The proposal -- sponsored by Sen. John Kerry, D-Massachusetts, and Sen. Kay Bailey Hutchison, R-Texas -- would establish an independent bank to provide loans and loan guarantees for projects of regional or national significance. The idea is to attract more infrastructure investment from the private sector. By creating an infrastructure bank with $10 billion now, supporters contend, they could spur up to $640 billion worth of infrastructure spending over the next decade, The New York Times reported.

"We have a choice," Kerry said at a news conference in Washington. "We can either build, and compete, and create jobs for our people, or we can fold up, and let everybody else win. I don't think that's America. I don't believe anybody wants to do that."

To underscore the need for better infrastructure, labor and business leaders joined forces at the news conference: Richard Trumka, president of the AFL-CIO labor union, and Thomas Donohue, president of the U.S. Chamber of Commerce.

The outlook for such a program is dim, however, given the current fiscal constraints, the newspaper reported. And Congress, like state governments, has been hesitant to cede control of choosing which projects to finance.

Sen. John Thune, R-South Dakota, has urged caution in going forward with an infrastructure bank, arguing that it would likely benefit large metropolitan regions at the expense of rural areas.

Gaining enough support for an infrastructure bank is also an issue in the House of Representatives. House Transportation and Infrastructure Committee Chairman John Mica, R-Florida, said he is "very reticent" to support Kerry's proposal because he would prefer to see more private investment rather than "Washington bureaucracy."

President Barack Obama has called for establishing an infrastructure bank since his 2008 campaign. His Fiscal Year 2012 budget calls for establishing a bank that would work somewhat differently than the one proposed by Kerry and Hutchison. Obama's plan would create a $30 billion bank that would invest in transportation projects alone. It would provide grants as well as loans.

Wyden Hopes to Bring Back Build America Bonds

There is also an effort underway in the Senate to revive the Build America Bonds program, which expired at the end of last year. (see Dec. 17 AASHTO Journal story)

Sen. Ron Wyden, D-Oregon, is leading the push to reauthorize BABs. He would change the program's name to "TRIPS," an acronym for Transportation and Regional Infrastructure Bonds.

Issuers sold more than $180 billion in BABs after the program started in April 2009, which Wyden called "a breathtaking sum."

The Obama administration supports reinstating BABs. (see March 11 AASHTO Journal story)