Infrastructure Bank for America Act of 2020

I 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 Com- mittee on Transportation and Infrastructure, and in addition to the Com- mittees 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 con- cerned A BILL To establish the Infrastructure Bank for America as a cor- poration to serve as a lender for and investor in infra- structure projects, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Infrastructure Bank 4 for America Act of 2020’’. 5 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 2 •HR 7231 IH SEC. 2. ESTABLISHMENT OF THE INFRASTRUCTURE BANK 1 HOLDING COMPANY. 2 (a) IN GENERAL.—There is established a corporation 3 to be known as the ‘‘Infrastructure Bank Holding Com- 4 pany’’ (in this Act referred to as the ‘‘Holding Com- 5 pany’’), which shall be the parent company of the Infra- 6 structure Bank for America established under section 3. 7 (b) BOARD OF DIRECTORS.—The Holding Company 8 shall have a Board of Directors, which shall— 9 (1) initially consist of 7 members, or such other 10 number as the formation agent determines appro- 11 priate; 12 (2) be elected by the shareholders of the Hold- 13 ing Company; 14 (3) within the limitations of law and regulation, 15 determine the general policies that govern the oper- 16 ations of the Holding Company, and have the power 17 to adopt, amend, and repeal bylaws governing the 18 performance of the powers and duties granted to or 19 imposed upon the Holding Company by law; and 20 (4) select and effect the appointment of quali- 21 fied persons to fill the office of the Chief Executive 22 Officer and such other offices as may be provided 23 for in the bylaws of the Holding Company and the 24 Infrastructure Bank for America established under 25 section 3. 26 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 3 •HR 7231 IH (c) TREATMENT OF SHAREHOLDERS OF THE FORMA- 1 TION AGENT.—The formation agent shall issue equity se- 2 curities of the Holding Company to each shareholder of 3 the formation agent, in an amount that the formation 4 agent determines has a value equal to the value of equity 5 securities of the formation agent held by such shareholder 6 upon the establishment of the Holding Company. 7 (d) EARNINGS AND RESERVES NOT GOVERNMENT 8 FUNDS.—The earnings and reserves of the Holding Com- 9 pany shall be the sole property of the Holding Company 10 and may not be construed to be Government funds, public 11 funds, or appropriated money. 12 SEC. 3. ESTABLISHMENT OF THE INFRASTRUCTURE BANK 13 FOR AMERICA. 14 (a) IN GENERAL.—The formation agent shall estab- 15 lish a corporation to be known as the ‘‘Infrastructure 16 Bank for America’’ (in this Act referred to as the 17 ‘‘Bank’’). The Bank shall— 18 (1) maintain its principle office in New York 19 City or the District of Columbia; and 20 (2) be registered as a Delaware corporation, 21 and, for the purposes of jurisdiction and venue in 22 civil actions, operate as a Delaware corporation. 23 (b) DUTIES OF THE FORMATION AGENT.—At the 24 earliest practicable date after the date of the enactment 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 4 •HR 7231 IH of this Act, the formation agent shall make and file with 1 the Secretary of the Treasury (in this Act referred to as 2 the ‘‘Secretary’’) an organization certificate for the Bank 3 in accordance with such rules and regulations as the Sec- 4 retary may prescribe. 5 (c) REGIONAL OFFICES.—The Bank shall establish 6 regional offices for the purpose of focusing on infrastruc- 7 ture projects in different areas of the Unites States. 8 (d) BOARD OF DIRECTORS.—The Board of Directors 9 of the Holding Company established under section 2(b) 10 shall be the initial Board of Directors of the Bank. 11 SEC. 4. FUNCTIONS OF THE BANK. 12 (a) IN GENERAL.—The Bank shall provide— 13 (1) equity investments, direct loans, indirect 14 loans, and loan guarantees for the construction or 15 maintenance of revenue-producing infrastructure 16 projects in the United States with sufficient revenue 17 sources and guarantees to support the interest and 18 principal payments to the Bank; and 19 (2) direct and indirect loans and loan guaran- 20 tees to State and local governments and State infra- 21 structure banks for the construction or maintenance 22 of infrastructure projects. 23 (b) SUPPORT FOR RURAL PROJECTS.