II

104TH CONGRESS

1ST SESSION S. 775

To amend title 23, United States Code, to provide for the designation of

the National Highway System, the establishment of certain financing

improvements, and the creation of State infrastructure banks, and for

other purposes.

IN THE SENATE OF THE UNITED STATES

MAY 9 (legislative day, MAY 1), 1995

Mr. BAUCUS (by request) introduced the following bill; which was read twice

and referred to the Committee on Environment and Public Works

A BILL

To amend title 23, United States Code, to provide for the

designation of the National Highway System, the establishment of certain financing improvements, and the

creation of State infrastructure banks, and for other

purposes.

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

3 SECTION 101. SHORT TITLE.

4 This Act may be cited as the ‘‘National Highway

5 System Designation Act of 1995’’.
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1 SEC. 102. NATIONAL HIGHWAY SYSTEM DESIGNATION.

2 Section 103 of title 23, United States Code, is

3 amended by inserting after subsection (b) the following:

4 ‘‘(c) NATIONAL HIGHWAY SYSTEM DESIGNATION.—

5 ‘‘(1) DESIGNATION.—The most recent National

6 Highway System (as of the date of enactment of this

7 Act) as submitted by the Secretary of Transpor8 tation pursuant to this section is designated as the

9 National Highway System.

10 ‘‘(2) MODIFICATIONS.—

11 ‘‘(A) IN GENERAL.—At the request of a

12 State, the Secretary may—

13 ‘‘(i) add a new route segment to the

14 National Highway System; or

15 ‘‘(ii) delete a route segment in exist16 ence on the date of the request;

17 if the total mileage of the National Highway

18 System (including any route segment proposed

19 to be added under this subparagraph) does not

20 exceed 168,000 miles (270,480 kilometers).

21 ‘‘(B) PROCEDURES FOR CHANGES RE22 QUESTED BY STATES.—Each State that makes

23 a request for a change in the National Highway

24 System pursuant to subparagraph (A) shall es25 tablish that each change in a route segment re26 ferred to in the subparagraph has been identi-
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1 fied by the State, in cooperation with local offi2 cials, pursuant to applicable transportation

3 planning activities for metropolitan areas car4 ried out under section 134 of this title and

5 statewide planning processes carried out under

6 section 135 of this title.

7 ‘‘(3) APPROVAL BY THE SECRETARY.—The Sec8 retary may approve a request made by a State for

9 a change in the National Highway System pursuant

10 to paragraph (2) if the Secretary determines that

11 the change—

12 ‘‘(A) meets the criteria established for the

13 National Highway System under this title; and

14 ‘‘(B) enhances the national transportation

15 characteristics of the National Highway Sys16 tem.’’.

17 SEC. 201. SHORT TITLE.

18 This title may be cited as the ‘‘Financing Improve19 ment Act of 1995’’.

20 SEC. 202. LIMITATION ON ADVANCE CONSTRUCTION.

21 Section 115(d) of title 23, United States Code, is

22 amended to read as follows:

23 ‘‘(d) LIMITATION ON ADVANCED FUNDING.—Sec24 retary may not approve an application under this section

25 unless the project is included in the State’s transportation
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1 improvement program in accordance with section 135 of

2 this title.’’.

3 SEC. 203. PAYMENT TO STATES FOR CONSTRUCTION,

4 FLEXIBLE TAPERED SHARE.

5 (a) STATE MATCHING SHARE.—Section 120 of title

6 23, United States Code, is amended by adding the follow7 ing new subsection:

8 ‘‘(j) USE OF OTHER FEDERAL FUNDING.—Notwith9 standing any other provision of this title, a State may use

10 Federal funds from sources other than this title to meet

11 the non-Federal share of a project under this title.’’.

12 (b) PAYMENTS.—Section 121(a) of title 23, United

13 States Code, is amended to read as follows:

14 ‘‘(a) The Secretary may in his discretion, from time

15 to time, make payments to a State for costs of construc16 tion incurred by the State on a project. The Federal share

17 may vary during the life of a project, but at no time shall

18 such share exceed the Federal share payable under sec19 tions 106(c), 120, and 130 of this title.’’.

