The Transportation Infrastructure Finance and Innovation Act (TIFIA) Program

Summary: The Transportation Infrastructure Finance and Innovation Act (TIFIA) program, administered by the Department of Transportation's Build America Bureau, provides long-term, low-interest loans and other types of credit assistance for the construction of surface transportation projects (23 U.S.C. §601 et seq.). The TIFIA program was reauthorized from FY2016 through FY2020 in the Fixing America's Surface Transportation (FAST) Act (P.L. 114-94). Direct funding for the TIFIA program is authorized at $300 million for each of FY2019 and FY2020. Additionally, state departments of transportation can use other federal-aid highway grant money, both formula and discretionary, to subsidize much larger loans. To date, states have not had to use other grant funding to subsidize credit assistance because the TIFIA program has a relatively large unexpended funding balance.

Summary: The primary goal of the TIFIA program, historically, has been to enable the construction of large-scale surface transportation projects by providing financing to complement state, local, and private investment. The TIFIA program has been one of the main ways in which the federal government has encouraged the development of public-private partnerships (P3s) and private financing in surface transportation often backed by new, but sometimes uncertain, revenue sources such as highway tolls, other types of user charges, and incremental real estate taxes. To be eligible for TIFIA assistance, a project sponsor must be deemed creditworthy, that is, a good risk for repaying its debts, and must have a dedicated source of revenue for repayment. Project sponsors, therefore, are required to develop a funding mechanism, whether this is a new user fee or tax or the repurposing of existing fees and taxes. Changes to the TIFIA program have sought to make TIFIA assistance more accessible to less costly projects, but so far every TIFIA-supported project has cost $175 million or more.

Summary: Financing projects instead of relying on pay-as-you go funding from taxes and other existing revenues can mean such projects can be constructed years earlier. TIFIA, therefore, is a means to accelerate project delivery and the benefits that flow from new infrastructure. The TIFIA program is also a relatively low-cost way for the federal government to support surface transportation projects because it relies on loans, not grants, and the TIFIA assistance is typically one-third or less of project costs. Another advantage from the federal point of view is that a relatively small amount of budget authority can be leveraged into a large amount of loan capacity. Because the government expects its loans to be repaid, an appropriation need only cover administrative costs and the subsidy cost of credit assistance. Program funding of $300 million can support approximately $4 billion in TIFIA loans.

Summary: Since its enactment in 1998, the TIFIA program has provided assistance of $32 billion to 74 projects with a total cost of about $117 billion (in FY2018 inflation-adjusted dollars). All but one TIFIA credit agreement has been a loan; the exception is a loan guarantee. The average TIFIA-supported project cost is $1.5 billion, and the average TIFIA loan is $430 million (both in FY2018 dollars). About two-thirds of TIFIA loans have gone to highway and highway bridge projects, and another quarter to public transportation. TIFIA has supported at least one project in 21 states, the District of Columbia, and Puerto Rico, but the top 10 states account for about 80% of the 74 projects supported.

Summary: The TIFIA program is likely to be considered in the 116th Congress during the reauthorization of the surface transportation programs. Program funding is one issue that may be discussed, because some stakeholders would like more budget authority despite a relatively large unexpended balance and the existing authority of states to use grant funding to pay the subsidy cost of credit assistance. Criticisms of the program and its implementation include the often slow decisionmaking process, the program's increasing risk aversion, and the limitation of the federal share of project costs to 33%, despite a statutory limit of 49%. Because of the relatively large unexpended balance, Congress might considered broadening the use of TIFIA assistance to nonsurface transportation and nontransportation infrastructure. Another option might be to create a national infrastructure bank, a federal infrastructure financing entity largely independent of other executive branch agencies, to take the place of TIFIA and other federal infrastructure credit assistance programs.

The Transportation Infrastructure Finance and Innovation Act (TIFIA) program provides long-term, low-interest loans and other types of credit assistance for the construction of surface transportation projects. The TIFIA prog ram, administered by the Build America Bureau of the Department of Transportation (DOT), was reauthorized most recently in the Fixing America's Surface Transportation (FAST) Act ( P.L. 114-94 ) from FY2016 through FY2020. Direct funding for the TIFIA program to make loans is authorized at $300 million for each of FY2019 and FY2020, but state departments of transportation can also use federal-aid highway grant money, both formula and discretionary, to subsidize much larger loans.

The primary goal of the TIFIA program, historically, has been to enable the construction of large-scale surface transportation projects by providing low-interest, long-term financing to complement state, local, and private investment. The TIFIA program has been one of the main ways in which the federal government has encouraged the development of public-private partnerships (P3s) and private financing in surface transportation often backed by new, but sometimes uncertain, revenue sources such as highway tolls, other types of user charges, and incremental real estate taxes. Since its enactment in 1998 as part of the Transportation Equity Act for the 21 st Century (TEA-21; P.L. 105-178 ) through FY2018, the TIFIA program has provided assistance of $32 billion to 74 projects with a total cost of about $117 billion (in FY2018 inflation-adjusted dollars).

Congress has used the TIFIA program as a model for other initiatives, notably the Water Infrastructure Finance and Innovation Act (WIFIA) program, administered by the Environmental Protection Agency and the Army Corps of Engineers. Several recent proposals would expand TIFIA assistance. For example, the Trump Administration's $200 billion infrastructure plan, based on leveraging state, local, and private resources, proposed adding several billion dollars of budget authority for TIFIA and expanding eligibility to ports and airports. The experience of TIFIA over the past decade shows, however, that there are limits to financing projects in this way. These limits include the number of projects that can take advantage of credit assistance, the difficulties of developing revenue mechanisms to service loans, the typical need for grant funding to make up a portion of the capital, and the difficulties of attracting private investment to risky projects, particularly those for which demand is uncertain or hard to predict.

Credit assistance provided by the TIFIA program can be in the form of loans, loan guarantees, and lines of credit. To date, all TIFIA assistance except one loan guarantee has been in the form of loans. Loans and loan guarantees can be provided up to a maximum of 49% of project costs; lines of credit can be for an amount up to a maximum of 33% of project costs. Despite the higher limit established in law, DOT has generally limited loans and loan guarantees to no more than 33% of project costs, so as "to ensure that the DOT shares the credit risk with other participants."

Projects eligible for TIFIA assistance include highways and bridges, public transportation, transit-oriented development, intercity passenger bus and rail, intermodal connectors, intermodal freight facilities, and the capitalization of a rural projects fund. Eligible applicants for TIFIA assistance include state and local governments, railroad companies (including Amtrak), transit agencies, and private entities.

Surface transportation projects are not evaluated for TIFIA assistance based on their projected benefits and costs. Instead, projects are assessed on creditworthiness, the ability of borrowers to repay their loans, and a number of other eligibility criteria. To be judged creditworthy, a project's senior debt obligations and the borrower's ability to repay the federal credit instrument must receive investment-grade ratings from at least one, but typically two, nationally recognized credit rating agencies. Generally, a project must cost $50 million or more to be eligible for assistance, but the threshold is $15 million for intelligent transportation system projects and $10 million for transit-oriented development projects, rural projects, and local projects. Another requirement is that loans must be repaid with a dedicated revenue stream, typically a project-related user fee, such as a toll, but sometimes dedicated tax revenue.

