Bill Summary
The "Infrastructure Bank for America Act of 2020" is a bill that aims to establish a corporation called the "Infrastructure Bank Holding Company", which will serve as a lender and investor in infrastructure projects in the United States. This bill also establishes the "Infrastructure Bank for America" as a subsidiary of the Holding Company. The Holding Company will have a Board of Directors and the Bank will have regional offices to focus on different areas of the country. The Bank's main function is to provide financing for revenue-producing infrastructure projects and to support rural projects. It is prohibited from engaging in commercial or investment banking activities. The Bank will also have the authority to pledge its loans to the Federal Reserve System and the Secretary of the Treasury can purchase its obligations. The Holding Company and the Bank will be exempt from taxation, except for any real property they hold. In order to incentivize investment in the Holding Company, this bill also includes a tax credit for qualified equity investments. The Federal Reserve System will have oversight and supervisory authority over the Holding Company and the Bank, while the Secretary of the Treasury will oversee bond issuances. A Infrastructure Guarantee Fund will also be established to protect against non-payment of loans or loan guarantees. This bill also includes a rule of construction that the federal government is not responsible for guaranteeing the assets of the Bank or Holding Company.
Possible Impacts
1. The establishment of the Infrastructure Bank for America could provide much-needed funding for infrastructure projects, improving the quality of roads, bridges, and public transportation systems for people living in the United States. This could lead to safer and more efficient travel for individuals and businesses alike.
2. The exemption from taxation for the Holding Company and the Bank could potentially benefit investors and shareholders, allowing them to see higher returns on their investments. This could attract more individuals and entities to invest in the Holding Company, boosting the economy and potentially creating job opportunities.
3. The limitation on commercial and investment banking activities for the Bank could lead to a more streamlined and focused approach to financing infrastructure projects. This could help prevent conflicts of interest and ensure that funds are directed towards projects with the greatest potential for success and impact, ultimately benefiting the American people.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7231 Introduced in House (IH)]
<DOC>
116th CONGRESS
2d Session
H. R. 7231
To establish the Infrastructure Bank for America as a corporation to
serve as a lender for and investor in infrastructure projects, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 15, 2020
Mr. Webster of Florida (for himself, Mr. Meuser, Mr. Reed, and Mr.
LaMalfa) introduced the following bill; which was referred to the
Committee on Transportation and Infrastructure, and in addition to the
Committees on Financial Services, and Ways and Means, for a period to
be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the
committee concerned
_______________________________________________________________________
A BILL
To establish the Infrastructure Bank for America as a corporation to
serve as a lender for and investor in infrastructure projects, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Infrastructure Bank for America Act
of 2020''.
SEC. 2. ESTABLISHMENT OF THE INFRASTRUCTURE BANK HOLDING COMPANY.
(a) In General.--There is established a corporation to be known as
the ``Infrastructure Bank Holding Company'' (in this Act referred to as
the ``Holding Company''), which shall be the parent company of the
Infrastructure Bank for America established under section 3.
(b) Board of Directors.--The Holding Company shall have a Board of
Directors, which shall--
(1) initially consist of 7 members, or such other number as
the formation agent determines appropriate;
(2) be elected by the shareholders of the Holding Company;
(3) within the limitations of law and regulation, determine
the general policies that govern the operations of the Holding
Company, and have the power to adopt, amend, and repeal bylaws
governing the performance of the powers and duties granted to
or imposed upon the Holding Company by law; and
(4) select and effect the appointment of qualified persons
to fill the office of the Chief Executive Officer and such
other offices as may be provided for in the bylaws of the
Holding Company and the Infrastructure Bank for America
established under section 3.
(c) Treatment of Shareholders of the Formation Agent.--The
formation agent shall issue equity securities of the Holding Company to
each shareholder of the formation agent, in an amount that the
formation agent determines has a value equal to the value of equity
securities of the formation agent held by such shareholder upon the
establishment of the Holding Company.
(d) Earnings and Reserves Not Government Funds.--The earnings and
reserves of the Holding Company shall be the sole property of the
Holding Company and may not be construed to be Government funds, public
funds, or appropriated money.
SEC. 3. ESTABLISHMENT OF THE INFRASTRUCTURE BANK FOR AMERICA.
(a) In General.--The formation agent shall establish a corporation
to be known as the ``Infrastructure Bank for America'' (in this Act
referred to as the ``Bank''). The Bank shall--
(1) maintain its principle office in New York City or the
District of Columbia; and
(2) be registered as a Delaware corporation, and, for the
purposes of jurisdiction and venue in civil actions, operate as
a Delaware corporation.
(b) Duties of the Formation Agent.--At the earliest practicable
date after the date of the enactment of this Act, the formation agent
shall make and file with the Secretary of the Treasury (in this Act
referred to as the ``Secretary'') an organization certificate for the
Bank in accordance with such rules and regulations as the Secretary may
prescribe.
