GLOBAL RAIL CONSORTIUM, LLC Nov. 10, 2004 Funding and Equity Contributions FLORIDA HIGH SPEED RAIL AUTHORITY
GLOBAL RAIL CONSORTIUM, LLC
Nov. 10, 2004
Funding and Equity Contributions
FLORIDA HIGH SPEED RAIL AUTHORITY
GLOBAL RAIL CONSORTIUM, LLC
I. Global Rail Consortium, LLC
II. Experience
III. Technology : “KTX-R Rolling Stock”
IV. Funding Plan
V.V. ClosingClosing
GLOBAL RAIL CONSORTIUM, LLC
State & Federal Participation
• TIFIA :• Tax Credit Bonds : • Tax-Exempt Bonds :• Grants :
Equity Participation : $ 400 million
IV. FUNDING PLANIV. FUNDING PLAN “ “Funding Sources”Funding Sources”
Sources of Funds
$ 2 billion
GLOBAL RAIL CONSORTIUM, LLC
Sources of Funds Amount
($ millions)
GRC / Partner Equity
400
Grants 0
Tax-Exempt ProjectRevenue Bonds
1,200
TIFIA Loans 800
Project Fund Interest
19
Total 2,419
Uses of FundsAmount
($ millions)
Project Equipment Fund 0
Project Infrastructure Fund
2,369
Capitalized Interest Fund 0
Debt Service Reserve Fund
0
Costs of Issuance 50
Total 2,419
Fund Appropriations for Project Infrastructure
IV. FUNDING PLANIV. FUNDING PLAN “ “Funding Sources”Funding Sources”
GLOBAL RAIL CONSORTIUM, LLC
IV. FUNDING PLANIV. FUNDING PLAN “ “Equity Contribution”Equity Contribution”
Sweat Equity ($ millions)
• Investment in Project Development prior to Selection : 6
• Project Development Investment prior to Financial Close : 5
• Project Revenue Bonds Costs of Issuance : 30
• Investment in TIFIA Loans Costs of Issuance : 20
• Operational Cash Guarantee : 50
Total Sweat / Soft Equity : 111
Grand Total - All Equity : 511
Member Equity Contributions
• GRC Equity Contribution : 250
• Equity by Partners : 150
Total Equity Contributions : 400
GLOBAL RAIL CONSORTIUM, LLC
• Reduces amount of debt required for the Project
• Minimizes Risk to the State of Florida
• Total equity invested equals 21% of total project cost ($511 / $2,400)
• Equity participants share the financial risk(s) of the project
• Emphasizes and Enhances GRC’s overall commitment to the project and the public / private partnership
• Puts equity investment at risk, dependent upon financial success, with repayment after operating costs and debt service
IV. FUNDING PLANIV. FUNDING PLAN “ “Equity Contribution”Equity Contribution”
What Does Equity Do?
GLOBAL RAIL CONSORTIUM, LLC
With Equity Investment in Project ($400 million)
• $ 26 Million / Year savings• $ 780 Million over life of Bonds
Assumptions: 5% interest rate 30 year bonds
What Does Equity Do?
IV. FUNDING PLANIV. FUNDING PLAN “ “Equity Contribution”Equity Contribution”
GLOBAL RAIL CONSORTIUM, LLC
• Project Bonds are retired by State of Florida participation (Fixed at $75 million / year)
• Balance of debt is serviced from fare box
• GRC equity participation reduces debt and enhances overall project success
• GRC pro forma financial statement shows sufficient revenues to amortize TIFIA debt
IV. FUNDING PLANIV. FUNDING PLAN “ “Amortization”Amortization”
How is Project & TIFIA Debt Retired?
GLOBAL RAIL CONSORTIUM, LLC
• Bring High Speed Rail to Florida
• Private Sector Participation
• State Contribution Fixed
• State Risk Mitigated
GRC’s Commitment
V. CLOSING