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- NIB encourages investment to facilitate large projects too big for the states
- Devolution of fails and burden sharing is impossible—states can’t afford or fix interstate freight bottlenecks
- States fail—costs, barriers to cooperation, and local politics—New Jersey proves McConaghy and Kessler 11
- The States cannot solve independent- code differences and an inability to co-operate
- Multi-jurisdictional projects are neglected in the current federal investment process
- This change, by itself, would be a major improvement for the federal investment process
- California proves that state infrastructure banks can solve.
- National bank key to finance projects across multiple jurisdictions Rendell, 11
- National transportation-only bank necessary to fund multi-state projects Schulz, 10
- “Multi-state projects are particularly hard to fund under the current system,”
- National bank key to coordinate projects across state lines Hinton, 11
- National bank overcomes jurisdictional barriers Mele, 10
- NIB solves better than the states and provides a model for state and local governments Trottenberg 11
UniformityOnly federal action solves uniformity and investment DUTTON ’10 – staff editor (Audrey, “Transportation Infrastructure Bank Plan Would Cost $4B”. http://www.bondbuyer.com/issues/119_270/2011-budget-transportation-projects-1006756-1.html) Total new obligations for surface transportation — including highways, bridges, and a new “livable communities” initiative — would be $43.4 billion, according to the budget. That is downsized from fiscal 2010’s estimated $43.7 billion and fiscal 2009’s actual $40.1 billion. Interstate maintenance, congestion mitigation, and demonstration projects would be pared down, but the federal government would obligate more money to federal-land highways, bridges, and other programs. The bank proposed by the president resembles a hybrid of the one-time-only Transportation Investment Generating Economic Recovery grant program, and the popular Transportation Infrastructure Finance and Innovation Act program.
It would fund or finance projects “that provide a significant economic benefit to the nation or a region” and “encourage collaboration among non-federal stakeholders including states, municipalities, and private investors, and also promote coordination with investments in other infrastructure sectors,” the documents said. Investment categories would include highways, tunnels, bridges, transit, commuter rail, passenger rail, freight rail, airports, aviation, and ports — almost the whole transportation universe. NIB encourages investment to facilitate large projects too big for the states Mallett et. al 2011 (William J. Mallett—specialist in Transportation Policy, Congressional Research Service, “ National Infrastructure Bank: Overview and Current Legislation,” 14 December 2011, http://www.fas.org/sgp/crs/misc/R42115.pdf, MH) One of the main arguments for creating a national infrastructure bank is to encourage investment that would otherwise not take place. This investment is especially thought to be lacking for large, expensive projects whose costs are borne locally but whose benefits are regional or national in scope. 33 A national infrastructure bank might help facilitate such projects by providing large amounts of financing on advantageous terms. 34 For instance, an infrastructure bank could provide loans with very long maturities and allow repayment to be deferred until a facility is up and running. *Once established, a national infrastructure bank might help accelerate worthwhile infrastructure projects, particularly large projects that can be slowed by funding and financing problems due to the degree of risk. These large projects might also be too large for financing from a state infrastructure bank or from a state revolving loan fund. 44 Moreover, even with a combination of grants, municipal bonds, and private equity, mega-projects often need another source of funding to complete a financial package. Financing is also sometimes needed to bridge the gap between when funding is needed for construction and when the project generates revenues. Devolution of fails and burden sharing is impossible—states can’t afford or fix interstate freight bottlenecks Pisarski 8 (Pisarski, Alan E., government transportation consultant, 2008, “The Transportation Challenge: Moving the US Economy”, US Chamber of Commerce—Building America’s Future)FS The responsibility for making improvements to freight-oriented corridors across multistate freight sheds and Interstate freight corridors currently falls awkwardly between the federal government—which has largely devolved responsibility for the planning, implementation, maintenance, and operation of the nation’s highway network to state DOTs and MPOs—and local governments, whose authority to finance and implement projects is limited to projects within their individual borders. This has led to an increasingly sharp mismatch between the scale of freight operations, which typically span several states, and state DOTs’ ability to deliver improvements and coordinate operations across these freight sheds and along the connecting Interstate corridors. The challenge