According to the National Stone, Sand & Gravel Association (NSSGA), Michael Bennett (D-Colo.) and Roy Blunt (R-Mo.) have introduced the Senate companion bill to The Partnership to Build America Act introduced in the House by Rep. John Delaney (D-Md.).
The legislation would create a $50 billion American Infrastructure Fund that could leverage up to $750 billion dollars in transportation, energy and education infrastructure projects through loans or guarantees to state or local governments to finance qualified infrastructure projects. The House bill currently has 50 co-sponsors (25 Republicans and 25 Democrats).
The proposal utilizes no appropriated funds; instead, it relies on repatriated corporate earnings as well as public-private partnerships to fund the bank. The AIF will be funded by the sale of $50 billion worth of Infrastructure Bonds with a 50-year term, paying a fixed interest rate of 1 percent, and not guaranteed by the U.S. government. U.S. corporations would be incentivized to purchase these new Infrastructure Bonds by allowing them to repatriate a certain amount of their overseas earnings tax free for every $1.00 they invest in the bonds.
The states or local governments would be required to pay back the loan at a market rate determined by the AIF to ensure they have “skin in the game.” In addition, the AIF would invest in equity securities for projects in partnership with states or local governments. At least 25 percent of the projects financed through the AIF must be Public-Private Partnerships for which at least 20 percent of a project’s financing comes from private capital using a public-private partnership model.
NSSGA has embraced an “all of the above” approach to increasing transportation infrastructure funding and is supportive of this innovative bipartisan effort.