20 (c) CONFORMING AMENDMENT.—Section 121(d) of

21 such title is amended as follows:

22 ‘‘(d) In making final payment pursuant to this sec23 tion, the Secretary shall be bound by the limitations with

24 respect to the permissible amounts of such payment con25 tained in sections 106(c), 120, and 130 of this title.’’.
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1 SEC. 204. TOLL ROADS, BRIDGES, TUNNELS, NON-TOLL

2 ROADS THAT HAVE A DEDICATED REVENUE

3 SOURCE, AND FERRIES.

4 Section 129 of title 23, United States Code, is

5 amended—

6 (1) by revising the title to read as follows:

7 ‘‘§ 129. Toll roads, bridges, tunnels, non-toll roads

8 that have a dedicated revenue source,

9 and ferries’’;

10 and

11 (2) by revising paragraph 129(a)(7) to read as

12 follows:

13 ‘‘(7) LOANS.—

14 ‘‘(A) IN GENERAL.—A State may loan an

15 amount equal to all or part of the Federal share

16 of a toll project or a non-toll project that has

17 a dedicated revenue source, specifically dedi18 cated to such project or projects under this sec19 tion, to a public entity constructing or propos20 ing to construct a toll facility or non-toll facility

21 with a dedicated revenue source. Dedicated rev22 enue sources for non-toll facilities include: ex23 cise taxes, sales taxes, motor vehicle use fees,

24 tax on real property, tax increment financing,

25 or such other dedicated revenue source as the

26 Secretary deems appropriate.
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1 ‘‘(B) COMPLIANCE WITH FEDERAL

2 LAWS.—As a condition of receiving a loan

3 under this paragraph, the public or private en4 tity that receives the loan shall ensure that the

5 qualifying project complies with the require6 ments of this title and any other applicable

7 Federal law, including any applicable provision

8 of Federal environmental laws.

9 ‘‘(C) SUBORDINATION OF DEBT.—The

10 amount of any loan received for a qualifying

11 project under this paragraph may be subordi12 nated to any other debt financing for the

13 project.

14 ‘‘(D) OBLIGATION OF FUNDS LOANED.—

15 Funds loaned pursuant to this paragraph may

16 be obligated for qualifying projects.

17 ‘‘(E) REPAYMENT.—The repayment of a

18 loan made pursuant to this paragraph shall

19 commence not later than 5 years after the facil20 ity that is the subject of the loan is open to

21 traffic.

22 ‘‘(F) TERM OF LOAN.—The term of a loan

23 to a public or private entity shall not exceed 30

24 years from the time the loan was obligated.
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1 ‘‘(G) INTEREST.—A loan made pursuant

2 to this paragraph shall bear interest at or below

3 market interest rates, as determined by the

4 State to make the qualifying project that is the

5 subject of the loan feasible.

6 ‘‘(H) REUSE OF FUNDS.—Amounts repaid

7 to a State from a loan made under this para8 graph may be obligated—

9 ‘‘(i) for any purpose for which the

10 loan funds were available under title 23,

11 United States Code, or Public Law 102–

12 240; and

13 ‘‘(ii) for the purchase of insurance or

14 for use as a capital reserve for other forms

15 of credit enhancement for project debt in

16 order to improve credit market access or to

17 lower interest rates.

18 ‘‘(I) GUIDELINES.—The Secretary shall es19 tablish procedures and guidelines for making

20 loans pursuant to this paragraph.’’.

21 SEC. 205. STATE HIGHWAY DEPARTMENT.

22 Section 302 of title 23, United States Code is amend23 ed to read as follows:
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1 ‘‘§ 302. State highway department

2 ‘‘Any State desiring to avail itself of the provisions

3 of this title shall have a State highway department which

4 shall have adequate powers, and shall be suitably equipped

5 and organized to discharge, to the satisfaction of the Sec6 retary, the duties required by this title. This section does

7 not restrict the eligibility of costs that may be claimed by

8 a State nor limit a State’s authority to engage the services

9 of private professional firms.’’.

