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The Virginia Railway Express (VRE) will contribute $119.2 million to support Virginia's purchase of rail right-of-way in the Interstate 95 corridor from CSX.
The commuter railroad will use proceeds from a closed public bond sale on June 28 to make the contribution toward the purchase, which is a component of the Transforming Rail in Virginia (TRV) program.
"As a major beneficiary of Transforming Rail in Virginia, VRE has worked to identify opportunities to support this important initiative. In addition to funds from the bond issuance, VRE will contribute another $75 million over the next 10 years on a pay-as-you-go basis, bringing our total financial support to nearly $195 million," said VRE CEO Rich Dalton in a press release.
Those funds will go to the Virginia Passenger Rail Authority (VPRA), which manages the $4 billion TRV program.
Demand for the bonds – issued under the name of the Northern Virginia Transportation Commission (NVTC), which co-owns VRE – was strong based on double-A credit ratings and a green bond designation, VRE officials said. Green bonds fund projects with environmental benefits.
The acquisition of rail right-of-way is essential to increasing passenger-rail service. The expansion of VRE service – to include off-peak, evening and weekend trains – and intercity passenger-rail service will help reduce future emissions of greenhouse gases and particulates.
The bonds are backed by revenue from the Commuter Rail Operating and Capital (CROC) Fund, which receives $15 million annually from motor fuels tax revenue collected in the jurisdictions represented on VRE’s two parent commissions, NVTC and the Potomac and Rappahannock Transportation Commission. The final maturity date for the entire bond series is June 1, 2052.
VRE’s additional $75 million contribution to TRV also will come from the CROC Fund.
Beyond these financial contributions, VRE will support TRV through station and rail infrastructure improvements. Its $1.1 billion capital improvements program is more than two-thirds funded. Among the projects are those that will lengthen existing and build new platforms to accommodate longer trains and allow for the simultaneous boarding of two trains at a station, VRE officials said.