BRADENTON, Fla. - Nearly $2 billion in federal loans to help fund the extension of rail rapid transit service into Virginia's Fairfax and Loudoun counties are a credit positive because the project is expected to drive new economic development, Moody's Investors Service said May 19.
The agency's comment follows the U.S. Department of Transportation's recent approval a $1.9 billion loan through the Transportation Infrastructure Finance and Innovation Act program to help fund the second phase of the Silver Line's connecting service through Dulles International Airport.
The TIFIA "loan is credit positive for Fairfax and Loudoun counties because government officials expect the Metrorail extension of the so-called Silver Line to spur additional economic development that will strengthen the counties' already sizable and diverse tax bases," said Moody's analyst Jennifer Diercksen.
Fairfax County recently updated its comprehensive plans for the Reston, Herndon, and Innovation Center areas to optimize development opportunities where the three new Metrorail stations will be located. The county adopted a similar plan in June 2010 for the Tysons area, which has seen increased economic development due to four new Metrorail stations, which are scheduled to open later this year.
Loudoun County expects its finances to improve by $386 million through 2040 as a result of the Silver Line and projected increases in housing units, office space, retail, and hotel rooms.
Fairfax and Loudoun counties expect moderate tax base growth of 5.8% and 4.6%, respectively, by the end of fiscal 2015, Diercksen said.
About $403 million of the TIFIA loan will support Fairfax County's share of Metrorail costs, $195 million will support Loudoun's portion, and the remainder will go to the Metropolitan Washington Airports Authority, which is building the $2.8 billion line.