(c) Regional Offices.--The Bank shall establish regional offices
for the purpose of focusing on infrastructure projects in different
areas of the Unites States.
(d) Board of Directors.--The Board of Directors of the Holding
Company established under section 2(b) shall be the initial Board of
Directors of the Bank.
SEC. 4. FUNCTIONS OF THE BANK.
(a) In General.--The Bank shall provide--
(1) equity investments, direct loans, indirect loans, and
loan guarantees for the construction or maintenance of revenue-
producing infrastructure projects in the United States with
sufficient revenue sources and guarantees to support the
interest and principal payments to the Bank; and
(2) direct and indirect loans and loan guarantees to State
and local governments and State infrastructure banks for the
construction or maintenance of infrastructure projects.
(b) Support for Rural Projects.--At least 7 percent of the dollar
amount of loans, equity investments, and loan guarantees provided by
the Bank shall be with respect to infrastructure projects in rural
areas.
(c) No Commercial or Investment Banking Activities.--The Bank shall
not accept customer deposits nor engage in financial or investment
banking activities such as trust management or underwriting securities.
(d) Pledge and Credit Facilities.--
(1) Pledge.--The Bank shall have the authority to pledge
its loans to the discount window of the Board of Governors of
the Federal Reserve System.
(2) Purchase of obligations.--The Secretary may, subject to
amounts provided in advance by appropriation Acts, purchase
obligations issued by the Bank in the same manner and under the
same requirements that the Secretary purchases obligations
under section 306(c) of the Federal Home Loan Mortgage
Corporation Act (12 U.S.C. 1455(c)).
(e) Leverage Limitation.--The Bank shall seek to maintain risk-
based capital at no less than 10 percent.
SEC. 5. HOLDING COMPANY SECURITIES.
(a) Equity Securities.--
(1) In general.--The Holding Company shall issue such
equity securities as the Holding Company determines
appropriate.
(2) Dividends.--The Holding Company may make such dividend
payments on the equity securities of the Holding Company as the
Holding Company determines appropriate.
(3) Initial issuance amount.--The Holding Company shall
have the goal of raising $1,000,000,000 in the initial issuance
of equity securities in a private placement and up to
$100,000,000,000 or more of equity securities in public
offerings over time, the purpose of which is to fund the Bank.
(4) Restriction on voting rights.--Any holder of an equity
security of the Holding Company that is a non-U.S. individual
or entity shall have no voting rights with respect to such
equity security.
(b) Bonds.--
(1) Standard bonds.--The Holding Company may issue standard
bonds with maturities up to 30 years or longer, as needed.
(2) Other bonds.--The Holding Company may issue such other
bonds, notes, and marketable securities with maturities and
interest rates as the Holding Company determines appropriate.
(3) Initial issuance amount.--The Holding Company shall
have the goal of making initial bond sales in a private
placement in an aggregate amount of $10,000,000,000 and in
public offerings in an amount of $1,000,000,000,000 or more
over time.
(4) Oversight and authority to purchase bonds.--
(A) Approval required.--Before issuing any bonds,
the Holding Company shall submit a proposal for such
bond issuance to the Secretary, and the Holding Company
may only issue such bonds if the Secretary approves the
proposal.
(B) Authority to purchase bonds.--
(i) In general.--The Secretary and the
Board of Governors of the Federal Reserve
System may purchase bonds issued under this
subsection.
(ii) Limitation.--The aggregate amount of
outstanding bonds purchased by the Secretary
under this subparagraph may not exceed 5
percent of the total amount of the outstanding
bonds of the Holding Company.
(5) Leverage limitation.--The Holding Company shall seek to
maintain risk-based capital at no less than 10 percent.
(c) Investment Limitation on Non-U.S. Individuals and Entities.--
Notwithstanding any other provision of law--
(1) non-U.S. individuals and entities may not hold more
than 25 percent, in the aggregate, of the equity securities and
bonds of the Holding Company; and
(2) nothing in this section shall prevent non-U.S.
individuals and entities that are shareholders from receiving
equity shares and dividend payments.
SEC. 6. OVERSIGHT AND REGULATION.
(a) Board of Governors of the Federal Reserve System.--The Board of
Governors of the Federal Reserve System shall have oversight and
supervisory authority over the Holding Company and the Bank in order to
ensure the safe and sound operation of the Holding Company and the
Bank.
(b) Secretary of the Treasury.--The Secretary shall oversee and
supervise the issuance of bonds by the Holding Company and the Bank, in
order to ensure the safe and sound financing of the Holding Company and
the Bank.
(c) Consultation.--The Secretary shall consult with the Board of
Governors of the Federal Reserve System and may consult with the
Secretary of Transportation and any other head of Federal agency when
carrying out the Secretary's duties under this Act.
SEC. 7. INFRASTRUCTURE GUARANTEE FUND.
