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A New Model for Investing in Infrastructure: Center of Excellence

By Sarah Kline

Wednesday, August 31, 2016

Last month, the Bipartisan Policy Center’s Executive Council on Infrastructure hosted its first stakeholder roundtable since releasing its report, Bridging the Gap Together: A New Model to Modernize U.S. Infrastructure. This event heralded the beginning of the next phase of the council’s work, moving from policy development to implementation—from research to action. As part of that transition, the council is now renewing its call for a center of excellence to spearhead development of the tools and resources needed to implement its recommendations.

The new model calls for increased transparency, full accounting for life-cycle costs, and development of a stronger partnership for infrastructure delivery.

The council has called for a new American model for investing in infrastructure to attract more private capital to help meet U.S. infrastructure needs. The new model calls for increased transparency, full accounting for life-cycle costs, and development of a stronger partnership for infrastructure delivery in which the public and private sectors share the risks, costs, and benefits.

In the report, the council also called for immediate creation of a new center of excellence:

“To jumpstart the process of moving to the New American Model for Investing in Infrastructure, there is an immediate need for the creation of a center of excellence to take the lead on developing the expedited processes, evaluation methodologies, and educational materials called for in this report. The center should be jointly funded by the public and private sectors and should act as an impartial third party to facilitate the rapid development of the templates and tools needed under the New American Model. The center should engage with experts from all aspects of infrastructure development and financing, in both the public and private sectors, to ensure that its products will meet the needs of a variety of stakeholders.”

The council recognized, however, that many entities are actively working on issues directly related to the new model, such as, the Department of Transportation’s Build America Bureau, AASHTO’s Build America Transportation Investment Center Institute, and the National Governors Association’s State Resource Center on Innovative Infrastructure Strategies. Rather than recreating the wheel, the council’s goal is to develop a new, supportive structure that can build upon these ongoing efforts.

Rather than recreating the wheel, the council’s goal is to develop a new, supportive structure that can build upon ongoing efforts.

With that in mind, BPC convened key stakeholders representing the federal government, state and local leaders, the private sector, and the research community to identify ways to advance the council’s recommendations in the field. Through a robust discussion among the participants, several key points emerged:

  • The lack of capacity at the state and local levels is one of the primary barriers to advancing alternative methods of developing and delivering infrastructure projects. Public agency staff require additional support on deciding when, why, and how to do things differently. To be most effective, capacity building efforts should include direct education and technical assistance as well as funding or on-call experts to supplement agency staff.
  • Assistance will be more effective the closer it is to staff “on the ground.” Developing a national center should not replace efforts to establish regional or state P3 offices (which are also recommended in the council’s report).
  • Funding can be a catalyst for change, and even a relatively small amount can bring people to the table. The competitive grant programs offered by U.S. DOT have encouraged state and local agencies to think outside the box. Even unsuccessful applicants have reported that the application process itself spurred new enthusiasm in their community for creatively addressing infrastructure needs.
  • States and localities across the country are at very different stages. Some are already working on asset inventories and P3s, while others are years away from taking that step. The “sweet spot” for a new center may be those places that are not yet actively working on elements of the new American model, but have begun to develop an interest in doing so.
  • There is a need for better data on the performance of infrastructure projects, both P3s and those that are conventionally delivered. An independent third party, such as a new center, would be the ideal entity to gather and share these figures.

America needs to embrace a deeper partnership between the public and private sectors to meet the demand for safe drinking water, affordable transportation options, and the efficient movement of goods.

The United States is facing tremendous infrastructure investment needs: $3.3 trillion worth of essential projects by 2025, according to the American Society of Civil Engineers. Private capital is available to help meet these needs, but in many places, cumbersome processes and uncertain politics push that capital away. America needs to embrace a deeper partnership between the public and private sectors to meet the demand for safe drinking water, affordable transportation options, and the efficient movement of goods—not just today, but for decades to come. The first step is to provide the support for public officials and staff to start thinking differently about how to deliver the projects their communities need. A new center of excellence, targeted to the needs of public agencies and coordinated with ongoing efforts by other entities, would help to move the new American model for investing in infrastructure from proposal to reality.

KEYWORDS: DEPARTMENT OF TRANSPORTATION, EXECUTIVE COUNCIL ON INFRASTRUCTURE