The attractiveness of TIFIA financing is its low cost, its flexibility, and its long duration, features that are hard to match in the private capital market. Federal credit assistance provides funds at a low fixed rate, the Treasury rate for a similar maturity; for rural infrastructure projects, federal assistance is provided at half the Treasury rate. Loans are available for up to 35 years from the date of substantial completion of a project. Repayments can be deferred for up to five years after substantial completion, and amortization can be flexible. In some circumstances, TIFIA can reduce the transaction costs of borrowing, which for tax-exempt bonds typically include underwriter fees, bond counsel expenses, and the cost of borrowing funds before they are needed (known as "negative carry"). The Riverside County Transportation Commission in California is using TIFIA financing to build the I-15 Tolled Express Lanes Project, and has estimated that using traditional bond financing in lieu of a $150 million TIFIA loan would have cost an additional $25 million for the $471 million project.

The characteristics of TIFIA financing can make it easier for project sponsors to attract the less patient and less flexible capital that is typically offered in the private market. This is especially important for projects like new toll roads, for which usage and revenue may take several years to grow to cover debt repayment. TIFIA financing is available with a senior or subordinate lien, but is typically used as subordinate debt, meaning it is in line to be repaid after the project's operational expenses and senior debt obligations. However, the TIFIA statute includes a provision which requires that in the event of a project bankruptcy, the federal government will be made equal with senior debt holders. This is referred to as the "springing lien," and has led some to ask whether TIFIA financing is truly subordinate. The springing lien issue notwithstanding, TIFIA financing is generally thought to reduce project risk, thereby helping to secure private financing at rates lower than would otherwise be available.

Financing projects instead of relying on pay-as-you go funding can mean such projects can be constructed years earlier than otherwise. TIFIA, therefore, is a means to accelerate project delivery and the benefits that flow from new infrastructure. Because of its advantages in terms of cost and flexibility, TIFIA may increase the number of projects that can be financed and thus provided on an accelerated schedule. In its 2016 report to Congress, DOT cited the example of managed lanes on U.S. 36 connecting Boulder and Denver, CO, a project it says was delivered 20 years earlier than anticipated because of TIFIA assistance.

Applications for credit assistance to DOT are accepted at any time. Formal acceptance into the program for evaluation follows a letter of interest from the project sponsor in a format prescribed by DOT. However, DOT recommends that project sponsors contact DOT much earlier for technical assistance to discuss and develop an application. This can involve an emerging project agreement between DOT and the project sponsor.

Acceptance into the TIFIA program requires a fee of $250,000 that is used to cover the costs of DOT's outside financial and legal advice. Additional amounts may be necessary if DOT's costs exceed $250,000. DOT notes that fees for a single project are typically between $400,000 and $700,000. For projects with estimated costs of less than $75 million, DOT is permitted to draw on federal funds to cover its costs, up to a total of $2 million annually, rather than charging fees to prospective borrowers.

Prior to submitting a formal application for credit assistance, DOT will review the letter of interest, the independent financial analysis, and any other supporting material. A key element of this review is an analysis of the creditworthiness of the project sponsor and the quality of the revenue pledged to repay the federal government. DOT also requires an oral presentation by the project sponsor. If these are satisfactory, DOT will invite the project sponsor to submit a formal application. The statute requires DOT to determine within 30 days whether the application is complete or whether additional material needs to be submitted. Within 60 days of that determination, DOT must inform the applicant whether the application has been approved or not. DOT staff make a recommendation to the DOT Council on Credit and Finance, with the Secretary of Transportation making the final decision.

In addition to the regular credit assistance process, the FAST Act required DOT to create an expedited application process for low-risk projects. These are defined as projects requesting $100 million or less in credit assistance, with a dedicated revenue stream unrelated to project performance (e.g., a dedicated sales tax) and standard loan terms.

Like highway and public transportation projects that receive federal grants, projects financed under TIFIA are subject to laws and regulations concerning planning requirements; review and mitigation of environmental effects; the use of domestic iron, steel, and manufactured goods; and payment of prevailing wages. For example, projects must comply with the requirements of the National Environmental Policy Act of 1969 (NEPA) regarding the effects of the project on the human and natural environment. Typically, the NEPA analysis must be well advanced before a letter of interest is submitted. A TIFIA loan or other credit assistance will not be made until a final NEPA decision has been issued.

The process for securing assistance has been praised for being predictable, but it has also been criticized for being slow and bureaucratic. For example, an official of Transurban, an Australia-based operator of toll roads, told Congress that the company did not pursue a TIFIA loan for the I-395 high occupancy toll (HOT) lanes in Virginia, in part because of the slowness of the approval process. There has also been criticism that the TIFIA program office has become more risk-averse, favoring low-risk projects that might be able to obtain financing from conventional sources.

Credit programs like TIFIA are governed by the Federal Credit Reform Act (FCRA) of 1990. Under FCRA, the cost to the federal government of a credit program is the administrative cost plus the subsidy cost of the credit assistance. According to FCRA, the subsidy cost is "the estimated long-term cost to the government of a direct loan or a loan guarantee ... calculated on a net present value basis." The subsidy cost estimate takes into account potential losses to the government resulting from loan defaults. Budget authority is typically provided to cover subsidy and administrative costs of a credit program. Costs of the TIFIA program are met by funding from the Highway Trust Fund (HTF) authorized by the FAST Act.

When a loan is made, the subsidy cost amount is taken from the available budget authority and added to money borrowed from the Treasury to make the loan. When the principal and interest are repaid by the borrower, money is transferred back to the Treasury. Budgeting for credit programs is done for a cohort of loans, which is a group of loans funded by one fiscal year's appropriation. If the subsidy cost estimate proves correct, the cost to the government, outside of the budget authority already provided, will be zero.

The amount of credit assistance available to borrowers from an amount of budget authority is determined by the subsidy rate after administrative costs are subtracted. The subsidy rate is the subsidy cost as a percentage of the dollars disbursed. As an example, if administrative costs are ignored, for every $100 of budget authority at a subsidy rate of 10%, the federal government can loan out $1,000 because it expects to eventually receive back $900 calculated in today's dollars. The budget authority covers the subsidy cost, which in this case is $100. As the subsidy rate declines, the government can provide more credit assistance because it expects a greater amount to be repaid by borrowers. With a subsidy rate of 5%, the TIFIA program could lend $2,000 for every $100 of budget authority ($100/5% = $2,000).

Forecasts of the cost of credit assistance necessarily rely on estimates of the interest rate (a Treasury bond with the same maturity as the loan), the repayment of loans, and the rate of defaults. Because conditions can change, agencies must reestimate the subsidy rate periodically, generally annually, for outstanding loans and loan guarantees. These reestimates appear in the Federal Credit Supplement published in the President's annual budget submission. Estimates and reestimates of the TIFIA subsidy rate are done by DOT in cooperation with the Office of Management and Budget (OMB). The subsidy rate and its reestimation provide information about the level of risk being undertaken by DOT and the subsequent performance of TIFIA-assisted projects. A single subsidy rate is calculated for all loans originated in a given fiscal year.

