Legislation Would Fund TRIP Bonds at $50 Billion Over 6 Years

AASHTO Journal, 3 February 2012

Three U.S. senators and two representatives are joining forces to push legislation that would provide an estimated $50 billion over six years to support state transportation infrastructure investments.The legislation creating Transportation and Regional Infrastructure Project Bonds, known as “TRIP bonds,” (S 1436) was introduced by Sens. Ron Wyden, D-Oregon; John Hoeven, R-North Dakota; and Mark Begich, D-Alaska. A House companion bill (HR 3736) was filed by Reps. Leonard Boswell, D-Iowa, and Ed Whitfield, R-Kentucky. The two bills were drafted to be part of a long-term surface transportation reauthorization.

According to Wyden’s office, the plan would transfer $900 million annually collected from customs users fees into a TRIP Bond Trust Account. Those funds would be invested for the life of the bonds to generate interest that would repay the $50 billion in bond principal. The interest on the bonds would be covered by tax credits.

Whitfield said during a news conference Tuesday in the U.S. Capitol that TRIP bonds are an innovative idea and exactly what is needed to help states shore up aging transportation systems. That sentiment was echoed by Wyden, who called the bonds “a shot in the arm for the transportation sector and jobs.”

Hoeven, who said the legislation’s strength is the way it leverages private-sector investment, cited the importance of allowing states to have control over how to spend the dollars and prioritizing the projects they need to do.

Jack Basso, director of program finance and management for the American Association of State Highway and Transportation Officials, appeared at Tuesday’s news conference.

“America has an infrastructure deficit that in many ways is starting to rival the national debt that we face,” said Basso, who worked with legislators to draft the bill’s language. “We should not lose sight of our fundamental need for our overall investment. These bonds are a down payment.”

More information, including a video of Tuesday’s news conference, is available at 1.usa.gov/Wyden013112. A chart describing how TRIP bonds work is available at bit.ly/TRIPbondschart.

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