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                                                      Calendar No. 516
116th Congress     }                                     {      Report
                                 SENATE
 2d Session        }                                     {     116-255
_______________________________________________________________________

                                     


                      TOD ADVANCEMENT ACT OF 2019

                               __________

                              R E P O R T

                                 of the

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 2805









[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]









                August 12, 2020.--Ordered to be printed 
                
                
                            ________
                            
                 U.S. GOVERNMENT PUBLISHING OFFICE 
                 
99-010                   WASHINGTON : 2020
                
                
                
                
                
                
                
                
                
                
                
                
       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                     one hundred sixteenth congress
                             second session

                 ROGER F. WICKER, Mississippi, Chairman
JOHN THUNE, South Dakota             MARIA CANTWELL, Washington
ROY BLUNT, Missouri                  AMY KLOBUCHAR, Minnesota
TED CRUZ, Texas                      RICHARD BLUMENTHAL, Connecticut
DEB FISCHER, Nebraska                BRIAN SCHATZ, Hawaii
JERRY MORAN, Kansas                  EDWARD J. MARKEY, Massachusetts
DAN SULLIVAN, Alaska                 TOM UDALL, New Mexico
CORY GARDNER, Colorado               GARY C. PETERS, Michigan
MARSHA BLACKBURN, Tennessee          TAMMY BALDWIN, Wisconsin
SHELLEY MOORE CAPITO, West Virginia  TAMMY DUCKWORTH, Illinois
MIKE LEE, Utah                       JON TESTER, Montana
RON JOHNSON, Wisconsin               KYRSTEN SINEMA, Arizona
TODD C. YOUNG, Indiana               JACKY ROSEN, Nevada
RICK SCOTT, Florida
                       John Keast, Staff Director
               David Strickland, Minority Staff Director 
               
               
















               
               
               

                                                      Calendar No. 516
116th Congress     }                                     {      Report
                                 SENATE
 2d Session        }                                     {     116-255

======================================================================



 
                      TOD ADVANCEMENT ACT OF 2019

                                _______
                                

                August 12, 2020.--Ordered to be printed

                                _______
                                

       Mr. Wicker, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 2805]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 2805) to improve transit-
oriented development financing, and for other purposes, having 
considered the same, reports favorably thereon with amendments 
and recommends that the bill (as amended) do pass.

                          Purpose of the Bill

    This legislation is intended to improve transit-oriented 
development financing under the Railroad Rehabilitation and 
Improvement Financing (RRIF) program by extending the sunset on 
the eligibility for transit-oriented development (TOD), 
clarifying the eligibility requirements for such loans, and 
increasing transparency with respect to the evaluation of 
applications for such loans.