10 SEC. 206. DONATION OF PRIVATE FUNDS, ASSETS, AND PUB11 LICLY OWNED RIGHT-OF-WAY FOR FEDERAL12 AID PROJECTS.

13 Section 323 of title 23, United States Code, relating

14 to donations, is amended—

15 (1) by redesignating subsection (c) as sub16 section (d);

17 (2) by inserting after subsection (b) the follow18 ing new subsection:

19 ‘‘(c) CREDIT FOR DONATION OF PRIVATE FUNDS,

20 ASSETS, AND PUBLICLY OWNED RIGHT-OF-WAY.—Noth21 ing in this title, or in any other provision of law should

22 be construed to prevent a person from donating private

23 funds or assets, or a State, county, city, or other political

24 subdivision of a State from donating publicly owned right25 of-way, in connection with a specific project constructed

26 under this title. The State matching share for a project
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1 with respect to which Federal assistance is provided may

2 be credited by the amount of the donated funds or the

3 fair market value of publicly owned right-of-way incor4 porated into the project by the State highway agency

5 under this title.’’; and

6 (3) by amending the first sentence of subsection

7 (d), as so redesignated, to read as follows:

8 ‘‘(d) PROCEDURES.—A gift or donation in accordance

9 with the above subsections may be made at any time dur10 ing the development of a project.’’.

11 SEC. 301. SHORT TITLE.

12 This title may be cited as the ‘‘State Infrastructure

13 Bank Financing Improvement Act of 1995’’.

14 SEC. 302. STATE INFRASTRUCTURE BANKS

15 NEW PROGRAM.—Chapter 1 of title 23, United

16 States Code, is amended by adding at the end thereof the

17 following new section:

18 ‘‘§ . State Infrastructure Banks

19 ‘‘(a) IN GENERAL.—Subject to the requirements of

20 this section, a State may establish a State Infrastructure

21 Bank for making loans and providing other assistance to

22 public or private entities constructing or proposing to con23 struct or initiate transportation projects, programs, or ac24 tivities that are eligible to receive assistance under this
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1 title or under Public Law 102–240, (hereafter also re2 ferred to in this section as a ‘qualifying project’).

3 ‘‘(b) DEPOSITS.—Notwithstanding any other provi4 sion of law, a State may deposit up to 15 percent of its

5 apportionments under section 104(b) and 144 for each re6 spective apportionment category under those sections, ex7 cept for Interstate construction, and up to 15 percent of

8 its allocation under section 157 of this title, after such

9 apportionment or allocation for the fiscal year, into a

10 State Infrastructure Bank, not later than 120 days after

11 the date of apportionment or allocation of such funds and

12 distribution of obligation limitation to the States by the

13 Secretary. The deposit into a State Infrastructure Bank

14 of any apportionment under section 104(b)(3) of this title

15 shall be derived from the State’s statewide flexible surface

16 transportation program apportionment, unless the appro17 priate metropolitan planning organization agrees that

18 urban or rural funds may be used. Federal disbursements

19 of capital reserves shall be at a rate consistent with the

20 Federal-aid highway program. A State may assign, trans21 fer, or loan to another State’s Infrastructure Bank, or to

22 multi-State compact or entity, that establishes a State In23 frastructure Bank, not more than the amount which a

24 State is otherwise entitled to deposit into its State Infra25 structure Bank.
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1 ‘‘(c) CONSULTATION WITH MPOs.—A State shall

2 consult with metropolitan planning organizations with re3 gard to the programming of any State Infrastructure

4 Bank projects.

5 ‘‘(d) APPLICABILITY OF CASH MANAGEMENT RE6 QUIREMENTS.—For funds used as a capital reserve, sec7 tions 3335 and 6503 of title 31, United States Code, shall

8 not apply to this section.

9 ‘‘(e) MATCHING REQUIREMENTS.—A State is re10 quired to deposit into the transportation infrastructure

11 bank, from non-Federal or Federal sources other than title

12 23, United States Code, an amount equal to the propor13 tional non-Federal share that a State would otherwise pay

14 on the basis of section 120(b) of this title.

