The Impact of U.S. Government Infrastructure Spending on the Private Funds Industry -

As part of our ongoing series on the Trump administration’s infrastructure proposal, Building A Stronger America (the “Plan”), we continue to provide insight on how various sectors of the financial industry may be impacted by one of the largest pro-growth government spending campaigns of the past few decades. In March 2018, we provided an update on administrative and legislative reactions to the proposal along with an analysis of relevant tax planning aspects of investing in U.S. infrastructure projects more generally. In this segment, we explore the potential impact of the Plan on private funds.

OVERVIEW OF THE PLAN -

On February 12, 2018, the Trump administration released a proposal that would increase U.S. federal infrastructure funding and incentives, provide state and local authorities greater discretion over infrastructure investments and encourage cooperation between state and local governments and the private sector in developing and operating infrastructure projects. If enacted, the Plan would, according to the current administration, result in $1.5 trillion in new infrastructure investment by leveraging $200 billion over 10 years in federal spending. The remainder of the funding would come from a combination of state and local government funds and private capital through public-private partnerships (“P3 Projects”).