THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, April 5, 1996 TAG: 9604050472
SECTION: LOCAL PAGE: B5 EDITION: FINAL
SOURCE: BY MAC DANIEL, STAFF WRITER
DATELINE: CHESAPEAKE LENGTH: Short : 46 lines
Virginia was selected Thursday as one of eight states to test a new federal program that will help pay for costly highway projects.
The pilot program will create a State Infrastructure Bank, or SIB, that will operate like a private bank, offering a range of loans and credit options for various highway projects in the state.
U.S. Sen. John Warner, chairman of a Senate transportation subcommittee, said Thursday that a range of state projects could benefit from the bank, including Chesapeake's long-sought improvements for Route 168 to North Carolina's Outer Banks.
Chesapeake officials have already asked that the $110 million Route 168 project be considered for funding under the new program. The city recently asked for proposals from private businesses to help build the road under Virginia's new Public-Private Transportation Act.
``It's good news,'' said Mary Ann Saunders, assistant to Chesapeake's city manager. ``It gives us a leg up.''
The SIB will create revolving loan funds to help finance new projects that might otherwise be delayed or could not be traditionally financed.
The banks will allow states to use up to 10 percent of their federal transportation aid as seed money to get the banks started. Once established, the bank will offer loan guarantees to provide additional security or credit support for financing projects.
As the loans are repaid, the bank's funds will be replenished and the bank can make new loans or loan guarantees to other transportation projects.
Using the banks to guarantee loans from other sources should allow the states to double the funds available for particular projects, transportation officials estimated.
``We can no longer rely on a single way to pay for infrastructure improvements,'' Transportation Secretary Federico Pena said in announcing the project.
Other states selected for the tests are Arizona, Ohio, Oklahoma, Oregon, Texas, Florida and South Carolina. Two more states will be named soon, the department said. by CNB