Challenges in Infrastructure Funding

This module provides a roadmap to understanding trends that have led to underfunding of infrastructure maintenance, potential impacts to the nation’s critical infrastructure systems, and current and emerging approaches and methods to funding infrastructure now and into the future.

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Resource List

These resources provide a baseline understanding of key issues related to the complex problem of infrastructure funding, and may be updated as new data becomes available.

Organizations:

• American Society of Civil Engineers: Publishes the Report Card for America’s Infrastructure, which is widely referenced in discussions of the condition of infrastructure assets and systems. The latest Infrastructure Report Cards and subreports can be accessed at http://www.infrastructurereportcard.org/, Web, 23 Mar 2017.
• National League of Cities: Researches and publishes position papers on traditional and creative solutions to resolve infrastructure issues. Topics include bridges, power, roads, security, utilities and water systems. More information and access to the topical papers is available at http://www.nlc.org/topics/infrastructure, Web, 23 Mar 2017.
• U.S. Government Accountability Office: Models state and local government sustainability on an annual basis. These simulations reveal long-term trends that burden these levels of government and make projections on their balances over the next 50 years. Current and past models and key reports are available at https://www.gao.gov/fiscal_outlook/state_local_fiscal_model/overview#t=1, Web, 23 Mar 2017.
• Bipartisan Policy Center: Assesses policy issues including infrastructure and seeks to combine the best ideas to promote health, security, and opportunity for Americans. BPC publishes issue papers promoting policy decisions on issues of importance on a national basis and identifies other sources for addressing these issues. BPC’s infrastructure issue papers are available at https://bipartisanpolicy.org/topics/infrastructure/, Web, 23 Mar 2017.

Recent Publications:

• 2017 Infrastructure Report Card: Published by the American Society of Civil Engineers, this report, issued every four years, assesses the current condition of infrastructure across the country. Additional reports include sector-specific or region-specific analysis, as well as economic impacts. Reports and roll-ups can be found at https://www.infrastructurereportcard.org, Web, 23 Mar 2017.
• Failure to Act: Closing the Infrastructure Investment Gap for America’s Economic Future: Report by the American Society of Civil Engineers. An update to their previous report, “Failure to Act: The Impact of Infrastructure Investment on America’s Economic Future.” Discusses the complex economic impacts of investment in infrastructure, or lack thereof.
  • Citation: American Society of Civil Engineers, “Failure to Act: Closing the Infrastructure Investment Gap for America’s Economic Future,” 2016, full text at: https://www.infrastructurereportcard.org/wp-content/uploads/2016/05/ASCE-Failure-to-Act-2016-FINAL.pdf, Web, 23 Mar 2017.
• Paying for local infrastructure in a new era of federalism: Prepared by the National League of Cities presents the results of a study of local infrastructure funding tools and their relationships to federal and state resources and revenues.
  • Citation: Information at http://www.nlc.org/topics/infrastructure, full text at http://www.nlc.org/sites/default/files/2016-12/NLC_2016_Infrastructure_Report.pdf, Web, 23 Mar 2017.
• Inside 5 Tools Cities Can Use to Pay for Infrastructure: Prepared by Next City, a nonprofit working to support social, economic, and environmental change in cities, the issue paper details funding/financing methods to support infrastructure.
  • Citation: Information at https://nextcity.org/topic/infrastructure, full text at https://nextcity.org/daily/entry/5-funding-tools-cities-pay-infrastructure-projects, Web, 23 Mar 2017.
• New and Emerging Capital Providers for Infrastructure Funding – 4617: Published by Water Research Foundation, the report provides a knowledge base on the applicability and potential of emerging capital financing approaches and tools.
  • Citation: Information and link to full text at: http://www.waterrf.org/Pages/Projects.aspx?PID=4617, Web, 23 Mar 2017.
• Bridging the Gap Together: A New Model to Modernize Infrastructure: Published by the Bipartisan Policy Center, The position paper presents framework and transparent system to identify projects that need funding and link them to readily available private capital while effectively allocating risks and resources.
  • Citation: Information at Bipartisan Policy Center, Infrastructure, https://bipartisanpolicy.org/topics/infrastructure/, full text at https://bipartisanpolicy.org/library/modernize-infrastructure/, Web, 23 Mar 2017.
• Getting Back in the Habit of Funding Infrastructure: Prepared by Moody’s Analytics, the position paper details how the U.S. reached the current state of infrastructure funding and opportunities to move back to a well-funded infrastructure.
  • Citation: Information at https://www.moodys.com/researchandratings/market- segment/infrastructure-project-finance/-/005008/005008/-/-1/0/-/0/-/-/-/-/-/-/ /en/global/pdf/rra, full text at https://www.economy.com/home/products/samples/2015-03-15-Getting-Back-In-The-Habit-of-Infrastructure.pdf, Web, 23 Mar 2017.
• State and Local Governments’ Fiscal Outlook, 2016 Outlook: Prepared by the U.S. Government Accountability Office, the report presents results of simulations of long-term fiscal trends in the state and local government sector and chronicles the long-term fiscal pressures facing state and local governments.
  • Citation: U.S. Government Accountability Office, State and Local Governments’ Fiscal Outlook: 2016 Outlook, GAO-17-213SP: 8 Dec 8 2016, full text at https://www.gao.gov/assets/690/681506.pdf, Web, 23 Mar 2017.
• More Money Won’t Fix U.S. Infrastructure If We Don’t Change How It’s Spent: In a different perspective paper, StreetsblogUSA, presents a view that sufficient funds exist to finance infrastructure and advocates assessing how the financing is spent can improve the overall funding outlook.
  • Citation: Full text at http://usa.streetsblog.org/2015/02/05/more-money-wont-fix-u-s-infrastructure-if-we-dont-change-how-its-spent/, Web, 23 Mar 2017.
• Making the most of a wealth of infrastructure finance: In a position paper, McKinsey & Company advocates for a different model that focuses on the way infrastructure projects are structured and prioritized as a means to infuse private financing more broadly into the funding landscape.
  • Citation: Full text at http://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/making-the-most-of-a-wealth-of-infrastructure-finance, Web, 23 Mar 2017.

