-mile service through shared connected and automated vehicles, urban air mobility, transit priority signaling, and other sensor-based technologies that improve pedestrian and cyclist accessibility (e.g., on-demand conversion of right-of-way for pedestrians and cyclists, sensor-based shared streets, and zero-emission zones).

FTA Pilot Program for Transit-Oriented Development Planning

FTA’s Pilot Program for Transit Oriented Development Planning offers discretionary grants to promote growth around transit stations to create compact, mixed-use communities with easy access to jobs and services. The program provides funding to integrate land use and transportation planning in conjunction with a project that seeks funding through the FTA’s Capital Investment Grants program. The pilot program was continued by the IIJA, with $13 million to $14 million in funding available annually through 2026.

One of the main goals of the program is to improve ridership by fostering multimodal connectivity and accessibility. The program funds planning efforts for increasing pedestrian and bicycle access to transit stations, as well as fostering development around existing intermodal passenger facilities. Intermodal passenger facilities could also use funding from the program to identify opportunities for public–private partnerships.

Vehicle Funding Programs

Programs under the vehicles category support intermodal passenger facilities by providing formula and discretionary grant funding for transit zero-emission fleet acquisition, facilities/stations supporting zero-emission transit vehicles, and EV charging infrastructure. Table D-2 provides a general overview of the program type, matching requirements, eligible activities, funding amount through FY 2026, and typical award size of grants for the vehicle programs. While this report focuses specifically on facilities, some of the federal funding programs listed in this section may assist with elements of an intermodal facility expansion, such as vehicle procurement and charging/fueling infrastructure.

FTA Section 5339 (a), (b), and (c)

FTA Section 5339 is made up of three programs for buses and bus facilities. Intermodal passenger facilities with bus service can capitalize on the significantly higher funding levels for these three programs thanks to the IIJA. While 5339 (a) is a formula funding program, 5339 (b) and (c) are discretionary grant programs (Federal Transit Administration 2022b).

Section 5339 (a) and (b) provides funding for states and transit agencies to purchase buses and replace, rehabilitate, and construct bus-related facilities, including technological changes or

innovations to modify low- or no-emission vehicles or facilities. Section 5339 (a) allocates more than $600 million annually through 2026 to states and transit agencies; intermodal passenger facilities can leverage these formula funds in addition to the approximately $400 million annually distributed through the 5339 (b) grant program. Applications for the competitive discretionary program, Section 5339 (b), are evaluated based on demonstration of need or the quality and extent to which the proposer demonstrates how the proposed project will address the need for capital investment in bus vehicles or supporting facilities. Applications are also assessed based on demonstration of benefits, how the proposed project will improve the condition of the transit system, how it will improve the reliability of transit service for its riders, and how it will enhance access and mobility within the service area. While the maximum federal share of net project costs is 80% under this program, grants directed to helping individuals with disabilities may be able to secure a higher federal share for certain projects (Federal Transit Administration 2022b).

Section 5339 (c) provides grant funding to state and local governmental authorities for the purchase or lease of zero-emission and low-emission transit buses as well as the acquisition, construction, and leasing of required supporting facilities. Eligible supporting facilities include recharging and refueling facilities for zero-/low-emission buses at intermodal passenger facilities. All applicants requesting funding for zero-emission-vehicle–related projects must include a single Zero-Emission Transition plan document containing the following information, at a minimum:

• Demonstrate a long-term fleet management plan with a strategy for how the applicant intends to use the current request for resources and future acquisitions.
• Address the availability of current and future resources to meet costs for the transition and implementation.
• Consider policy and legislation affecting relevant technologies.
• Include an evaluation of existing and future facilities and their relationship to the technology transition.
• Describe the partnership of the applicant with the utility or alternative fuel provider.
• Examine the impact of the transition on the applicant’s current workforce by identifying skill gaps, training needs, and retraining needs of the existing workers of the applicant to operate and maintain zero-emission vehicles and related infrastructure and avoid displacement of the existing workforce (Federal Transit Administration 2022b).

