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On Friday, Iowa Interstate Railroad Ltd. (IAIS) announced plans to increase the infrastructure portion of its 2011 capital spending budget by $4.5 million compared with last year. The regional is budgeting a total of about $35 million this year — its highest-ever annual capex for infrastructure.

Principal components of the capex program include:
• $14 million to build a more modern diesel shop and logistics center in Homestead, Iowa, to support the recently upgraded locomotive fleet;
• $7.6 million to replace ties and complete surfacing work;
• $6.4 million to install 15 miles of new rail; and
• $1.3 million to complete a car repair shop, maintenance-of-way base and train crew center in Silvis, Ill., to support current and anticipated traffic growth.
 
IAIS also plans to spend $2 million on track spur improvements to a customer elevator in Atlantic, Iowa; $1 million on paving work for an intermodal facility in Council Bluffs, Iowa; and $1 million on yard improvements and construction of a new team track for transmodal expansion in Council Bluffs. Part of the required financing will be covered by a bank loan, and the balance will be generated from internal funds and utilization of the recently extended short-line tax credit, IAIS officials said in a prepared statement.

“We increased the infrastructure portion of our capital program from roughly $9.5 million to $14 million as a direct result of the extension of the 45G Tax Credit program into 2011,” said IAIS President and Chief Executive Officer Dennis Miller. "This program provides for tax credits tied to infrastructure investment in support of increased capacity, and we are making full use of it.”