15 ‘‘(f) INVESTMENT INCOME.—Temporary investment

16 income generated by the funds deposited into a transpor17 tation infrastructure bank shall be—

18 ‘‘(1) credited to the transportation infrastruc19 ture bank;

20 ‘‘(2) available for use in providing loans and

21 other assistance to qualifying projects, programs, or

22 activities from the transportation infrastructure

23 bank; and

24 ‘‘(3) invested in United States Treasury securi25 ties, bank deposits, or such other financing instru-
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1 ments as the Secretary may provide to earn interest

2 to enhance the leveraging of qualifying transpor3 tation activities.

4 ‘‘(g) TREATMENT OF FEDERAL DEPOSITS.—The de5 posit of Federal apportionments into a State Infrastruc6 ture Bank shall not be construed as a commitment, guar7 antee, or obligation on the part of the United States to

8 any third party, nor shall any third party have any right

9 against the United States for payment solely by virtue of

10 the deposit. Furthermore, any security or debt financing

11 instrument issued by a State Infrastructure Bank shall

12 expressly state that the security or instrument does not

13 constitute a commitment, guarantee, or obligation of the

14 United States.

15 ‘‘(h) LOANS AND OTHER ASSISTANCE.—

16 ‘‘(1) GENERAL AUTHORITY.—From amounts

17 deposited into a transportation infrastructure bank

18 established by a State or multi-State entity under

19 this section, a State or multi-State entity may loan

20 to a public or private entity, an amount equal to all

21 or part of the cost of construction or capital cost of

22 a qualifying transportation project eligible for fund23 ing under this section.

24 ‘‘(2) SUBORDINATION OF DEBT.—The amount

25 of any loan or other assistance received for a quali-
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1 fying project under this paragraph may be subordi2 nated to any other debt financing for the project.

3 ‘‘(3) REPAYMENT.—The repayment of any loan

4 from a State transportation infrastructure bank

5 shall commence not later than 5 years after the fa6 cility has opened to traffic or the project, activity or

7 facility has been completed.

8 ‘‘(4) TERM OF LOAN.—The term for repaying

9 such loan shall not exceed 30 years from the date

10 of obligation of the loan.

11 ‘‘(5) INTEREST.—Any loan from a State Infra12 structure Bank shall bear interest as the State de13 termines appropriate to make the qualifying project

14 feasible.

15 ‘‘(6) REUSE OF FUNDS.—The repayment of a

16 loan or other assistance to a State from any loan

17 under this section may be credited to the transpor18 tation infrastructure bank or obligated for any pur19 pose for which the loaned funds were available under

20 this title.

21 ‘‘(7) PROCEDURES AND GUIDELINES.—The

22 Secretary shall establish procedures and guidelines

23 for establishing, operating, and making loans from a

24 State Infrastructure Bank.
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1 ‘‘(8) DEFINITION OF OTHER ASSISTANCE.—For

2 purposes of this section, the term ‘other assistance’

3 includes any use of funds for the purpose of credit

4 enhancements, use as a capital reserve for bond or

5 debt instrument financing, bond or debt instrument

6 financing issuance costs, bond or debt issuance fi7 nancing insurance, subsidizing of interest rates, let8 ters of credit, credit instruments, bond or debt fi9 nancing instrument security, and other forms of

10 debt financing that relate to the qualifying project.

11 ‘‘(9) ADMINISTRATIVE COSTS.—For each fiscal

12 year, a State may use an amount not to exceed two

13 percent of the Federal funds deposited into a State

14 Infrastructure Bank to provide for the reasonable

15 costs of administering such fund.

16 ‘‘(10) ANNUAL REPORTS.—A State or multi17 State entity that establishes a transportation infra18 structure bank is required to make an annual report

19 to the Secretary on its status no later than Septem20 ber 30 of each year.

21 ‘‘(11) CONTINUING FEDERAL DEPOSITS.—As a

22 condition of receiving continuing Federal deposits

23 into a transportation infrastructure bank, a State or

24 multi-State entity must maintain an investment

25 grade rating on its debt issuances or have a suffi-
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1 cient level of bond or debt financing instrument in2 surance to maintain the viability of the fund and

3 must have filed its annual report with the Sec4 retary.’’.

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