LaHood Said to Reject Federal Loan To Dulles Metrorail Project

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(Washington D.C. - WAMU) US Transportation Secretary Ray LaHood met yesterday with the partners behind the faltering Dulles Metrorail project, a nearly $6 billion venture to build a new subway line out to Dulles Airport in Northern Virginia. And according to several sources involved in the meeting, LaHood told them that a federal loan they were hoping for isn't likely.

In recent months, the project has been mired in a conflict between two partners: the Metropolitan Washington Airports Authority, which is in charge of operating the project, and local lawmakers, who are in charge of funding. The Authority has recently made several decisions that will likely drive the cost of the project higher, including its choice of an underground location for a train station at the airport that will cost almost $300 million more than an above-ground alternative.

This has infuriated local Northern Virginia lawmakers, some of whom-- especially in suburban Loudoun County --  are talking about withdrawing their share of the funding from the project.

That's why this federal loan was so crucial. If the Airports Authority could win a $1.7 billion low-interest federal loan from the Department of Transportation, it could reduce the project's financial burden on the localities and keep its tenuous funding agreement with them intact.

After yesterday's meeting with LaHood, however, it's now clear that won't be happening.

LaHood called the lawmakers and the Airports Authority to his DC office to try to work out an agreement between the two partners. During the meeting, several participants say, LaHood told the Airports Authority there's no way the Obama Administration could possibly grant the project a loan of the size they're requesting. Scott York, the chairman of the Loudoun County Board of Supervisors who attended the meeting, says LaHood told the Airports Authority that his department is not a "cash cow."

Other than York, none of the people in on the meeting would say much of substance on the record. Airports Authority leaders say they appreciate LaHood's peacemaking efforts and that the meeting was an open and frank discussion. A LaHood spokesperson declined to comment. The AP is reporting that LaHood asked a smaller group to return Friday and that there will be another meeting in 30 days.