INFRASTRUCTURE/TRUMP AS PRESIDENT: “When President Donald Trump unveiled his long-anticipated infrastructure plan on Monday [2-12-18], there was one word that caught the attention of many investors: ‘recycling.’
It isn’t the garbage variety. Since early last year, infrastructure fund managers, bankers and lobbyists have been pitching the administration on the concept of infrastructure asset recycling…
The federal government would set up a pot of money to give state and local governments a bonus payment when they privatize or lease one of their existing assets to investors. To earn the bonus, governments would have to commit to using the sale proceeds to fund new bridges, roads or other infrastructure projects in need of money.
President Trump’s $1.5 trillion infrastructure plan stopped short of recommending such a fund. But it eased a requirement that investors who buy or lease public infrastructure assets must repay all their existing tax-exempt debt—an expensive proposition that makes such deals harder to finance. The plan proposes governments could recycle deal proceeds into new projects, and if they do, the tax-exempt debt could remain outstanding.”
-Cezary Podkul, “Should America Sell Its Existing Roads to Pay for New Ones?,” The Wall Street Journal online, Feb. 14, 2018 08:00am