Sierra Northern, Mendocino short lines obtain $31M RRIF loan

The U.S. Department of Transportation today announced that its Build America Bureau provided a $31.4 million Railroad Rehabilitation and Improvement Financing (RRIF) loan to the Sierra Northern Railway (SNR) and Mendocino Railway (MRY) to expand and rehabilitate rail infrastructure in the Central Valley and Mendocino County, California.

The RRIF program maintains a $7 billion set-aside to support small railroads like SNR and MRY. This is the bureau’s first loan to a short line since the program was created in 2016, USDOT officials said. SNR and MRY were co-applicants for the RRIF program loan.

The loan finances nearly 100% of the planned improvements, including SNR's expansion of 6.7 miles of Oakdale Branch track for engine and carriage storage; and MRY's rehabilitation of Noyo Canyon Tunnel No. 1, a total of 27 bridges and 40 miles of track, according to a USDOT press release.

The work is anticipated to be completed in 2027. The project benefits to the community will include greater safety, operating capacity and efficiency; fewer derailments and grade-crossing incidents; and reduced congestion and air pollution on local roads and highways, USDOT officials said.

"Sierra's and Mendocino's RRIF loan will help modernize the rail line, which will greatly enhance existing freight service and make the railroad more attractive to new freight customers,” said Build America Bureau Executive Director Morteza Farajian.