The original subsidy rate for TIFIA loans originated in fiscal years with loans still outstanding ranges from 15.16% to 3.36%. The subsidy rate for FY2019 is estimated to be 6.3%. Current reestimates of these original subsidy rates range from -8.06% to 46.12%. The subsidy rate is negative when the government expects to receive repayments greater than the amount of loans, on a net present value basis. The increased (+) or decreased (-) cost to the government of these reestimates is reflected in the net lifetime reestimate amount ( Table 1 ).

Based on the subsidy rate, the cost to the government has been approximately 7 cents for every dollar financed, according to DOT. However, the Congressional Budget Office (CBO) notes that this does not take into account the market value of the financial risk to which taxpayers are exposed by federal credit programs such as TIFIA. CBO estimates that including this financial risk the TIFIA program costs 33 cents for every dollar financed.

The FAST Act authorized $275 million for the TIFIA program in each of FY2016 and FY2017, $285 million in FY2018, and $300 million in each of FY2019 and FY2020. These amounts are much lower than those authorized in the Moving Ahead for Progress in the 21 st Century Act (MAP-21; P.L. 112-141 ), which greatly enlarged the TIFIA program ( Figure 1 ). Seen in isolation, this reduced DOT's capacity to issue loans by approximately $7.25 billion in FY2016, assuming a 10% subsidy rate and excluding administrative costs.

However, the FAST Act also allows states to use funds from three other highway programs to pay for the subsidy and administrative costs of credit assistance: the discretionary Nationally Significant Freight and Highway Projects Program, known as INFRA grants; the formula National Highway Performance Program; and the formula Surface Transportation Block Grant Program. This use of grant funds has the potential to increase TIFIA financing much above the direct authorization, but at the discretion of state departments of transportation. Payment of the TIFIA subsidy cost has also been allowed as part of the Better Utilizing Investments to Leverage Development (BUILD) Transportation Discretionary Grants program (formerly TIGER program).

Although direct funding for the TIFIA program was reduced in the FAST Act, DOT has not been limited in providing credit assistance. Funding for the TIFIA program is available until expended, and thus unused money accumulates from year to year. Unobligated budget authority in the TIFIA program was $1.65 billion at the end of FY2018, according to DOT. This amount has accumulated despite a clawback provision in MAP-21 that reduced TIFIA's budget authority by $640 million. The clawback provision was subsequently abolished in the FAST Act, presumably because of the reduction in the TIFIA program's authorization.

Except for one loan guarantee, every credit agreement under the TIFIA program to date has been a loan. Through FY2018, TIFIA had provided loans worth about $32 billion (in FY2018 inflation-adjusted dollars). The overall cost of the 74 projects supported by TIFIA loans is estimated to be $117 billion (FY2018 dollars). The average project cost is about $1.5 billion and the average loan amount $430 million (both in FY2018 dollars). Consequently, the average TIFIA share of project costs has been about 28%. Over the 20-year history of the program, the average number of loans has been about four per year, worth about $1.6 billion (FY2018 dollars). The enlargement of the TIFIA program in FY2013 led to an increase in lending, but much of that occurred in a single year, FY2014 ( Figure 2 ).

About two-thirds of TIFIA loans have gone to highway and highway bridge projects and another quarter to public transportation. Two loans (3%) have gone to railroad projects and another five (7%) to other surface transportation projects, including a combined parking and public transportation facility at O'Hare International Airport in Chicago.

TIFIA assistance has been geographically limited, with projects in 21 states, the District of Columbia, and Puerto Rico receiving financing. Ten states account for about 80% of the 74 projects supported. These are California, Texas, Virginia, Colorado, Florida, Illinois, Washington, New York, North Carolina, and Maryland.

User charges, including highway tolls, are the revenue pledge most often made by borrowers, accounting for half of the projects. Various taxes, particularly sales taxes, and general revenues make up most of the other half of project revenue pledges.

At the time of DOT's most recent report to Congress on TIFIA, issued in August 2016, 86% of TIFIA loans were performing as expected, 8% were exceeding expectations, and 6% were performing below expectations. Through FY2018, two TIFIA-assisted projects have gone into bankruptcy, the South Bay Expressway toll road project in San Diego, CA, and the SH-130 toll road project (segments 5 and 6) near Austin, TX. The San Diego Association of Governments bought the South Bay Expressway project after it went bankrupt, and, according to DOT, "repaid all outstanding TIFIA indebtedness." According to the DOT, the SH-130 TIFIA loan was converted to 34% ownership of the new company that will operate the toll road until 2062, a payment to the government of $15 million, and remaining debt of $87 million. It is uncertain whether the federal government will eventually receive payment equal to the amount of principal and interest that were originally payable on the $430 million TIFIA loan.

The TIFIA program is the federal government's main tool for encouraging the establishment of public-private partnerships (P3s) and the investment of private capital in surface transportation. The low cost of borrowing, term length, and repayment flexibility can lower financial risk for private investors. P3s offer several advantages over traditional procurement methods, including additional capital, private management expertise, and risk transfer. By encouraging private finance and insisting on creditworthiness standards, the program relies, in part, on market discipline to stimulate projects with favorable benefits versus costs.

Although the TIFIA program has supported the creation of P3s and leveraged private capital for transportation projects, government involvement remains more important in TIFIA-supported projects. According to one analysis of the TIFIA program through 2016, about one-third of TIFIA-supported projects (23 projects) were developed as P3s and the other two-thirds were governmentally procured. The 23 P3 projects had total project costs of $33 billion, of which 29% came from government grants, 28% TIFIA loans, 28% other debt, 13% private equity, and 1% other capital.

TIFIA was initially designed to support large and very costly projects for which grant funding was unlikely to be enough. Despite this, there have been complaints that relatively few projects can take advantage of the program. Most typical highway and public transportation projects cost much less than the TIFIA thresholds for eligibility and have no obvious revenue stream to generate a repayment mechanism. Modifications to the TIFIA program, such as lower cost thresholds, lower interest rates for rural projects, and waived fees for smaller projects, have sought to make financing more accessible. However, to date, the size of TIFIA-supported projects does not appear to have declined. The smallest project since the passage of MAP-21 in July 2012, for example, is the U.S. 36 Managed Lane/Bus Rapid Transit Project between Boulder and Denver, CO, which had a total cost of $175 million. But this is phase 2 of a project that totaled almost $500 million. Moreover, there have been no TIFIA loans to rural project funds.

In addition to the use of direct program funding, TIFIA assistance can be obtained by using other federal-aid highway funds, both discretionary and formula, and discretionary BUILD program (formerly TIGER program) funds. There have been a few BUILD program-funded TIFIA loans, but to date no states have traded formula grant funding for a larger loan. At the moment, states do not have to make that trade because the TIFIA program is not in danger of running out of budget authority. DOT calculated that unobligated budget authority in the TIFIA program at the end of FY2018 was $1.65 billion. This amount of end of fiscal year unobligated budget authority is much higher now than it was in FY2012, but the level has stabilized over the past few years ( Table 2 ).

If the TIFIA program does exhaust its direct funding in the future, an unanswered question is whether states will choose to use grant funding to pay the subsidy and administrative costs of a loan. A similar option, the capitalization of a state infrastructure bank with grant funds, has largely gone unused, partly because states have planned to commit these funds to traditional projects years in advance.

