The Transportation Equity Act for the 21st Century (TEA-21) is the primary authorizing legislation for highway, highway safety, transit and other surface transportation programs. TEA-21 provides federal funding for transportation planning at the state and local levels and establishes the rules for such funding. Much of this funding is allocated to states through a statutory formula. Priorities for funding are specified in long-range local and statewide transportation plans, developed by Metropolitan Planning Organizations (MPOs) and state DOTs. There are also several grant and loan programs administered by the U.S. Department of Transportation, in which projects are chosen through a competitive application process.

TEA-21's provisions of particular relevance to rail include enhancement of the Operation Lifesaver Initiative and the High Speed Rail Corridors and Highway Rail Grade Crossing Programs and establishment of both the Transportation Infrastructure Finance and Innovation (TIFIA) program, a Federal credit program for transportation projects of national significance, and the Railroad Rehabilitation and Improvement Financing (RRIF) program, which provides direct loans and loan guarantees to public or private sponsors of intermodal and rail capital projects.

RRIF provides loans and loan guarantees for railroad capital improvement projects including acquisition, development, improvement, or rehabilitation of intermodal or rail equipment and facilities. Although there is no direct Federal funding, a non-Federal source may fund the required credit risk premium.

For specific rail project information, consult the FRA publication, "Intercity Freight and Passenger Rail: State and Local Project Reference Guide." This guide is designed to assist local and state planners and decision makers in considering rail projects in their transportation plans and programs and in determining cost-effective allocation of scarce transportation resources. It discusses the transportation planning process, intercity rail project evaluation, project priority setting, project opportunities under TEA-21, assessment of projects' environmental/societal benefits, and innovative financing mechanisms that can be employed to advance public benefit rail projects. General information on TEA-21 funding programs can be found on the TEA-21 home page at: http://www.fhwa.dot.gov/tea21/index.htm .

TEA-21 expires in FY 2003. FRA is part of an intra-DOT task force led by the Office of the Secretary that is developing a legislative proposal that builds on TEA-21 by enhancing mobility, reducing congestion, and growing the economy, while maximizing the safety and security of all Americans.