Transit Oriented Development - Guidance FAQs

An eligible purpose for RRIF loans is to “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 subchapter; 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.”¹

To be eligible, a RRIF TOD project must be economic development and meet all four of the statutory eligibility criteria.

The Bureau’s interpretation of, and methods for evaluating, the above underlined statutory language are the subject of the guidance provided in this section of the FAQ.

¹ 45 U.S.C. § 822(b)(1)(E)

The RRIF TOD statute uses the phrase “economic development, including commercial and residential development” to describe an eligible purpose for RRIF loans.¹ This phrase refers to any real estate development projects that enhance the economic vitality and competitiveness of the surrounding neighborhood and region, and provide new spaces and opportunities for commercial activity and housing. Eligible projects are not limited to real estate developments with commercial and residential uses; any land uses permitted under applicable local law and projects that are economically feasible based on applicants’ own analysis and due diligence are eligible, including but not limited to office, institutional (e.g., civic, academic, health, etc.), industrial, entertainment, recreational, etc.

The statute also uses the phrase “related infrastructure and activities,” which means infrastructure and activities related to eligible RRIF TOD projects.

¹ 45 U.S.C. § 822(b)(1)(E)

An illustrative example of an eligible RRIF TOD project is a private real estate developer that partners with a local government-sponsored passenger rail agency to form a joint venture to apply for a RRIF loan for a project or series of projects that: (i) create or enhance economic development, and (ii) improve the financial position of an eligible passenger rail agency or service.

In general, RRIF may be used to finance both “vertical” and “horizontal” elements of an eligible TOD project, as well as “related infrastructure and activities.” “Vertical” elements are the TOD buildings themselves and “horizontal” elements are the infrastructure and activities that prepare a site for development (e.g., demolition of existing structures, or construction of building foundations or utility connections). A RRIF TOD loan may also be used to finance infrastructure and activities related to the eligible TOD project. Building a new, or improving an existing, passenger rail station or service is eligible for traditional RRIF loans.

Applicants may wish to include in their proposed RRIF TOD projects information on how their projects could drive transformative, long-lasting improvements in the surrounding area that may result in one or more of the following:

• Increased location- and energy-efficient housing options, including affordable and/or mixed-income housing, particularly for the local workforce, low and moderate income households, families with children, minorities, seniors, veterans, persons with disabilities, or disadvantaged communities, such as homeless or low-income populations;
• Increased housing options or other significant benefits for persons and households already located in the area (i.e., current residents);
• Increased transportation options and enhanced priority and safety for pedestrians, bicyclists, and other non-motorized micro-mobility options;
• Improved access to employment centers, educational opportunities, and essential services; and
• Improved environmental quality and/or public health outcomes.

This example scenario and list of potentially eligible infrastructure activities are illustrative and not meant to be comprehensive. Interested applicants are encouraged to contact the Bureau to explore their projects and the RRIF TOD eligibilities further.

No. Inclusion of affordable housing is not a Federal requirement. However, some local governments may require a minimum percentage of new housing to be affordable as a condition of their local entitlement process.

Yes, provided a project can satisfy all the eligibility criteria that apply specifically to RRIF TOD. In general, RRIF TOD aims to support projects that generate new, positive financial benefits for passenger rail services or stations, either through capital improvements or operational benefits, such as passenger trip generation. To the extent an industrial development near passenger rail is a land use permitted under applicable local law, is economically feasible based on the applicants’ own analysis and due diligence, and is financially beneficial for a related passenger rail service or station, it may be eligible for a RRIF TOD loan.

Projects in industrial areas that construct operations, maintenance, or storage facilities for freight or passenger rail are railroad improvements that may be eligible for traditional RRIF loans, but not a RRIF TOD loan.

Similarly, projects in industrial areas that develop, improve, or rehabilitate intermodal facilities for transporting or facilitating direct intermodal transfer of freight may be eligible for traditional TIFIA loans, but not a RRIF TOD loan.

Yes. An eligible purpose for RRIF loans is to “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 subchapter; 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.”¹

To be eligible, a RRIF TOD project must be economic development and meet all four of the statutory eligibility criteria.

The Bureau’s interpretation of, and methods for, evaluating the above underlined statutory eligibility criteria are the subject of the guidance provided in this section of the FAQ.

¹ 45 U.S.C. § 822(b)(1)(E)

RRIF TOD Eligibility Criterion #1: “Incorporates private investment”

Private investment can take many forms, including but not limited to direct monetary contributions of private funding (i.e., private equity), in-kind contributions of private property or services, project debt repaid by private sources of funding (not including Federal credit assistance, such as a RRIF or TIFIA loan or other Federally-guaranteed debt), or investment of revenues generated from value capture mechanisms into the construction or improvement of the related passenger rail station or service.