Other Resources:

• Expanding our Nation’s Infrastructure through Innovative Financing: U.S. Department of Treasury, Office of Economic Policy: An overview of underinvestment in infrastructure and approaches to solving the funding shortfalls.
  • Citation:Department of Treasury, Resource Center, Economic Policy. Link to pdf can be found at https://www.treasury.gov/resource-center/economic-policy/Documents/3_Expanding our Nation’s Infrastructure through Innovative Financing.pdf, Web, 23 Mar 2017.
• Funding Municipal Infrastructure: Integrating Project Finance and Crowdfunding: Published by Stanford University, Global Project Center under support from the National Science Foundation, this document discusses causes of current fiscal issues at municipalities and the integration of crowdfunding with small municipal projects.
  • Citation: Full text at https://gpc.stanford.edu/publications/funding-municipal-infrastructure-integrating-project-finance-and-crowdfunding, Web, 23 Mar 2017.
• Fixing America’s Surface Transportation Act, or “FAST Act”: Signed in 2015 to provide long-term funding for planning and investment in surface transportation.
  • Citation: Information at https://www.fhwa.dot.gov/fastact/, full text at https://www.fhwa.dot.gov/fastact/legislation.cfm, Web, 23 Mar 2017.
• The Short and Long term Impact of Infrastructure Investments on Employment and Economic Activity: Prepared by the Economic Policy Institute, the briefing paper details the role of infrastructure in the economy and provides three scenarios to illustrate how financing impacts the economy.
  • Citation: Full text at http://www.epi.org/files/2014/impact-of-infrastructure-investments.pdf, Web, 23 Mar 2017.
• Answering the Infrastructure Finance FAQs: Presented by the Bipartisan Policy center, the article provides definitions for many of the fundamental financing terms and a primer on their application.
  • Citation: Information at Bipartisan Policy Center, Infrastructure, https://bipartisanpolicy.org/topics/infrastructure/, full text at https://bipartisanpolicy.org/blog/infrastructure-finance-faqs/, Web, 23 Mar 2017.
• What Would an Infrastructure Bank Really Do?: The position paper prepared by Brookings Institute addresses the potential benefits of establishing a National Infrastructure Bank.
  • Citation: Full text at https://www.brookings.edu/blog/up-front/2012/07/16/what-would-an-infrastructure-bank-really-do/, Web, 23 Mar 2017.

These materials were developed as an initiative of the Advanced Thinking in Homeland Security (HSx) curriculum at the Center for Homeland Defense and Security.