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‘‘(2) AVAILABILITY.—Amounts authorized under 
this section for a fiscal year shall be available for ob-
ligation on October 1 of the fiscal year. 
‘‘(c) LIMITATIONS ON CREDIT AMOUNTS.—For each of 
fiscal years 2004 through 2009, principal amounts of Fed-
eral credit instruments made available under this chapter 
shall be limited to $2,600,000,000.’’. 
SEC. 1602. STATE INFRASTRUCTURE BANKS. 
(a) IN GENERAL.—Section 189 of title 23, United 
States Code, is amended to read as follows: 
‘‘§ 189. State infrastructure bank program 
‘‘(a) DEFINITIONS.—In this section, the following defi-
nitions apply: 
‘‘(1) CAPITAL
PROJECT.—The term ‘capital 
project’ has the meaning such term has under section 
5302 of title 49, United States Code. 
‘‘(2) OTHER FORMS OF CREDIT ASSISTANCE.—
The term ‘other forms of credit assistance’ includes 
any use of funds in an infrastructure bank—
‘‘(A) to provide credit enhancements; 
‘‘(B) to serve as a capital reserve for bond 
or debt instrument financing; 
‘‘(C) to subsidize interest rates;
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‘‘(D) to insure or guarantee letters of credit 
and credit instruments against credit risk of 
loss; 
‘‘(E) to finance purchase and lease agree-
ments with respect to transit projects; 
‘‘(F) to provide bond or debt financing in-
strument security; and 
‘‘(G) to provide other forms of debt financ-
ing and methods of leveraging funds that are ap-
proved by the Secretary and that relate to the 
project with respect to which such assistance is 
being provided. 
‘‘(3) STATE.—The term ‘State’ has the meaning 
such term has under section 401 of this title. 
‘‘(4) CAPITALIZATION.—The term ‘capitalization’ 
means the process used for depositing funds as initial 
capital into a State infrastructure bank to establish 
the infrastructure bank. 
‘‘(5) COOPERATIVE AGREEMENT.—The term ‘co-
operative agreement’ means written consent between a 
State and the Secretary which sets forth the manner 
in which the infrastructure bank established by the 
State in accordance with this section will be adminis-
tered.
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‘‘(6) LOAN.—The term ‘loan’ means any form of 
direct financial assistance from a State infrastructure 
bank that is required to be repaid over a period of 
time and that is provided to a project sponsor for all 
or part of the costs of the project. 
‘‘(7) GUARANTEE.—The term ‘guarantee’ means 
a contract entered into by a State infrastructure bank 
in which the bank agrees to take responsibility for all 
or a portion of a project sponsor’s financial obliga-
tions for a project under specified conditions. 
‘‘(8) INITIAL ASSISTANCE.—The term ‘initial as-
sistance’ means the first round of funds that are 
loaned or used for credit enhancement by a State in-
frastructure bank for projects eligible for assistance 
under this section. 
‘‘(9) LEVERAGE.—The term ‘leverage’ means a 
financial structure used to increase funds in a State 
infrastructure bank through the issuance of debt in-
struments. 
‘‘(10) LEVERAGED.—The term ‘leveraged’, as 
used with respect to a State infrastructure bank, 
means that the bank has total potential liabilities 
that exceed the capital of the bank. 
‘‘(b) COOPERATIVE AGREEMENTS.—Subject to the pro-
visions of this section, the Secretary may enter into coopera-
224
tive agreements with States for the establishment of State 
infrastructure banks for making loans and providing other 
forms of credit assistance to public and private entities car-
rying out or proposing to carry out projects eligible for as-
sistance under this section. 
‘‘(d) FUNDING.—
‘‘(1) HIGHWAY ACCOUNT.—Subject to subsection 
(j), the Secretary may permit a State entering into 
a cooperative agreement under this section to establish 
a State infrastructure bank to deposit into the high-
way account of the bank not to exceed—
‘‘(A) 10 percent of the funds apportioned to 
the State for each of fiscal years 2005 through 
2009 under each of sections 104(b)(1), 104(b)(3), 
104(b)(4), and 144; and 
‘‘(B) 10 percent of the funds allocated to the 
State for each of such fiscal years under section 
105. 