The form, tenor, and total amount of private investment incorporated into a project is negotiated at arm’s length between the applicant or borrower and the parties involved in delivering the project. Private investment may be incorporated initially or over the life of a project or joint venture.¹

¹ The RRIF statute requires that no less than 25% of the total eligible project cost of TOD projects must be funded with non-Federal sources, such as: state, regional, or local public funding; or private funding or non-Federal debt sources. Furthermore, as part of its creditworthiness review, the Bureau reserves the right to require applicants to make additional equity contributions as part of a project’s plan of finance to reduce the Bureau’s risk exposure and protect the Federal interest.

RRIF TOD Eligibility Criterion #2: “ is physically or functionally related to a passenger rail station or multimodal station that includes rail service”

Projects are physically related to a station if there is a direct connection between them (i.e., they are co-located or share the same physical footprint). Examples of a physical relationship include: a project built above, within, or directly adjacent to a station; or a project and station connected by a dedicated avenue of access (i.e., an enclosed walkway).

Projects are functionally related to a station if they are accessible to one another with or without a physical connection. A functional, as opposed to physical, relationship includes projects located outside the same physical footprint or structural envelope of a station and even separated, for example, by intervening streets, thoroughfares, or unrelated properties. Projects within 1/2 mile of a station, which is the generally-accepted distance most people can be assumed to safely and conveniently walk on a regular basis to use rail transit, are ipso facto functionally related to the station. If a project is not within 1/2 mile, it may be functionally related to a station, but the functional relationship is not ipso facto and the sponsor should be able to demonstrate, based on reasonable analysis, that people can and will safely and conveniently walk or bicycle on a regular basis to a station.¹

Projects must be physically or functionally related to a station with a passenger rail service, or a multimodal station with at least one passenger rail service. “Passenger rail” service is provided by a “railroad carrier,” as that term is defined in 49 U.S.C. § 20102. In general, this includes “commuter rail” or “intercity passenger rail” services.

Examples of “commuter rail” service include Maryland Area Regional Commuter and Virginia Railway Express services in the Washington, D.C. area. An example of “intercity passenger rail” service includes Amtrak service.²

¹ This method of analyzing a “functional relationship” is based on the same method used in FTA’s Circular on Joint Development (FTA C 7050.1B), published in 2020, to evaluate a project’s “functional relationship” to transit, which incorporates the same method established in FTA’s statement of policy, published in 2011, on the eligibility of pedestrian and bicycle improvements under Chapter 53 grant programs. (76 FR 52046, Aug. 19, 2011). In the 2011 statement of policy, FTA states, “research indicates that: (1) Pedestrians walk at a pace of approximately two miles per hour, and (2) pedestrians generally are willing to walk approximately fifteen minutes to reach a public transportation stop or station. Accordingly, pedestrians generally are able to walk a distance of approximately one-half mile during a fifteen minute walk at a two mile per hour pace. Based on this information, FTA hereby establishes a one-half mile de facto pedestrian catchment area. This de facto catchment area will simplify the process of determining whether a pedestrian improvement is eligible for FTA funding. Moreover, FTA will measure one-half mile using a ‘radial distance’ because the radial method further simplifies these determinations.”

² If you have questions about whether a specific passenger rail service is or is not “commuter rail” or “intercity passenger rail,” please contact the Bureau.

RRIF TOD Eligibility Criterion #3: “H as 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 subchapter

The “commencement” of a procurement process for a construction contractor can take many forms. Competitive procurement processes typically begin either with a request for qualifications (RFQ) or request for proposals (RFP).

RRIF TOD Eligibility Criterion #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

The Bureau does not define “a high probability of reducing the need for financial assistance under any other Federal program” nor does it prescribe the form or amount of benefits or revenue the relevant station or service should receive. The form, tenor, and total amount of benefits or revenue the relevant station or service receives is negotiated at arm’s length between the applicant or borrower and the parties involved in delivering the project. A relevant station or service may receive the benefits or revenues initially or over the life of a project or joint venture.

Applicants should be able to demonstrate to the Bureau the source and expected amount of benefits or revenues the relevant station or service will receive and how its need for other Federal financial assistance will be reduced because of these benefits or revenues. For example, the applicant could demonstrate to the Bureau that the TOD project will increase ridership for the relevant station or service, which will increase farebox and potentially other revenue exceeding the marginal cost of providing service to accommodate the additional riders as transit operating costs are generally fixed.