FHWA National Electric Vehicle Infrastructure Formula Program

The National Electric Vehicle Infrastructure (NEVI) Formula Program will provide formula grants to states to strategically deploy EV charging infrastructure and to establish an interconnected network to facilitate data collection, access, and reliability. This is a new program that was enacted as part of the IIJA, unlocking $1 billion annually in funding through 2026. While NEVI is primarily a formulaic program, the program sets aside 10% of funds for discretionary grants to assist state and local governments in strategically deploying electric vehicle charging infrastructure (Federal Highway Administration 2023a).

Each state DOT must submit a plan to U.S. DOT describing how NEVI formula funds will be used before it can access and apportion funds to local entities. The plan will detail locations for charging infrastructure on one of the state’s designated alternative fuel corridors. Intermodal passenger facilities located on these alternative fuel corridors qualify for NEVI formula funding. In addition to funding the acquisition and installation of EV charging infrastructure, NEVI will help with operations and maintenance of infrastructure previously acquired through the program. Other eligible projects include analysis to evaluate the demand for EV charging infrastructure, data sharing about EV charging infrastructure, and traffic control devices to provide directions to acquired EV charging infrastructure (Federal Highway Administration 2023a).

FHWA Charging and Fueling Infrastructure Discretionary Grant Program

The Charging and Fueling Infrastructure (CFI) Discretionary Grant Program is a new competitive grant program created by the IIJA. Owners of intermodal passenger facilities looking to add electric vehicle charging stations should consider the CFI program since it provides $400 to $700 million per year in discretionary grant funding through 2026. The CFI program has two tracks for applications:

• Corridor charging: To deploy EV charging and hydrogen/propane/natural gas fueling infrastructure along designated alternative fuel corridors.
• Community charging: To install EV charging and alternative fuel along public roads and in schools, parks, and public parking facilities.

Special priority is given to projects located in low (and moderate) income neighborhoods as well as in rural areas (Federal Highway Administration 2023a).

FTA Ferry Program

The FTA Ferry Program is a set of three competitive grant programs distributed by the FTA. Intermodal passenger facilities with passenger ferry components can utilize these three programs to improve and expand passenger ferry service (Federal Transit Administration 2022b).

The Passenger Ferry Grant Program is set to receive $30 million annually through FY 2026. The program supports passenger ferry systems in urbanized areas. Capital projects, such as the acquisition, replacement, or rehabilitation of ferries, terminals, and other facilities and equipment, are eligible for funding. Competitiveness for the program depends on factors such as age and condition of ferries, terminals, and other infrastructure; rider benefits; project readiness; and connectivity to other modes. An important note is that passenger ferry grants cannot be used for operating, planning, or preventative maintenance expenses (Federal Transit Administration 2022b).

The Electric or Low-Emitting Ferry Pilot Program is a new program created by the BIL. It is set to receive $50 million annually through FY 2026, with an additional $50 million per year in advance appropriations, for a total of up to $100 million per year. Ferry vessels that reduce emissions through alternative fuels or onboard energy systems, along with necessary charging infrastructure, qualify for this program (Federal Transit Administration 2022b).

The Ferry Service for Rural Communities Program is the rural-focused counterpart to the Passenger Ferry Grant Program; $200 million per year is authorized for the program through 2026, with an additional $200 million in advance appropriations annually. Eligible activities include capital, planning, and operating assistance for regularly scheduled ferry service. To qualify for the Rural Communities Program, the ferry system must serve two or more rural areas located 50 or more sailing miles apart or serving two rural areas with a single segment over 20 miles between two rural areas that otherwise does not qualify for the Passenger Ferry Grant Program (Federal Transit Administration 2022b).

Roadway Funding Programs

Roadway funding programs support the development of bicycle, pedestrian, and road infrastructure surrounding intermodal passenger facilities. Table D-3 provides a general overview of the program type, matching requirements, eligible activities, funding amount through FY 2026, and typical award size of roadway program grants.

