We can do better than 'C-' infrastructure: Here's how to fund it

We can do better than 'C-' infrastructure: Here's how to fund it
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Despite division on almost everything, there is bipartisan consensus that America’s infrastructure needs a major upgrade and needs it now. A report card issued this spring from the American Society of Civil Engineers scored our nation’s infrastructure a “C minus” and called for an additional $2.6 trillion in funding over the next decade to fix the deficiencies. 

The talk of the town in Washington, DC is infrastructure. A bipartisan infrastructure bill being negotiated by Congress is one of the most-watched pieces of legislation in years. Unfortunately, politics is getting in the way, again. How to fund the bill’s nearly $1.2 trillion price tag has gotten bogged down in the usual gridlock. 

As mayors, we ran our cities with two goals in mind: make our communities more livable and make it easier to get around. But like state and federal governments, mayors work with limited budgets and must think outside the box when it comes to funding infrastructure improvements in their cities. Last week, 369 Mayors signed a letter to Congress urging immediate action on the issue.

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We should apply those same principles to our infrastructure needs. We may come from different political parties, but we believe the opportunity is ripe for federal and local governments to collaborate with the private sector on effective financing solutions. Public-private partnerships (P3s) are an ideal means to unlock substantial capital for new infrastructure projects.

San Francisco’s Golden Gate Bridge is perhaps the most recognizable P3, constructed during the throes of the Great Depression when the federal funds and tax base were simply insufficient for a project of this magnitude.

Right now, Congress and the White House agree that P3s offer a funding source to cover some of the infrastructure price tag. In a fact sheet issued by the Biden administration, P3s, including private activity bonds, direct pay bonds and asset recycling for infrastructure investment, are included under the proposed financing sources. What a great start.

P3s work by creating long-term leases for qualified operators to manage and maintain infrastructure assets. The deals are designed to incentivize the private operators to pick up the tab for the repair and maintenance of existing infrastructure, as well as build new projects, leveraging expertise government officials simply do not have.

The government and taxpayers are never responsible for the debt incurred by the partnership in developing a project like a highway. The state and taxpayers are fully protected, and the roadway always remains state-owned.

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The result of these deals are valuable new revenue streams for federal, state and local governments, and infrastructure better managed by those who do it for a living and know how to do it well — and who have a greater incentive to build a project on time. After all, their money is on the line.

Local governments have recently started entering “lease, don’t sell models” allowing them to rehab current assets using P3s, generating revenue for their municipalities and citizens while not being responsible for the costs and upkeep. It’s a true win-win. 

It is not just roads and bridges that are in desperate need of repair and new construction. Public schools and buildings, housing, seaports, airports and increasing access to high-speed broadband are all a major part of our nation’s infrastructure needs. Funding these critical projects are no small task and should not have to rely solely on tax increases and new borrowing. Time is of the essence and the private sector is ready to step up and help. Congress should do their part to support the integrity of America’s infrastructure now. 

We were pleased to see P3s included in the list of funding sources agreed upon by the White House and a bipartisan coalition of senators last month. If anything can stay above the partisan rancor, it should be a commonsense funding source like P3s. We are hopeful they will.

Mick Cornett is a Republican who served as the 35th mayor of Oklahoma City from 2005 to 2018.

Michael Nutter is a Democrat who served as the 98th mayor of Philadelphia from 2008 to 2016.

They are the co-chairs of the bipartisan “Let’s Build Infrastructure” coalition.