[Federal Register Volume 61, Number 216 (Wednesday, November 6, 1996)]
[Notices]
[Pages 57513-57514]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-28578]


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DEPARTMENT OF TRANSPORTATION
Federal Highway Administration
Federal Railroad Administration
Federal Transit Administration


Participation in the State Infrastructure Bank Pilot Program

AGENCY: Federal Highway Administration (FHWA), Federal Railroad 
Administration (FRA), and Federal Transit Administration (FTA), DOT.

ACTION: Notice of request for participation.

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SUMMARY: This notice invites States to submit applications for 
participation in the State Infrastructure Bank (SIB) Pilot Program 
originally established by the National Highway System Designation Act 
of 1995 (the NHS Act). Pursuant to Section 350 of the NHS Act, USDOT is 
authorized to enter into agreements with States to establish State 
Infrastructure Banks or multistate infrastructure banks. Under the 
Department of Transportation and Related Agencies Appropriations Act of 
1997 (Appropriations Act), USDOT is currently authorized to enter into 
Cooperative Agreements with more than ten States qualified to establish 
State Infrastructure Banks or multistate infrastructure banks. Another 
purpose of this notice is to outline the procedures that will be 
established for designation of additional States to be included in the 
Pilot Program. Further, $150 million will be available for distribution 
among the ten States previously designated by the Secretary and any 
additional States designated as a result of this notice. Distribution 
of these funds will not take place prior to 180 days after the 
enactment of the Appropriations Act on September 30, 1996.

DATES: Applications for participation will be considered as soon as 
they are received and must be received by the close of business on 
December 20, 1996.

FOR FURTHER INFORMATION CONTACT: Mr. Max Inman, FHWA Office of Fiscal 
Services, (202) 366-6813; Mr. John Paolella, FRA Office of Policy and 
Program Development, (202) 632-3154; or Mr. Richard Steinmann, FTA 
Office of Budget and Policy, (202) 366-4060. Application requests and 
specific questions regarding the SIB Pilot Program may also be directed 
to the Division or Regional Offices of FHWA or FTA in your State.

SUPPLEMENTARY INFORMATION:

I. Background

    Congress established a Pilot Program for State Infrastructure Banks 
(SIBs) through Section 350 of the NHS Act (Pub. L. 104-59). That 
section originally authorized USDOT to enter into cooperative 
agreements with up to ten States for the establishment of SIBs or 
multistate infrastructure banks for making loans and providing other 
assistance to public and private entities carrying out or proposing to 
carry out projects eligible for assistance under the section. 
Subsequently, Congress enacted the Department of Transportation and 
Related Agencies Appropriations Act of 1997 (Pub. L. 104-205), which 
authorizes the Secretary of Transportation to enter into agreements 
with more than ten States qualified to establish SIBs. Under the terms 
and conditions of the NHS Act, States may use up to 10 percent of 
specified FY 1996 and FY 1997 apportionments and allocations in 
addition to non-Federal matching funds to capitalize the SIBs.
    In addition, as a result of the Appropriations Act, $150 million 
will be available for distribution among the ten States previously 
designated by the Secretary and any additional States designated as a 
result of this notice. Distribution of these funds will not take place 
prior to 180 days after the enactment of the Appropriations Act. These 
funds shall be used to advance projects or programs under the terms and 
conditions of section 350. Any portion of these funds may be deposited 
into a highway or transit SIB account. Section 350 also requires that 
disbursement of these funds be at a rate consistent with historic rates 
for the Federal-aid highway program. Therefore, disbursements will be 
limited to 15 percent of $150 million for FY 1997 ($22.5 million), and 
remaining amounts will be disbursed in subsequent years.
    The Pilot Program and subsequent implementation by designated SIBs 
will help USDOT determine how to proceed with the SIB concept while 
simultaneously advancing additional projects. It will help USDOT 
understand how SIBs can leverage Federal dollars to increase 
transportation infrastructure investment as ISTEA reauthorization 
legislation moves forward.

II. Definitions

    State Infrastructure Bank (SIB): An infrastructure investment fund 
established to facilitate and encourage investment in eligible 
transportation infrastructure projects sponsored by public and/or 
private entities. Through a SIB, a State can use its initial capital, 
provided by its Federal-aid highway apportionments, any allocation 
received under the fiscal year 1997 DOT Appropriations Act, Federal 
transit allocations, and non-Federal monies, to make loans, provide 
credit enhancement, serve as a capital reserve for bond or debt 
financing, subsidize interest rates, issue letters of credit, finance 
purchase and lease agreements, provide debt financing security, or 
provide other forms of financial assistance for construction of 
projects qualified under the Federal-aid highway program and transit 
capital projects. As the funds are repaid or compensation is provided, 
the SIB can make new financial assistance available to other projects, 
continually recycling the initial monies, thus leveraging the initial 
funds available.
    Multistate Infrastructure Bank: Interstate compact among two or 
more States to enter into a cooperative agreement with USDOT to 
establish a SIB.

