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Economic development - Freight Railroad Infrastructure Improvement Program

Freight Rail Infrastructure Improvement Program (FRIIP) loans are awarded to private industries, railroads, and local governments to improve rail infrastructure and to construct new rail-served facilities. The overall goal is to boost economic development and jobs, and increase the use of rail service.

FRIIP provides funding for the following types of railroad projects:

• Connect an industry to the national railroad system - Examples include construction of industrial spur tracks to various industries, and a pipeline from an ethanol plant to a nearby railhead.
• Make improvements to enhance transportation efficiency, safety and intermodal freight movement - Recent projects include grain and fertilizer storage/handling facilities, warehousing facilities to provide rail access and improved loading and delivery products, and transloading facilities.
• Accomplish line rehabilitation - FRIIP funds have been used to fund rehabilitation projects on privately owned rail lines and rail facilities, and projects that are needed to provide increased efficiencies and benefits that are beyond the basic level of service.
• Complete rail-related projects in a timeframe that would not otherwise be possible. 

FRIIP's role in economic development

The program helps fund rail-related projects for new start-up businesses and existing businesses wanting to expand. The projects improve transportation efficiency and cost savings, much of which is realized by rail users and their customers. Projects are subjected to a benefit/cost analysis, and must create positive benefits. Other benefits include highway maintenance cost savings as a result of diversion of traffic to rail transportation.

Eligibility and availability of funds

Typically, FRIIP assistance is in the form of low interest loans that can be made to units of government, railroads or directly to businesses, and must be repaid within a 10-year period. Since the program began in 1993, WisDOT has provided 89 FRIIP loans totaling $100 million. Previously, funding for FRIIP came from a combination of segregated transportation fund revenues and loan repayments. Currently, FRIIP funding is entirely provided through the repayment of loans. The funding level is approximately $4.5 million per year.

Case studies

A $2,468,022 loan was provided to Zenda Grain LLC to construct a rail spur, a grain storage bin, rail loadout equipment and a concrete dump pit at the company’s Wisconsin property. The Zenda Grain LLC facility is located in Walworth County, south of Lake Geneva. Rail service is provided by the Wisconsin and Southern Railroad Company, under contract from the State of Wisconsin and the Wisconsin River Rail Transit Commission, who are co-owners of the rail line. Zenda Grain is taking advantage of its location near Chicago grain markets and will be reducing the number of grain trucks traveling on Wisconsin highways. The facility increases the market for Wisconsin corn and soy beans and enhances the state farming economy.

A $737,700 loan was awarded to Specialty Ingredients, LLC in Watertown, for construction of a double spur track with a loadout facility for ethanol and other products. The project reduces the number of trucks on state highways by providing a larger capability to transload products between railcars and trucks. Several other companies benefit from savings in shipping costs for such items as bentonite, ethanol, corn meal, dry distillers grain, sugar, salt and cement. Specialty Ingredients is presently served by the Canadian Pacific Railway Company.

For more information, including an application, see WisDOT's FRIIP Web page, or contact Frank Huntington, Bureau of Railroads and Harbors, (608) 267-3710.

Questions about the content of this page:
Dennis Leong, dennis.leong@dot.wi.gov 
Last modified: April 6, 2012