The US Department of Transportation (USDOT) has announced a major expansion of the Transportation Infrastructure Finance and Innovation Act (TIFIA) program, a move poised to reshape the landscape of American infrastructure financing. On July 7, US Transportation Secretary Sean Duffy revealed that all eligible transportation projects can now access TIFIA loans covering up to 49% of total eligible project costs, a significant increase from the previous cap of 33%.
Secretary Duffy emphasized the USDOT’s commitment to equitable and efficient infrastructure development and said “It’s common sense to allow all eligible projects the same access to our low-interest financing opportunities.”
Key changes to TIFIA loan coverage
This policy update removes a longstanding barrier, or “policy roadblock,” that limited the amount of federal support available to project sponsors. By raising the maximum loan coverage, the USDOT aims to accelerate the delivery of critical infrastructure projects by both public and private entities. Secretary Duffy highlighted that this decision follows extensive analysis, successful pilot programs, and valuable feedback from stakeholders across the transportation sector.
Background: Building on successful pilot programs
Historically, the TIFIA program had already piloted higher loan coverage through targeted initiatives, such as:
- The TIFIA Rural Projects Initiative, which provided enhanced support for rural infrastructure.
- Select transit and Transit-Oriented Development (TOD) projects, which benefited from increased federal participation.
These pilots demonstrated that increased federal involvement did not significantly raise taxpayer risk, paving the way for this broader policy change. Now, the higher 49% loan maximum is available to all eligible TIFIA projects, regardless of type or location.
TIFIA program benefits and impact
The TIFIA program has a proven track record, having supported over $150 billion in infrastructure investment through more than $52 billion in direct loans. Key benefits of TIFIA financing include:
- Low, fixed interest rates that reduce borrowing costs for project sponsors
- Flexible amortization schedules tailored to project cash flows
- Long repayment periods—up to 35 years, and in some cases, as long as 75 years
- No pre-payment penalties, allowing borrowers to repay early without additional costs
- Enhanced financial viability for projects that may otherwise struggle to attract private investment, making TIFIA a critical tool for public-private partnerships and innovative project delivery.
Implications for US infrastructure development
While the annual availability of TIFIA funding is determined by congressional appropriations rather than a statutory cap, this policy change does not increase the total funding pool. However, by allowing sponsors to finance a larger share of project costs with low-interest federal loans, the program becomes even more attractive and accessible. This is expected to:
- Accelerate project timelines by reducing the need for complex, multi-source financing
- Encourage broader participation from both public agencies and private investors
- Support a wider range of projects, including those in rural and underserved communities
US infrastructure finance: Looking ahead
The USDOT’s decision to expand TIFIA loan coverage to 49% of eligible project costs marks a transformative step in US infrastructure finance. By making federal support more accessible and flexible, the TIFIA program is positioned to drive the next generation of transportation projects—supporting economic growth, job creation, and improved mobility across the nation.