It’s a disappointing fact that today’s Washington, D.C., is too often polarized and paralyzed. The resulting gridlock makes progress difficult on key public investment priorities like infrastructure.
But look beyond the nation’s capital and you’re likely to see promising signs of progress at the state and local levels, as leaders ask voters to make a commitment to future infrastructure development in this election season.
“Voters in 26 states on Nov. 8 will decide whether to provide a record-breaking $250 billion or more for 375 local and regional projects and initiatives,” an October 28 article in The Bond Buyer reports, quoting the Eno Center for Transportation, a policy advocacy organization for the transportation industry. The Eno Center has launched an online database to track the electoral fate of transit and infrastructure projects around the country.
Depending upon the project, funding would come from any of several potential financing sources, like budgeted funds or municipal bond issues.
As a trade industry representing the nation’s capital markets and financial industry, SIFMA watches municipal bond issues with particular interest. The prudential use of long-term debt issued through the capital markets is a proven strategy for making large-scale public investment projects affordable at the state and local level, while providing reliable and steady returns for investors.
In an era of declining federal infrastructure funding, that approach can be a win-win for taxpayers, investors and communities. Among the numerous bond issues voters will decide on Nov. 8:
- Maine voters are asked to authorize a $100 million general bond issue to finance improvements to highways, bridges and multimodal facilities.
- In Cook County, Illinois, voters will consider a $32 million bond issue to fund road transportation in towns around the county.
- Glenwood, Colorado, voters are looking at a $104 million bond issue to improve traffic safety and reduce congestion and to construct a riverwalk.
- In Fairfax County, Virginia, voters will consider a $120 million bond issue to fund public transit and transportation improvements.
- In northern California, three San Francisco-area counties are seeking approval of a $3.5 billion bond measure to finance upgrades to the Bay Area Rapid Transit system.
It’s worth noting that even if voters were to approve every single one of these projects and others listed in the Eno Center database, the reality is that the total amount of funding would still be inadequate to the task.
The American Society of Civil Engineers estimates that the United States needs a whopping $3.6 trillion in investment by 2020 to repair, replace and upgrade the nation’s roads, highways, bridges, airports, water treatment systems, power grids and other vital infrastructure.
Experts agree that, given the dire state of American infrastructure and the level of investment needed, funding won’t be found simply from public financing, important as that funding stream may be. Michael Decker, managing director of SIFMA’s Municipal Division, reported recently on how effective public-private partnerships can spur new and creative types of financing for public projects. That would be a step in the right direction.
In the meantime, the projects on the November ballot, if approved by voters, will represent a good down payment toward the overall level of investment that’s required.
That’s a point that Eno Center President and CEO Robert Puentes emphasizes in a September op-ed for U.S. News and World Report, where he urges policymakers to pay close attention to the message that voters send about public investment on Election Day.
“Of course, our nation’s transportation challenges will not be resolved with a simple flip of a lever in the voting booth. But we are paying close attention to the message voters will send this November,” Puentes writes. “The results may mean a future of more citizen involvement in the decisions that shape their communities and regions. Others should pay attention too.”
Other recent Project Invested infrastructure reports: