In recent years, states and the federal government experimented with a set of innovative finance mechanisms, credit programs, and revolving loan funds to stretch public and private dollars and support the kind of infrastructure investments necessary to build the next economy.
For transportation projects, much of this support comes in the form of below market revolving loans and loan guarantees from state infrastructure banks (SIBs.) Since established in the 1990s they have provided billions in financing for more than 1,000 projects mostly focused on the 100 largest metropolitan areas. However, this activity is highly concentrated in just a few states as many SIBs are underutilized or inactive. This research shows that SIBs can be valuable tools for delivering
infrastructure projects and can generate more investment per dollar than traditional federal and state grant programs.
This report recommends that U.S. states should:
- Align federal and state roles and responsibilities to streamline project delivery and ensure loan capacity is fully utilized
- Ensure the long-term sustainability of revolving infrastructure funds by leveraging capitalization and reach a broader range of sponsors and projects
- Develop partnerships with local public and private actors so projects have high economic,
environmental, or social effects
As a nation, we've got to figure out better, more long-term ways, more sustainable ways, to fund needed transportation projects without having to rely on this annual uncertainty which seems to be the norm instead of the exception now.