No. A RRIF loan for a TOD project may only finance up to 75% of the total eligible project cost. This means that no less than 25% of the total eligible project cost must be funded with non-Federal sources, such as: state, regional, or local public funding; or private funding or non-Federal debt sources.¹

¹45 U.S.C. § 822(h)(4)

No. RRIF TOD projects are neither subject to minimum or maximum total eligible cost thresholds, nor minimum or maximum loan amounts. However, the DOT is authorized to have, at any one time, up to $35 billion in unpaid principal amounts of obligations under direct loans and loan guarantees through the RRIF program.

One type of project eligible for TIFIA loans is “a project to improve or construct public infrastructure that is located within walking distance of, and accessible to, a fixed guideway transit facility, passenger rail station, intercity bus station, or intermodal facility, including a transportation, public utility, or capital project described in section 5302(3)(G)(v) of title 49, and related infrastructure.”¹

To be eligible, a TIFIA TOD project must be public infrastructure and meet the statutory eligibility criteria.

The Bureau’s interpretation, of and methods for, evaluating the above underlined statutory language are the subject of the guidance provided in this section of the FAQ.

¹ 23 U.S.C. § 601(a)(12)(E)

The TIFIA TOD statute uses the term “public infrastructure” to describe an eligible project for TIFIA loans. This term refers to infrastructure systems, structures, and facilities, including but not limited to transportation, public utility systems, and capital projects.¹ Based on statutory and regulatory references within the Department, the term “public” might reasonably be understood in this context to mean:

1. owned, occupied, developed, or operated/maintained by the public sector; or
2. open to the public, support a public service, or serve a public purpose

As provided in the TIFIA statute, “public infrastructure” may also include “related infrastructure” and the kinds of infrastructure and activities listed below:

• property acquisition;
• demolition of existing structures;
• site preparation;
• utilities;
• building foundations;
• walkways;
• pedestrian and bicycle access to a public transportation facility;
• construction, renovation, and improvement of intercity bus and intercity rail stations and terminals;
• renovation and improvement of historic transportation facilities;
• open space;
• safety and security equipment and facilities (including lighting, surveillance, and related intelligent transportation system applications);
• facilities that incorporate community services such as daycare or health care;
• a capital project for, and improving, equipment or a facility for an intermodal transfer facility or transportation mall; and
• construction of space for commercial uses.

¹ 23 U.S.C. § 601(a)(12)(E) (referring to 49 U.S.C. § 5302(3)(G)(v)).

An illustrative example of an eligible TIFIA TOD project is a private real estate developer who purchases several acres of land near a new transit station that they intend to develop into a mixed-use, transit-oriented community consisting of several new buildings, a street network, open space and other amenities, etc.

“Vertical” elements of a TOD project are the buildings themselves and “horizontal” elements are the infrastructure and activities that prepare a site for development (e.g., demolition of existing structures, or construction of building foundations or utility connections). In general, TIFIA TOD loans may be used to finance “horizontal” elements and related infrastructure, such as roads, sidewalks, parks, transit access improvements. TIFIA TOD loans may also be used to finance vertical development of public-sector buildings and facilities, such as government buildings, civic centers, and other facilities that incorporate community services such as daycare, health care, education, job training, etc.

This example scenario and list of potentially eligible infrastructure activities are illustrative and not meant to be comprehensive. Interested applicants are encouraged to contact the Bureau to explore their projects and the TIFIA TOD eligibilities further.

Under the TIFIA TOD authority, TIFIA can finance vertical development of public-sector buildings and facilities.

However, under a separate authority, TIFIA can finance any eligible FTA project¹ and FTA’s statutory definition of “capital project” includes “joint development”² as eligible for funding under any of FTA’s capital grant programs. Joint development projects requesting new FTA grant funding or approval to use real property with a Federal interest and meet the statutory eligibility criteria may receive FTA approval, and thus be eligible for TIFIA financing, per 23 U.S.C. § 601(a)(12)(A). Joint developments not requesting new FTA grant funding or approval to use real property with a Federal interest, or that do not meet the statutory eligibility criteria at 49 U.S.C. § 5302(3)(G), may not receive, or be eligible for, FTA approval, however, they may still be eligible for TIFIA financing, per 23 U.S.C. § 601(a)(12)(E).³

The Bureau supports the use of joint development as a means of constructing or improving public infrastructure, and encourages sponsors of joint development projects to contact the Bureau to explore their projects and all the TIFIA financing options.

A detailed discussion of the eligibility criteria for FTA-assisted joint development projects are available in the FTA’s Joint Development Guidance (Circular 7050.1B).

