For Immediate Release: January 14, 2015

The Commonwealth Transportation Board has awarded the City of Alexandria a $50 million loan from the Virginia Transportation Infrastructure Bank (VTIB), for the City to construct a Metrorail station in the Potomac Yard area.  Governor Terry McAuliffe’s announcement of today’s award, which follows, details the importance of the new station and provides reaction from Governor Terry McAuliffe, Mayor William D. Euille, and state officials.

The new station will be funded through a variety of sources -- including new tax revenue from development around the station and two new special tax districts – without the need for any additional local funds.  This means that most residents and businesses in Alexandria will not have to contribute to the station’s construction through local taxes.  Because the new tax revenue will be received over time but the station must be paid for when it is built, the City plans to issue General Obligation Bonds to finance construction. Today’s VTIB loan, which is close to the maximum available from the state fund, will lower the amount the City must borrow from other sources.

“The Potomac Yard Metrorail Station project is one of the City’s highest priorities,” said Paul Smedberg, the member of Alexandria City Council who represented the City at today’s meeting of the Board in Richmond.  “Today’s action by the Commonwealth Transportation Board is recognition that the station will also be a key part of the region's transit network.”

The 30-year loan locks in an interest rate of 2.17%, which is substantially lower than municipal bonds.  The loan also requires no interest or principal payments for four and one-half years after contract completion. This grace period is important to allow early development around the Metro station to begin to create new revenue prior to the City’s first repayments.

The City’s loan application included an offer to accelerate repayment if revenue exceeds expectations.  Members of the Board took particular note of this innovative provision, which would allow the money lent to the City to be returned to the VTIB’s revolving fund 11 to 12 years earlier than originally planned.

For media inquiries, please contact Craig T. Fifer, Director of Communications and Public Information, at craig.fifer@alexandriava.gov or 703.746.3965.

Following is the text of the Governor’s announcement, which is also available at https://governor.virginia.gov/newsroom/newsarticle?articleId=7573 :

For Immediate Release: January 14, 2015
Contacts: Office of the Governor: Brian Coy, (804) 225-4260, Brian.Coy@governor.virginia.gov

Governor McAuliffe Announces Award of $50 Million Loan to the City of Alexandria to Build a New Potomac Yard Metrorail Station

~Station secures integral piece of financing plan for important economic development project~

Governor Terry McAuliffe announced today that the Commonwealth Transportation Board has approved a $50 million loan from the Virginia Transportation Infrastructure Bank (VTIB) for the City of Alexandria to construct a Metrorail station in the Potomac Yard area.   

The Potomac Yard Metrorail Station will be built on Metrorail’s Yellow and Blue Lines, between the existing Braddock Road and Ronald Reagan Washington National Airport stations, and is expected to generate billions of dollars in new private sector investment.  The resulting development around the station will support up to 26,000 new jobs within one-quarter mile, and 13,000 new residents within one-half mile.

“This loan is an important step towards a major economic development project for Virginia, and a sign of continued progress as we seek to build a new Virginia economy,” said Governor McAuliffe.  “I applaud the Commonwealth Transportation Board for approving this investment to reduce strain on area roadways, attract new residents, and create and keep good jobs right here in the Commonwealth.”

“The investment Virginia is making today will pay dividends over generations by spurring smart growth and bolstering transit alternatives for the entire region,” said Alexandria Mayor William Euille.  “We thank Governor McAuliffe and the Commonwealth Transportation Board for supporting this important project.”

The new station will also enable thousands of residents and workers to reach their destinations without adding vehicles to congested routes such as U.S. Route 1, which already carries up to 50,000 vehicles per day.  Potomac Yard is located only five miles from downtown Washington, D.C., in the same corridor as the busy Crystal City economic hub, the Pentagon, and Ronald Reagan Washington National Airport.  The station is a key component of the City of Alexandria’s strategy to focus development in areas served by transit, linking transportation and land use to enable people to travel using modes other than the automobile.

“Metro is a crucial part of the region’s transportation network,” said Secretary of Transportation Aubrey Layne.  “This Metro station is essential to the redevelopment of Potomac Yard into a major transit-oriented activity center, which will benefit both the Commonwealth of Virginia and the Washington, D.C., region.”

Feasible station location options will cost between $209 million and $268 million.  Today’s loan provides up-front construction funds at substantially lower interest rates than municipal bonds, and will be repaid by the new tax revenue occurring from development in Potomac Yard, and the revenue from two special tax districts surrounding the station.  Remaining costs will be paid by contributions by private developers, funding from the Northern Virginia Transportation Authority, and some federal funding.

Jennifer Mitchell, Director of the Department of Rail and Public Transportation, praised this combined funding approach.  “Utilizing the anticipated revenue from the development that the station will bring is not only an innovative way to build new infrastructure, it also reinforces the indisputable benefits transit brings to a city and its communities.”

The City of Alexandria is currently completing the environmental impact review stage of the process required to secure federal funds.  Partner agencies include the Washington Metropolitan Area Transit Authority, the Federal Transit Administration, and the National Park Service.  It is expected that public review of the Draft Environmental Impact Statement will start in March 2015, after which Alexandria City Council will choose the preferred station location in April.  The project timeline anticipates that the new station will open in late 2018.

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