FHWA Highway Safety Improvement Program

The Highway Safety Improvement Program (HSIP) provides formula funding from the FHWA for the reduction of traffic fatalities and serious injuries on all public roads. Applicants to the HSIP must focus on performance and demonstrate a data-driven, strategic approach to improving highway safety. The IIJA ensures that HSIP will receive up to $3+ billion annually through 2026 to allocate to states (Federal Highway Administration 2023a).

Thanks to the IIJA, new eligible activities make the HSIP more relevant than ever for intermodal passenger facilities. The IIJA specifies that HSIP can be utilized for traffic calming measures and roadway improvements that separate motor vehicles from pedestrians and bicyclists. Moreover, up to 50% of HSIP apportionments can be transferred at the state’s discretion to other funding programs that intermodal passenger facilities could tap into. Programs that HSIP funding could be transferred to include the STBG program, the CMAQ Program, and the Carbon Reduction Program (Federal Highway Administration 2023a).

U.S. DOT Nationally Significant Multimodal Freight and Highway Program

The Nationally Significant Multimodal Freight & Highway Projects Grant program (also known as INFRA) is dedicated to rebuilding the nation’s aging infrastructure. INFRA utilizes selection criteria that promote projects that are critical to national and regional economic vitality as well as environmental justice goals toward highway and intercity/freight rail projects. The program also incentivizes project sponsors to pursue innovative delivery strategies, including public–private partnerships (U.S. Department of Transportation 2024b).

INFRA is now part of the MPDG opportunity, which is a combined solicitation. The other grant programs included in the MPDG are MEGA and the Rural Surface Transportation Grant program. MPDG allows applicants to apply to one, two, or all three of these funding opportunities by submitting only one application. INFRA grants can cover up to 60% of future eligible project costs. While INFRA grants are intended to provide funding to projects that are shovel ready and result in construction, eligible activities include planning, feasibility analysis, and revenue forecasting (U.S. Department of Transportation 2024b).

The INFRA grant program has the following goals, which factor heavily into merit criteria scoring:

• Support national and regional activity.
• Focus on climate change and environmental justice impacts.
• Advance racial equity.
• Engage more non-federal sources of infrastructure investment.
• Use innovative solutions for all aspects of the project (U.S. Department of Transportation 2024b).

INFRA’s focus on freight limits some of its applicability to intermodal passenger facilities. Nonetheless, eligible project types for INFRA funding include highway freight projects, bridge projects, intermodal rail projects, and port projects. Elements of these projects can benefit intermodal passenger facilities, such as improvements to pedestrian and cyclist infrastructure or the establishment of a bus rapid transit infrastructure (U.S. Department of Transportation 2024b).

U.S. DOT Safe Streets and Roads for All Grant Program

The Safe Streets and Roads for All (SS4A) grant program is a discretionary grant program for improving roadway safety by significantly reducing or eliminating roadway fatalities and

Funding for Airports, Ports, and Railroads

Seven programs provide funding for a variety of airport, port, and railroad projects. Table D-4 provides a general overview of the program type, matching requirements, eligible activities, funding amount through FY 2026, and typical award size of grants.

FRA

FRA Federal-State Partnership for Intercity Passenger Rail Grant Program

FRA administers the Federal-State Partnership for Intercity Passenger Rail Grant Program, which is a competitive grant program. Formerly known as the Federal-State Partnership for State of Good Repair, this program focuses on funding capital projects that reduce the state-of-good-repair backlog. The IIJA authorized a significant increase in funding to $22.5 billion through 2026, in addition to expanding the program’s scope to include projects that improve performance or expand or establish new intercity passenger rail service. The IIJA authorized a significant increase in funding; $22.5 billion is allocated to the program through 2026 (Federal Railroad Administration 2024).

