U.S. Transportation Secretary Ray LaHood announced today the approval of $150 million in credit assistance to help California build the second phase of the Presidio Parkway, a new 1.6-mile, six-lane roadway that will improve the connection between San Francisco and the Golden Gate Bridge and replace the existing Doyle Drive. The project will improve seismic and traffic safety.
The credit assistance was made possible under the Department's Transportation Infrastructure Finance and Innovation Act (TIFIA) program that provides access to capital and helps finance projects that otherwise might be delayed.
"Innovative loan programs like this can help us achieve President Obama's vision of an America built to last," said Secretary LaHood. "A little TIFIA assistance goes a long way in leveraging additional funding and will help ensure that those who live and work in the North Bay counties can get where they need to go."
Through the TIFIA program, the Department split credit assistance into two loans. One is a short-term loan to be repaid at the end of construction; the second is a long-term loan with repayment over the life of the project. This financing structure allows the overall interest costs to be reduced and brings the repayments within available funding sources.
The new parkway will serve as a primary north-south link for commuters who work in San Francisco and will be essential to economic growth. The route will allow local businesses to attract and retain talent from a wider area, improving the region's competitiveness. The existing Doyle Drive, built in 1936, is now at the end of its useful life with an outdated design and seismic structure. In 2010, Doyle Drive was rated the worst for structural sufficiency of all California roads.
"This project will help promote economic opportunity," Federal Highway Administrator Victor Mendez said. "It will create jobs now and transform a deteriorated road into one with many benefits for the community for years to come."
In addition to the seismic and safety upgrades, the Presidio Parkway will have the unique design features of a true parkway, including a wider landscaped median, safer city streets, and better access for pedestrians. The $150 million loans will go toward the $364.7 million total cost of the project's second phase, which includes tunnel, roadway, viaduct, interchange and landscaping work. The first phase involves preliminary construction and seismic work and is nearly complete.
The California Department of Transportation (Caltrans) is advancing the project through a public-private partnership with Golden Link Concessionaire, LLC, a private developer Caltrans selected to design, finance and construct the project's second phase and then operate and maintain the facility for 30 years once finished. An essential component to making the Presidio Parkway a viable project were efforts by the Federal Highway Administration (FHWA) to look more broadly at what project costs might be eligible for federal funding related to availability payments in public-private partnerships (P3s). This interpretation resulted in greater flexibilities for maximizing Federal-aid participation in the project. FHWA expects future P3 projects to utilize this flexibility, significantly increasing opportunities for private investment in delivery of the nation's infrastructure.
The project is scheduled to be completed in 2015.