public infrastructure financing: a strategic investment approach september 25, 2013 by dj heffernan...

Public Infrastructure Financing: A Strategic Investment Approach

September 25, 2013

By DJ HeffernanDaniel Heffernan Company

Overview• Infrastructure Financing Context

• Land Use Planning Constraints

•Private Investor Constraints

•Financing Tools/Constraints

•Strategic Investing

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Infrastructure Investment Needs• Washington State Infrastructure Grade: C

• http://www.infrastructurereportcard.org/washington/washington-overview/

• Bond Banks: Supply Side Solution to Demand Side Problem• Insert link on HH income to debt ratios OR stat on HH income

loss

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Land Use Planning Issues

• Plan Provides Strategic Vision but…

• Plan vs. Implementation: Regulatory Disconnect• Where did the land go? • Where did the capacity go?

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Investor Constraints

• ROI Horizon

• Holding Costs

• Strategic Assets vs. Market Assets?

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Financing Tools

• Washington State’s Tool Box• http://www.infrafunding.wa.gov/iadatabase.html

• Local Tool Box• LID’s, Sales and Use Tax Districts• Community Renewal Districts• B&O Taxes

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Financing Constraints

• Competing Demands: New Assets vs. Capital Maintenance

• The “We don’t have any loose change” Problem

• Impact Fee/Concurrency Dilemmas

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Strategic Solutions

• Land Use: Define Strategic vs. Market Land• Regulate accordingly• Link land use plans to TIP Strategies Plan

• Investor Risks: ROI and Holding Costs• Ports? Reserve Capacity? Tax Incentives? Knots?

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Strategic Solutions• Financial • Public Dialog/Consensus on Strategic Infrastructure

Investments (new vs. replacement assets)

• Reduce Private Sector Cap-rate for fees

• Get creative – use the tool kits!

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Daniel Heffernan Company

Contact Information:

DJ Heffernan• (503) 310-2306• djheff1@gmail.com

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