OTTAWA — A nascent federal agency designed to find new ways to finance construction of transit systems is making its first investment in a multibillion-dollar electric rail system in Montreal.
The Canada Infrastructure Bank says it will provide a $1.28-billion loan to help build the system, best known by its French acronym REM.
The loan includes an interest rate of one per cent, rising to three per cent over the 15-year term of the loan.
The $6.3-billion electric rail system, largely managed and funded by Quebec’s pension scheme, was high on the federal government’s wish list for the infrastructure agency when it launched late last year.
The loan will replace previously pledged federal cash for the project, which Prime Minister Justin Trudeau has said could be freed up for other provincial projects.
The province is on the brink of a provincial election campaign, with voters going to the polls Oct. 1.
The Canadian Press