(a) Establishment.--The Bank shall establish an Infrastructure
Guarantee Fund that shall be available for State and local governments
and other persons who wish to deposit funds to be used with respect to
specific loans or loan guarantees made by the Bank in the event of any
non-payment by the recipient of such loan or loan guarantee.
(b) Return of Funds.--Any funds described under subsection (a) that
are remaining at the time such loans or guaranteed loans are repaid in
full shall be returned to the State or local government or other person
who deposited the funds.
SEC. 8. HOLDING COMPANY AND BANK EXEMPTION FROM TAXATION.
Effective for taxable years ending on or after the date of
enactment of this Act, the Holding Company and the Bank, including
franchises, capital, reserves, surplus, advances, and income of the
Holding Company or Bank shall be exempt from all taxation imposed by
the United States, by any territory, dependency, or possession thereof,
or by any State, county, municipal, or local taxing authority, except
that any real property of the Holding Company and the Bank shall be
subject to State, territorial, county, municipal, or local taxation to
the same extent according to its value as other real property is taxed.
SEC. 9. INFRASTRUCTURE BANK HOLDING COMPANY CREDIT.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended--
(1) by adding at the end the following new section:
``SEC. 45U. INFRASTRUCTURE BANK HOLDING COMPANY CREDIT.
``(a) In General.--For purposes of section 38, in the case of a
taxpayer who holds a qualified Holding Company equity investment on a
credit allowance date of such investment which occurs during the
taxable year, the Infrastructure Bank Holding Company credit determined
under this section for such taxable year is an amount equal to 10
percent of the amount paid to the Holding Company for such investment
at its original issue.
``(b) Credit Allowance Date.--For purposes of this section, the
credit allowance date with respect to any qualified Holding Company
equity investment is--
``(1) the date on which such investment is initially made;
and
``(2) each of the 4 anniversary dates of such date
thereafter.
``(c) Qualified Holding Company Equity Investment.--For purposes of
this section, the term `qualified Holding Company equity investment'
means any equity investment originally issued by the Holding Company to
the taxpayer under section 5(a)(1) of the Infrastructure Bank for
America Act of 2020 not later than 3 years after the date of the
enactment of such Act.
``(d) Holding Company.--For purposes of this section, the term
`Holding Company' means the Infrastructure Bank Holding Company
established by the Infrastructure Bank for America Act of 2020.
``(e) Basis Reduction.--The basis of any qualified Holding Company
equity investment shall be reduced by the amount of any credit
determined under this section with respect to such investment.''; and
(2) in the table of contents for such subpart, by adding at
the end the following:
``45U. Infrastructure Bank Holding Company credit.''.
(b) Conforming Amendments.--
(1) Section 38(b) of such Code is amended by striking
``plus'' at the end of paragraph (32), by striking the period
at the end of paragraph (33) and inserting ``, plus'', and by
adding at the end the following new paragraph:
``(34) the Infrastructure Bank Holding Company credit
determined under section 45U.''.
(2) Section 1016(a) of such Code is amended by striking
``and'' at the end of paragraph (37), by striking the period at
the end of paragraph (38) and inserting ``, and'', and by
adding at the end the following new paragraph:
``(39) to the extent provided in section 45U(e).''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years ending after the date of the enactment of this
Act.
SEC. 10. RULE OF CONSTRUCTION.
Nothing in this Act may be construed as authorizing the Federal
Government to guarantee the assets of the Bank or Holding Company.
SEC. 11. DEFINITIONS.
For the purposes of this Act:
(1) Bank.--The term ``Bank'' means the Infrastructure Bank
for America established under section 3.
(2) Formation agent.--The term ``formation agent'' means an
entity selected by the Secretary of the Treasury with
significant experience in infrastructure and infrastructure
finance.
(3) Holding company.--The term ``Holding Company'' means
the Infrastructure Bank Holding Company established under
section 2.
(4) Revenue-producing infrastructure project.--The term
``revenue-producing infrastructure project'' means an
infrastructure project that, when complete, generates revenue
from user fees or other sources.
(5) Risk-based capital.--The term ``risk-based capital''
shall have the meaning given that term by the Board of
Governors of the Federal Reserve System.
(6) Rural.--The term ``rural'' means a county that is
neither in a metropolitan statistical area nor in a
micropolitan statistical area that is adjacent to a
metropolitan statistical area, as those terms are defined by
the Office of Management and Budget and as applied under
currently applicable Urban Influence Codes, established by the
Economic Research Service of the Department of Agriculture.
(7) State.--The term ``State'' means each of the several
States, the District of Columbia, each territory or possession
of the United States, and each federally recognized Indian
Tribe.
(8) State infrastructure bank.--The term ``State
infrastructure bank'' means a State infrastructure bank or
multi-State infrastructure bank established pursuant to--
(A) section 350 of the National Highway System
Designation Act of 1995;
(B) section 1511(l) of the Transportation Equity
Act for the 21st Century;
(C) section 610 of title 23, United States Code; or
(D) any State law as an agency, component unit, or
other governmental entity of the State.
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