Congress could increase the lending capacity of the TIFIA program by authorizing and appropriating additional funding. However, there may not be enough suitable projects to make use of significantly greater budget authority, even if eligibility is expanded beyond surface transportation to include port, aviation, and economic development projects. To date, the greatest value of loans issued in any year has been about $8 billion. The average since the expansion of the program in FY2013 has been about $3.5 billion (in FY2018 dollars).

More applications for credit assistance might result from lowering the fees and other costs associated with federal support. One option is to reduce the fees for projects of $75 million or more. All else equal, however, this would increase the administrative costs of the program and reduce its lending capacity. Another option is to increase the threshold below which one credit agency rating is needed rather than two on the senior debt and the federal credit instrument. Currently, the threshold is $75 million, but S. 3631 (115 th Congress) proposed to increase it to $150 million.

The calculation of the TIFIA program's subsidy cost has generally been conservative. To date, two TIFIA-financed projects have gone bankrupt, and, according to DOT, 6% of loans were underperforming in 2016. A less conservative calculation by DOT and OMB could allow DOT to lend a greater amount with the same amount of budget authority.

It does appear that the federal government has adjusted its subsidy cost estimates downward over the past few years in recognition of DOT's loss experience under the TIFIA program. However, the lack of defaults may be due to the types of projects being assisted and the generally favorable economic conditions. An enlarged TIFIA program might mean assisting more risky projects, leading to a higher subsidy rate, all else being equal. The 20-year experience of the TIFIA program, furthermore, is possibly less informative than it appears. The share of loans that have been fully repaid is about 15%. Many of the projects that have received assistance are permitted to defer interest and principal payments and have very long amortization schedules, so there is still a great deal of uncertainty as to how they will perform over the long term. For example, the I-495 high occupancy toll (HOT) lanes project in Northern Virginia received credit assistance in 2007 and the lanes opened in 2012, but interest payments did not begin until 2017. Principal repayments are not scheduled to begin until 2032, and are to continue until loan maturity in 2047.

Ultimately, decisions about the level of risk that the TIFIA program is willing to take are made by DOT's Credit Council and the Secretary of Transportation within the limits of the program's statutory requirements. However, a critic of TIFIA's decisions on risk has suggested developing "an underlying risk framework and underwriting standards within which loans can be negotiated," and "creating a federal advisory committee to evaluate industry trends and periodically assess the effectiveness of TIFIA's risk framework in meeting its policy objectives."

MAP-21 greatly enlarged the TIFIA program and at the same time raised the maximum federal share from 33% to 49% of eligible project costs. However, DOT announced after the statutory change that it would typically provide up to 33% and would provide amounts between 33% and 49% only in exceptional circumstances. To date, no project has received more than 33%. TIFIA appears to be maximizing its leveraging of nonfederal resources, but it may be limiting the projects that could use a larger share of TIFIA assistance. For example, the American Public Transportation Association has argued that an increased federal share "would enable TIFIA credit assistance to meaningfully support certain projects with large public benefits that may be difficult to finance conventionally without federal credit support, while still ensuring other investors share in project costs and risks."

Federal Share for Major Public Transportation Capital Projects

By statute, the Secretary of Transportation may consider a TIFIA loan as part of the nonfederal share for federally funded highway and public transportation projects if the loan is repaid from nonfederal funds. For major public transportation capital projects seeking funding from the federal Capital Investment Grant (CIG) program (also known as "New Starts"), the Trump Administration has decided that it "considers U.S. Department of Transportation loans in the context of all Federal funding sources requested by the project sponsor when completing the CIG evaluation process, and not separate from the Federal funding sources." In the CIG program, the maximum federal share of a project is 80%, although the share of funding permissible from the CIG program alone is lower. If projects seeking CIG grant funding receive unfavorable ratings because they are also proposing to use large TIFIA loans, then CIG project sponsors are more likely to request smaller TIFIA loans or perhaps to seek alternatives to TIFIA program financing. Low ratings on transit projects drawing on TIFIA loans could also stop them from moving forward. An option for Congress, such as H.R. 731 (116 th Congress), is to require TIFIA loans to be considered part of the nonfederal share of surface transportation projects.

Some project sponsors have stated that the process for obtaining TIFIA assistance led them not to seek TIFIA loans. A number of proposals have been suggested to speed up approvals, such as regular and more frequent DOT credit council meetings, increased administrative spending to more quickly assess applications, regular publication of information on the time it takes to reach application milestones, and changes to the Letter of Interest process to provide greater schedule certainty. The FAST Act required DOT to expedite projects thought to be lower-risk—those requesting $100 million or less in credit assistance with a dedicated revenue stream unrelated to project performance and standard loan terms—but it is not clear what effect this could have, as only two projects have received TIFIA loans of less than $100 million since the passage of the FAST Act. S. 3631 (115 th Congress) proposed additional criteria for expedited loans for public agency borrowers. Other options, though possibly more controversial, would be to expedite reviews with experienced sponsors or to prioritize the evaluation of certain projects, such as those with national benefits or that involve significant private capital, over others.

The Trump Administration has proposed broadening the eligibility of TIFIA assistance from highways and public transportation to ports and airports. S. 3647 (115 th Congress) would have allowed $10 million in TIFIA program funds to pay the subsidy costs of credit assistance to airport-related projects. One reason TIFIA eligibility has been limited to surface transportation projects is that funding for the program comes from the Highway Trust Fund (HTF), which traditionally has been supported by revenues from highway users. Now that the HTF has relied heavily on general Treasury funds for a decade, Congress may want to revisit this limitation. If TIFIA were to begin making loans to a broader set of projects, DOT likely would need to bring in expertise to provide analysis and advice on these new sectors.

Another option for broadening eligibility is to create a new entity such as a national infrastructure bank. Such proposals in the 115 th Congress include the National Infrastructure Development Bank Act of 2017 ( H.R. 547 ), the Partnership to Build America Act of 2017 ( H.R. 1669 ), and the Building and Renewing Infrastructure for Development and Growth in Employment (BRIDGE) Act ( S. 1168 ). Most proposals include a wide range of infrastructure projects, including transportation, water, energy, and telecommunications infrastructure. One purported advantage of a national infrastructure bank over other loan programs, such as TIFIA, is that it would have more independence in its operation, such as in project selection, and have greater expertise at its disposal.

Most infrastructure bank proposals assume the bank would improve the allocation of public resources by funding projects with the highest economic returns regardless of infrastructure system or type. Selection of the projects with the highest returns, however, might conflict with the traditional desire of Congress to ensure funding for various types of projects. In the extreme case, major transportation projects might not be funded if the bank were to exhaust its lending authority on water or energy projects offering higher returns.

The limitations of a national infrastructure bank include its duplication of existing programs like TIFIA. Most legislative proposals for infrastructure banks do not address this duplication, leading to questions about how each would run in parallel. Would a national infrastructure bank avoid current TIFIA-type projects or would it "compete" with the TIFIA program to finance these projects? The addition of a national infrastructure bank seems unlikely to increase the number of surface transportation projects involving major credit assistance without other substantial changes in the way such projects are typically funded and financed.


