Innovative finance tools and programs have been designed to enhance the effectiveness of grant management techniques and bridge investment gaps between available resources and infrastructure needs. They comprise three primary mechanisms:
Improving Federal-aid Financial Management
FHWA 1990 broad-based effort to test and evaluate innovative strategies for state DOTs to get the most from Federal highway grants has advanced many financial management tools that are now standard, such as advance construction, flexible matching, and toll credits.
Federal-aid Fund Management Tools
Increase states' flexibility in providing the required match for Federal-aid programs and advances the timing of Federal-aid fund reimbursement
Federal Debt Financing Tools
Allow state and local entities to borrow against future expected revenue and Federal aid to better manage and accelerate project delivery.
Federal Credit Assistance Tools
Improve project sponsors' access to credit through loans and credit enhancements to better manage and accelerate project delivery.