PROVIDENCE, R.I. (WPRI) — A state panel gave the green light on Thursday for Rhode Island to borrow $140 million in order to start covering the cost of the Washington Bridge crisis, secured by future federal highway aid.

The quasi-public R.I. Commerce Corp.’s Access to Capital Committee voted 2-0 to recommend that the full Commerce board should authorize the debt, using so-called “GARVEE” bonds. The acronym is short for Grant Anticipation Revenue Vehicle.

GARVEE bonds allow a state to borrow money from investors with a promise to pay it back using the federal transportation funding the state will receive from Congress in future years. Rhode Island has used GARVEE bonds for major projects in the past — including construction of the eastbound Washington Bridge in the 2000s.

State officials expect to close on the bonds by Aug. 29, according to a presentation provided to the Commerce Corp. committee. The agency has the legal authority to borrow money without authorization from voters, unlike general-obligation bonds, which appear on the ballot.

The $140 million GARVEE transaction is moving ahead even as new uncertainty surrounds Gov. Dan McKee’s plan to build a new westbound bridge. The existing bridge closed abruptly last December due to a structural failure, and was later deemed beyond repair.

The McKee administration currently pegs the price tag for the entire bridge crisis at $473 million , including emergency expenses, demolition and reconstruction. (The presentation provided to the capital panel used an outdated figure — $455 million — which fails to account for the higher-than-expected final contract for the demolition project.)

However, no bids were submitted to build the new westbound bridge before a deadline earlier this month, leading McKee to acknowledge he no longer knows how much the project might cost . More clarity is expected once the state gets responses to a formal “request for information” — or RFI — that is supposed to go out to construction companies soon.

A poll released last month by Salve Regina University’s Pell Center showed only 29% of Rhode Island voters approved of how McKee has handled the bridge situation to date.

State lawmakers voted last month to authorize up to $334.58 million in GARVEE bonds to cover costs related to the Washington Bridge closure. The Assembly’s financing plan also included $45 million from the state’s capital account; $35 million in federal American Rescue Plan Act funds; and $37 million in state money that was already allocated to the bridge.

Separately, the state has applied to the U.S. Department of Transportation for a federal Mega Grant of $221 million that could offset some of the proposed GARVEE borrowing; the state could also get a $176 million federal INFRA Grant if the Mega Grant is denied. (The state is not eligible for both.)

A decision on the federal grant application is expected this fall.

The administration could float another round of GARVEE debt this winter if the state is awarded a federal grant worth “significantly less” than $221 million, according to the presentation provided to the capital committee.

Ted Nesi ( tnesi@wpri.com ) is a Target 12 investigative reporter and 12 News politics/business editor. He co-hosts Newsmakers and writes Nesi’s Notes on Saturdays. Connect with him on Twitter , Threads and Facebook .

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