I 

112TH CONGRESS 

2D SESSION H. R. 3793 

To establish State infrastructure banks for education. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 18, 2012 

Mr. SHULER introduced the following bill; which was referred to the 

Committee on Education and the Workforce 

A BILL 

To establish State infrastructure banks for education. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Investing for Tomor5 row’s Schools Act of 2012’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds the following: 

8 (1) According to the National Center for Edu9 cation Statistics, an estimated $127 billion in school 

10 repair, modernization, expansion, and construction is 

11 needed. 


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1 (2) A 2011 survey of 50 major city school sys2 tems conducted by the Council of the Great City 

3 Schools indicates that they have approximately 

4 $15.3 billion in new construction needs; $46.7 billion 

5 in repair, renovation, and modernization needs; and 

6 $14.4 billion in deferred maintenance needs, which 

7 amounts to about $76.5 billion or approximately 

8 $8.9 million per school, including new school con9 struction. 

10 (3) Nearly 90 percent of all 55.5 million school11 age children in the United States attend public 

12 schools. Approximately 14 million students attend 

13 schools which report the need for extensive repair or 

14 replacement of one or more buildings. 

15 (4) Academic research has proven a direct cor16 relation between the condition of school facilities and 

17 student achievement. Researchers have found that 

18 students assigned to schools in poor conditions can 

19 be expected to fall 10.9 percentage points behind 

20 those in buildings in excellent condition. Similar 

21 studies have demonstrated up to a 20-percent im22 provement in test scores when students were moved 

23 from a poor facility to a new facility. Some schools 

24 report students missing 4 days annually due to 


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1 health problems caused by adverse building condi2 tions. 

3 (5) Large numbers of local educational agencies 

4 have difficulties securing financing for school facility 

5 improvement. Some of the deepest reductions to K– 

6 12 formula funding since the onset of the recession 

7 have occurred in the past year, and a majority of 

8 States have cut per-student educational funding. On 

9 average, some 47 percent of total education expendi10 tures in the United States come from State funds. 

11 (6) Local educational agencies manage over 1 

12 million acres of school building site area, with an es13 timated 6.6 billion gross square feet of public school 

14 building space. 

15 (7) Local educational agencies have an esti16 mated $271 billion of deferred building and grounds 

17 maintenance in their schools, excluding administra18 tive facilities, which averages $4,883 per student. 

19 (8) Schools that implement energy-saving strat20 egies, including following green building design and 

21 using energy-efficient building components, can re22 duce energy use by as much as one-third, resulting 

23 in major environmental and cost-savings benefits. 

24 (9) In 2010, the educational facilities construc25 tion market was estimated at $50 billion. 


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1 (10) Educating America’s future workforce in 

2 schools and libraries equipped for the 21st century 

3 is important for the United States competitive posi4 tion within the world economy. 

5 SEC. 3. STATE INFRASTRUCTURE BANK PILOT PROGRAM. 

6 (a) ESTABLISHMENT.— 

7 (1) COOPERATIVE AGREEMENTS.—Subject to 

8 the provisions of this section, the Secretary of the 

9 Treasury, in consultation with the Secretary of Edu10 cation, may enter into cooperative agreements with 

11 States for the establishment of State infrastructure 

12 banks and multistate infrastructure banks for mak13 ing loans— 

14 (A) to local educational agencies for build15 ing or repairing elementary or secondary 

16 schools which provide free public education (as 

17 such terms are defined in section 14101 of the 

18 Elementary and Secondary Education Act of 

19 1965 (20 U.S.C. 8801)); 

20 (B) to public libraries for building or re21 pairing library facilities; and 

22 (C) to eligible charter school entities for 

23 use for the objective described in section 

24 5224(2) of such Act (20 U.S.C. 7223c(2)) conVerDate Mar 15 2010 03:45 Jan 19, 2012 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3793.IH H3793

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1 sistent with subpart 2 of part B of title V of 

2 such Act (20 U.S.C. 7223 et seq.). 

3 (2) INTERSTATE COMPACTS.—Congress grants 

4 consent to two or more of the States, entering into 

5 a cooperative agreement under paragraph (1) with 

6 the Secretary of the Treasury for the establishment 

7 of a multistate infrastructure bank, to enter into an 

8 interstate compact establishing such bank in accord9 ance with this section. 