House Select Committee on the Modernization of Congress: Structure and Procedures

Summary: On January 4, 2019, the House established the Select Committee on the Modernization of Congress by adopting Title II of H.Res. 6, the House rules package for the 116th Congress (2019-2020), on a 418-12 vote. The purpose of the select committee as stated in its authorizing resolution is "to investigate, study, make findings, hold public hearings, and develop recommendations on modernizing Congress."

Summary: Twelve Members, six from each party, have been selected by their leadership to serve on the select committee during its year-long investigation. The committee's authorizing resolution requires its membership to include two Members from the freshman class of the 116th Congress, two Members of the Rules Committee, and two Members of the Committee on House Administration. Funding for the select committee in the amount of $487,500 was provided through House adoption of H.Res. 245 on March 27, 2019.

Summary: The committee has held four hearings to date, with additional meetings likely. Committee operations are scheduled to end on February 1, 2020. Any final report of the committee will be made public. Publication of the final report will require approval from at least two-thirds of the committee. Given that both parties are equally represented on the committee, some amount of bipartisan support will be needed to approve and publish the final report.

The Select Committee on the Modernization of Congress is the most recent effort of the House of Representatives to examine its internal procedures and operations through the use of a specialized committee, commission, or party conference or caucus group. The original Joint Committee on the Organization of Congress was constituted during the 79 th Congress (1945-1946) for the purpose of strengthening the role of Congress and its committees in the lawmaking process. In 1965, Congress reincarnated this joint committee to suggest additional changes in how the two chambers operate, and the committee was reconstituted during the 102 nd and 103 rd Congresses (1991-1994). While these efforts were bicameral in nature, other examinations of congressional operations, such as that being undertaken by this panel, have been focused primarily on the House.

On January 4, 2019, the House established the Select Committee on the Modernization of Congress by adopting Title II of H.Res. 6 , the House rules package for the 116 th Congress (2019-2020), on a 418-12 vote. The stated purpose of the select committee is "to investigate, study, make findings, hold public hearings, and develop recommendations on modernizing Congress." The select committee's authorization ends on February 1, 2020, and any activities beyond that date would require additional authorization.

Twelve Members have been appointed by the Speaker to the select committee in accordance with H.Res. 6 , six of whom were appointed on the recommendation of the minority leader. The committee's authorizing resolution further requires the membership of the committee to include

two freshman Members, two Members from the Committee on Rules, and two Members from the Committee on House Administration.

The membership of this committee differs from that of other committees in three key ways:

1. Party ratios on committees generally reflect the overall party balance in the chamber. The select committee, however, is composed of an equal number of Democrats and Republicans (like the House Ethics Committee). 2. Service on the select committee does not count toward the committee membership limitations in House Rule X. 3. Members of the select committee are appointed by the Speaker based in part on recommendations of the minority leader. By comparison, placement on a standing committee generally occurs on the basis of a three-step process: first, recommendations of a party's steering committee are made; second, each party must approve those recommendations; third, committee assignment resolutions ratifying each party's selections are adopted on the House floor.

On January 4, 2019, Speaker Pelosi selected Representative Derek Kilmer (WA) to serve as chair of the Select Committee on the Modernization of Congress. On January 29, 2019, the Speaker appointed the five additional Democratic Members: Emanuel Cleaver (MO), Suzan DelBene (WA), Zoe Lofgren (CA), Mark Pocan (WI), and Mary Gay Scanlon (PA). On February 11, Republican Leader Kevin McCarthy recommended the six GOP Members: Tom Graves (vice chair, GA), Rob Woodall (GA), Susan Brooks (IN), Rodney Davis (IL), Dan Newhouse (WA), and William Timmons (SC).

Section two of the select committee's authorizing resolution (Title II of H.Res. 6 ) created a set of procedures specific to the select committee that will help guide the committee's work during its year-long operation. These rules supplement House Rules X and XI, which govern most committee procedure that applies to the select committee, with certain exceptions.

No legislative jurisdiction was delegated to the committee—introduced measures will not be referred to it. The committee has the broad responsibility to study House operations with an eye toward modernizing the conduct of its business. In particular, the committee is charged with investigating the following seven areas:

1. rules to promote a more modern and efficient Congress; 2. procedures, including the schedule and calendar; 3. policies to develop the next generation of leaders; 4. staff recruitment, diversity, retention, and compensation and benefits; 5. administrative efficiencies, including purchasing, travel, outside services, and shared administrative staff; 6. technology and innovation; and 7. the work of the House Commission on Congressional Mailing Standards (Franking Commission).

Building on the requirements of H.Res. 6, the select committee by a unanimous vote agreed to additional rules of procedure at its first meeting, held on March 12, 2019. The committee established its regular meeting day (the first Tuesday of each month), quorum requirements for various committee activities, and how the committee intends to conduct its questioning of invited witnesses. It takes two Members to make a quorum for a hearing, one-third for a markup (for instance, of any report the committee might release), and a majority "actually present" to issue a report. Committee rules also incentivize on-time arrival at a hearing with "early-bird" rules allowing Members present at the start to question witnesses before late-arrivers.

The chair (Representative Kilmer) and vice chair (Representative Graves) are provided five minutes each to make opening statements, and the chair may recognize others to make opening statements as well. Committee rules place an overall time limit of 10 minutes for opening statements. Questioning witnesses occurs under the five-minute rule, and any committee member may submit to the chair "questions for the record" (written questions to witnesses who appeared) within 10 business days of a hearing. Although the committee is not authorized to issue subpoenas to compel the attendance of witnesses or the production of documents, it "may recommend subpoenas and depositions and submit such recommendations to the relevant standing committee."

On March 26, 2019, the Committee on House Administration reported H.Res. 245 , a resolution to fund House standing and select committees during the 116 th Congress, which the House agreed to the following day. This resolution authorized $487,500 for expenditures of the select committee during the course of its investigation. With operations of the select committee scheduled to end on February 1, 2020, all but $37,500 of this amount has been reserved for use during the first session of the 116 th Congress (2019).

Prior to the adoption of H.Res. 245 , the select committee was provided with interim funding.

In addition, pursuant to H.Res. 6 , the select committee may use the services of House staff.

Consistent with its mandate, the committee's first hearing (March 12) was held for the purpose of receiving testimony from Members themselves regarding any suggested improvements to congressional operations. Thirty-five Members testified before the committee to present their own reform ideas spanning a wide range of subjects—for instance, changes to the standing rules, family-friendly adjustments to the House schedule, additional resources to support the work of Congress, and ways to delegate more policymaking responsibilities to individual Members.

The committee's next three hearings (held on March 27, May 1, and May 10) included testimony from Capitol Hill practitioners, former Members, scholars, and others on a number of proposals the committee might consider in making its own recommendations. Additional hearings and other meetings are likely to be convened throughout calendar year 2019, and information on current and upcoming activities of the committee can be found on its official website.

H.Res. 6 states that the select committee "shall submit a final report to the House." The final report is to include the committee's findings and any policy recommendations it might have.