                          Background and Needs

    The RRIF program offers long-term, low-cost loans to 
railroad operators to finance improvements to infrastructure 
and equipment.\1\ Under the RRIF program, loans may be used to: 
(1) acquire, improve, or rehabilitate intermodal or rail 
equipment or facilities; (2) develop or establish new 
intermodal or railroad facilities; (3) reimburse planning and 
design expenses relating to these activities; (4) refinance 
certain outstanding debt; and (5) finance certain transit-
oriented development. The Build America Bureau, which is within 
the U.S. Department of Transportation (DOT), administers the 
RRIF program and, through it, may provide up to $35 billion in 
direct loans and loan guarantees.\2\ Of this amount, $7 billion 
is set aside to provide loans to short line railroads.\3\
---------------------------------------------------------------------------
    \1\45 U.S.C. 822.
    \2\Congress created the Build America Bureau in section 9001 of the 
Fixing America's Surface Transportation Act (Pub. L. 114-94) and 
directed the Bureau to administer various infrastructure financing 
programs, including RRIF. See 49 U.S.C. 116(d).
    \3\Short line railroads refer to class II and class III carriers, 
which are defined based on annual revenue of the carrier. See 49 CFR 
1201.1-1. Class II carriers are defined as having annual carrier 
operating revenues of less than $250 million but in excess of $20 
million. Class III carriers are defined as carriers having annual 
carrier operating revenues of $20 million or less.
---------------------------------------------------------------------------
    The Transportation Equity Act for the 21st Century\4\ 
created the RRIF program, replacing a prior railroad loan 
program established in 1976.\5\ Congress subsequently amended 
the RRIF program through the Safe, Accountable, Flexible and 
Efficient Transportation Equity Act: A Legacy for Users,\6\ the 
Rail Safety Improvement Act of 2008,\7\ and the Fixing 
America's Surface Transportation (FAST) Act.\8\
---------------------------------------------------------------------------
    \4\Pub. L. 105-178.
    \5\David Randall Peterman, The Railroad Rehabilitation and 
Improvement Financing (RRIF) Program, Congressional Research Service, 
Jan. 31, 2018 (https://crsreports.congress.gov/
product/pdf/R/R44028/7) (accessed Apr. 22, 2020).
    \6\Pub. L. 109-59.
    \7\Pub. L. 110-432.
    \8\Pub. L. 114-94.
---------------------------------------------------------------------------
    In the FAST Act, Congress created an eligibility for RRIF 
loans to finance transit-oriented development with a sunset on 
the eligibility of December 4, 2019.\9\\10\ To qualify for a 
RRIF TOD loan, an applicant seeking to finance economic 
development and related infrastructure and activities must show 
that the project: (1) incorporates private investment; (2) is 
physically and functionally related to a passenger rail station 
or multimodal station that includes rail service; (3) has a 
high probability of the applicant commencing the contracting 
process for construction not later than 90 days after the date 
on which the direct loan or loan guarantee is obligated for the 
project; and (4) has a high probability of reducing the need 
for financial assistance under any other Federal program for 
the relevant passenger rail station or service by increasing 
ridership, tenant lease payments, or other activities that 
generate revenue exceeding costs.\11\
---------------------------------------------------------------------------
    \9\The FAST Act also eliminated the requirement that borrowers' 
credit risk premiums be refunded. Unlike the Transportation 
Infrastructure Finance and Innovation Act (TIFIA) program, which 
provides credit assistance for transportation projects of regional and 
national significance, the RRIF program does not cover the cost of 
credit premiums for loan recipients.
    \10\45 U.S.C. 822(b)(1)(E) and (b)(3).
    \11\45 U.S.C. 822(b)(1)(E).
---------------------------------------------------------------------------
    To address the sunset on the RRIF TOD eligibility, the bill 
would extend the TOD eligibility until December 4, 2021. The 
Consolidated Appropriations Act of 2020\12\ extended the 
provision until September 30, 2020. S. 2805 would further 
extend the sunset until December 4, 2021, in order to provide 
additional certainty for the program and potential applicants. 
The bill also would clarify the existing eligibility by 
requiring that the project: (1) incorporates private investment 
of greater than 20 percent of the total project cost; (2) is 
physically connected to, or is within \1/2\ mile walking 
distance from, a passenger rail station or multimodal station 
that includes rail service; (3) has a certification that the 
contracting process for construction will commence not later 
than 90 days after the date on which the direct loan or loan 
guarantee is obligated; and (4) demonstrates the ability to 
generate new financial assistance. Finally, the bill would 
provide additional transparency around the process for 
approving or denying requests for RRIF TOD loans.
---------------------------------------------------------------------------
    \12\Pub. L. 116-94.
---------------------------------------------------------------------------

                         Summary of Provisions

    If enacted, S. 2805 would do the following:
   Extend the sunset for financing RRIF loans to 
        improve transit-oriented development until December 4, 
        2021.
   Clarify the eligibility requirements for RRIF loans 
        to improve transit-oriented development.
   Increase transparency with respect to RRIF TOD loans 
        by requiring the DOT to provide Congress with a semi-
        annual report on the evaluation of applications for 
        such loans.

                          Legislative History

    S. 2805 was introduced on November 6, 2019, by Senator 
Wicker (for himself and Senator Duckworth) and was referred to 
the Committee on Commerce, Science, and Transportation of the 
Senate. Senators Collins, Markey, Reed, and King are additional 
cosponsors. On November 13, 2019, the Committee met in open 
Executive Session and, by voice vote, ordered S. 2805 reported 
favorably with an amendment.

                            Estimated Costs

    In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    S. 2805 would authorize the Department of Transportation 
(DOT) to provide loans and loan guarantees under the Railroad 
Rehabilitation and Improvement Financing program (RRIF) for 
certain economic development projects tangentially related to 
passenger rail services for an additional two years through 
December 4, 2021. The bill also would require DOT to report to 
the Congress semiannually on the number of applications 
received and the number of loans issued for such economic 
development projects.
    Using information from DOT on the number of RRIF 
applications received for such economic development projects in 
recent years, CBO estimates that implementing S. 2805 would 
cost less than $500,000 over the 2020-2024 period. Any such 
spending would be subject to the availability of appropriated 
funds.
    The CBO staff contact for this estimate is Robert Reese. 
The estimate was reviewed by H. Samuel Papenfuss, Deputy 
Assistant Director for Budget Analysis.

