Greeley says MERGE still hinges on TIFIA loan terms and local funding plan

Greeley officials said Tuesday that the MERGE highway project’s financing plan is still being assembled, with the city counting on a federal TIFIA loan and local revenue sources even as key pieces — including whether the city secures a discounted federal interest rate — remain unsettled.

During a work-session update on MERGE, staff and advisers told the City Council that the project’s cost estimate for the U.S. 34 portion has risen to a range of $160 million to $190 million, up from about $134 million used in grant applications last year. Officials said the higher estimate reflects a better understanding of the scope as design advances, along with escalation, interchange refinement, utility coordination and construction market conditions. The city’s presentation described the funding strategy as ongoing and tied to aligning costs with available funding.

A project adviser identified in the meeting as Speaker G said the city knows what is expected from several outside sources, including the RAISE grant, the federal rural grant, and state-level funding agreements, but said the local share remains the biggest unknown. He said city finance and public works staff are meeting biweekly on funding scenarios and expect the local package to include "earned revenue" from sources such as Quality of Life funding as well as federal credit assistance through TIFIA, the Transportation Infrastructure Finance and Innovation Act loan program.

The adviser told council that voters have already authorized the city to borrow up to $65 million in TIFIA principal, and that the city has submitted initial letters of interest to the U.S. Department of Transportation’s Build America Bureau. Those letters were acknowledged, he said, but a formal application still must be submitted and reviewed. He added that one major issue is not only whether the application is accepted, but also whether the city qualifies for a rural discount that could lower the interest rate and increase how much the city can afford to borrow.

Council members pressed on that risk. Council Member Deb DeBoutez asked whether the city could still be rejected and lose that funding source, and was told that it could. Council Member Johnny Olson later said the outcome is partly political because the discounted rural designation is limited, adding that city officials will likely need help from members of Congress to advocate for the project.

The financing discussion came as staff emphasized that MERGE itself remains on schedule. The agenda summary said the project’s elements are underway and not delayed. The presentation listed the RAISE grant agreement and a 30% design task order as completed since June, said the city has advertised for CM/GC services, and showed upcoming milestones including completion of the RFQ evaluation on Aug. 14, CM/GC interviews on Aug. 26 and contractor onboarding in the third quarter of 2026. Staff said they plan to return later with a fuller discussion of the funding sources side of the equation.