Rhode Island Infrastructure Bank recently announced $30.9 million in low interest loans for road and bridge projects in Providence, Warwick and Cumberland through the Municipal Road and Bridge Revolving Fund (MRBRF). With the closing of these loans, the
Rhode Island Infrastructure Bank recently announced $30.9 million in low interest loans for road and bridge projects in Providence, Warwick and Cumberland through the Municipal Road and Bridge Revolving Fund (MRBRF). With the closing of these loans, the Bank’s Road and Bridge Program has provided over $100 million in low interest loans to 19 municipalities across the state.
“The Infrastructure Bank is proud to support local communities make significant investments in their transportation infrastructure,” said Jeffrey Diehl, Infrastructure Bank CEO. “Our below-market interest rate loans will deliver over $2.6 million of debt service savings for Providence, Warwick, and Cumberland over the lifetime of the loans. Additionally, the project financing will support approximately 332 well-paying jobs across Rhode Island.”
The Bank’s Loan and Bridge program provides below-market interest rate loans to municipalities to complete critical right-of-way improvements. Since the program’s inception in 2015, the program has lent over $105 million to 19 communities for local road and bridge improvements. According to an Infrastructure Bank release, over this 5-year span, the MRBRF has supported more than 1,100 local jobs for Rhode Island’s skilled laborers.
Warwick received a $10.0 million loan to design, construct, and repair streets and sidewalks. Based on an interest rate of 1.24 percent over the course of the 10-year loan, the city is expected to save $300,000 in interest payments. This is the second time the city has taken advantage of MRBRF financing. In 2015, the city used a $1.6 million loan from the Infrastructure Bank for the replacement of the Mill Creek Bridge.
In a statement Mayor Joseph J. Solomon said, “Rhode Island Infrastructure Bank has been essential to saving Warwick taxpayer dollars. We are proud to continue working with the Bank to upgrade Warwick’s infrastructure in a way that delivers savings to the community; by spending wisely we can do more for our taxpayers. With interest rates at historic lows and the Bank offering below-market rates, this is a prime opportunity to make investments in our infrastructure.”
The City requested the loan from the RI Infrastructure Bank late last year, and the initiative was passed by a vote of 8-1 by the Warwick City Council in January.
“When the City Council overwhelmingly passed this initiative, I promised that I would move quickly to ensure that funding is in place and work begins as soon as possible. The current COVID-19 crisis is something we could not have predicted at that time, but I want our residents to know that my team has been doing everything possible to move this effort along,” said Solomon. “Improving our infrastructure is one of my top priorities, and my Roadway Improvement Initiative will allow us to accelerate our efforts.”
City roads and sidewalks will be paved over the next three years with the bond funding. The roads have an expected 20-year lifespan, whereas the bonds will be paid back within 10 years of their issuance.
“Given our city’s AA bond rating, which was recently affirmed by Standard & Poor’s, as well as the historically low interest rates the bond market is experiencing, it makes sense that we seize this opportunity to improve our City’s infrastructure,” Solomon said. “Our economy will also benefit from this investment, and I am pleased that these bonds were approved by R.I. Infrastructure Bank. I look forward to quickly deploying this funding during road paving season to help our economy on its path to recovery.”
Road improvements will be selected by need from an objective rating list compiled by the City’s Department of Public Works.
Providence received a $20 million loan to fund the second phase of road and sidewalk improvements. Over the 20-year term of the loan, Providence is expected to save over $2.1 million in interest payments. In 2018 the city borrowed $10 million with the Bank for the first stage of improvements.
Cumberland received a $2.5 million loan to support town-wide street pavement improvements. Over 20-year loan term, the city is expected to save $200,000 in loan payments. Previously, Cumberland borrowed $500,000 from the Road and Bridge program for roadway and sidewalk reconstruction.