Infrastructure’s Death by a Thousand Cuts, its Rebirth by Bonds, Ballots, and Partnerships
America spent $416 billion on transportation and water infrastructure last year—three quarters of which came directly from state and local governments—and billions more when investments in energy and public buildings and the value of federal tax subsidies for municipal bonds are factored in. Yet even with these massive dollar figures, we are still not doing enough to deliver the infrastructure the nation needs to create more equitable, resilient, and economically vibrant communities.
There is no single reason for America’s failure to invest in its infrastructure. It’s a story of death by a thousand cuts—declining federal dollars, political dysfunction, high levels of state and local debt, the age of our assets, a growing population, hangovers from the Great Recession, and a multitude of other smaller issues—that have left us bereft of sufficient support. No one level of government or program is responsible for America’s infrastructure, and there is no single approach that will get us back on track. It will take a broad range of initiatives at the federal, state, and local level, as well as increased involvement from the private sector, to fill in America’s massive infrastructure investment gap.
When viewed more broadly in this way, the signs are encouraging. Across the country, a number of new institutions, tools, and programs are emerging. Even in Washington, where major national programs like the Highway Trust Fund remain in limbo, there is a push to give cities and states access to flexible lending programs through new bond tools, including qualified public infrastructure bonds, and loan programs under the Water Infrastructure Finance and Innovation Act. States and localities are stepping up with ballot initiatives and legislative moves to generate new revenue at the gas pump and through sales taxes to support efforts like public transportation expansions (Atlanta), road investments (Wyoming), and a $7.6 billion water bond (California).
Yet one of the biggest trends across all levels of government isn’t in developing new financial tools or generating new revenue—it’s enhancing the public sector’s capacity to work with the private sector to design, build, finance, operate, and maintain infrastructure assets. While specific approaches vary, efforts like the Chicago Infrastructure Trust, the West Coast Infrastructure Exchange, Virginia’s Office of Transportation Public-Private Partnerships, and the Obama Administration’s Build America Transportation Investment Center are working to get more private capital into public projects.
None of these efforts alone can solve America’s multitude of infrastructure challenges. Rebuilding and renewing economically critical roads, water treatment facilities, ports, airports, public buildings, and transit systems will require unprecedented cooperation between all levels of government and the private sector. While significant progress has yet to be made, pockets of innovation across the United States are paving the way for the next generation of American infrastructure investment.