                      Regulatory Impact Statement

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       number of persons covered

    S. 2805, as reported, would not create any new programs or 
impose any new regulatory requirements and therefore would not 
subject any individuals or businesses to new regulations.

                            economic impact

    S. 2805, as reported, is not expected to have a negative 
impact on the Nation's economy.

                                privacy

    S. 2805, as reported, is not expected to have an adverse 
impact on the personal privacy of individuals.

                               paperwork

    S. 2805, as reported, would not significantly affect the 
paperwork requirements for the DOT because it only 
incrementally adjusts existing RRIF reporting requirements.

                   Congressionally Directed Spending

    In compliance with paragraph 4(b) of rule XLIV of the 
Standing Rules of the Senate, the Committee provides that no 
provisions contained in the bill, as reported, meet the 
definition of congressionally directed spending items under the 
rule.

                      Section-by-Section Analysis


Section 1. Short title

    This section would provide that the bill may be cited as 
the ``TOD Advancement Act of 2019''.

Section 2. Extension of transit-oriented development loan and loan 
        guarantee authority

    This section would amend section 502(b)(3) of the Railroad 
Revitalization and Regulatory Reform Act of 1976 to extend the 
sunset on the RRIF TOD eligibility to December 4, 2021.

Section 3. Eligible purposes

    This section would amend section 502(b)(1)(E) of the 
Railroad Revitalization and Regulatory Reform Act of 1976 to 
clarify the eligibility requirements for the RRIF TOD program.

Section 4. Semi-annual report on transit-oriented development 
        eligibility

    This section would require reporting to Congress on the 
number of applications submitted for RRIF TOD loans, the number 
of RRIF TOD loans provided, and, for each application, the 
reasons for providing or declining to provide the requested 
RRIF TOD loan.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
material is printed in italic, existing law in which no change 
is proposed is shown in roman):

       RAILROAD REVITALIZATION AND REGULATORY REFORM ACT OF 1976

                      [45 U.S.C. 822(1)(E)-(b)(3)]

SEC. 502. DIRECT LOANS AND LOAN GUARANTEES.

  (a) * * *
  (b) Eligible Purposes.--
          (1) In general.--Direct loans and loan guarantees 
        under this section shall be used to--
                  (A) * * *
                  (B) * * *
                  (C) * * *
                  (D) * * *
                  [(E) finance economic development, including 
                commercial and residential development, and 
                related infrastructure and activities, that--
                          [(i) incorporates private investment;
                          [(ii) is physically or functionally 
                        related to a passenger rail station or 
                        multimodal station that includes rail 
                        service;
                          [(iii) has a high probability of the 
                        applicant commencing the contracting 
                        process for construction not later than 
                        90 days after the date on which the 
                        direct loan or loan guarantee is 
                        obligated for the project under this 
                        title; and
                          [(iv) has a high probability of 
                        reducing the need for financial 
                        assistance under any other Federal 
                        program for the relevant passenger rail 
                        station or service by increasing 
                        ridership, tenant lease payments, or 
                        other activities that generate revenue 
                        exceeding costs.]
                  (E) finance economic development, including 
                commercial and residential development, and 
                related infrastructure and activities, that--
                          (i) incorporates private investment 
                        of greater than 20 percent of total 
                        project costs;
                          (ii) is physically connected to, or 
                        is within \1/2\ mile walking distance 
                        from, a passenger rail station or 
                        multimodal station that includes rail 
                        service;
                          (iii) has a certification from the 
                        applicant that the contracting process 
                        for construction will commence not 
                        later than 90 days after the date on 
                        which the direct loan or loan guarantee 
                        is obligated for the project under this 
                        subchapter; and
                          (iv) demonstrates the ability to 
                        generate new financial assistance for 
                        the relevant passenger rail station or 
                        service by increasing ridership, tenant 
                        lease payments, or other activities 
                        that generate revenues in excess of 
                        costs.
          (2) * * *
          (3) Sunset.--The Secretary may provide a direct loan 
        or loan guarantee under this section for a project 
        described in paragraph (1)(E) until [September 30, 
        2020] December 4, 2021.

           *       *       *       *       *       *       *


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