More information about joint development is available in the Transportation Research Board’s Guide to Joint Development for Public Transportation Agencies

¹ Per 23 U.S.C. § 601(a)(12)(A), TIFIA loans can finance any surface transportation project eligible for grant funding through a program authorized under Chapter 53 of Title 49, U.S.C.

² 49 U.S.C. § 5302(3)(G)

³ Per 23 U.S.C. § 601(a)(12)(E), TIFIA loans can finance “a project to improve or construct public infrastructure that is located within walking distance of, and accessible to, a fixed guideway transit facility, passenger rail station, intercity bus station, or intermodal facility, including a transportation, public utility, or capital project described in section 5302(3)(G)(v) of title 49, and related infrastructure.”

Yes. One type of project eligible for TIFIA loans is “a project to improve or construct public infrastructure that is located within walking distance of, and accessible to, a fixed guideway transit facility, passenger rail station, intercity bus station, or intermodal facility, including a transportation, public utility, or capital project described in section 5302(3)(G)(v) of title 49, and related infrastructure.”

To be eligible, a TIFIA TOD project must be public infrastructure and meet the statutory eligibility criteria.

The Bureau’s interpretation, of and methods for, evaluating the above underlined statutory eligibility criteria are the subject of the guidance provided in this section of the FAQ.

¹ 23 U.S.C. § 601(a)(12)(E)

A public infrastructure project within 1/2 mile of a qualified facility or station (see the definitions of qualified facilities and stations in the FAQs below), which is the generally-accepted distance most people can be assumed to safely and conveniently walk on a regular basis to use rail transit, is ipso facto located within walking distance of, and accessible to the facility or station. If a project is not within 1/2 mile, it may be eligible, but the project is not ipso facto located within walking distance of, and accessible to the facility or station and the applicant should be able to demonstrate, based on reasonable analysis, that people can and will safely and conveniently walk or bicycle on a regular basis to an eligible facility or station.¹

¹ This method of analyzing “walking distance” is based on the same method used in FTA’s Circular on Joint Development (FTA C 7050.1B), published in 2020, to evaluate a project’s “functional relationship” to transit, which incorporates the same method established in FTA’s statement of policy, published in 2011, on the eligibility of pedestrian and bicycle improvements under Chapter 53 grant programs. (76 FR 52046, Aug. 19, 2011). In the 2011 statement of policy, FTA states, “research indicates that: (1) Pedestrians walk at a pace of approximately two miles per hour, and (2) pedestrians generally are willing to walk approximately fifteen minutes to reach a public transportation stop or station. Accordingly, pedestrians generally are able to walk a distance of approximately one-half mile during a fifteen minute walk at a two mile per hour pace. Based on this information, FTA hereby establishes a one-half mile de facto pedestrian catchment area. This de facto catchment area will simplify the process of determining whether a pedestrian improvement is eligible for FTA funding. Moreover, FTA will measure one-half mile using a ‘radial distance’ because the radial method further simplifies these determinations.”

Yes and yes. The terms “facility” and “station” might reasonably be understood to have the same meanings as they are defined in FTA’s National Transit Database Reporting Policy Manual. Per the NTD Reporting Policy Manual, however, there are key differences between the definitions of a “facility” and a “station,” and both are distinct from the definition of a “stop.”

A “station” means a passenger boarding / alighting facility with a platform, which may include:

• Stairs, elevators, escalators, passenger controls (e.g., faregates or turnstiles), canopies, wind shelters, lighting, signs,
• Buildings with a waiting room, ticket office or machines, restrooms, or concessions.

Typical examples of “stations” include:

• Fixed guideway passenger facilities (except for on-street cable car and light rail stops), including busway passenger facilities; underground, at-grade, and elevated rail stations; and ferryboat terminals.
• Transportation / transit / transfer centers, park-and-ride facilities, and transit malls with the above components, including those only utilized by motor buses.

The definition of a “facility” encompasses the definition of a “station” and more. In other words, a “station” is a type of “facility” and there are examples of “facilities” that are not “stations.” For example, the NTD Reporting Policy Manual defines a “passenger facility” to include a “simple at-grade platform” and “exclusive platform,” which include low-level or raised platforms on-street or in street or highway medians that typically include shelters, canopies, lighting, signage, and/or ticket vending machines, and are often served by light rail, streetcar, and cable car transit. For bus modes, to be defined as a “simple at-grade platform” or an “exclusive platform,” a significant structure must be present; these definitions do not include a “simple bus shelter.” The NTD Reporting Policy Manual goes on to note that, in addition to passenger facilities, a “facility” is defined as, for example, administrative offices owned by a transit agency or a building where the routine maintenance and repairs of transit vehicles are conducted.

