Dive Brief:

• The Federal Transit Administration has committed to a full-funding grant of just over $1 billion for Chicago's $2.3 billion Red Line rail project, according to Crain's Chicago Business.
• The money will pay for new tracks, signals, station improvements and an overpass to increase capacity and efficiency for what city officials have said is the heart of the Chicago Transit Authority rail system.
• The city was only able to secure the grant after approving a transit tax-increment financing (TIF) district and bonds that will provide matching funds.

Dive Insight:

The Chicago City Council fast-tracked approval for its part of the rail financing in December in order to secure the federal grant before President Barack Obama leaves office. The creation of the TIF drew criticism from opponents, who said the city should seek state help with matching funds rather than put more financial pressure on property owners. However, according to officials, the TIF should result in only a 0.5% increase in property taxes for those in the district.

It was only in September that the CTA still had concerns about meeting the grant application deadlines. In addition to the concerns over financing, the agency still had to determine how many land acquisitions were necessary to complete the project, as well as complete the required environmental impact study and review.

The information included in the CTA's paperwork must have satisfied federal officials, and while there is no indication that any part of the review is subject to debate, lessons learned from the $5.6 billion Purple Line light-rail project in Maryland show how quickly promised federal funds can disappear.

A group of Chevy Chase, MD, residents field a lawsuit in federal court arguing that the projected ridership data in the project's environmental review was not accurate, and U.S. District Court for DC Judge Richard Leon agreed. He rescinded both federal and state approval for the new rail line, which killed a $900 million FTA grant. Leon said that because the Purple Line projected that 25% of its riders would come from DC's Metrorail, which has had declining ridership and safety issues, the FTA must take another look at the existing environmental review and determine whether a new study is warranted.