—At least 7 24 percent of the dollar amount of loans, equity investments, 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 5 •HR 7231 IH and loan guarantees provided by the Bank shall be with 1 respect to infrastructure projects in rural areas. 2 (c) NO COMMERCIAL OR INVESTMENT BANKING AC- 3 TIVITIES.—The Bank shall not accept customer deposits 4 nor engage in financial or investment banking activities 5 such as trust management or underwriting securities. 6 (d) PLEDGE AND CREDIT FACILITIES.— 7 (1) PLEDGE.—The Bank shall have the author- 8 ity to pledge its loans to the discount window of the 9 Board of Governors of the Federal Reserve System. 10 (2) PURCHASE OF OBLIGATIONS.—The Sec- 11 retary may, subject to amounts provided in advance 12 by appropriation Acts, purchase obligations issued 13 by the Bank in the same manner and under the 14 same requirements that the Secretary purchases ob- 15 ligations under section 306(c) of the Federal Home 16 Loan Mortgage Corporation Act (12 U.S.C. 17 1455(c)). 18 (e) LEVERAGE LIMITATION.—The Bank shall seek to 19 maintain risk-based capital at no less than 10 percent. 20 SEC. 5. HOLDING COMPANY SECURITIES. 21 (a) EQUITY SECURITIES.— 22 (1) IN GENERAL.—The Holding Company shall 23 issue such equity securities as the Holding Company 24 determines appropriate. 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 6 •HR 7231 IH (2) DIVIDENDS.—The Holding Company may 1 make such dividend payments on the equity securi- 2 ties of the Holding Company as the Holding Com- 3 pany determines appropriate. 4 (3) INITIAL ISSUANCE AMOUNT.—The Holding 5 Company shall have the goal of raising 6 $1,000,000,000 in the initial issuance of equity se- 7 curities in a private placement and up to 8 $100,000,000,000 or more of equity securities in 9 public offerings over time, the purpose of which is 10 to fund the Bank. 11 (4) RESTRICTION ON VOTING RIGHTS.—Any 12 holder of an equity security of the Holding Company 13 that is a non-U.S. individual or entity shall have no 14 voting rights with respect to such equity security. 15 (b) BONDS.— 16 (1) STANDARD BONDS.—The Holding Company 17 may issue standard bonds with maturities up to 30 18 years or longer, as needed. 19 (2) OTHER BONDS.—The Holding Company 20 may issue such other bonds, notes, and marketable 21 securities with maturities and interest rates as the 22 Holding Company determines appropriate. 23 (3) INITIAL ISSUANCE AMOUNT.—The Holding 24 Company shall have the goal of making initial bond 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 7 •HR 7231 IH sales in a private placement in an aggregate amount 1 of $10,000,000,000 and in public offerings in an 2 amount of $1,000,000,000,000 or more over time. 3 (4) OVERSIGHT AND AUTHORITY TO PURCHASE 4 BONDS.— 5 (A) APPROVAL REQUIRED.—Before issuing 6 any bonds, the Holding Company shall submit 7 a proposal for such bond issuance to the Sec- 8 retary, and the Holding Company may only 9 issue such bonds if the Secretary approves the 10 proposal. 11 (B) AUTHORITY TO PURCHASE BONDS.— 12 (i) IN GENERAL.—The Secretary and 13 the Board of Governors of the Federal Re- 14 serve System may purchase bonds issued 15 under this subsection. 16 (ii) LIMITATION.—The aggregate 17 amount of outstanding bonds purchased by 18 the Secretary under this subparagraph 19 may not exceed 5 percent of the total 20 amount of the outstanding bonds of the 21 Holding Company. 22 (5) LEVERAGE LIMITATION.—The Holding 23 Company shall seek to maintain risk-based capital at 24 no less than 10 percent. 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 8 •HR 7231 IH (c) INVESTMENT LIMITATION ON NON-U.S. INDIVID- 1 UALS AND ENTITIES.—Notwithstanding any other provi- 2 sion of law— 3 (1) non-U.S. individuals and entities may not 4 hold more than 25 percent, in the aggregate, of the 5 equity securities and bonds of the Holding Company; 6 and 7 (2) nothing in this section shall prevent non- 8 U.S. individuals and entities that are shareholders 9 from receiving equity shares and dividend payments. 10 SEC. 6. OVERSIGHT AND REGULATION. 11 (a) BOARD OF GOVERNORS OF THE FEDERAL RE- 12 SERVE SYSTEM.—The Board of Governors of the Federal 13 Reserve System shall have oversight and supervisory au- 14 thority over the Holding Company and the Bank in order 15 to ensure the safe and sound operation of the Holding 16 Company and the Bank. 17 (b) SECRETARY OF THE TREASURY.