for the public and private sectors is to find effective institutional and financing approaches to deal with these major Interstate corridors and bottlenecks. Few states can afford the cost of fixing a major bottleneck alone, and no mechanism presently exists for a single state to share the benefits, costs, and risks of a major project among the three to five neighboring states that also would benefit. States fail—costs, barriers to cooperation, and local politics—New Jersey proves McConaghy and Kessler 11 (McConaghy, Ryan, Deputy Director at the Schwartz Initiative on Economic Policy, and Kessler, Jim, Senior VP at Third Way, January 2011, “A National Infrastructure Bank”, Schwartz Initiative on Economic Policy) FS In October, Governor Chris Christie announced his intention to terminate New Jersey’s participation in the Access to the Region’s Core (ARC) Tunnel project, citing cost overruns that threatened to add anywhere from $2-$5 billion to the tunnel’s almost $9 billion price tag. At the time, Christie stated, “Considering the unprecedented fiscal and economic climate our State is facing, it is completely unthinkable to borrow more money and leave taxpayers responsible for billions in cost overruns. The ARC project costs far more than New Jersey taxpayers can afford and the only prudent move is to end this project.”1 Despite the fact that the project is absolutely necessary for future economic growth in the New Jersey-New York region and would have created thousands of jobs, it was held captive to significant cost escalation, barriers to cooperation between local, state, and federal actors, and just plain politics. The States cannot solve independent- code differences and an inability to co-operate Istrate and Puentes 09 Better selection process. At its heart, an NIB is about better selection of infrastructure projects. The bank would lend or grant money on a project basis, after some type of a BCA. In addition, the projects would be of national or regional significance, transcending state and local boundaries. The bank would consider different types of infrastructure projects, breaking down the modal barriers. This would be a giant step from the current federal funding for infrastructure, most of which is disbursed as federal aid transportation grants to states in a siloed manner. Multi-jurisdictional projects are neglected in the current federal investment process in surface transportation, due to the insufficient institutional coordination among state and local governments that are the main decisionmakers in transportation. The NIB would provide a mechanism to catalyze local and state government cooperation and could result in higher rates of return compared to the localized infrastructure projects. An NIB would need to articulate a clear set of metropolitan and national impact criteria for project selection. Impact may be assessed based on estimated metropolitan multipliers of the project. This criterion would allow the bank to focus on the outcomes of the projects and not get entangled in sector specific standards. Clear evaluation criteria would go a long way, forcing the applicants, be it states, metros or other entities, to have a baseline of performance. This change, by itself, would be a major improvement for the federal investment process, given that a major share of the federal infrastructure money goes to the states on a formula basis, without performance criteria. States are too uncoordinated; the NIB solves. Puentes 10 (Puentes, Robert, director of the Metropolitan Infrastructure Initiative at the Brookings Institute, May 13, 2010, Congressional Testimony to the House Ways and Means Committee, http://www.brookings.edu/research/testimony/2010/05/13-infrastructure-puentes) If correctly structured, an NIB may introduce a federal investment process that requires and rewards performance, with clear accountability from both recipients and the federal government. There are several advantages: Better selection process. At its heart, an NIB is about better decisionmaking of infrastructure projects. The bank would lend or grant money on a project basis, after some type of benefit/cost analysis. In addition, the projects would be of national or regional significance, transcending state and local boundaries. The bank would consider different types of infrastructure projects, breaking down the modal barriers. This would be a giant step from the current federal funding for infrastructure, most of which is disbursed as federal aid transportation grants to states in a siloed manner. Multi-jurisdictional projects are largely neglected in the current federal investment process in surface transportation, due to the insufficient institutional coordination among state and local governments that are the main decisionmakers in transportation. The NIB would provide a mechanism to catalyze intergovernmental cooperation and could result in higher rates of return compared to the localized infrastructure projects. An NIB would need to articulate a clear set of metropolitan and national impact criteria for project selection. Impact may be assessed based on estimated metropolitan multipliers of the project. This criterion would allow the bank to focus on the outcomes of the