Infrastructure Banks as Back Up?
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?
September 18, 2012 4:16 PM
Infrastructure Banks Must Be Accountable
By Laura Barrett
Infrastructure banks are a terrific idea whose time has come. We have to start to answer the pent up need in our communities with fair, accountable financing mechanisms. An infrastructure bank is one of the most accountable ideas proposed thus far; it would have an independent and objective board of directors. However, as USPIRG has detailed in numerous reports, we have to make sure that our communities have access to decision-makers. We also need to make sure that infrastructure banks use employment models that lift up communities such as the Missouri Model, heralded by Secretary LaHood. Using a part of the project's budget to train low income minority and women workers is a proven method. The Missouri Department of Transportation devel...
Infrastructure banks are a terrific idea whose time has come. We have to start to answer the pent up need in our communities with fair, accountable financing mechanisms. An infrastructure bank is one of the most accountable ideas proposed thus far; it would have an independent and objective board of directors. However, as USPIRG has detailed in numerous reports, we have to make sure that our communities have access to decision-makers. We also need to make sure that infrastructure banks use employment models that lift up communities such as the Missouri Model, heralded by Secretary LaHood. Using a part of the project's budget to train low income minority and women workers is a proven method. The Missouri Department of Transportation developed this model to rebuild I-64 after community groups like Metropolitan Congregations United (MCU) demanded jobs for their constituents. The project was finished $11 billion under budget and three weeks early and had the best diversity record on any FHWA project - a success on all counts.
People are hungry for investment in their communities. Despite our country's economic woes, people across the country are voting to tax themselves to fund transit ever year. The Center for Transportation Excellence reports that for 2012, transit ballot initiatives are at an astonishing 89% success rate! People in this country want to see an increasing investment in transit and are willing to pay for it out of their own pockets.
They are also willing to put in long volunteer hours as grassroots leaders in community organizing campaigns as well. Gamaliel released a study last week on our community organizing campaigns for the last five years. What we found was that as a network, we created almost 640,000 jobs and added $21 billion to the Gross Domestic Product (GDP) through infrastructure, transit funding, education, and health campaigns. It's a strategy that works for everyone.
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September 17, 2012 8:42 AM
Better ideas for cash-strapped states?
By Gabriel Roth
Research Fellow, The Independent Institute
Even if the federal government had the funds for a national “Infrastructure Bank”, it would be unlikely to support high-priority projects. The record shows that the current administration prefers projects that please its political friends.
Would not cash-strapped states do better to rely on transportation users to fund projects that they themselves are prepared to pay for? Raising fuel taxes dedicated to highways is one option.
If that is unacceptable, express toll lanes — with tolls varied electronically to ensure uncongested travel at all times — can be privately financed to improve mobility. As far back as 2003, our contributors Bob Poole and Ken Orski proposed building networks of such lanes in eight metropolitan areas: Los Angeles, San Francisco, Washington DC, Seattle, Houston, Dallas/Fort-Worth, Atlanta and Miami.
Express toll (“HOT”) lanes already work successfully in California, Colorado, and Minnesota, and are about to be used to relieve congestion on a segment of the Washington Capital Beltway. There seem to be opportunities for plenty more.