III. Notice of Request for Participation

    States must successfully address in detail all the application 
criteria listed in the following section entitled ``Criteria for 
Applications to Participate in the SIB Pilot Program.'' These 
responses, submitted as an application by the State, will provide the 
basis for determining a State's ability and qualifications to implement 
a SIB and the initial projects it expects to facilitate through 
financial support for the SIB. Based on the responses to the 
application criteria, the Secretary will designate qualified States to 
participate in the Pilot Program. After designation, the Secretary will 
enter into cooperative agreements with States to participate in the 
Pilot Program. Applications for participation must be received by the 
close of business on December 20, 1996.
    USDOT recognizes that this is a Pilot Program and is receptive to 
innovative and non-traditional approaches to establishing a SIB and 
defining the types of assistance that may be offered. Subject to 
section 350 of the NHS Act, USDOT seeks to work in cooperation with the 
States to define the implementation of the program. USDOT will not 
require that all Pilot SIBs be configured in the same way or that they 
provide the same forms of assistance.

[[Page 57514]]

This Pilot Program, therefore, gives States an opportunity to determine 
how they might best structure SIBs. USDOT is interested in information 
detailing how States propose to establish and implement SIBs and is 
looking for serious evidence of thoughtful proposals.

IV. Criteria for Applications To Participate in the SIB Pilot 
Program

    Applications must provide detailed information on the following 
areas:
    1. The types of assistance to be provided by the SIB (e.g., loans, 
credit enhancements, capital reserves for debt financing, interest rate 
subsidies, letters of credit);
    2. Identification and description of projects to be advanced as a 
result of Pilot designation (According to the NHS Act, first use of SIB 
capitalization funds must be for a Title 23 highway construction or 
Title 49 capital transit project that follows Federal procedures. 
However, with repayment revenues, a SIB can assist Title 23 or Title 49 
projects that follow State procedures.);
    3. The status of any enabling legislation, if required by a State 
prior to establishing a SIB, or existing administrative authority to 
implement a SIB;
    4. The relationship between the SIB and other innovative financing 
efforts underway or planned by the State and how its experience under 
the innovative financing programs to date can reflect this;
    5. The relationship of the projects proposed for the SIB to the 
Transportation Improvement Program (TIP), the approved Statewide 
Transportation Improvement Program (STIP) and any other federally 
required plans;
    6. The ways the SIB will more effectively use and leverage Federal 
monies;
    7. The sources and amounts of Federal funds that will be used to 
capitalize the SIB (CMAQ and ISTEA demonstration funds cannot be used) 
in addition to any funds that may be distributed by the Secretary as a 
result of the Appropriations Act; and the sources and amounts of non-
Federal matching funds required by Section 350(e)(1);
    8. The proposed institutional framework for the SIB, including 
State agencies that may be involved on a formal basis or an informal 
advisory basis;
    9. The proposed mechanisms and internal procedures to monitor and/
or track the flow of Federal funds to accounts in the SIB and the 
State's preferred reporting procedures to USDOT, given that Section 350 
requires maintenance of separate accounts for highway and transit; and
    10. The use of a SIB to facilitate development of intermodal or 
multistate projects.
    States should indicate in their applications the type and extent of 
any technical assistance they might need to expedite implementation if 
designated as a pilot.
    Copies of the original enabling legislation (Section 350 of the NHS 
Act), the Appropriations Act, and sample project summaries are 
available upon request from the USDOT contact persons referenced in 
this notice, or any Division or Regional Office of FHWA or FTA. 
Completed applications should be submitted to the FHWA Division Office 
or FTA Regional Office. USDOT may seek further clarification of SIB 
applications in writing or through an informal interview process with 
States.

    Authority: Pub. L. 104-59, Sec. 350, 109 Stat. 568, 618-622 
(1995); Pub. L. 104-205, title I (1996).

    Issued on: November 1, 1996.
Jolene M. Molitoris,
Federal Railroad Administrator.
Gordon J. Linton,
Federal Transit Administrator.
Rodney E. Slater,
Federal Highway Administrator.
[FR Doc. 96-28578 Filed 11-05-96; 8:45 am]
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