The Northern Indiana Commuter Transportation District Board of Trustees gave authority Monday to the railroad's administration to initiate a bond issue, if necessary, to cover the cost of its South Shore Line Double Track NWI project, which now stands at $439 million.
The action follows an August promise of $50.6 million for the project from the Federal Transit Administration, an advance on a 38% funding commitment that would follow a full-funding grant agreement in the FTA's New Starts grant program.
South Shore Line President Michael Noland said the railroad and local partners, including the Northwest Indiana Regional Development Authority and the Indiana Finance Authority, are working on an aggressive schedule with the FTA to reach the grant agreement.
Noland said engineering work is 90% done on the project, which would add a second track to single-tracked areas between Gary and Michigan City, as well as add bridges and upgrade stations on that stretch. The project would also move the South Shore tracks off the street in Michigan City.
The authority to issue revenue bonds helps complete a financial plan for a project whose construction cost estimate has increased from about $420 million in recent months. Noland said the FTA expects all government financing approvals — including ones like Monday's authorization of a bond issue — to be concluded before a full-funding grant agreement is finalized.
"This will give the FTA the comfort that because the price of the project has gone up, that if we needed to extend these dollars, we have gone forward and identified the funding," he said. "The federal government will not consider anything other than a commitment that has already achieved final governmental authority."
The South Shore and its partners are also working on a full-funding grant agreement with the FTA for a similar New Starts grant for the West Lake Corridor extension. Noland said that agreement is expected "in the very, very near future." Once that's achieved, the railroad will issue a notice to proceed to design-build team F.H. Paschen and Ragnar Benson to begin construction of the commuter rail extension from Hammond to Dyer.
During its remotely held meeting, the NICTD board also approved the purchase of 50 new ticket vending machines for use at its stations. The railroad will spend just over $2 million, some of it grant money, to buy machines that accept cash from BEA Transit Technologies. The current vending machines only accept credit and debit cards. The new ones will accept some forms of electronic payment as well as cash.