The Federal-State Partnership splits funding into two buckets: projects located within the Northeast corridor, which receive up to two-thirds of total funding, and projects located outside the Northeast corridor, which will receive at least one-third of total funding. The Federal-State Partnership features a category for station projects, which could relate to intermodal passenger facilities. Station projects can use funding to repair, replace, modernize, improve, or expand an existing station, in addition to constructing a new station (Federal Railroad Administration 2024).

FRA Consolidated Rail Infrastructure and Safety Improvements Program

The Consolidated Rail Infrastructure and Safety Improvements (CRISI) Program is an FRA grant program funding projects that improve the safety, efficiency, and reliability of intercity passenger and freight rail. The IIJA nearly tripled funding for the CRISI program, which will now award up to $1 billion in grants per year through 2026 (Federal Railroad Administration 2024).

The CRISI program dedicates at least 25% of funding to projects in rural areas. The CRISI program also sets aside at least $150 million annually for intercity passenger rail projects, $25 million for trespassing prevention, and $2 million for magnetic levitation projects. It also seeks to fund projects that address climate change, environmental justice, and racial equity (Federal Railroad Administration 2024).

Any project that enhances multimodal connections, including connections to intercity bus/rail service and commercial air service, qualifies for CRISI grants. Joint scheduling, ticketing, and baggage handling projects are among the projects that qualify for CRISI grants by facilitating service integration between rail and other modes. Additionally, capital projects that facilitate ridership growth along heavily traveled rail corridors can receive CRISI funding (Federal Railroad Administration 2024).

FAA

Airport Improvement Program

The FAA administers the Airport Improvement Program (AIP), providing grants for planning and development of public-use airports in the National Plan of Integrated Airport Systems (NPIAS). The AIP provides more than $3.35 billion annually to more than 3,300 eligible airports through entitlement funding and discretionary funding. The AIP also provides block grants to individual states for use at general aviation airports (Federal Aviation Administration 2024b).

The AIP is an important source of funding for airports across the country and provides funds for most airfield capital improvement or rehabilitation projects. Therefore, only a limited amount of AIP funding can be dedicated to intermodal passenger facilities, and this funding is limited to public-use areas (Federal Aviation Administration 2024b).

Airport Terminal Program

The Airport Terminal Program (ATP) is a new FAA discretionary program created by the IIJA that is dedicated to providing funding for terminal development projects. The goal of the program is to address the nation’s aging air infrastructure. The IIJA has set aside $1 billion annually for ATP through 2026 (Federal Aviation Administration 2024a).

Large-hub airports are set to receive a maximum of 55% of total ATP funding, while medium-hub airports are allocated a maximum of 15%, small-hub airports will receive a maximum of 20%, and non-hub or non-primary airports will receive a minimum of 10% of total funding. ATP grants can be used for a variety of projects related to upgrading, rebuilding, and expanding airport terminals. The ATP was created with sustainability and multimodality in mind, which positions intermodal passenger facilities well for grants. On-airport rail access projects, for example,

ASAP grants can be used for the planning, design, and construction of projects at intermodal passenger facilities to meet and exceed ADA standards for buildings. ASAP grants can only be used for legacy stations or facilities that are not ADA compliant. Through repairs, modifications, and retrofits, not only can ASAP grants be used to provide access to transit systems for people with disabilities, but also can benefit bicyclists, stroller-users, passengers with luggage, and so forth to help them better utilize an intermodal passenger facility (Federal Transit Administration 2022b).

Financing Options and Innovative Delivery Strategies

Ideally, maximizing funding from the many sources described previously would cover the entire public cost of delivering a project. If there is a funding gap after all possible public funding sources have been exhausted, the remaining capital cost shortfall is generally assumed to be covered by some form of public financing or an alternative revenue source. If a funding gap is large, and available debt financing terms are less favorable or flexible, future revenue streams from the project may not be sufficient to cover the resulting debt, and the project will not be financially feasible. Maximizing funding from all possible federal, state, and local sources can minimize the funding shortfall and resulting debt issuance required (U.S. Department of Transportation 2024a).

