Navigating Infrastructure Delivery Through Financing Headwinds

As the federal debt grows and bond yields rise, public owners may need to reevaluate their approach to financing and delivering essential infrastructure projects. Over the past few weeks, the national debt surpassed $40 trillion and the yield on 30-year U.S. Treasury bonds reached a 19-year high. Growing federal debt may constrain future federal contributions to state and local projects, while rising bond yields may increase borrowing costs for those projects. To overcome these challenges, state and local governments may need to consider alternative strategies to address their critical infrastructure needs.

When applied strategically to appropriate projects, project delivery methods such as design-build and construction manager-at-risk may create efficiencies with respect to project cost and schedule. An environment with constrained government financing options may also lead more public owners to consider public-private partnerships (P3s) for project delivery. While private