—The Secretary 18 shall oversee and supervise the issuance of bonds by the 19 Holding Company and the Bank, in order to ensure the 20 safe and sound financing of the Holding Company and the 21 Bank. 22 (c) CONSULTATION.—The Secretary shall consult 23 with the Board of Governors of the Federal Reserve Sys- 24 tem and may consult with the Secretary of Transportation 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 9 •HR 7231 IH and any other head of Federal agency when carrying out 1 the Secretary’s duties under this Act. 2 SEC. 7. INFRASTRUCTURE GUARANTEE FUND. 3 (a) ESTABLISHMENT.—The Bank shall establish an 4 Infrastructure Guarantee Fund that shall be available for 5 State and local governments and other persons who wish 6 to deposit funds to be used with respect to specific loans 7 or loan guarantees made by the Bank in the event of any 8 non-payment by the recipient of such loan or loan guar- 9 antee. 10 (b) RETURN OF FUNDS.—Any funds described under 11 subsection (a) that are remaining at the time such loans 12 or guaranteed loans are repaid in full shall be returned 13 to the State or local government or other person who de- 14 posited the funds. 15 SEC. 8. HOLDING COMPANY AND BANK EXEMPTION FROM 16 TAXATION. 17 Effective for taxable years ending on or after the date 18 of enactment of this Act, the Holding Company and the 19 Bank, including franchises, capital, reserves, surplus, ad- 20 vances, and income of the Holding Company or Bank shall 21 be exempt from all taxation imposed by the United States, 22 by any territory, dependency, or possession thereof, or by 23 any State, county, municipal, or local taxing authority, ex- 24 cept that any real property of the Holding Company and 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 10 •HR 7231 IH the Bank shall be subject to State, territorial, county, mu- 1 nicipal, or local taxation to the same extent according to 2 its value as other real property is taxed. 3 SEC. 9. INFRASTRUCTURE BANK HOLDING COMPANY CRED- 4 IT. 5 (a) IN GENERAL.—Subpart D of part IV of sub- 6 chapter A of chapter 1 of the Internal Revenue Code of 7 1986 is amended— 8 (1) by adding at the end the following new sec- 9 tion: 10 ‘‘SEC. 45U. INFRASTRUCTURE BANK HOLDING COMPANY 11 CREDIT. 12 ‘‘(a) IN GENERAL.—For purposes of section 38, in 13 the case of a taxpayer who holds a qualified Holding Com- 14 pany equity investment on a credit allowance date of such 15 investment which occurs during the taxable year, the In- 16 frastructure Bank Holding Company credit determined 17 under this section for such taxable year is an amount 18 equal to 10 percent of the amount paid to the Holding 19 Company for such investment at its original issue. 20 ‘‘(b) CREDIT ALLOWANCE DATE.—For purposes of 21 this section, the credit allowance date with respect to any 22 qualified Holding Company equity investment is— 23 ‘‘(1) the date on which such investment is ini- 24 tially made; and 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H7231.IH H7231 pbinns on DSKJLVW7X2PROD with BILLS 11 •HR 7231 IH ‘‘(2) each of the 4 anniversary dates of such 1 date thereafter. 2 ‘‘(c) QUALIFIED HOLDING COMPANY EQUITY IN- 3 VESTMENT.—For purposes of this section, the term ‘quali- 4 fied Holding Company equity investment’ means any eq- 5 uity investment originally issued by the Holding Company 6 to the taxpayer under section 5(a)(1) of the Infrastructure 7 Bank for America Act of 2020 not later than 3 years after 8 the date of the enactment of such Act. 9 ‘‘(d) HOLDING COMPANY.—For purposes of this sec- 10 tion, the term ‘Holding Company’ means the Infrastruc- 11 ture Bank Holding Company established by the Infra- 12 structure Bank for America Act of 2020. 13 ‘‘(e) BASIS REDUCTION.—The basis of any qualified 14 Holding Company equity investment shall be reduced by 15 the amount of any credit determined under this section 16 with respect to such investment.’’; and 17 (2) in the table of contents for such subpart, by 18 adding at the end the following: 19 ‘‘45U. Infrastructure Bank Holding Company credit.’’. (b) CONFORMING AMENDMENTS.— 20 (1) Section 38(b) of such Code is amended by 21 striking ‘‘plus’’ at the end of paragraph (32), by 22 striking the period at the end of paragraph (33) and 23 inserting ‘‘, plus’’, and by adding at the end the fol- 24 lowing new paragraph: 25 VerDate Sep 11 2014 05:00 Jul 09, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H723 [Text truncated for display. Full text available on Congress.gov.]