Various financing options are available to cover the remaining costs, depending on the scenario and types of public stakeholders involved. The following describes some of the more common debt financing mechanisms available at the federal level (and state/local level, depending on the location) as well as more innovative, project-specific mechanisms that may be available for consideration for intermodal passenger facilities (U.S. Department of Transportation 2024a).

Within the context of intermodal station development potential, these additional, project-specific mechanisms generally leverage two primary opportunities that these stations tend to catalyze: (1) land use/future development potential, and (2) mobility-focused revenue-generating potential. In each case, successfully generating revenue from land use and mobility opportunities requires significant planning and time to develop and structure partnerships with the necessary public- and private-sector stakeholders. Such opportunities also have implications for the types of governance structures that may be most applicable, depending on the given scenario (U.S. Department of Transportation 2024a).

Federal Financing Mechanisms

Table D-5 summarizes the matching requirements, eligible activities, and funding amounts through FY 2026 for federal financing programs.

Transportation Infrastructure Finance and Innovation Act and TIFIA 49 for Transit and TOD Projects

The Transportation Infrastructure Finance and Innovation Act (TIFIA) provides low-cost financing to fill funding gaps in infrastructure projects. TIFIA credit assistance is available in the form of direct loans, loan guarantees, and standby lines of credit to finance surface transportation projects of national and regional significance. Credit assistance has historically been capped at 33% of reasonably anticipated eligible project costs. However, in 2022, the U.S. DOT introduced the “TIFIA 49” initiative, which increases the maximum loan amount from 33% to 49% of project costs for eligible transit and TOD projects. In addition to this increase, the IIJA has made TIFIA credit assistance more attainable and flexible by (1) relaxing requirements for investment-grade ratings, and (2) increasing the maximum loan duration from 35 years to 75 years for projects with an estimated life greater than 50 years (U.S. Department of Transportation 2024a).

Recently, TIFIA loan eligibility was expanded to include port, TOD, and airport terminal and airside projects. To be eligible, these types of projects need to be added to the STIP project lists under special exceptions as TIFIA currently requires projects to be listed on the STIP (U.S. Department of Transportation 2024a).

Railroad Rehabilitation and Improvement Financing

The Railroad Rehabilitation and Improvement Financing (RRIF) program provides federal credit assistance in the form of direct loans, loan guarantees, and lines of credit to finance rail projects. RRIF offers direct loans for up to 100% of the project cost (or up to 75% for eligible TOD projects). The program allows a repayment period of up to 75 years after the date of substantial completion of the project, pursuant to the BIL. The RRIF program is authorized to provide up to $35 billion in direct loans and loan guarantees to finance development of railroad infrastructure, with $7 billion reserved for freight railroads other than Class I carriers (railroads with operating revenue of less than $272.0 million annually). Additionally, there is now a discretionary credit assistance of $50 million per year for FY 23 – FY 26, subject to appropriations, of up to $20 million per loan. At least 50% of such credit assistance is set aside for freight railroads other than Class I carriers. Furthermore, the IIJA made TOD a permanent project eligibility. Lastly, the infrastructure law codified the RRIF express program, which establishes an expedited credit review process for loans that meet certain financial and operational criteria and requires regular updates from U.S. DOT on status of application so as to reduce applicant uncertainty (U.S. Department of Transportation 2024a).

Eligible applicants for RRIF financing include railroads, state and local governments, government-sponsored authorities and corporations, limited-option freight shippers that intend to construct a new rail connection, and joint ventures that include at least one of the preceding categories. The FRA notes that RRIF financing may be used to:

• Acquire, improve, or rehabilitate intermodal or rail equipment or facilities, including track, components of track, bridges, yards, buildings and shops, and the installation of positive train control systems;
• Develop or establish new intermodal or railroad facilities;
• Reimburse planning and design expenses relating to these activities;
• Refinance outstanding debt incurred for the purposes listed previously; and
• Finance TOD (U.S. Department of Transportation 2024e).