Summary of H.R. 547 - National Infrastructure Development Bank Act of 2017

This bill proposes the creation of a new National Infrastructure Development Bank to help the United States invest in and improve its infrastructure (things like roads, bridges, water systems, energy, and broadband networks). The bank aims to make it easier and more efficient for public and private sectors to finance infrastructure projects that create jobs and strengthen the economy.

Why is this needed?

• Good infrastructure creates jobs and helps economic growth.
• Many historic projects (like canals, highways, dams) boosted America’s economy in the past.
• The US ranks 11th globally in infrastructure but has many aging systems that received a poor grade ("D+") and need trillions of dollars of investment soon.
• Current government funds are insufficient to meet the growing infrastructure needs.
• Private investors like pension funds and banks want to invest in infrastructure but need a trustworthy institution to partner with.

What will the National Infrastructure Development Bank do?

- The Bank will be a government-owned corporation that provides loans, loan guarantees, and issues special bonds ("Public Benefit Bonds") to fund infrastructure projects across the country.

- It will work with states, local governments, and private partners to finance projects in transportation, energy, environment, and telecommunications.

- It aims to attract private investment by sharing the risk and making projects more financially viable.

How will the Bank be governed?

• It will have a 7-member Board of Directors appointed by the President and confirmed by the Senate.
• Board members must have experience in public sector, private sector, and finance.
• The Board oversees the Bank’s activities, reviews projects, and approves financing decisions.
• The Bank will have three main committees:
  • Executive Committee - handles daily operations and project approvals.
  • Risk Management Committee - manages financial and operational risks.
  • Audit Committee - handles audits and ensures accountability.

What kinds of projects qualify?

Projects must provide a clear public benefit. Purely private projects without public benefits are not eligible. The Bank will prioritize:

• Projects that boost economic growth and create jobs, especially those benefiting disadvantaged communities.
• Transportation projects that reduce traffic, improve safety, and reduce greenhouse gases.
• Environmental projects improving water systems, flood protection, and pollution control.
• Energy projects supporting renewables, energy efficiency, and smart grid technologies.
• Telecommunications projects expanding broadband, especially in rural and poor areas.

Financial Assistance Details

• The Bank can provide direct loans, loan guarantees, and issue bonds to finance projects.
• Financial assistance generally won’t exceed 50% of a project's eligible costs.
• Projects must have dedicated revenue sources to repay loans.
• The Bank will charge reasonable fees and ensure projects meet strict risk and compliance rules.

Special Bond Program - American Infrastructure Bonds

The Bank can support tax-advantaged bonds called American Infrastructure Bonds. The Bank pays a subsidy on interest to issuers of these bonds to make borrowing cheaper for infrastructure projects.

The subsidy is limited by law so the Bank doesn’t overspend and must be approved based on project merits.

Other Important Provisions

• Workforce protections: Workers on funded projects must be paid fair wages per existing federal law (Davis-Bacon Act).
• Buy America rules: Projects receiving funding must primarily use US-produced iron, steel, and manufactured goods, except under limited exceptions.
• Transparency: The Bank must keep records public and allow 30 days for public comments before final financing is approved.
• Auditing and Reporting: The Bank will have annual audits and report yearly to Congress and the President about its activities and project progress.
• Tax exemption: Bonds issued by the Bank will be exempt from state and local taxes.

Funding for the Bank

The bill authorizes $5 billion annually from 2017 to 2021 to capitalize the Bank, with limited amounts set aside for administrative costs.

In Summary

This bill sets up a government-owned Infrastructure Bank to better manage and finance important infrastructure projects across the US by combining public funds, private investments, and bond issuance. It expects to accelerate infrastructure improvements, create jobs, support economic growth, protect the environment, and improve public services like transportation, water, energy, and communication.