Documents produced by House committees generally require a majority of the committee with a quorum present to support their publication. In the case of the select committee, a higher threshold of two-thirds is required to publish its final report. Given that the committee is composed of six Members from each party, some amount of bipartisan support will be needed to publish the final report. If all committee members are present for this vote, support from at least 8 of the 12 would be needed to meet the two-thirds threshold.

Public Availability of Committee Records and Their Disposition

House rules generally require committees to make their proceedings and written documents available to the public within a specified period of time. The select committee is not excepted from this obligation. As specified in Committee Rule 6, "documents reflecting the proceedings of the Committee shall be made publicly available ... not more than 24 hours after each meeting has adjourned."

After the committee's work is concluded, any records it produced during the course of its investigation will be distributed to the relevant standing committee(s) as designated by the Speaker, and any recommendations offered by the committee in its final report must be made public within 30 days of its submission to the House.

The below CRS experts are available to answer inquiries from congressional clients concerning the topics specified.


Cambodia: Background and U.S. Relations

Summary: U.S. relations with the Kingdom of Cambodia have become increasingly strained in recent years in light of Prime Minister Hun Sen's suppression of the political opposition and his growing embrace of the People's Republic of China (PRC). During the previous decade, U.S. engagement with the Kingdom slowly strengthened as Western countries continued to pressure Hun Sen to abide by democratic norms and institutions and as the U.S. government attempted to prevent Cambodia from falling too heavily under China's influence. Following strong performances by the opposition in the 2013 and 2017 elections, the Cambodian government banned the largest opposition party, the Cambodia National Rescue Party (CNRP), in 2017. As a result, the ruling Cambodian People's Party (CPP) ran virtually unopposed in the 2018 National Assembly election. The Trump Administration and Congress have imposed sanctions in order to pressure Hun Sen into restoring democratic rights and dropping criminal charges against opposition leaders.

Summary: While the U.S. government has criticized Hun Sen's backtracking on democracy, it also has sought to remain engaged with Cambodia. During the past decade, U.S. interests and foreign assistance efforts in Cambodia have included strengthening democratic institutions and norms, promoting the rule of law, increasing bilateral trade and investment, supporting economic growth, reducing poverty, and improving public health. The U.S. government has supported demining and related activities in Cambodia, which is among the countries most heavily affected by unexploded ordnance (UXO). Military engagement has included U.S. naval port visits, U.S. military assistance and training, and joint exercises.

Summary: The United States and other countries have provided funding for the Extraordinary Chambers in the Courts of Cambodia (ECCC), also known as the Khmer Rouge Tribunal, established through a 2003 agreement between the government of Cambodia and the United Nations. Since the court commenced proceedings in 2006, it has convicted and sentenced three former Khmer Rouge leaders for crimes against humanity and war crimes committed during the period of Khmer Rouge rule (1975-1978). Following the conclusion of two trials in November 2018, the Cambodian government announced that the ECCC's work was concluded, despite calls by some Cambodians and international human rights groups to prosecute additional Khmer Rouge officials.

Summary: In recent years, PRC assistance to Cambodia, by some measures, has begun to match total annual foreign aid flows from traditional major providers of official development assistance to Cambodia. China's economic support has given Hun Sen greater political room to maneuver, according to some analysts. In return, Cambodia has appeared increasingly willing to accommodate or support Beijing's positions on various regional issues, including territorial disputes in the South China Sea. Japan is the largest provider of Official Development Assistance and second-largest source of foreign direct investment in Cambodia.

Summary: One of the poorest countries in Asia, Cambodia has performed well on some socioeconomic indicators since the United Nations brokered a peace settlement in 1991 and restored a constitutional monarchy in 1993. The Kingdom's economy has achieved an average annual growth rate of 7.7% since 1995, driven by growth in the agricultural, construction, garment, real estate, and tourism sectors. China, Japan, South Korea, and Southeast Asian countries are the main sources of foreign investment. The United States is the single largest overseas market for Cambodian merchandise exports, which consist mostly of garments and footwear.

U.S. relations with the Kingdom of Cambodia have become increasingly strained in recent years in light of Prime Minister Hun Sen's suppression of the political opposition and his growing embrace of the People's Republic of China (PRC). During the previous decade, U.S. engagement with the Kingdom slowly strengthened as Western countries continued to pressure Hun Sen to abide by democratic norms and institutions and as the U.S. government attempted to prevent Cambodia from falling too heavily under China's influence. Following strong performances by the opposition in the 2013 and 2017 elections, the Cambodian government banned the largest opposition party, the Cambodia National Rescue Party (CNRP), in 2017. As a result, the ruling Cambodian People's Party (CPP) ran virtually unopposed in the July 2018 National Assembly election and won all 125 seats. The Trump Administration stated that the election "failed to represent the will of the Cambodian people" and represented "the most significant setback yet to the democratic system enshrined in Cambodia's constitution.…"

Between 1975 and 1991, Cambodia endured the four-year reign of the Communist Party of Kampuchea (also known as the Khmer Rouge), during which an estimated 2 million Cambodians died; an invasion and occupation by Vietnam; and civil war. The Paris Peace Agreement, signed by Cambodia and 18 other nations pledging to support the country's sovereignty and reconstruction on October 23, 1991, ended the Cambodian-Vietnamese War and set out a framework for a liberal democracy with periodic and genuine elections. Since the United Nations administered the first postwar national elections in 1993, Cambodia has made fitful progress in its political and social development, including the conduct of elections, a vibrant civil society, and a relatively open mass media.

Hun Sen, age 65, has been the nation's leader for over 30 years, including as Premier of the Vietnam-backed Republic of Kampuchea between 1985 and 1993, and as Prime Minister after the United Nations-sponsored national elections in 1993. National politics are highly personalized, with Hun Sen at the helm, while corruption is widespread and political, legal, and judicial institutions remain weak. Although democratic institutions and practices have developed since the Peace Accords, Hun Sen often has employed undemocratic means to remain in power. According to some experts, the Cambodian leader has bolstered his political strength through a combination of "guile and force"; electoral victories; legal and extralegal political maneuvers; influence over the judiciary, broadcast media, and labor unions; patronage; cronyism; and intimidation. Some scholars have described the Cambodian polity before the election as an example of "competitive authoritarianism," whereby multiparty elections are held and a civil society exists, but the national leader or political party maintains its dominance over them in undemocratic or unconstitutional ways.

The Cambodian National Rescue Party (CNRP), a union of two opposition parties led by Sam Rainsy, a long-time opposition leader, and politician and human rights activist Kem Sokha, made significant gains in the 2013 parliamentary election and 2017 local elections. Following the party's strong showing in the 2017 commune council elections, many political observers predicted that the 2018 national elections would continue the trend of increasing competitiveness between the CPP and the CNRP. Furthermore, some observers reported fewer irregularities in 2017 compared to the 2013 National Assembly election, due in part to financial and technical assistance from Japan and the European Union that focused on improvements in the voter registration system.

Hun Sen, on the one hand, has maintained electoral support, particularly in rural areas, due in part to Cambodia's three decades of relative political stability and economic development under his regime. The CNRP's growing electoral strength, on the other hand, reflected the will of a younger and more globalized electorate that is less focused on Cambodia's past turbulence, more concerned about corruption and inequality, and more demanding about government accountability and performance, according to observers. Nearly two-thirds of the country's population are under the age of 30 and half are under the age of 25.