10 (b) FUNDING.—The Secretary of the Treasury, in 

11 consultation with the Secretary of Education, shall make 

12 grants to State infrastructure banks and multistate infra13 structure banks in a State in a cooperative agreement 

14 under subsection (a)(1) to provide initial capital for loans 

15 provided under this section. Each bank shall apply repay16 ments of principal and interest on loans to the making 

17 of additional loans. The Secretary shall take final action 

18 on an application for a grant under this subsection within 

19 90 days of the date of the submission of such application. 

20 (c) INFRASTRUCTURE BANK REQUIREMENTS.—In 

21 order to establish an infrastructure bank under this sec22 tion, each State establishing the bank shall— 

23 (1) contribute, at a minimum, in each account 

24 of the bank from non-Federal sources an amount 

25 equal to 25 percent of the amount of each capitalizaVerDate Mar 15 2010 03:45 Jan 19, 2012 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3793.IH H3793

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1 tion grant made to the State and contributed to the 

2 bank under subsection (b); 

3 (2) identify an operating entity of the State as 

4 recipient of the grant if the entity has the capacity 

5 to manage loan funds and issue debt instruments of 

6 the State for purposes of leveraging the funds; 

7 (3) allow such funds to be used as reserve for 

8 debt issued by the State so long as proceeds are de9 posited in the fund for loan purposes; 

10 (4) ensure that investment income generated by 

11 funds contributed to an account of the bank will 

12 be— 

13 (A) credited to the account; 

14 (B) available for use in providing loans to 

15 projects eligible for assistance from the account; 

16 and 

17 (C) invested in United States Treasury se18 curities, bank deposits, or such other financing 

19 instruments as the Secretary may approve to 

20 earn interest to enhance the leveraging of 

21 projects assisted by the bank; 

22 (5) ensure that any loan from the bank to a 

23 local educational agency or public library will bear 

24 interest at or below the lowest interest rates being 

25 offered for bonds the income from which is exempt 


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1 from Federal taxation, as determined by the State, 

2 to make the project that is the subject of the loan 

3 feasible; 

4 (6) ensure that repayment of any loan from the 

5 bank to a local educational agency or public library 

6 will commence not later than 1 year after the project 

7 has been completed; 

8 (7) ensure that the term for repaying any loan 

9 to a local educational agency or public library will 

10 not exceed 30 years after the date of the first pay11 ment on the loan under paragraph (5); 

12 (8) ensure that the funds loaned annually that 

13 are used under subsection (a)(1)(C) are limited to a 

14 percentage of the total funds loaned that does not 

15 exceed the percentage of elementary and secondary 

16 school students in the State enrolled in charter 

17 schools during the most recent school year for which 

18 enrollment data are available; and 

19 (9) require the bank to make an annual report 

20 to the Secretary on its status and make such other 

21 reports as the Secretary may require by guidelines. 

22 (d) FORMS OF ASSISTANCE FROM INFRASTRUCTURE

23 BANKS.— 

24 (1) IN GENERAL.—An infrastructure bank es25 tablished under this section may make loans in an 


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1 amount equal to all or part of the cost of carrying 

2 out a project eligible for assistance under this sec3 tion. 

4 (2) APPLICATIONS FOR LOANS.—An application 

5 to an infrastructure bank for a loan shall include— 

6 (A) in the case of a renovation project, a 

7 description of each architectural, civil, struc8 tural, mechanical, or electrical deficiency to be 

9 corrected with funds under a loan and the pri10 orities to be applied; 

11 (B) a description of the criteria used by 

12 the applicant to determine the type of corrective 

13 action necessary for the renovation of a facility; 

14 (C) a description of improvements to be 

15 made and a cost estimate for the improvements; 

16 (D) a description of how work undertaken 

17 with the loan will promote energy conservation; 

18 and 

19 (E) such other information as the infra20 structure bank may require. 

21 An infrastructure bank shall take final action on a 

22 completed application submitted to it within 90 days 

23 after the date of its submission. 

