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Infrastructure Finance Bill Introduced in Congress
On May 22, 2013, the Partnership to Build America Act (H.R. 2084) was introduced into the U.S. House of Representatives. This bill would establish a $50 billion "American Infrastructure Fund" to be capitalized by the sale of 50-year bonds. These bonds would pay a 1-percent interest rate and would not be guaranteed by the federal government. To encourage private investors to invest in the American Infrastructure Fund, the bill would allow corporations to repatriate foreign earnings tax-free -- for every $1 invested in the fund, a corporation would be able to repatriate $4 from overseas. The American Infrastructure Fund would provide loans and loan guarantee to support investments in a variety of infrastructure projects, including transportation, water, energy, communications, and education.
The nation's transportation system requires significant investments to maintain a state of good repair and to accommodate economic and population growth. Interest in innovative financing has grown in recent years as traditional funding sources, namely the gas tax, have failed to keep pace with needs. Proposals for a national infrastructure bank emerged as part of the discussion leading to the passage last summer of the transportation reauthorization bill, Moving Ahead for Progress in the 21st Century (MAP-21), although none of the proposals were incorporated into the final bill.
GO TO 2040 supports the strategic use of innovative finance mechanisms, including public-private partnerships and value capture. These approaches should be considered on a project-by-project basis and may have merit in providing a portion of a particular project's overall funding. However, GO TO 2040 recognizes that innovative financing cannot fully meet the region's transportation funding needs and calls for an increase in traditional funding sources to provide an adequate level of resources.