IN THE SENATE OF THE UNITED STATES
July 28, 2011
Mr. Wyden (for himself, Mr. Hoeven, and Mr. Begich) introduced the following bill; which was read twice and referred to the Committee on Finance
To provide $50,000,000,000 in new transportation infrastructure funding through bonding to empower States and local governments to complete significant infrastructure projects across all modes of transportation, including roads, bridges, rail and transit systems, ports, and inland waterways, and for other purposes.
Short title; etc
This Act may be cited as the
Transportation and Regional Infrastructure Project Bonds
Act of 2011 or
TRIP Bonds Act.
References to Internal Revenue Code of 1986
Except as otherwise expressly provided, whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.
Findings and purpose
Congress finds the following:
Our Nation’s highways, transit systems, railroads, ports, and inland waterways drive our economy, enabling all industries to achieve growth and productivity that makes America strong and prosperous.
The establishment, maintenance, and improvement of the national transportation network is a national priority, for economic, environmental, energy, security, and other reasons.
The ability to move people and goods is critical to maintaining State, metropolitan, rural, and local economies.
The construction of infrastructure requires the skills of numerous occupations, including those in the contracting, engineering, planning and design, materials supply, manufacturing, distribution, and safety industries.
Investing in transportation infrastructure creates long-term capital assets for the Nation that will help the United States address its enormous infrastructure needs and improve its economic productivity.
Investment in transportation infrastructure creates jobs and spurs economic activity to put people back to work and stimulate the economy.
Every billion dollars in transportation investment has the potential to create up to 30,000 jobs.
Every dollar invested in the Nation’s transportation infrastructure yields at least $5.70 in economic benefits because of reduced delays, improved safety, and reduced vehicle operating costs.
Numerous experts have noted that the estimated cost to maintain and improve our Nation’s highways, bridges, and other critical transportation infrastructure significantly exceeds what is currently being provided by all levels of government.
The purpose of this Act is to provide financing for additional transportation infrastructure capital investments.
Credit to holders of TRIP bonds
Subpart I of part IV of subchapter A of chapter 1 is amended by adding at the end the following new section:
For purposes of this subpart, the term TRIP bond means any bond issued as part of an issue if—
100 percent of the available project proceeds of such issue are to be used for expenditures incurred after the date of the enactment of this section for 1 or more qualified projects pursuant to an allocation of such proceeds to such project or projects by a State infrastructure bank,
the bond is issued by a State infrastructure bank and is in registered form (within the meaning of section 149(a)),
the State infrastructure bank designates such bond for purposes of this section,
the term of each bond which is part of such issue does not exceed 30 years,
the issue meets the requirements of subsection (e),
the State infrastructure bank certifies that it meets the State contribution requirement of subsection (h) with respect to such project, as in effect on the date of issuance, and
the State infrastructure bank certifies the State meets the requirement described in subsection (i).
For purposes of this section, the term qualified project means the capital improvements to any transportation infrastructure project of any governmental unit or other person, including roads, bridges, rail and transit systems, ports, and inland waterways proposed and approved by a State infrastructure bank, but does not include costs of operations or maintenance with respect to such project.
Applicable credit rate
In lieu of section 54A(b)(3), for purposes of section 54A(b)(2), the applicable credit rate with respect to an issue under this section is the rate equal to an average market yield (as of the day before the date of sale of the issue) on outstanding long-term corporate debt obligations (determined in such manner as the Secretary prescribes).
Limitation on amount of bonds designated
The maximum aggregate face amount of bonds which may be designated under subsection (a) by any State infrastructure bank shall not exceed the TRIP bond limitation amount allocated to such bank under paragraph (3).
National limitation amount
There is a TRIP bond limitation amount for each calendar year. Such limitation amount is—
$5,000,000,000 for 2011,
$5,000,000,000 for 2012,
$10,000,000,000 for 2013,
$10,000,000,000 for 2014,
$10,000,000,000 for 2015,
$10,000,000,000 for 2016, and
except as provided in paragraph (4), zero thereafter.
Allocations to States
The TRIP bond limitation amount for each calendar year shall be allocated by the Secretary among the States such that each State is allocated 2 percent of such amount.
Carryover of unused issuance limitation
If for any calendar year the TRIP bond limitation amount under paragraph (2) exceeds the amount of TRIP bonds issued during such year, such excess shall be carried forward to 1 or more succeeding calendar years as an addition to the TRIP bond limitation amount under paragraph (2) for such succeeding calendar year and until used by issuance of TRIP bonds.
Special rules relating to expenditures
An issue shall be treated as meeting the requirements of this subsection if, as of the date of issuance, the State infrastructure bank reasonably expects—
at least 100 percent of the available project proceeds of such issue are to be spent for 1 or more qualified projects within the 5-year expenditure period beginning on such date,
to incur a binding commitment with a third party to spend at least 10 percent of the proceeds of such issue, or to commence construction, with respect to such projects within the 12-month period beginning on such date, and
to proceed with due diligence to complete such projects and to spend the proceeds of such issue.
