Local governments play a key role in funding, operating, and maintaining local roads, bridges, airports, transit facilities, drinking water, sewer systems, and other types of infrastructure. Yet, as is widely publicized, these jurisdictions face a serious infrastructure deficit. While municipal bonds continue to be the key options for how local infrastructure is financed, local governments are exploring new ways to finance needed expansion, upgrades, and repairs.
According to a new white paper, “Infrastructure Financing: A Guide for Local Government Managers,” issued by ICMA and the Government Finance Officers Association (GFOA), alternative financing sources, properly selected and managed, can complement traditional sources to meet infrastructure needs. Tapping these sources not only leverages new resources, but also can make it possible to complete certain projects more quickly.
Across the United States, local governments face a serious infrastructure deficit and are exploring new ways to finance needed expansions, upgrades, and repairs. Despite the fact that eroding infrastructure is seen as one of the most urgent issues facing the country, in 2012, infrastructure funding was at its lowest percentage of total local government expenditures in more than 50 years.
Prepared by Drs. Can Chen of Florida International University and John R. Bartle of the University of Nebraska at Omaha, the white paper explores how local governments are addressing the challenge of bridging infrastructure financing gaps. In this context, they:
- Describe the full range of infrastructure financing methods currently in use.
- Document emerging methods in local infrastructure financing.
- Illustrate cases where local governments have explored alternative methods of infrastructure financing.
- Offer recommendations for local government managers who are considering the use of alternative infrastructure financing options.