projects and not get entangled in sector specific standards. Clear evaluation criteria would go a long way, forcing the applicants, be it states, metros or other entities, to have a baseline of performance. This change, by itself, would be a major improvement for the federal investment process, given that a major share of the federal infrastructure money goes to the states on a formula basis, without performance criteria. Keeping recipients accountable. An NIB would have more control over the selection and execution of projects than the current broad transportation grants. It would be able to enforce its selection criteria, make sure that the projects are more in line with its objectives, and have oversight of the outcomes of the projects. The new infrastructure entity should require repayment of principal and interest from applicants. This would bring more fiscal discipline and commitment from the recipients to the outcomes of the project. The extensive use of loans by an NIB contributes to the distinction between a bank and another federal agency. The interest rates charged to the state and local recipients of NIB loans might be set to slowly repay the initial injections of federal capital, while still maintaining a sufficient capital base. Correcting the maintenance bias. The mere establishment of an NIB would not correct for the problem of deferred maintenance. However, through the selection process, it could address the current bias by imposing maintenance requirements to recipients including adequately funded maintenance reserve accounts and periodic inspections of asset integrity. Better delivery of infrastructure projects. An NIB could require that projects be delivered via the mechanism offering best-value to the taxpayer and end user. The design-bid-build public finance model has been the most commonly used project delivery method in the transportation sector in the United States. Until very recently, there has been little experimentation with other delivery contracting types. Evidence from other federal states, such as Australia, shows that private delivery saves money on infrastructure projects. California proves that state infrastructure banks can solve. IBank 12-California Infrastructure and Economic Development Bank [“I-Bank Seeks to Boost Public Infrastructure Funding,” 2/24/2012, http://www.ibank.ca.gov/res/docs/pdfs/2012%20News/I-Bank%20News%20Release%20(Revised%202.24.12).pdf, DKP] Sacramento, CA – The California Infrastructure and Economic Development Bank (I-Bank) today announced that low-cost financing is available through its Infrastructure State Revolving Fund (ISRF) Program with record-low fixed interest rates of 2.11% for 20 year loans and 2.52% for 30 year loans approved in February 2012. The ISRF Program finances a wide variety of local government public infrastructure projects including streets, parks, and flood control. In light of the recent dissolution of redevelopment agencies, the I-Bank’s ISRF Program can provide additional funding for vital jobs-producing public infrastructure projects. “We want to get the word out about this golden financing opportunity before rates rise, as they inevitably will,” said Stanton Hazelroth, I-Bank’s Executive Director. “These rates provide extremely low-cost public infrastructure financing opportunities for local governments. Low rates enable more projects to be constructed or keep the cost of a project low enough to pass on the savings to ratepayers.” National bank key to finance projects across multiple jurisdictions Rendell, 11 --- former Governor of Pennsylvania and as Co-Chair of Building America`s Future (5/17/2011, Ed, Financial Market Regulatory Wire, “BUILDING AMERICA`S FUTURE EDUCATIONAL FUND CO-CHAIR ED RENDELL PREPARED TESTIMONY BEFORE THE SENATE FINANCE COMMITTEE HEARING ON FINANCING 21ST CENTURY INFRASTRUCTURE, AS RELEASED BY THE COMMITTEE - NEWS EVENT,” Factiva, JMP) As it is obvious that existing revenue sources and methods are inadequate to address our vast infrastructure needs, Building America`s Future believes that a National Infrastructure Bank can be part of the solution. A properly constructed Bank will take the politics out of the equation and invest in projects based on merit and help to finance critical projects of regional or national significance. Right now, if multiple states wanted to complete a project crossing multiple jurisdictions or infrastructure sectors, there is no singular place to which they can apply for financial assistance. A National Infrastructure Bank can fill that void by leveraging dollars from states and local governments as well as the private sector, focusing on projects of regional or national significance, and subjecting all requests to a benefit-cost analysis. Clear accountability and transparency requirements would be part of the process. National transportation-only bank necessary to fund multi-state projects Schulz, 10 (5/19/2010, John D., Contributing Editor, “Has the time come for a U.S. Infrastructure Bank?” http://www.logisticsmgmt.com/article/has_the_time_come_for_a_u.s._infrastructure_bank/, JMP) Robert Poole, director of transportation policy at the Los Angeles-based Reason Foundation, a libertarian-leaning think tank, said the nation