It’s hard to talk about projects without talking about project funding. Although most look abroad in places like China, Africa or South America for major infrastructural projects, if the National Infrastructure Reinvestment Bank becomes a reality, the US itself might become the next big project region.By George Lauriat, AJOTBack nearly a year ago, while on the campaign trail Presidential candidate Barack Obama, proposed the creation of National Infrastructure Reinvestment Bank, as part of the $210 billion economic stimulus package. The idea for a National Infrastructure Reinvestment Bank wasn’t new as Senators Christopher Dodd and Chuck Hagel had made a similar proposal back in 2007. What a difference a year makes. Now President Obama with a Democratic majority is in position to move the proposal from simply campaign rhetoric to legislation in rapid fashion. According to information released during the campaign, The National Infrastructure Reinvestment Bank (NIRB) will receive $60 billion from the Federal government over a 10-year period to provide financing to transportation infrastructure project. In addition it is hoped that the Bank could attract upwards another $500 billion in private investment. In theory, funding for the new Bank would be possible as a result of the end of the Iraq War and the drain on Federal monies. It is estimated that the projects the Bank finances will create up to two million new direct and indirect jobs and stimulate approximately $35 billion per year in new economic activity. BANKING ON THE BANK Under the proposed legislation National Infrastructure Reinvestment Bank would be semi autonomous from the federal government similar to the Postal Service. In this regard the Bank would be invested with wide ranging powers similar to the Federal Deposit Insurance Corporation (FDIC). For example, the NIRB would have the power to accept for funding any infrastructure project with a potential Federal commitment of $75 million or more and the authority to determine the appropriate Federal share of spending for each project. Moreover, the Bank can issue infrastructure bonds, and to provide direct subsidies to qualified infrastructure projects and provide loan guarantees to State or local governments issuing debt to finance projects. The interest rates on these instruments would be low. According to the proposed legislation funding for the bank would be taken from borrowed funds not to exceed one percent. As the legislation is now composed, the NIRB would also act with existing programs already in place such as the Highway Trust Fund and State Revolving Funds. At this juncture it appears largely aimed at surface projects, mostly highway and mass transit and doesn’t speak to the needs of pipelines, waterways, harbors and airports. WHAT’S AT STAKE Back in February 2008, when candidate unveiled the stimulus package he said “This investment will multiply into almost half a trillion dollars of infrastructure spending and generate nearly two million new jobs—many of them in the construction industry that’s been hit hard by the housing crisis.” Principally, what President Obama and his staff had in mind at the time, was the National Surface Transportation Policy and Revenue Study Commission report. At the center of the report is the DOT’s (Department of Transportation) anticipated 70% increase in freight between now and 2020. In order the US surface transportation system to handle the load, the DOT estimates that US, at all levels of government, must spend at $225 billion annually for the next 50 years. Currently it is estimated that less than $90 billion is spent annually. The report suggested fixing the current Highway Trust Fund shortfall by raising the gas—or federal motor fuels—tax to from five-to-eight cents per year to 25-to-40 cents per gallon per year over the next five years or conversely 41 cents to 66 cents per day, which would eventually be followed by a vehicle miles traveled tax until at least 2025, implementing a federal