‘‘(2) TRANSIT ACCOUNT.—Subject to subsection 
(j), the Secretary may permit a State entering into 
a cooperative agreement under this section to establish 
a State infrastructure bank, and any other recipient 
of Federal assistance under section 5307, 5309, or 
5311 of title 49, to deposit into the transit account of 
the bank not to exceed 10 percent of the funds made
225
available to the State or other recipient in each of fis-
cal years 2005 through 2009 for capital projects 
under each of such sections. 
‘‘(3) RAIL ACCOUNT.—Subject to subsection (j), 
the Secretary may permit a State entering into a co-
operative agreement under this section to establish a 
State infrastructure bank, and any other recipient of 
Federal assistance under subtitle V of title 49, to de-
posit into the rail account of the bank funds made 
available to the State or other recipient in each of fis-
cal years 2005 through 2009 for capital projects 
under such subtitle. 
‘‘(4) CAPITAL GRANTS.—
‘‘(A) HIGHWAY
ACCOUNT.—Federal funds 
deposited into a highway account of a State in-
frastructure bank under paragraph (1) shall con-
stitute for purposes of this section a capitaliza-
tion grant for the highway account of the bank. 
‘‘(B) TRANSIT ACCOUNT.—Federal funds de-
posited into a transit account of a State infra-
structure bank under paragraph (2) shall con-
stitute for purposes of this section a capitaliza-
tion grant for the transit account of the bank. 
‘‘(C) RAIL ACCOUNT.—Federal funds depos-
ited into a rail account of a State infrastructure
226
bank under paragraph 3 shall constitute for pur-
poses of this section a capitalization grant for 
the rail account of the bank. 
‘‘(5) SPECIAL RULE FOR URBANIZED AREAS OF 
OVER 200,000.—Funds in a State infrastructure bank 
that are attributed to urbanized areas of a State with 
urbanized populations of over 200,000 under section 
133(d)(3) may be used to provide assistance with re-
spect to a project only if the metropolitan planning 
organization designated for such area concurs, in 
writing, with the provision of such assistance. 
‘‘(6) DISCONTINUANCE OF FUNDING.—If the Sec-
retary determines that a State is not implementing 
the State’s infrastructure bank in accordance with a 
cooperative agreement entered into under subsection 
(b), the Secretary may prohibit the State from con-
tributing additional Federal funds to the bank. 
‘‘(e) FORMS OF ASSISTANCE FROM INFRASTRUCTURE 
BANKS.—An infrastructure bank established under this sec-
tion may make loans or provide other forms of credit assist-
ance to a public or private entity in an amount equal to 
all or a part of the cost of carrying out a project eligible 
for assistance under this section. The amount of any loan 
or other form of credit assistance provided for the project 
may be subordinated to any other debt financing for the
227
project. Initial assistance provided with respect to a project 
from Federal funds deposited into an infrastructure bank 
under this section may not be made in the form of a grant. 
‘‘(f) ELIGIBLE PROJECTS.—Subject to subsection (e), 
funds in an infrastructure bank established under this sec-
tion may be used only to provide assistance for projects eli-
gible for assistance under this title and capital projects de-
fined in section 5302 of title 49, and any other projects 
related to surface transportation that the Secretary deter-
mines to be appropriate. 
‘‘(g) INFRASTRUCTURE BANK REQUIREMENTS.—In 
order to establish an infrastructure bank under this section, 
the State establishing the bank shall—
‘‘(1) deposit in cash, at a minimum, into each 
account of the bank from non-Federal sources an 
amount equal to 25 percent of the amount of each 
capitalization grant made to the State and deposited 
into such account; except that, if the deposit is into 
the highway account of the bank and the State has a 
non-Federal share under section 120(b) that is less 
than 25 percent, the percentage to be deposited from 
non-Federal sources shall be the lower percentage of 
such grant; 
‘‘(2) ensure that the bank maintains on a con-
tinuing basis an investment grade rating on its debt,
228
or has a sufficient level of bond or debt financing in-
strument insurance, to maintain the viability of the 
bank; 
‘‘(3) ensure that investment income derived from 
funds deposited to an account of the bank are—
‘‘(A) credited to the account; 
‘‘(B) available for use in providing loans 
and other forms of credit assistance to projects 
eligible for assistance from the account; and 
‘‘(C) invested in United States Treasury se-
curities, bank deposits, or such other financing 
instruments as the Secretary may approve to 
earn interest to enhance the leveraging of projects 
assisted by the bank; 
‘‘(4) ensure that any loan from the bank will 
bear interest at or below market interest rates, as de-
termined by the State, to make the project that is the 
subject of the loan feasible; 
‘‘(5) ensure that repayment of any loan from the 
bank will commence not later than 5 years after the 
project has been completed or, in the case of a high-
way project, the facility has opened to traffic, which-
ever is later;
229
‘‘(6) ensure that the term for repaying any loan 
will not exceed 30 years after the date of the first 
payment on the loan; and 
‘‘(7) require the bank to make an annual report 
to the Secretary on its status no later than September 
30 of each year and such other reports as the Sec-
retary may require under guidelines issued to carry 
out this section. 