Neither the definitions of a “station” nor a “facility” encompass the definition of a “stop,” which is typically an on-street location at the curb or in a median, sometimes with a shelter, signs, or lighting for bus, light rail, cable car, etc., but no platforms and no significant structure.

A key distinction between the definitions of a “station” and a “facility,” and the definition of a “stop” is the presence of a platform at the former and not the latter.

The term “fixed guideway transit” may reasonably be understood to have the same meaning as it is defined in FTA’s National Transit Database Reporting Policy Manual. Per that document,“fixed guideway transit,” means a public transportation service that uses and occupies a separate right-of-way or rail for the exclusive use of public transportation; or a fixed catenary system over roadway useable by other forms of transportation.

• “Public transportation” [or “transit”] means “regular, continuing shared-ride surface transportation services that are open to the general public or open to a segment of the general public defined by age, disability, or low income; and does not include intercity passenger rail transportation provided by [Amtrak] (or a successor to [Amtrak]); intercity bus service; charter bus service; school bus service; sightseeing service; courtesy shuttle service for patrons of one or more specific establishments; or intra-terminal or intra-facility shuttle services.”¹

Examples of “fixed guideway transit” include:

• all rail modes, such as heavy rail, light rail, or commuter rail;
• inclined plane, cable car, monorail, or automated guideway;
• bus rapid transit² and trolleybus;³ and
• aerial tramway⁴and ferryboat⁵.

¹49 U.S.C. § 5302(14)

² Per FTA’s NTD Reporting Policy Manual, “bus rapid transit” means “fixed-route bus systems that operate at least 50 percent of the service on fixed guideway. These systems also have defined passenger stations, traffic signal priority or preemption, short headway bidirectional services for a substantial part of weekdays and weekend days; low-floor vehicles or level-platform boarding, and separate branding of the service. Agencies typically use off-board fare collection as well.”

³ Per FTA’s NTD Reporting Policy Manual, “trolleybus” means “a transit mode comprising electric rubber-tired passenger vehicles, manually steered and operating singly on city streets. Vehicles are propelled by a motor drawing current through overhead wires via trolleys, from a central power source not onboard the vehicle.”

⁴ Per FTA’s NTD Reporting Policy Manual, “aerial tramway” means “a transit mode that is an electric system of aerial cables with suspended powerless passenger vehicles. The vehicles are propelled by separate cables attached to the vehicle suspension system and powered by engines or motors at a central location not on-board the vehicle.”

⁵Per FTA’s NTD Reporting Policy Manual, “ferryboat” means “a mode comprising vessels carrying passengers and / or vehicles over a body of water that are generally diesel powered. Ferryboat may also include hovercraft, hydrofoil, and other high-speed vessels. Intercity ferryboat (FB) service is excluded, except for that portion of such service that is operated by or under contract with a public transit agency for predominantly commuter services. Predominantly commuter service means that for any given trip segment (i.e., distance between any two piers), more than 50 percent of the average daily ridership makes a return trip on the ferryboat on the same day.”

Passenger rail is passenger service provided by a “railroad carrier,” as that term is defined in 49 U.S.C. § 20102. In general, this includes “commuter rail” or “intercity passenger rail” services.

Examples of “commuter rail” service include Maryland Area Regional Commuter and Virginia Railway Express services in the Washington, D.C. area. An example of “intercity passenger rail” service includes Amtrak service.¹

¹If you have questions about whether a specific passenger rail service is or is not “commuter rail” or “intercity passenger rail,” please contact the Bureau.

The term “intercity bus” may reasonably be understood to have the same meaning as it is defined in FTA’s National Transit Database Reporting Policy Manual. Per the NTD Reporting Policy Manual, “intercity bus” is public or private bus services that provide regularly scheduled service that is open to the public using over-the-road buses that operate with limited stops between two urbanized areas or that connect rural areas to an urbanized area. FTA defines “intercity bus” service as bus service where 50 percent or more of the passengers do not make a same-day return trip.

The term “intermodal” means the ability to connect more than one means or mode of transportation. In the context of the TIFIA TOD statute, the term “intermodal facility” might reasonably be understood to mean a facility that connects at least one of the other three modes listed before it in the statute, i.e., “fixed-guideway transit,” “passenger rail,” or “intercity bus.”

Yes and no. TIFIA TOD projects are subject to a minimum total eligible cost threshold of $10 million.¹ However, the TIFIA program does not specify a maximum total eligible cost threshold.

¹ 23 U.S.C. § 602(a)(5)(B)(ii)