Washington, D.C.– America’s rural communities have overwhelming infrastructure needs but often lack the economies-of-scale necessary to attract private investors who can help finance infrastructure projects. Now, in a new white paper released today, the Bipartisan Policy Center’s Executive Council on Infrastructure proposes a range of strategies that would enable these rural communities to unlock private capital and update their infrastructure.
The proposals are a mix of federal recommendations and strategies states and local governments can implement to better attract private capital.
“Investing in infrastructure can be a key part of generating economic development in rural America,” said Michele Nellenbach, BPC’s director of strategic initiatives. “We need to ensure that our rural communities have the federal support and the technical know-how to attract those essential investments.”
At the federal level, the white paper calls for an Office of Rural Partnerships to help communities identify and develop projects appropriate for private investment, a Rural Bundling Pilot Program to help communities package multiple projects and reduce costs, a Rural Liaison in every infrastructure agency focused on better positioning rural communities to compete for private capital, and flexible financing terms.
The five strategies proposed in the white paper are:
- Targeted funding. Continued public funding for rural infrastructure is essential. In addition, support for pre-development expenses, P3 screening, and life-cycle cost analysis would help rural communities lay the groundwork for private sector investment.
- Project bundling. A bundled suite of projects can bring the necessary scale to attract private sector interest as well as take advantage of economies of scale to deliver cost savings.
- Regional coordination. When approached regionally, infrastructure projects may be able to draw upon a larger revenue base, more financing options, and expertise from regional entities.
- Capacity building. Most rural agency staff has little experience with alternative approaches to infrastructure delivery and financing, so technical assistance is critical.
- Accessible financing. Making federal and state loan and credit programs easier for rural communities to access could help them bring financing to the table.
“The approaches we propose in this white paper would make a significant difference in bringing private capital off the sidelines and into projects throughout rural America,” Nellenbach said. “Public-private partnerships are a vital tool to filling the infrastructure gap, and one that communities all across the country should be able to utilize. Our strategies would help achieve that goal.”