24 (3) CRITERIA FOR LOANS.—In considering ap25 plications for a loan to a local educational agency or 


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1 a public library an infrastructure bank shall con2 sider— 

3 (A) the extent to which the local edu4 cational agency or public library involved lacks 

5 the fiscal capacity, including the ability to raise 

6 funds through the full use of such agency’s 

7 bonding capacity and otherwise, to undertake 

8 the project for which the loan would be used 

9 without the loan; 

10 (B) in the case of a local educational agen11 cy, the threat that the condition of the physical 

12 plant in the project poses to the safety and 

13 well-being of students; 

14 (C) the demonstrated need for the con15 struction, reconstruction, or renovation based 

16 on the condition of the facility in the project; 

17 and 

18 (D) the age of such facility. 

19 (e) CERTAIN QUALIFYING PROJECTS.— 

20 (1) IN GENERAL.—A project is eligible for a 

21 loan to a local educational agency or public libraries 

22 from an infrastructure bank if it is a project that 

23 consists of— 


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1 (A) the construction of new elementary or 

2 secondary schools to meet the needs imposed by 

3 enrollment growth; 

4 (B) the repair or upgrading of classrooms 

5 or structures related to academic learning, in6 cluding the repair of leaking roofs, crumbling 

7 walls, inadequate plumbing, poor ventilation 

8 equipment, and inadequate heating or light 

9 equipment; 

10 (C) an activity to increase physical safety 

11 at the educational facility involved; 

12 (D) an activity to enhance the educational 

13 facility involved to provide access for students, 

14 teachers, and other individuals with disabilities; 

15 (E) an activity to address environmental 

16 hazards at the educational facility involved, 

17 such as poor ventilation, indoor air quality, or 

18 lighting; 

19 (F) the provision of basic infrastructure 

20 that facilitates educational technology, such as 

21 communications outlets, electrical systems, 

22 power outlets, or a communication closet; 

23 (G) work that will bring an educational fa24 cility into conformity with the requirements 

25 of— 


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1 (i) environmental protection or health 

2 and safety programs mandated by Federal, 

3 State, or local law if such requirements 

4 were not in effect when the facility was ini5 tially constructed; and 

6 (ii) hazardous waste disposal, treat7 ment, and storage requirements mandated 

8 by the Resource Conservation and Recov9 ery Act of 1976 or similar State laws; 

10 (H) work that will enable efficient use of 

11 available energy resources, especially coal, solar 

12 power, and other renewable energy resources; 

13 (I) work to detect, remove, or otherwise 

14 contain asbestos hazards in educational facili15 ties; or 

16 (J) work to construct new public library 

17 facilities or repair or upgrade existing public li18 brary facilities. 

19 (2) DAVIS-BACON.—The wage requirements of 

20 the Act of March 3, 1931 (referred to as the ‘‘Davis21 Bacon Act’’, 40 U.S.C. 276a et seq.) shall apply 

22 with respect to individuals employed on the projects 

23 described in paragraph (1). 

24 (3) GREEN PRACTICES.—An entity using a loan 

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1 ovation project described in paragraph (1) shall en2 sure that the project uses, to the maximum extent 

3 practicable, green practices that are certified, 

4 verified, or consistent with any applicable provisions 

5 of— 

6 (A) the LEED Green Building Rating Sys7 tem; 

8 (B) Energy Star; 

9 (C) the CHPS Criteria; 

10 (D) Green Globes; or 

11 (E) an equivalent program adopted by the 

12 State or another jurisdiction with authority over 

13 the entity. 

14 (f) SUPPLEMENTATION.—Any loan made by an infra15 structure bank shall be used to supplement and not sup16 plant other Federal, State, and local funds available. 

17 (g) LIMITATION ON REPAYMENTS.—Notwithstanding 

18 any other provision of law, the repayment of a loan from 

19 an infrastructure bank under this section may not be cred20 ited towards the non-Federal share of the cost of any 

21 project. 

22 (h) SECRETARIAL REQUIREMENTS.—In admin23 istering this section, the Secretary of the Treasury shall 

24 specify procedures and guidelines for establishing, operVerDate Mar 15 2010 03:45 Jan 19, 2012 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H3793.IH H3793

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1 ating, and providing assistance from an infrastructure 

2 bank. 

