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Updated September 20, 2021
National Infrastructure Bank: Proposals in the 117th Congress
Introduction
operate as a revolving fund, such that credit assistance and
The term “infrastructure” generally refers to long-lived,
administrative costs are limited to the size of the
capital-intensive systems and facilities in the areas of
appropriation, but funds from borrowers’ payments could
transportation, energy, water, and telecommunications.
be used to make new loans. In some formulations, an
Some broader definitions also include facilities for
infrastructure bank would raise its own capital through
education, recreation, and health. Although the condition
bond issuance.
and performance of these systems are generally thought to
be important for the nation’s well-being, there is less
Advantages and Disadvantages
agreement on the optimal level of infrastructure investment,
Advantages of a national infrastructure bank potentially
how to maximize the effectiveness of spending, and the
include the leveraging of state, local, and private-sector
appropriate role of the federal government.
investment, data-driven project selection, and a highly
skilled staff with expertise in infrastructure financing.
State and local governments and the private sector provide
Drawbacks might include the limited number of suitable
the bulk of infrastructure investment. The federal role in
projects for support, the duplication of existing programs,
infrastructure investment is important but limited in size
and pressure to allocate loans according to political criteria.
and scope. For example, the federal government was
A bank may also not be the lowest-cost means of increasing
responsible for 25% of total government highway outlays in
infrastructure spending. The Congressional Budget Office
2018. The federal government supports infrastructure
notes that a special entity issuing its own debt would not be
investment in four ways: (1) direct investment in federally
able to offer the low interest and issuance costs of the U.S.
owned infrastructure; (2) grants to nonfederal entities,
Treasury. Some see a larger federal role in infrastructure as
especially state and local governments; (3) tax preferences
a drawback as well, and suggest that Congress might
that forgo federal revenue to provide incentives for
enhance the operation of state infrastructure banks as an
nonfederal investment in infrastructure; and (4) loans and
alternative.
other types of credit assistance to nonfederal entities.
Legislative Proposals in the 117th Congress
National Infrastructure Bank
Most infrastructure bank bills introduced in the 117th
A national infrastructure bank is typically seen as a way for
Congress would create a financing entity to support projects
the federal government to provide loans, loan guarantees,
across several infrastructure sectors. These include the
and lines of credit to support infrastructure projects being
National Infrastructure Development Bank Act of 2021
carried out by nonfederal entities. Many different
(H.R. 4413, Representative DeLauro); the National
formulations have been proposed over the years, but policy
Infrastructure Investment Corporation Act of 2021 (H.R.
choices typically include the following:
4446, Representative Carbajal); the National Infrastructure
Infrastructure type. Some proposals focus on one type,
Bank Act of 2021 (H.R. 3339, Representative Danny
such as transportation or energy, but most would support a
Davis); the 21st Century Infrastructure Bank Act (H.R.
wider spectrum of sectors.
3722, Representative Maloney); and the Reinventing
Economic Partnerships and Infrastructure Redevelopment
Institutional form and governance. Most current
(REPAIR) Act (S. 1499, Senator Warner). Several other
proposals would create a wholly owned government
bills would create an entity to support infrastructure
corporation overseen by a board whose members are
projects that aim to improve resilience and reduce
selected by the President or Congress. But other models
greenhouse gas emissions. These include the National
exist, including placing the bank inside an existing federal
Green Bank Act of 2021 (H.R. 2656, Representative
agency and creating a government-sponsored enterprise
Himes/S. 1208, Senator Murphy); the America’s Clean
with an independent board.
Future Fund Act (H.R. 2451, Representative Newman); and
Funding source. Under the Federal Credit Reform Act of
the National Climate Bank Act (S. 283, Senator Markey).
1990 (FCRA; 2 U.S.C. §661(a)), credit assistance by the
Details of five selected bills can be seen in Table 1.
bank would be supported by an appropriation that pays the
subsidy cost and federal administrative cost. According to
The REPAIR Act, for example, would create the
FCRA, the subsidy cost is “the estimated long-term cost to
Infrastructure Financing Authority (IFA), a wholly owned
the government of a direct loan or a loan guarantee ...
government corporation, with a $10 billion appropriation
calculated on a net present value basis.” An appropriation
and the ability to collect fees from borrowers. The IFA’s
would leverage larger loan amounts from the U.S. Treasury.
funding would leverage a larger amount from the Treasury.
Assuming a 10% subsidy cost, every $1 appropriated
Because loan repayments go to the Treasury, the IFA would
beyond the amount of administrative costs would enable the
likely require future appropriations. Infrastructure sectors
bank to lend $10 to projects. Loan repayments would go to
supported would include transportation, energy, and water,
the Treasury (not the bank). Alternatively, a bank could
but with the board of directors authorized to modify this
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portfolio. The IFA’s seven directors would be appointed by
the President with advice and consent of the Senate.
Table 1. Selected Infrastructure Bank Bills Introduced in the 117th Congress
H.R. 3339
H.R. 3722
H.R. 4413
H.R. 4446
S. 1499
(Rep. D. Davis)
(Rep. Maloney)
(Rep. DeLauro)
(Rep. Carbajal)
(Sen. Warner)
Name
National
21st Century
National
National
Infrastructure
Infrastructure Bank
American
Infrastructure
Infrastructure
Financing Authority
Infrastructure Bank
Development Bank
Investment
Corporation
Organization
Whol y owned
Whol y owned
Whol y owned
Whol y owned
Whol y owned
type
government
government
government
government
government
corporation
corporation
corporation
corporation
corporation
Governance
25-member board of
Nine-member board
Seven-member board
Seven-member board
Seven-member board
directors appointed
of trustees, all
of directors, all
of directors; three
of directors, all
by President with
appointed by the
appointed by
appointed by
appointed by
advice and consent of
President with the
President with advice
President with advice
President with advice
Senate
advice and consent of
and consent of
and consent of
and consent of
the Senate. Eight to
Senate; President
Senate; four
Senate; President
be chosen from
designates board
appointed by
designates board
candidates selected by chairperson and vice-
congressional leaders
chairperson
congressional leaders
chairperson
Eligible
Transportation,
Transportation,
Transportation,
Transportation,
Transportation,
infrastructure
energy,
energy, water,
energy,
energy,
energy, water; super-
projects
environmental,a
communications,
environmental,a
environmental,
majority of board of
telecommunications
educational facility
telecommunications
telecommunications
directors may modify
affordable housing,
list of eligible project
schools, public
types
recreation, and
libraries
Types of
Loans, loan
Loans, bond
Loans, loan
Loans, loan
Loans, loan
credit
guarantees
guarantee, equity
guarantees, lines of
guarantees
guarantees
assistance
investment
credit
Funding
Sale of capital stock,
$50 bil ion
$25 bil ion
Loans from pension
$10 bil ion
callable capital, may
appropriation, may
appropriation; fees
funds
appropriation; fees
issue own bonds, bank issue own bonds
deposits, fees, $100
mil ion appropriation
for start-up costs
Type of bank
Revolving fund
Revolving fund
Leveraged
Revolving fund
Leveraged
Sources: Congressional Research Service based on H.R. 3339, H.R. 3722, H.R. 4413, H.R. 4446, S. 1499, 117th Congress.
a. “Environmental” includes drinking water and wastewater treatment facilities, stormwater management systems, open-space management
systems, wetland restoration, solid waste disposal facilities, hazardous waste facilities, and industrial site cleanup projects.
IF11608
William J. Mallett, Specialist in Transportation Policy
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National Infrastructure Bank: Proposals in the 117th Congress
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