‘‘(i) UNITED STATES NOT OBLIGATED.—The deposit of 
Federal funds into an infrastructure bank established under 
this section shall not be construed as a commitment, guar-
antee, or obligation on the part of the United States to any 
third party, nor shall any third party have any right 
against the United States for payment solely by virtue of 
the contribution. Any security or debt-financing instrument 
issued by the infrastructure bank shall expressly state that 
the security or instrument does not constitute a commit-
ment, guarantee, or obligation of the United States. 
‘‘(j) MANAGEMENT
OF FEDERAL FUNDS.—Sections 
3335 and 6503 of title 31, shall not apply to funds deposited 
into an infrastructure bank under this section. 
‘‘(k) PROGRAM ADMINISTRATION.—For each of fiscal 
years 2005 through 2009, a State may expend not to exceed 
2 percent of the Federal funds contributed to an infrastruc-
230
ture bank established by the State under this section to pay 
the reasonable costs of administering the bank.’’. 
(b) PREPARATORY AMENDMENTS.—
(1) SECTION 181.—Section 181 of such title is 
further amended—
(A) by striking the section designator and 
heading and inserting the following: 
‘‘§ 181. Generally applicable provisions’’; 
(B) by striking ‘‘In this subchapter’’ and 
inserting ‘‘(a) DEFINITIONS.—In this chapter’’; 
(C) in paragraph (5) by striking ‘‘184’’ and 
inserting ‘‘604’’; 
(D) in paragraph (11) (as redesignated by 
section 1601(a) of this Act) by striking ‘‘183’’ 
and inserting ‘‘603’’; and 
(E) by adding at the end the following: 
‘‘(b) TREATMENT OF CHAPTER.—For purposes of this 
title, this chapter shall be treated as being part of chapter 
1.’’. 
(2) SECTION 182.—Section 182(b)(2)(A)(viii) of 
such title is further amended by inserting ‘‘and chap-
ter 1’’ after ‘‘this chapter’’. 
(3) SECTION 183.—Section 183(a) of such title is 
further amended—
231
(A) in paragraph (1) by striking ‘‘182’’ and 
inserting ‘‘602’’; and 
(B) 
in 
paragraph 
(3) 
by 
striking 
‘‘182(b)(2)(B)’’ and inserting ‘‘602(b)(2)(B)’’. 
(4) SECTION 184.—Section 184 of such title is 
further amended—
(A) in subsection (a)(1) by striking ‘‘182’’ 
and inserting ‘‘602’’; 
(B) 
in 
subsection 
(a)(3) 
by 
striking 
‘‘182(b)(2)(B)’’ and inserting ‘‘602(b)(2)(B)’’; 
and 
(C) in subsection (b)(10) by striking ‘‘183’’ 
and inserting ‘‘603’’. 
(5) REFERENCES IN SUBCHAPTER.—Subchapter 
II of chapter 1 of such title is amended by striking 
‘‘this subchapter’’ each place it appears and inserting 
‘‘this chapter’’. 
(6) SUBCHAPTER HEADINGS.—Chapter 1 of such 
title is further amended—
(A) by striking ‘‘SUBCHAPTER I—GEN-
ERAL PROVISIONS’’ preceding section 101; and 
(B) by striking ‘‘SUBCHAPTER
II—IN-
FRASTRUCTURE FINANCE’’ preceding section 
181.