SENATORS MCCORMICK, DUCKWORTH INTRODUCE BILL TO EXPAND LOW-COST FINANCING FOR TRANSPORTATION INFRASTRUCTURE

WASHINGTON - U.S. Senators Dave McCormick (R-PA) and Tammy Duckworth (D-IL) today introduced the Transit for Urban Renewal and Business Opportunities Act (TURBO Act), legislation that would expand and modernize a key federal financing tool used by state and local governments to deliver critical transportation infrastructure through public-private partnerships.

Private Activity Bonds (PABs) are tax-exempt bonds that state and local governments issue on behalf of private entities to finance projects that serve a public purpose. Administered by the Build America Bureau within the U.S. Department of Transportation, PABs are a critical tool for attracting private-sector investment in highways, transit, and freight infrastructure. But the national volume cap for qualified highway and surface freight transfer facilities has been exhausted, with the current $30 billion cap fully allocated.

Beyond the cap, outdated rules also prevent communities from using these bonds for many of today's transportation needs. Current law generally allows the bonds to finance the construction of rail and bus infrastructure, but not the purchase of rolling stock. It also limits eligibility for passenger rail projects to those capable of reaching 150 miles per hour, leaving many modern rail projects that operate on shared freight corridors ineligible for this low-cost financing.

The TURBO Act would:

• Raise the national volume cap for qualified highway and surface freight transfer facilities from $30 billion to $45 billion, ensuring that critical transportation projects can continue to access low-cost financing through public-private partnerships.
• Expand the eligibility of mass commuting facility bonds to explicitly cover the acquisition of rolling stock - such as buses, railcars, and ferries - lowering the cost of modernizing transit fleets and letting local communities determine their own infrastructure needs.
• Lower the speed threshold for high-speed intercity rail facilities from 150 miles per hour to 110 miles per hour, opening PAB financing to a far wider range of passenger rail investments, including projects that operate on shared rights-of-way with freight railroads.
  
  

"America's transportation needs are growing, and we should be making it easier, not harder, for states and communities to finance the projects that keep goods and people moving," said Senator McCormick. "The TURBO Act modernizes a proven, low-cost financing tool critical so highway, transit, and rail projects in Pennsylvania can move forward. By expanding capacity and cutting outdated red tape, we can unlock more private investment in Pennsylvania and across the country."

"Far too often, roads that need repaving and transportation facilities that need revamping are left unfixed because states and towns don't have the funding they need," said Senator Duckworth. "Our bipartisan bill would help state and local governments supercharge their infrastructure financing-enabling them to deliver faster on projects, replace old buses, improve inter-city passenger rail and more. It's critical we build on the incredible progress of the Bipartisan Infrastructure Law, and this commonsense legislation would help us do just that."

Congress created this financing category in the 2005 Surface Transportation Authorization (SAFETEA-LU), which set the national cap at $15 billion, and doubled it to $30 billion on a bipartisan basis in the 2021 Infrastructure Investment and Jobs Act (IIJA). With nearly all of that expanded capacity now committed, communities risk losing access to affordable financing for major projects at a time when infrastructure demands continue to grow.

The TURBO Act is supported by the following stakeholders:

"Pennsylvania's public transportation systems need reliable, flexible financing tools to modernize fleets, improve infrastructure, and continue providing safe, dependable service," said Kim Whetsell, Executive Director of the Pennsylvania Public Transportation Association (PPTA). "The Pennsylvania Public Transportation Association applauds Senators McCormick and Duckworth for introducing the TURBO Act, which would expand financing opportunities and help transit agencies make strategic, long-term investments. This legislation is an important step toward strengthening public transportation across the Commonwealth, and we encourage Congress to advance it. We thank Senators McCormick and Duckworth for their leadership and commitment to the future of public transit."

"SEPTA operates the oldest rail vehicle fleet in the nation, and replacing four major rail fleets at once is an unprecedented financial challenge that our current capital funding cannot fully support," said SEPTA General Manager, Scott A. Sauer. "While there is no substitute for dedicated federal investment in the nation's critical transit infrastructure, the financing modernization provisions in the TURBO Act could give SEPTA access to additional financing options to deliver much needed investments for our customers and the Greater Philadelphia region."

"Modern, reliable public transportation depends on having the tools to invest in the future,"said Katherine Kelleman, CEO of Pittsburgh Regional Transit. "Pittsburgh Regional Transit applauds Senators McCormick and Duckworth for introducing the TURBO Act,which will expand financing options for transit agencies as they replace aging fleets, upgrade infrastructure and improve service. This legislation will give agencies greater flexibility to make smart, long-term investments that benefit riders and the communities they serve. PRT encourages Congress to advance this critical legislation, and we thank Senators McCormick and Duckworth for their leadership on this issue."

"The TURBO Act is a smart, forward-thinking solution to expand access to low-cost financing for critical infrastructure and transportation projects," said Jeff Nobers, Executive Director, Pittsburgh Works Together. "By raising the cap on these bonds and making more passenger rail projects eligible, this bill empowers local communities and encourages public-private partnerships to modernize infrastructure across the country creating thousands of jobs and making it easier for people to access good paying careers."

"Reliable infrastructure is essential to the competitiveness of American manufacturers" said Jezree Friend, Vice President, Manufacturer & Business Association. "The Manufacturer & Business Association applauds Senator McCormick for introducing theTURBO Act, which expands access to financing tools that will strengthen supply chains, encourage private-sector investment, and modernize our transportation infrastructure. This legislation will help keep Pennsylvania businesses competitive and our economy moving forward."

"We at the Erie Regional Chamber & Growth Partnership are well aware of the difficulties of financing infrastructure investment in the Erie region, the Commonwealth, and across the nation. The TURBO Act, by raising the limits for Private Activity Bonds, helps solve the problem of infrastructure investment costs and financing. We at the Erie Regional Chamber commend Senators McCormick and Duckworth for this bipartisan solution." - Erie Regional Chamber and Growth Partnership

Read the full bill text here.

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