Silver Line Update: Partners Await Fed Loan Decision

The most notable elements of a presentation Wednesday about the second phase of Metro’s Silver Line were news that the project appears to be nearing final approval for a federal loan that will save Loudoun millions and concerns about potential development on Dulles International Airport property.

Last month, bids came in for the bulk of the project and the Metropolitan Washington Airports Authority, the entity tasked with constructing the project, indicated it would likely chose a $1.18 billion bid by Capital Rail Constructors, which includes Clark Construction Group and Kiewit Infrastructure South. That bid was lower than the anticipated $1.4 billion to $1.6 billion cost.

Loudoun’s share of the project equals 4.8 percent of the total project, including phase one. In addition, the Loudoun is attempting to find a private partner to construct three parking garages, estimated to cost $130 million. The county has set aside $300 million in its capital improvement plan to pay for the project and a federal TIFIA loan could mean lower interest rates and a much lower overall cost during the life of the loan.

“We continue to move forward with that process,” said Penny Newquist, the county’s deputy chief financial officer.

The project's second phase would extend the Silver Line from Wiehle Avenue in Reston to Route 772 in Ashburn.

Most recently, the federal government requested $100,000 from the project partners – MWAA, Loudoun and Fairfax County – to pay for a review of financial records. Newquist said she expected the partners to complete their presentation to TIFIA administrators by the end of May and receive a decision by the end of the year. When supervisors expressed dismay at the uncertainty of a final approval date, County Administrator Tim Hemstreet said he believed the project was on track for TIFIA approval now that it had entered the “application phase.”

“What we have been told throughout the process is the application is the last stage for approval,” Hemstreet said. “It’s certainly a positive sign that we’re being asked to pay for the financial advisors because that’s a prerequisite to actually approving the loan documents.”

However, the a new “rolling process” by congress left a little uncertainty about the timeframe.

“I don’t know that we can give you an exact timeframe because I’m not sure that they know what their timeframe is, completely,” Hemstreet said.

Hemstreet said that with a TIFIA loan, county debt service payments would begin around 2023, while payment would begin in 2016 or 2017 without the federal loan because money would have to be borrowed against the credit rating of the Dulles Toll Road, which draws nearly double the interest rate currently.

During the discussion, Supervisor Matt Letourneau (R-Dulles) said he wants to make sure the county pays close attention and engages MWAA about its plans on the Dulles International Airport property.

“Certainly presentations were made by Mr. Potter that he would wish to work with the county in a cohesive manner to develop the property,” Letourneau said, referring to MWAA president and CEO Jack Potter. “But there is still the concern that MWAA could move forward on their property and develop large-scale commercial, which would be competing with what’s happening on county property.”

Landowners near the airport, who fear they would be at a disadvantage competing against potentially less stringent development condition, have long been expressed such concerns.

County Attorney Jack Roberts said he did not believe MWAA could move forward with development at the airport rapidly, giving the county time to engage the MWAA board.

“The issue of development on airport land, as I understand it, is not something that would even happen in the short term,” he said.

Letourneau said he’s comfortable with assurances from Potter that MWAA would work with the county, “but he may not be there forever.”

Tolls along the Dulles Toll Road are the primary source of funding for the project, with Fairfax and Loudoun funding smaller shares.

Meanwhile, the first phase of the project is nearing completion and the Washington Metropolitan Area Transit Authority, which operates Metro, continues to express optimism that passengers will begin riding that portion of the Silver Line by the end of the year.

Read more about the Silver Line project or visit the project’s website.