# Plain Language Summary: Invest in American Railroads Act

This bill makes it easier and cheaper for railroad companies to borrow money from the federal government to build, repair, and improve rail infrastructure. Right now, when railroads take out federal loans, they have to pay "credit risk premiums"—basically insurance fees that protect the government if the railroad can't pay back the loan. This bill allows the federal government to cover some or all of these insurance costs for the railroads, making borrowing more affordable. The government would set aside at least $100 million per year specifically for passenger rail projects, with a total of $300 million per year available through 2027 for all types of rail projects.

The bill also expands who can get these loans and what they can use the money for. Previously, only larger freight railroads and certain other entities could borrow. Now smaller freight railroad companies can apply too. Railroads can now use federal loans to pay for planning, design, and permitting costs before construction even begins—not just for the actual construction and equipment. This helps smaller operations that might struggle to fund upfront planning expenses on their own.

The bill makes it easier for railroads to qualify for loans by being more flexible about what they can use as collateral (the assets they pledge to secure the loan). Instead of requiring only physical assets like buildings and equipment, railroads can now offer intangible assets like long-term shipping contracts and access rights. The bill also extends the repayment period from 35 years to 50 years, giving railroads more time to pay back loans, which lowers their annual payments. Additionally, loan repayment periods can now stretch as long as the useful life of the equipment or infrastructure being financed, recognizing that some rail infrastructure lasts for decades.

Invest in American Railroads Act

Kuster, Ann M.

Invest in American Railroads Act This bill revises and expands the Railroad Rehabilitation and Improvement Financing program of the Department of Transportation (DOT). Specifically, the bill <ul> <li>authorizes DOT to pay certain credit risk premiums for loans or loan guarantees;</li> <li>requires DOT to set aside at least $100 million for passenger rail projects in a given fiscal year;</li> <li>directs DOT to provide loans and loan guarantees to private entities with controlling ownership in one or more freight railroads other than Class I carriers;</li> <li>expands eligibility under the loan program to include reimbursement of planning, permitting, and design expenses related to acquiring, improving, or rehabilitating intermodal or rail equipment or facilities;</li> <li>sets forth collateral and appraisal standards under the program; and</li> <li>allows loan repayment terms to be extended up to 50 years after the date of substantial completion of a project, or the estimated useful life of the rail equipment or facilities to be acquired, rehabilitated, improved, developed, or established.</li> </ul>