Rules regarding continuing compliance after 5-year determination
To the extent that less than 100 percent of the available project proceeds of such issue are expended by the close of the 5-year expenditure period beginning on the date of issuance, the State infrastructure bank shall redeem all of the nonqualified bonds within 90 days after the end of such period. For purposes of this paragraph, the amount of the nonqualified bonds required to be redeemed shall be determined in the same manner as under section 142.
Recapture of portion of credit where cessation of compliance
If any bond which when issued purported to be a TRIP bond ceases to be such a bond, the State infrastructure bank shall pay to the United States (at the time required by the Secretary) an amount equal to the sum of—
the aggregate of the credits allowable under section 54A with respect to such bond (determined without regard to section 54A(c)) for taxable years ending during the calendar year in which such cessation occurs and each succeeding calendar year ending with the calendar year in which such bond is redeemed by the bank, and
interest at the underpayment rate under section 6621 on the amount determined under paragraph (1) for each calendar year for the period beginning on the first day of such calendar year.
TRIP Bonds Trust Account
The following amounts shall be held in a TRIP Bonds Trust Account:
The proceeds from the sale of all bonds issued under this section.
The investment earnings on proceeds from the sale of such bonds.
The amount described in paragraph (2).
Any earnings on any amounts described in subparagraph (A), (B), or (C).
Appropriation of revenues
There is hereby transferred to the TRIP Bonds Trust Account an amount equal to the lesser of—
the revenues resulting from the imposition of fees pursuant to section 13031 of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c) for fiscal years beginning after September 30, 2011, or
Use of funds
Amounts in the TRIP Bonds Trust Account may be used only to pay costs of qualified projects and redeem TRIP bonds, except that amounts withdrawn from the TRIP Bonds Trust Account to pay costs of qualified projects may not exceed the proceeds from the sale of TRIP bonds described in subsection (a)(1).
Use of remaining funds in TRIP bonds trust account
Upon the redemption of all TRIP bonds issued under this section, any remaining amounts in the TRIP Bonds Trust Account shall be available to pay the costs of any qualified project.
Applicability of Federal law
The requirements of any Federal law, including titles 23, 40, and 49 of the United States Code, which would otherwise apply to projects to which the United States is a party or to funds made available under such law and projects assisted with those funds shall apply to—
funds made available under the TRIP Bonds Trust Account for similar qualified projects, including contributions required under subsection (h), and
similar qualified projects assisted through the use of such funds.
Subject to subsections (e) and (f), it shall be the duty of the Secretary to invest in investment grade obligations such portion of the TRIP Bonds Trust Account as is not, in the judgment of the Secretary, required to meet current withdrawals. To the maximum extent practicable, investments should be made in securities that support infrastructure investment at the State and local level.
State contribution requirements
For purposes of subsection (a)(6), the State contribution requirement of this subsection is met with respect to any qualified project if the Secretary has received from 1 or more States, not later than the date of issuance of the bond, written commitments for matching contributions of not less than 20 percent (or such smaller percentage as determined under title 23, United States Code, for such State) of the cost of the qualified project.
State matching contributions may not include Federal funds
For purposes of this subsection, State matching contributions shall not be derived, directly or indirectly, from Federal funds, including any transfers from the Highway Trust Fund under section 9503.
Utilization of updated construction technology for qualified projects
For purposes of subsection (a)(7), the requirement of this subsection is met if the appropriate State agency relating to the qualified project is utilizing updated construction technologies.
Other definitions and special rules
For purposes of this section—
State infrastructure bank
The term State infrastructure bank means a State infrastructure bank established under section 610 of title 23, United States Code, and includes a joint venture among 2 or more State infrastructure banks.
Notwithstanding any other provision of law, a State infrastructure bank shall be authorized to perform any of the functions necessary to carry out the purposes of this section, including the making of direct grants to qualified projects from available project proceeds of TRIP bonds issued by such bank.
Credits may be transferred
Nothing in any law or rule of law shall be construed to limit the transferability of the credit or bond allowed by this section through sale and repurchase agreements.
Prohibition on use of highway trust fund
Notwithstanding any other provision of law, no funds derived from the Highway Trust Fund established under section 9503 shall be used to pay for credits under this section.
Paragraph (1) of section 54A(d) of the Internal Revenue Code of 1986 is amended—
or at the end of subparagraph (D),
or at the end of subparagraph (E),
by inserting after subparagraph (E) the following new subparagraph:
a TRIP bond,
(paragraphs (3), (4), and (6), in the case of a TRIP bond) after
of section 54A(d)(2) of such Code is amended by striking
the end of clause (iv), by striking the period at the end of clause (v) and
, and, and by adding at the end the following new
in the case of a TRIP bond, a purpose specified in section 54G(a)(1).
The table of sections for subpart I of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:
Sec. 54G. TRIP bonds.
The amendments made by this section shall apply to bonds issued after the date of the enactment of this Act.
Additional revenues through extension of customs user fees
Section 13031(j)(3) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)), as amended by the Omnibus Trade Act of 2010, is amended—
January 7, 2020
in subparagraph (A) and inserting
January 7, 2048, and
January 14, 2020
in subparagraph (B)(i) and inserting
January 14, 2048.