- Introduction
- Step 1. Make freight transportation a cause the entire state can get behind
- Step 2. Reconnect shippers, planners, and policymakers to the value of rail transportation
- Step 3. Alter or reverse the marketplace forces that are damaging transportation efficiency
- Step 4. Measure and compare the total costs and impacts of each transport mode, and of the entire system as a whole
- Step 5. Establish a set of land use codes specifically for commercial development and freight transportation
- Step 6. Stimulate the rail, trucking, and waterway industries to establish a comprehensive and coordinated business plan for growth
- Step 7. Employ new and innovative methods of applying public- and private-sector funding for transportation system improvements
- Step 8. Institute a new, permanent stakeholder think tank to ensure ongoing collaboration between the public and private sectors in the implementation of this business plan
- Conclusion
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Adobe Acrobat (*.pdf) (11MB)Step 7. Employ new and innovative methods of applying public- and private-sector funding for transportation system improvements
In the early 19th century, state and local governments were also faced with the challenge of financing major infrastructure projects without sufficient funding streams. Ample capital was seeded by enticing private investors with corporate charters, shareholder protection, limited liability, and land grants, rather than by massive public spending. A platform was thus created for the aggregation of private capital for profitable transportation development that our governments could not afford to fund.
The first step toward successful funding of our state’s transportation system improvements is a statewide growth business plan. With a comprehensive business plan in place, we can attract private investment not only on a project-by-project basis, but, more importantly, for system-wide funding programs that considerably augment and leverage limited public dollars.
Here is an example of a collaborative funding program that leverages existing resources, assets, and low- or no-cost government guarantees.
Funding Goal: Provide a ready-at-hand financing mechanism to facilitate investment in rail infrastructure needed by non-rail shippers to ship/receive goods by rail
Participants:
- Shippers and/or Receivers
- Commonwealth of Pennsylvania
- Private financial institutions
- Freight railroads
Key Features:
- A private shipper and/or receiver in need of new rail infrastructure such as a siding or loading facility commits to a specific shipping volume (a take-or-pay contract) and enters into a loan payback agreement
- A state government entity (a business or economic development agency, or the Department of Transportation) provides a loan guarantee
- A private financial institution provides the loan funds
- The freight railroad in addition to providing the new service may discount rail rates to customer as partial or full compensation for initial investment
- This is a win-win for all parties