This week, U.S. Rep. Dan Webster, R-Fla., introduced a bill to “support wholesale lending to infrastructure projects through state and local governments, state infrastructure banks and private entities.”
Webster introduced the “Infrastructure Bank for America Act” on Monday, Republican U.S. Reps. Doug LaMalfa of California, Dan Meuser of Pennsylvania and Tom Reed of New York are cosponsoring the proposal.
“America’s infrastructure is long overdue for critical repairs and needed advancements,” said Webster on Tuesday. “This bank will work with state and local partners to facilitate private infrastructure investment, creating a needed mechanism for states and municipalities to access necessary funding.”
Webster’s office offered some of the details of the proposal.
“As a Government-sponsored Enterprise (GSE), the Infrastructure Bank for America (IBA) would have access to lower cost of funds, a benefit passed to state and municipal borrowers, used to support all infrastructure projects including a minimum of 7 percent for necessary rural project investment,” the congressman’s office noted. “The Bank, structured similarly to the Federal Home Loan Bank System, encourages private investment through tax incentives for those investments during the first three years of IBA operation. This approach differs from prior Infrastructure Bank proposals in the sense that it will be entirely capitalized by private investment. Infrastructure banks have successfully complemented existing funding programs across the world, including US state infrastructure banks. The Infrastructure Bank for America will support industries and projects critical to the structure, growth and resurgence of the US economy. IBA investments are not limited and can help finance surface transportation projects, electric grid security, broadband connectivity, the revitalization of Main Street USA, and more.”
“The IBA serves as a compliment, not a replacement, for existing programs and encourages states and municipalities to pursue all available funding sources,” Webster said. “While federal infrastructure investment is critical, the current level of resources from the federal government will not address America’s current infrastructure needs on its own. The Infrastructure Bank for America will work with state and local governments to identify priority projects and infuse private capital to address our critical infrastructure needs.”
“America’s infrastructure is in critical need of modernization,” Meuser said. “Although there is bipartisan consensus on this issue, the sheer magnitude of needed investment exceeds the budget and borrowing capacity of states and the federal government. The Infrastructure Bank for America would serve as a significant supplement to existing funding sources through private investment that would increase access to capital for worthy infrastructure projects across the nation, without putting the burden on taxpayers. This new mechanism will help to safely rebuild America and strengthen our economic competitiveness with the rest of the world.”
“We care about supporting communities across the country who have long lacked access to the capital needed to upgrade aging infrastructure. By facilitating unique public/private partnerships at the state and local level, the Infrastructure Bank for American will unlock a wave of investments in critical projects that will boost economic growth and improve livelihoods,” said Reed.
“Crumbling roads, lack of broadband connectivity, and weak electrical grids are issues that Northern Californians deal with daily,” said LaMalfa. “Despite dozens of grants and loan programs, the Federal government can’t fund every infrastructure upgrade across the country. At the same time, American pension funds and investments have flowed into places like China. While leaders in Sacramento and Washington continue in that direction, my colleagues and I are proposing the creation of the Infrastructure Bank for America. This bank will provide a safe financial return for Americans by putting their funds back into their own neighborhoods. We need to focus our efforts on our own infrastructure, because it’s what our citizens care about. It’s an improvement in quality of life for us and future generations.”
Webster’s proposal was sent to the U.S. House Transportation and Infrastructure, the Financial Services and the Ways and Means Committees which sent it to various subcommittees. So far, there is no companion measure over in the U.S. Senate.
Reach Kevin Derby at email@example.com.