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Iowa Railway Finance Authority approves loans for flood-damaged railroads

July 31, 2008

AMES, Iowa – July 31, 2008 – Recent floods caused major damage to Iowa’s transportation infrastructure, including our state’s railroads. Governor Chet Culver charged each state agency to look for ways to use existing programs in innovative ways to assist with flood recovery efforts. The Iowa Department of Transportation (DOT) and Iowa Railway Finance Authority (IRFA) did just that when the IRFA, at their meeting today, approved emergency funding from the Rail Revolving Loan and Grant Program for seven railroads to repair Iowa track damaged by the recent floods.

“As this year's historic natural disasters remind us, transportation in all its forms is vital to our state's economy and communities. More than 400 miles of rail were damaged as a result of flooding, and it is important that we do whatever we can to fully restore rail service as quickly as possible," said Governor Culver. "This public/private partnership between Iowa's rail companies, the Iowa Railway Finance Authority and Iowa Department of Transportation will help us meet the transportation challenges before us. By working together, we will help rebuild Iowa's transportation system, and move farther down the road to recovery."

“Approval of the loan to the Iowa Northern Railway Company will greatly enhance our ability to more quickly repair the washouts and other track damage the company suffered in the floods. We can accomplish the repairs more efficiently using both our own employees and contractors,” said T. Scott Bannister, vice president, general counsel and secretary of the Iowa Northern Railway Company, one of the loan recipients.   

The funding is being offered as loans to the railroads for a term of 15 years at 0 percent interest and defers the start of loan repayments until Jan. 1, 2011.  Those being approved for loans at today's IRFA meeting and the maximum amounts of those loans are as follows.

Railroad applicant

Maximum eligible loan

Burlington Junction Railway

$71,000

Cedar Rapids and Iowa City Railway Co.

$320,000

Keokuk Junction Railway Co.

$554,000

Iowa, Chicago and Eastern Railroad Corp.

$1,417,000

Iowa Interstate Railroad Ltd.

$772,000

Iowa Northern Railway Co.

$681,000

Iowa River Railroad

$184,000

TOTAL

$3,999,000

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Contact: Rose Wazny at 515-239-1066 or roselyn.wazny@dot.iowa.gov


Iowa highway in the evening