In November 2017, the Supreme Court of Cambodia, at the behest of the government, made a ruling that dissolved the CNRP for "conspiring with the United States to overthrow the government." Then-U.S. Ambassador to Cambodia William Heidt stated that Hun Sen's accusations that the United States is attempting to overthrow the government were "inaccurate, misleading, and baseless." In addition, the Supreme Court banned 118 CNRP members from participating in politics for five years. The government allowed 55 opposition seats to be filled instead by third parties, with many of them going to FUNCINPEC, the royalist party that dominated opposition politics until the late 2000s. The National Assembly also amended laws to remove CNRP commune councilors and village chiefs and replace them mostly with CPP members.

Since 2008, the government has pursued several defamation charges against former CNRP president Sam Rainsy, a move regarded by many observers as politically motivated. Sam Rainsy subsequently has spent most of his time in self-imposed exile. In December 2017, the government charged Sam Rainsy with treason for posting a video on social media urging security personnel not to "obey orders from any dictators if they order you to shoot and kill innocent people." Former CNRP vice-president Kem Sokha was detained between September 2017 and September 2018, awaiting trial for treason , allegedly for collaborating with the United States to foment a popular overthrow of the CPP. Kem was released on bail and placed under house arrest in September 2018. A U.S. Embassy spokesperson stated, "We continue to call on the government of Cambodia to drop all charges against Mr. Sokha, remove restrictions on the political rights of him and other opposition leaders, and engage opposition leaders in an urgent dialogue aimed at building genuine national reconciliation."

Crackdown on Government Critics and Civil Society

Beginning in 2015 with new government restrictions on nongovernmental organizations (NGOs), and during the lead-up to the 2018 national elections, the Cambodian government placed increasing restrictions on political and social activism, civil society, free speech, and foreign-funded democracy programs. During 2015-2017, more than 25 opposition members and government critics were arrested, and many fled the country. In June 2016, government critic Kem Ley was killed under suspicious circumstances. In 2017, the Cambodian Foreign Ministry expelled the Washington, DC-based National Democratic Institute (NDI), which was engaged in democracy programs in Cambodia, on the grounds that NDI was not registered with the government. Government media outlets also alleged that NDI, which received financial support from the U.S. Agency for International Development (USAID), was involved in a conspiracy involving the CNRP and U.S.-funded NGOs to overthrow the government.

In 2017, the government closed more than one dozen Cambodian radio stations that sold airtime to Voice of America (VOA) and Radio Free Asia (RFA). RFA, facing political and economic pressure from the government, closed its Phnom Penh office. Authorities also ordered the Cambodia Daily , known as an opposition newspaper, to shut down in September 2017, ostensibly for failing to pay taxes. In 2018, the government made its first arrest under a lèse-majesté law, passed by the National Assembly in February 2018, which makes insulting the monarch a crime.

Congress periodically has imposed conditions upon some U.S. assistance to Cambodia in order to promote democracy and human rights in the Kingdom. From 1998 to 2007, Congress prohibited government-to-government assistance to Cambodia in order to pressure Hun Sen into fully instituting democracy, but allowed U.S. assistance to NGOs and some humanitarian programs to continue. Congress lifted the ban in 2007 due in part to improving democratic processes, although most U.S. assistance efforts in Cambodia continue to be channeled through NGOs. The FY2014 and FY2017 Consolidated Appropriations Acts placed conditions related to democratic governance upon some assistance to Cambodia.

The Administration and the 115 th Congress (2017-2018) took numerous steps in response to Hun Sen's recent suppression of the opposition, which include the following:

In November 2017, the Trump Administration withdrew $1.8 million in assistance to the National Election Committee (NEC). On December 12, 2017, the Subcommittee on Asia and the Pacific of the House Committee on Foreign Affairs held a hearing on U.S. policy options to promote democracy and human rights in Cambodia. On November 16, 2017, the Senate passed S.Res. 279 , urging the Department of the Treasury to consider blocking the assets of senior Cambodian government officials implicated in the suppression of democracy and human rights abuses. In December 2017, the Trump Administration announced that the U.S. government would "restrict entry into the United States of those individuals involved in undermining democracy in Cambodia." In August 2018, in response to the National Assembly election, the Administration announced that it would "expand" the restrictions. Pursuant to Executive Order 13818, which implemented the Global Magnitsky Human Rights Accountability Act (Section 1261 of P.L. 114-328 ), in June 2018, the U.S. Department of the Treasury sanctioned Cambodian General Hing Bun Hieng, commander of Hun Sen's bodyguard unit, "for being the leader of an entity involved in serious human rights abuses" over a span of two decades. Sanctioned individuals are denied entry into the United States, and any assets that they hold in the United States are blocked. The Consolidated Appropriations Act, 2018 ( P.L. 115-141 ), enacted on March 23, 2018, imposed conditions upon U.S. assistance to the Government of Cambodia related to democracy and regional security. The act mandated funds for democracy programs and "programs in the Khmer language to counter the influence of the People's Republic of China in Cambodia."

In the 116 th Congress, on January 8, 2019, Senators Cruz and Coons introduced the Cambodia Trade Act of 2019 ( S. 34 ), which would require a report on the continuing participation of Cambodia in the U.S. Generalized System of Preferences (GSP) program. On January 11, 2019, Representatives Yoho, McCaul, and Engel introduced the Cambodia Democracy Act of 2019 ( H.R. 526 ), which would impose visa restrictions upon and block assets of Cambodian senior government officials that the President determines have undermined democracy or committed or directed serious human rights violations.

Some policy experts maintain that continued U.S. engagement is the most effective course for promoting democratization from within and countering PRC influence. Some contend that many Cambodians view the United States favorably, and that Washington should continue to promote U.S. interaction with democratic forces in the Kingdom. In September 2018, Prime Minister Hun Sen, in a speech before the United Nations General Assembly, stated, "We are heartedly regretful to highlight the fact that human rights nowadays have become 'a mission to impose civilization' for some powerful nations or, perhaps, as their operating standards as the pretext for interference under the name of political right protection."

U.S.-Cambodian relations expanded after 2007, when political and human rights conditions in the Kingdom improved and the U.S. government lifted some restrictions on U.S. assistance. Principal areas of U.S. engagement have included U.S. foreign assistance programs, demining activities, limited military assistance and cooperation, U.S. missing-in-action (MIA) recovery efforts, and U.S. naval port visits. In 2017, the Cambodian government suspended Angkor Sentinel, an annual bilateral military exercise launched in 2010 that focuses on international peacekeeping, humanitarian assistance, and military-to-military cooperation. Some observers interpreted the unilateral action as a sign of Hun Sen's further distancing the Kingdom from the United States. The Cambodian government also postponed indefinitely a U.S. humanitarian mission in the Kingdom, the U.S. Navy Mobile Construction Battalion (also known as Seabees), without an explanation. The Seabees had worked with RCAF since 2008 and performed more than $5 million in community service projects throughout the country.

In January 2019, U.S. Department of Defense Deputy Assistant Secretary for South and Southeast Asia Joseph H. Felter met with Cambodian military officials in Phnom Penh. The two sides discussed regional security issues and bilateral cooperation, including ways to improve defense ties and restart joint military activities. Felter also called on the Cambodian government to drop treason charges against Kem Sokha.

