Senate Commerce Committee chairman Jay Rockefeller D-W.Va., introduced a bill Wednesday that would create a national infrastructure bank and fund it with $10 billion over two fiscal years.
The bill, which was co-sponsored by Sen. Frank Lautenberg D-N.J. would provide $5 billion in each of fiscal 2012 and 2013 for the American Infrastructure Investment Fund, which would be housed within the Department of Transportation.
The fund or bank would give financial assistance to state and local governments and private entities to encourage them to make capital investments in transportation projects.
Eligible types of projects would include rail lines, ports, pipelines, airports, highways, bridges and public transportation systems.
The Rockefeller-Lautenberg bill also would create a National Infrastructure Investment Grant program and authorize $600 million per year during those two fiscal years.
The competitive grants could be used to build new or improve existing transportation-infrastructure projects similar to those that could be financed by the infrastructure bank.
“Our bill offers an investment mechanism to leverage the vast amount of private capital waiting to be put to use,” Rockefeller said in the announcement.
The bank would make loans at rates set to a benchmark of marketable Treasury securities.
Direct loans could not be more than 70% of the total project cost. Loan guarantees could not exceed 80% of a project’s cost.
A seven-member board of directors would make decisions on which projects to fund. An executive director would publish an investment prospectus describing the priorities and strategy for the bank as well as how applications would be scored for potential awards.
The bank’s board would include the secretaries of Treasury, Commerce and Energy and four officials from the Department of Transportation. The executive director would be appointed by the president and would have to be confirmed by the Senate.
“The fund would be designed in a scalable manner that would allow it to broaden its investment portfolio into other types of infrastructure projects, such as telecommunications, energy and water projects in the future,” Rockefeller and Lautenberg said in their release.
The Rockefeller-Lautenberg plan is not the first infrastructure bank proposal. Former Senators Chris Dodd, D-Conn., and Chuck Hagel, R-Neb., introduced a $75 billion bank plan in 2007 which failed to move through the Senate.
President Obama introduced a $50 billion infrastructure bank plan in August 2008 as part of his stimulus plan but that also did not advance.
Obama’s fiscal 2012 budget request includes a bank that would be funded with $30 billion over six years.
Rep. Rosa DeLauro, D-Conn., has introduced a bill to create an infrastructure bank and fund it with $25 billion over five years, along with private funds..
More recently, in March, Sen. John Kerry, D-Mass, unveiled legislation for a national infrastructure bank that would receive $10 billion to provide loans or loan guarantees for projects.
The bank’s loans and guarantees would have to be backed by a revenue stream such as tolls or other state and local contributions.
The biggest problem with all of the proposals is their projected cost in a time of budget austerity.
House Transportation committee chairman Rep. John Mica, R-Fla., hasn’t ruled out the idea of an infrastructure bank, according to a spokesman, but has pronounced himself reticent to support anything on the table now.
