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Appendix C: Panel Discussion Questions

Panel: How could Federal Credit be used by Project Sponsors?

1. Is Federal credit the best way to help large-scale projects in light of what likely will be continuing budget constraints, or are there other forms of assistance we should be considering?
2. Given that the Federal Government can offer credit incentives, tax incentives, and regulatory incentives, which approaches would have the greatest benefit in stimulating more investment?
3. Are there market gaps which the Federal Government should address through credit, and if so, how can that be done with the least interference to the private capital markets?
4. If the role defined for the Federal credit program is too risky for private investors, why should the Federal Government get involved?
5. Do we need a Federal credit program in addition to the State Infrastructure Bank program? Given the limited experience of the State Infrastructure Bank program, is the request to create another new program premature?
6. Should there be concern that project sponsors will seek to maximize the amount of assistance they receive from the Federal Government in the form of direct or guaranteed loans?
7. Why is it necessary to have a deferral feature for principal and interest for the first 10 years?
8. To be truly effective, is it essential that the Federal credit be subordinate?
9. Are there other types of transportation projects not currently envisioned under the Federal credit program (e.g., private freight rail yards) which would benefit from the provision of credit assistance?

Roundtable Discussion: What are the Federal Tax Issues relating to Credit Assistance?

1. If the Federal Government takes a subordinate position as a junior-lien lender, does that constitute an implicit guarantee of the private capital markets' senior debt?
2. Would a standby line of credit be viewed as an "indirect guarantee" under Section 149(b) of the Internal Revenue Code?
3. Are there other precedents of borrowers receiving both Federal credit and tax-exempt bond proceeds?
4. Have other Federal programs which may result in additional tax-exempt debt issuance (e.g., EPA State Revolving Funds, SIBs, FHWA Federal-aid) been scored with tax expenditures?
5. What is the policy rationale for Section 149(b), and what types of financing was it designed to discourage?

Panel: How Creditworthy is Federal Credit?

1. How risky are transportation infrastructure projects generally? Is this too risky a business for the Federal Government to be in?
2. The Federal Credit Reform Act of 1990 requires that budget authority be provided for the "expected losses" resulting from every loan or loan guarantee. How should the credit risk of large infrastructure projects be assessed and scored against the budget?
3. OMB Circular A-129 prohibits paying outstanding Federal credit with the proceeds of tax-exempt obligations. Is this a desirable policy?
4. Could the Federal credit program set a precedent for other industry sectors to seek similar assistance? Is this a desirable outcome?

Keynote Presentation: Program Administration/Recap of Key Federal Policy Issues

1. Are the program goals and project selection criteria outlined in the policy discussion paper appropriate, or should other factors be considered?
2. How should DOT assess the economic benefits of a project? Should it just consider future revenue streams or should it consider pollution reduction, congestion relief and other indirect benefits?
3. Should a credit program offer both guaranteed loans and direct loans, or just one or the other?
4. What's to prevent DOT from making a loan to a bad project?
5. How can DOT best monitor a portfolio of these types of projects?
6. Given that the Department has limited experience with direct credit projects such as the Alameda Corridor, should more experience be gained before establishing a nationwide program?