3 (i) UNITED STATES NOT OBLIGATED.—The con4 tribution of Federal funds into an infrastructure bank es5 tablished under this section shall not be construed as a 

6 commitment, guarantee, or obligation on the part of the 

7 United States to any third party, nor shall any third party 

8 have any right against the United States for payment sole9 ly by virtue of the contribution. Any security or debt fi10 nancing instrument issued by the infrastructure bank 

11 shall expressly state that the security or instrument does 

12 not constitute a commitment, guarantee, or obligation of 

13 the United States. 

14 (j) MANAGEMENT OF FEDERAL FUNDS.—Sections 

15 3335 and 6503 of title 31, United States Code, shall not 

16 apply to funds contributed under this section. 

17 (k) PROGRAM ADMINISTRATION.—For each of fiscal 

18 years 2013 through 2017, a State may expend not to ex19 ceed 2 percent of the Federal funds contributed to an in20 frastructure bank established by the State under this sec21 tion to pay the reasonable costs of administering the bank. 

22 (l) SECRETARIAL REVIEW.—The Secretary of the 

23 Treasury shall review the financial condition of each infra24 structure bank established under this section and transmit 


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1 to Congress a report on the results of such review not later 

2 than 90 days after the completion of the review. 

3 (m) AUTHORIZATION OF APPROPRIATIONS.—For 

4 grants to States for the initial capitalization of infrastruc5 ture banks there are authorized to be appropriated 

6 $500,000,000 for fiscal year 2013 and for each of the 4 

7 succeeding fiscal years. 

8 SEC. 4. DEFINITIONS. 

9 For purposes of this Act: 

10 (1) ELIGIBLE CHARTER SCHOOL ENTITY.—The 

11 term ‘‘eligible charter school entity’’ means— 

12 (A) a charter school (as defined in section 

13 5210 of the Elementary and Secondary Edu14 cation Act of 1965 (20 U.S.C. 7221i)); or 

15 (B) a developer (as so defined) that has 

16 applied to an authorized public chartering agen17 cy (as so defined) to operate a charter school. 

18 (2) LOCAL EDUCATIONAL AGENCY.—(A) The 

19 term ‘‘local educational agency’’ means a public 

20 board of education or other public authority legally 

21 constituted within a State for either administrative 

22 control or direction of, or to perform a service func23 tion for, public elementary or secondary schools in a 

24 city, county, township, school district, or other polit25 ical subdivision of a State, or for such combination 


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1 of school districts or counties as are recognized in a 

2 State as an administrative agency for its public ele3 mentary or secondary schools. 

4 (B) The term includes any other public institu5 tion or agency having administrative control and di6 rection of a public elementary or secondary school. 

7 (C) The term includes an elementary or sec8 ondary school funded by the Bureau of Indian Af9 fairs but only to the extent that such inclusion 

10 makes such school eligible for programs for which 

11 specific eligibility is not provided to such school in 

12 another provision of law and such school does not 

13 have a student population that is smaller than the 

14 student population of the local educational agency 

15 receiving assistance under this Act with the smallest 

16 student population, except that such school shall not 

17 be subject to the jurisdiction of any State edu18 cational agency other than the Bureau of Indian Af19 fairs. 

20 (3) OUTLYING AREA.—The term ‘‘outlying 

21 area’’ means the Virgin Islands, Guam, American 

22 Samoa, the Commonwealth of the Northern Mariana 

23 Islands, the Republic of the Marshall Islands, the 

24 Federated States of Micronesia, and the Republic of 

25 Palau. 


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1 (4) PUBLIC LIBRARY.—The term ‘‘public li2 brary’’ means a library that serves free of charge all 

3 residents of a community, district, or region, and re4 ceives its financial support in whole or in part from 

5 public funds. Such term also includes a research li6 brary, which, for the purposes of this sentence, 

7 means a library that— 

8 (A) makes its services available to the pub9 lic free of charge; 

10 (B) has extensive collections of books, 

11 manuscripts, and other materials suitable for 

12 scholarly research which are not available to the 

13 public through public libraries; 

14 (C) engages in the dissemination of hu15 manistic knowledge through services to readers, 

16 fellowships, educational and cultural programs, 

17 publication of significant research, and other 

18 activities; and 

19 (D) is not an integral part of an institu20 tion of higher education. 

21 (5) STATE.—The term ‘‘State’’ means each of 

22 the 50 States, the District of Columbia, the Com23 monwealth of Puerto Rico, and each of the outlying 

24 areas. 

Æ 


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