The American Society of Civil Engineers has estimated the five-year investment need of America's infrastructure to be $2.2 trillion. Public financing can only go part of the way in meeting this overwhelming shortfall; more has to be done to assist transportation agencies in leveraging private capital to meet the need. In the current economic climate, infrastructure investment has become increasingly attractive to investors looking for a long-term and stable return. NCPPP members have reported that $450 billion of private funds have been accumulated in investment vehicles focused on infrastructure. While some of these funds are from overseas, an increasing number of American pension funds, many investing for public sector employees, have begun to explore infrastructure investment. Providing capital for innovative project financing may not result in the high internal rate of return that the securities market once did, but in these troubling economic times, a regular return resulting from an equity investment in a toll facility is a welcomed change.
The NCPPP recommends Congress to take advantage of the opportunities that the transportation authorization process provides to review the policies governing federal involvement in supporting the future of our nation's infrastructure. Expanding existing federal programs, including TIFIA, Private Activity Bonds and Urban Congestion Partnerships are actions that Congress could take today to assist States in meeting the current transportation infrastructure need. Providing immediate project credit assistance, through State Infrastructure Banks, would not only work to address the infrastructure maintenance challenge, but also help put more Americas to work. With this expanded interest in partnerships the federal government should also encourage states to establish dedicated PPP teams to provide guidance as public authorities engage the private sector. The federal government must create an environment of innovation in which state and local authorities can development public-private partnerships that are transparent and that protect the public interest. Equally important, these actions provide an environment in which risks can be clearly defined and therefore would promote private sector investment.
Thank you for your consideration - The National Council for Public-Private Partnerships stands ready to assist in building the framework that will lead to greater private sector involvement in addressing our nation's transportation infrastructure crisis. Congress has the opportunity to make positive policy changes to create an environment of partnership to address the challenges facing the infrastructure systems of the United States. In this time of both economic difficultly and pressing infrastructure funding demands, it is essential to the future of the nation, in all aspects, that all available resource be employed to secure America's mobility. Neither the public nor the private sectors alone can provide the infrastructure improvements required for our 21st century economy - partnership is necessary.