Tuesday, July 12, 2005 (Washington, DC) The Tex-Mex Railroad, a short line connecting the United States to Mexico, has won approval of a $50 million loan it will use for major safety and infrastructure projects in the wake of growing cross border trade.

The loan from the Federal Railroad Administration (FRA) will increase efficiency by allowing Tex-Mex to operate at higher track speeds, and increase capacity to accommodate growing freight rail traffic along its busy NAFTA corridor. It will also improve track safety along the railroad’s line between Laredo and Corpus Christi, TX.

The loan will help upgrade 146 miles of track, rehabilitate 26 bridges, construct two new sidings and lengthen one, and replace 75,000 crossties. Two rail yards, at Laredo and Corpus Christi, also will be upgraded. In addition, a portion of the loan will be used to refinance prior debt incurred for previous capital investment projects.

“When you improve the safety of your rails, you end up increasing capacity,” said U.S. Transportation Secretary Norman Y. Mineta. “Safety equals more business,” he said.

The loan is being made under the Railroad Rehabilitation and Improvement Financing (RRIF) program administered by the FRA. This program assists short line and regional railroads to acquire, improve, or rehabilitate rail equipment and infrastructure. Direct loans can pay up to 100 percent of an approved rail project with repayment schedules of 25 years at interest rates equal to the cost of borrowing by the federal government.

The Tex-Mex railroad is now a part of the Kansas City Southern Railway (KCSR) network. It serves mainly as a bridge railroad to move traffic and make connections between KCSR, Union Pacific, BNSF Railway, and Transportacion Ferrovaiaria Mexicana located in Mexico.

-END-