suffers from both insufficient and poorly targeted infrastructure investments. “Multi-state projects are particularly hard to fund under the current system,” Poole said. “Large, billion-dollar, multi-state, multi-modal projects would be particularly attractive to funding through infrastructure bank funding.” But Poole is opposed to using general U.S. funds for transport projects. Rather, he said, they should be funded by user funds, not federal grants. All projects should be merit-based, which could be difficult in a town where all 538 members of Congress are used to bringing home some bacon to their districts and states. “There may be a niche market role for a narrow transportation-only infrastructure bank,” Poole said. “But a broader infrastructure bank may be too ambitious to try and achieve a multi-modal, grant-and-loan-based bank, which I think might fail,” he added. National bank key to coordinate projects across state lines Hinton, 11 (6/17/2011, Christopher, MarketWatch, “How to fix crumbling U.S. roads, rails and airways; Falling tax revenue is hurting U.S. shipping and prosperity,” Factiva, JMP) Instead, a more likely solution could be the development of more public-private partnerships, these people said. “If you’ve got the right deal worked out, the private sector can do things better than the public sector,” said Timothy James, a research professor at the W.P. Carey School of Business at Arizona State University. The Obama administration has latched onto the idea and has been promoting the formation of a National Infrastructure Bank that would leverage private-sector lending with public financing and coordinate projects across state lines.
In general terms, creation of a NIB would have two major advantages. First, it would remove Federal infrastructure funding from the six-year reauthorization cycle which is causing so many delays and problems right now. Also, moving those investment decisions outside the Congressional authorization process would eliminate the hodgepodge of pork-barrel projects larded into reauthorization bills needed to attract votes, but adding little to national transportation efficiency. Instead, a NIB could fund projects based on overall merit and bring accountability to infrastructure investment. Today, the Federal government collects fuel taxes to fund highway and other infrastructure projects, but it actually has little control over those projects. More than three-quarters of those funds are distributed as grants to states or local governments. Yet the Federal government has little direct control over the projects funded or how they might fit into national goals such as congestion reduction. Worse, the current highway funding mechanism actually discourages preventive maintenance. That money can only be used for major maintenance projects, in effect giving states an incentive to ignore preventive maintenance until the situation deteriorates enough to qualify for Federal funds.
The European Investment Bank has filled just such a role for over fifty years, helping build an effective transportation network that spans many national borders. It could work here, as well. NIB solves better than the states and provides a model for state and local governments Trottenberg 11-MA in Public Policy @ Kennedy School of Government, Harvard, Assisstant Secretary for Transportation Policy-US Department of Transportation, Executive Director of Build America’s Future [Polly, Congressional Documents and Publications, (congressional testimony), “Senate Commerce, Science and Transportation Committee Hearing: ‘Building American Transportation Infrastructure through Innovative Funding,’” July 20, 2011, http://commerce.senate.gov/public/?a=Files.Serve&File_id=19217555-56ac-46b6-aada-91b60cc1e352, DKP] The emphasis placed at the Federal level on competitive, merit-based selection will also serve as a model to State and local governments who will continue to make the bulk of infrastructure decisions. In Chairman Mica's recent transportation reauthorization proposal, he focuses on providing incentives for States to create and capitalize State infrastructure banks. A national infrastructure bank could leverage State investments through their own infrastructure banks. The national infrastructure bank would build on the best practices developed through DOT's existing credit assistance and discretionary programs to provide a more robust and effective mechanism for investing Federal funds and attracting substantial private sector co-investment to our most challenging and complex transportation projects. Directory: files files -> Answer True False 2 points Question 2 files -> Integer programming and game theory files -> 4 Integer Programming files -> Bpa vehicle Window Repair Scenario #1 task: Procure vehicle window relacement. Objective files -> Pop Warner History files -> North Carolina Inclusion Initiative Mapping Where Children with ieps are Being Served Purpose files -> Fall 2013 Spring 2014 Program Data: Standard 1 Exhibit 4d files -> Hanban – asia society confucius classrooms network 2010 request for proposal files -> Northern England’s set-jetting locations Download 1.1 Mb. Share with your friends:
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