State Infrastructure Banks are revolving infrastructure investment funds for surface transportation that are established and administered by states. A SIB, much like a private bank, can offer a range of loans and credit assistance enhancement products to public and private sponsors of Title 23 highway construction projects, Title 49 transit capital projects, and Title 49 (subtitle V) railroad projects. The requirements of Titles 23 and 49 apply to SIB repayments from Federal and non-Federal sources. All repayments are considered to be Federal funds.
SIBs give states the capacity to increase make more efficient use of its transportation funds and significantly leverage Federal resources by attracting non-Federal public and private investment. Alternatively, SIB capital can be used as collateral to borrow in the bond market or to establish a guaranteed reserve fund. Loan demand, timing of needs, and debt financing considerations are factors to be weighed by states in evaluating a leveraged SIB approach.
SIBs are capitalized with Federal-aid surface transportation funds and matching State funds. (Several states have established SIBs or separate SIB accounts capitalized solely with state funds.) As loans or other credit assistance forms are repaid to the SIB, its initial capital is replenished and can be used to support a new cycle of projects.
Two State Infrastructure Bank (SIB) pilot programs currently exist. The first pilot program was authorized by the National Highway System Designation Act of 1995 (NHS Act), section 350 (enacted November 28, 1995). The second pilot program was authorized by the Transportation Equity Act for the 21st Century (TEA-21), section 1511 (enacted June 9, 1998). Thirty-one States (including Puerto Rico) established NHS Act SIBs and two additional States established TEA-21 SIBs (see Table 1). No additional States may establish SIB pilot programs. Congress in 2005 authorized a permanent SIB program that is codified in 23 U.S.C. 610. No states have created SIBs under the Title 23 program.
|State||Year(s) of Federal Capitalization||Amount of Federal Capitalization|
|1||Florida||1996, 1997, 1998, 1999, 2003||$101,065,437|
|2||Missouri||1996, 1997, 1999||$48,410,000|
|NHS Act SIBs|
|2||Arizona||1996 and 1997||$46,185,974|
|11||Minnesota||1997 & 1999||$35,069,200|
|17||Ohio||1996 & 1997||$87,000,000|
|18||Oregon||1996 & 1997||$14,483,000|
|20||Puerto Rico||1997 & 1998||$12,008,588|
|25||Texas||1996 & 1997||$171,288,804|
|28||Virginia||1996 & 1997||$18,000,000|
Source: U.S. General Services Administration Financial Management Information Systems (FMIS), March 31, 2011.
States participating in the SIB pilot programs have executed cooperative agreements with the Federal Highway Administration (FHWA) and the Federal Transit Administration (FTA), as applicable, establishing the basic requirements of the SIB. The cooperative agreement outlines the structure of the SIB, including the administering agency, financial assistance policies, accounting and audit procedures, and sanctions and compliance.
Federal funding for the NHS Act SIB pilot programs was limited to funds authorized in fiscal years 1996 and 1997, including $150 million from the General Fund of the U.S. Treasury. No additional Federal funds are available to capitalize NHS Act SIB pilot programs. Federal funding for the TEA-21 SIB pilot programs was limited to funds authorized by TEA-21 as well as the funds eligible for the NHS Act SIB pilot programs. According to FHWA reports, about $661 million in Federal funding from fiscal years 1996 through 2003 was provided to capitalize the pilot program SIBs. No additional Federal funds are available to capitalize either of the SIB pilot programs.
States wishing to establish a new SIB or expand their SIB using Federal funds may do so in accordance with the provisions of 23 U.S.C. 610.
States must match the Federal funds used to capitalize the SIB on an 80-20 Federal/non-Federal basis, except for the highway account where the sliding scale provisions apply. States also have the opportunity to contribute additional state or local funds beyond the required nonfederal match.
MAP-21 has not allowed new 2013-2014 funding to be used to capitalize SIBs.
SIB pilot programs may offer highway and transit capital project sponsors the following forms of assistance
TEA-21 SIB pilot programs also may assist railroad projects if 49 U.S.C. Subtitle V funds were used to capitalize the bank. Despite the ability to offer other forms of credit enhancement, SIB pilot programs have provided direct loans almost exclusively.