There are some things that are so basic and intrinsic that we don’t think about them until something goes wrong. Consider breathing or your heartbeat — you don’t consciously think to make your heart beat, and unless you are doing so deliberately, breathing is just as autonomic. But boy, when either one encounters difficulty it tends to seize the mind. The same can be considered true about national infrastructure.
Our infrastructure can be defined as everything that makes the country work, from roads and bridges to subway lines, water transportation lines, and sewage removal systems. It’s railroads, dams, and power lines. It concerns how people and goods are transported, and the stage on which daily life is played out. Because it is so basic and so fundamental, many people take it for granted. Unless you are involved in building or maintenance, you tend to not notice it until something goes wrong. But as anyone who is involved understands, something is going seriously wrong and the plans to adders the issue, including a national infrastructure bank, have the potential to change the contracting field and the bonding market in a serious way.
Understanding the Problem with Infrastructure
The Minneapolis evening rush hour on August 1st, 2007, was going pretty much like any other — a lot of traffic, distracted moods, impatient drivers, mixed with “Minnesota nice.” Then, unimaginable disaster struck, as the portion of 1-35 that spanned the Mississippi suddenly collapsed, plummeting a sickening torrent of cars and concrete into the river, killing 13. The terrifying footage shocked the country. This was a modern bridge in a modern city, crumbling like a toy.
Though some had been raising alarms about the state of our infrastructure beforehand, this elevated it a national issue. Since then, we’ve encountered a stream of terrible reports, with independent groups giving our infrastructure grades like D+ (and the plus seemed generous) and estimates of how much it would cost to fix, ranging into the low trillions. Locations and structures that need to be addressed — from bridges to levees to dams — are all over the country. Something has to be done.
Unfortunately, governmental paralysis has stifled work. Recently, however, there has been some movement and there is a chance we can break out of this to tackle the necessary work to repair America.
The National Infrastructure Bank and Tax Compromises
Ideas about a National Infrastructure Bank have been floating around for a long time, with general bipartisan support. President Obama first proposed on in 2011, and while there was agreement that it was needed, it became buried in election-year politics and hung up on the idea of taxes. Congress didn’t want any taxes raised to pay for it, so it seemed to languish. It was never discarded, though, and was recently proposed again by Republican Senator Deb Fischer.
What the Bank would do is start a pool of money that is used to invest in state or local projects, helping to fund them and being a source of revenue from which local governments can draw. It would also guarantee private investment in these projects, which can help incentivize work to move forward. Both sides agree on this rough structure. It’s paying for it that was the problem.
It looks like there might be relief, though. The Obama Administration has proposed that the initial investment come from offshore tax shelters, which some corporations use to avoid paying taxes. Closing these loopholes is popular with both parties and a key plank of the Republican tax strategy. It looks like there is a chance this could finally happen.
What the Bank Would Mean to Contractors
The bank won’t be like opening a fire hydrant, of course. Projects and money won’t shoot forth for us to dance under in the street. But it will start to move the process forward in a way that will gain momentum. Right now, our infrastructure spending is incredibly low for a nation of our size and complexity. The Bank can change this, on every level of government.
This means more work for contractors, subcontractors, and suppliers. It will also, in many cases, mean that to get these jobs you’ll have to obtain the right bonds, both performance and payment, as stipulated in the Miller and Little Miller Acts. These funds will most likely be regulated, so hoping that you can skate by without getting a surety bond from a trusted source is the best way to be left out in the cold.
Infrastructure erodes slowly until it suddenly collapses with terrifying speed. Unfortunately, the government moves just as slowly. Now, however, there seems to be progress and a chance to rebuild the central nervous system of our country. Being prepared for change means getting the job and being part of an American rebirth.
Getting the contract requires the backing of a strong Surety company with a reputation you can depend on. Contact Surety1 today for a quick and fair bonding process that’ll get you to work.