In a groundbreaking move towards enhancing infrastructure development, many local and state governments have recently been awarded grants under the Innovative Finance and Asset Concession Grant program. This initiative aims to facilitate a strategic approach to inventorying public assets with an eye on potential monetization through public-private partnerships (P3s). Officially established as part of the 2021 Infrastructure Investment and Jobs Act, the program intends to modernize how public entities consider and manage their assets.
The program has successfully allocated nearly $50 million to 45 distinct public entities during its inaugural funding round. Spearheaded by the U.S. Department of Transportation’s Build America Bureau, this initiative supports local governments in creating a comprehensive inventory of their assets. The hope is that by doing so, they can explore various P3 opportunities that can enhance public services and infrastructure efficacy.
The essence of this program lies in understanding that many local governments possess undervalued or underutilized assets that could be effectively leveraged through public-private collaborations. Morteza Farajian, the executive director of the Build America Bureau, highlighted this intent at The Bond Buyer’s infrastructure conference, emphasizing the creation of a national inventory of assets. This comprehensive database will assist developers in identifying opportunities for investment and project development, fostering a more efficient marketplace for infrastructure improvements.
The emphasis on transit-oriented development (TOD) within over 70% of the submitted projects showcases the program’s potential to reshape urban areas and improve public transportation systems. Funding is specifically tailored to help communities partner with the private sector, ultimately leading to expedited completion of vital transportation projects and the addition of housing and other essential public services. Transportation Secretary Pete Buttigieg encapsulated the program’s goals by stating that these grants would catalyze significant community benefits through private engagements.
While the funding awarded may appear minimal—averaging around $1 million per grant—the strategic utility of these funds cannot be understated. The program delineates two specific types of grants: technical assistance grants and expert services grants. The technical assistance grants are designed to aid in developing and entering into asset concession agreements while the expert services grants provide funding for hiring professional services aimed at maximizing project development.
With $100 million set aside for this initiative over the next five years, the opportunities for local governments to modernize and invigorate their infrastructure are substantial. For instance, Capital Metro in Austin plans to utilize their $1 million grant to explore equitable TOD pilot sites, signaling a direct approach to housing and transportation linkage. Meanwhile, North Miami’s $1.75 million grant will bolster its downtown revitalization efforts through mixed-use TOD projects, illustrating just one of many potential pathways for urban growth.
The launch of the Innovative Finance and Asset Concession Grant program represents a pivotal moment in the evolution of public infrastructure funding and development. By encouraging local and state governments to take stock of their assets and contemplate innovative monetization strategies, this program is poised to transform urban landscapes. Through effective public-private partnerships, communities can envision a future where infrastructure development is more resilient, strategic, and beneficial for all stakeholders involved. This initiative not only promotes fiscal responsibility but also paves the way for sustainable urban development across the country.