Obama Pushes for More Private Financing for Infrastructure
President Obama is seeking to tap more private-sector dollars to help finance a wide range of U.S. infrastructure projects, but his new plan consists of modest, incremental actions and doesn't include any new federal spending.
The Build America Investment Initiative, which Obama announced on July 17, includes what he calls a new U.S. Dept. of Transportation "one-stop shop" to find ways to remove barriers to the greater use of private transportation infrastructure investment.
Besides the Build America Transportation Investment Center at DOT, the plan includes a new interagency working group, chaired by Treasury Secretary Jack Lew and DOT Secretary Anthony Foxx, to focus on speeding up financing and completing major national projects. The group is to send recommendations, a time line and goals to Obama by mid-November. Foxx says the interagency panel also will look at non-transportation infrastructure, including water and energy.
Treasury will host an infrastructure finance summit on Sept. 9 for public-sector officials and private investors.
Jeff Zients, director of the White House National Economic Council, told reporters the new plan aims to "turbocharge private investment in our roads, rails, highways and bridges."
Speaking near a Delaware interstate bridge closed for repairs since June 2 (ENR 6/16-23 p 10), Obama said, "There are lots of investors who want to back infrastructure projects because, when it's done right, they get a steady, long-term investment."
He added that many states and localities "would welcome more private investment, but they need a partner in the federal government to help do some matchmaking and work through some of the complexities of private financing of infrastructure."
Brian Pallasch, American Society of Civil Engineers managing director for government relations and infrastructure initiatives, says more information-sharing about project finance is a good idea. "States need to learn from other states what works, what doesn't work," he adds.
Matt Girard, chief operating officer of Plenary Concessions, Denver, says, "Anything that removes hurdles to allow for P3s to be ... another tool in the toolbox for state agencies is obviously a good thing." But Girard notes, "To even have a P3 to be a tool in the toolshed, there's still got to be other sources of funding to help pay for it."
Foxx says, "None of these steps we are taking should be seen as a substitute for adequate public financing, because there isn't a substitute for that." The new plan doesn't provide any additional federal funding, but Obama did announce a $302-billion, four-year transportation bill in February. That proposal has made little headway on Capitol Hill.
