For cash-strapped states, all hope isn't necessarily lost.
Despite shrinking federal funds, innovative tools such as revolving state loan funds present "an increasingly important mechanism for financing and funding infrastructure projects such as state infrastructure banks," according to a Brookings report out last week.
The way such loan funds are implemented is far from perfect, Brookings found, but they can represent an important means of delivering infrastructure projects. The short report walks through how the funds are structured in various states and how they can be improved on. For one, many state infrastructure bank officials say complying with federal environmental and contractual regulations can slow down the investment process--a problem that could be magnified for states with smaller projects and less-developed banks of their own.
A national infrastructure bank, as proposed by the administration, could help relieve states of some of those problems by offering expertise in dealing with complex regulations and project delivery, the report found.
Such loan funds and infrastructure banks may just be tools in states' infrastructure project delivery arsenals, but they're tools that can be sharpened and strengthened. Is there a broader role the federal government can take in fostering innovative financing like these funds? If so, how? What more can states do? Or is this barking up the wrong tree?