Postwar Cambodia has been heavily dependent upon foreign assistance from major foreign aid donors, particularly Japan, South Korea, the United States, Australia, and France. Official Development Assistance (ODA) for Cambodia totaled $797 million in 2016, not including assistance from China. The Kingdom's reliance upon foreign assistance, while still significant, has declined during the past decade-and-a-half. ODA fell from 120% of central government expenditures in 2002 to less than a third in 2015, according to World Bank figures.

Some analysts contend that ODA for Cambodia, part of a "multibillion dollar international effort to transplant democracy in Cambodia since the early 1990s," long has kept Hun Sen's authoritarian tendencies in check, but has lost its effectiveness in doing so. The United States provided roughly $235 million in assistance related to good governance, democracy, and civil society between 1993 and 2018. In recent years, by some measures, assistance from China, which comes without conditions for good governance and human rights, has roughly matched the total assistance from major providers of ODA.

The United States provided an estimated $79.3 million in foreign assistance to the Kingdom in FY2018, a decrease of 10% compared to FY2017. U.S. foreign assistance to Cambodia includes efforts to strengthen democratic institutions and civil society; reduce child and maternal mortality; and combat HIV/AIDS and other infectious diseases. International Military Education and Training (IMET) programs provide English language instruction and aim to expose the next generation of Cambodia's military leaders to "American ways and values." U.S. demining assistance supports the removal of landmines and other unexploded ordnance (UXO). The Trump Administration's FY2019 foreign operations budget request would reduce annual assistance to Cambodia by nearly 75% compared to FY2017.

The Extraordinary Chambers in the Courts of Cambodia (ECCC), an international tribunal established through an agreement between the government of Cambodia and the United Nations, began proceedings in 2006 to try Khmer Rouge leaders and officials responsible for grave violations of national and international law. The ECCC, which has convicted three Khmer Rouge senior figures at a reported cost of $300 million, has been financed through contributions by the Cambodian government and with donations by foreign countries, particularly Japan, both directly to the ECCC and to a U.N.-administered international trust fund.

The U.S. government withheld assistance to the ECCC from 2006 to 2008 due to doubts about the court's independence due to alleged Cambodian government interference. In 2008, the United States began providing annual contributions to the international trust fund. In addition, the U.S. government has contributed to the Documentation Center of Cambodia (DC-Cam), an archive, library, and public service center focused upon Khmer Rouge atrocities, providing $9.8 million to DC-Cam since 2005. Since 2010, some U.S. foreign operations appropriations measures have placed conditions upon assistance to the tribunal in order to discourage corruption and political interference within the court and to ensure that the Cambodian government also was contributing to its costs. The Consolidated Appropriations Act, 2018 ( P.L. 115-141 ) states that no assistance may be made available for the ECCC.

ECCC prosecutors charged five former Khmer Rouge leaders with crimes against humanity and war crimes. In 2012, "chief executioner" Kaing Guek Eav, who ran the infamous Toul Sleng prison in Phnom Penh, was sentenced to life in prison. Former Foreign Minister Ieng Sary died in March 2013, before the completion of his trial, while his wife, former Minister of Social Affairs Ieng Thirith, was declared mentally unfit for trial.

In August 2014, the court sentenced former leaders Nuon Chea and Khieu Samphan each to life in prison for some crimes against humanity, and in a separate trial in November 2018, each was convicted of additional crimes, including genocide. Although Cambodian and international human rights groups have advocated prosecuting midranking Khmer Rouge officials, Hun Sen has opposed further indictments, arguing that they would undermine national stability. At the end of the trials of Nuon Chea and Khieu Samphan in November 2018, Deputy Prime Minister Sar Kheng announced that the tribunal's work was finished.

Cambodia is among the world countries most heavily contaminated by unexploded ordnance (UXO), including cluster munitions, landmines, and other undetonated weapons left from U.S. bombing during the Vietnam War, the Vietnamese invasion of Cambodia in 1978, and civil wars during the 1970s and 1980s. In 1969, the United States launched a four-year carpet-bombing campaign, dropping 2.7 million tons of ordnance, mostly cluster munitions, on Cambodia, more than the amount that fell on Germany and Japan combined during World War II. Up to 25% of the cluster bombs failed to explode, according to some estimates.

There have been over 64,000 UXO casualties in Cambodia since 1979, including over 19,000 deaths. The economic costs of UXO include land prevented from being used for agricultural purposes, forestry, and cattle, and disruptions to irrigation and drinking water supplies. An estimated 761 square miles of the country remain contaminated with UXO.

With the help of international assistance, Cambodia has reduced the UXO casualty rate from roughly 250 people per year a decade ago to about 100 annually in recent years, according to the Landmine and Cluster Munition Monitor. About 50% of contaminated land reportedly has been cleared, although many of the remaining areas are the most densely affected. The Cambodian Mine Action Authority is finalizing plans to clear all contaminated land by 2025. Despite progress, the migration of many poor Cambodians to areas that have high concentrations of UXO reportedly has contributed to a recent spike in casualties.

Between 1993 and 2016, the U.S. government contributed over $124 million for UXO removal and disposal, related educational efforts, and survivor assistance programs in Cambodia. USAID's Leahy War Victims Fund has supported programs to help provide medical and rehabilitation services and prosthetics to Cambodian victims of UXO. Congress appropriated $5.5 million and $4.5 million in FY2016 and FY2017, respectively, for Department of State demining efforts in the Kingdom.

More than 1,900 U.S. residents of Cambodian descent, of whom about 1,400 have felony convictions, are subject to deportation, according to U.S. Immigration and Customs Enforcement (ICE). Between 2002, when the two countries signed a Memorandum of Understanding on repatriation, and 2017, roughly 600 Cambodian nationals who were permanent U.S. residents and who had been convicted of felony crimes were deported to Cambodia. Many of them came to the United States during the 1980s as refugee children, and never have lived in Cambodia or had left when they were very young. Many Cambodians subject to deportation have jobs and families in the United States, and many served prison time in the United States for crimes committed during their youth. Under the Trump Administration, the number of Cambodian, Laotian, and Vietnamese nationals who have received orders of removal has risen significantly. In 2018, 110 U.S. residents of Cambodian descent were deported to Cambodia, compared to 29 in 2017 and 74 in 2016.

In 2017, the Department of Homeland Security's Immigration and Customs Enforcement agency (ICE) deemed that the Cambodian government was uncooperative or hindering U.S. deportation efforts, and in violation of its international obligations, and placed Cambodia on a list of "recalcitrant countries." The U.S. government imposed limited visa restrictions upon Cambodian Foreign Ministry employees and their families pursuant to Section 243(d) of the Immigration and Nationality Act.

In the past decade-and-a-half, Cambodia, one of the poorest countries in Asia, has performed well on some socioeconomic indicators. The Kingdom's economy, which largely was destroyed by the Khmer Rouge and subsequent conflicts, has achieved an average annual growth rate of 7.7% since 1995 and 7.0% since 2014, driven largely by foreign investment and the development of the agricultural, construction, garment, real estate, and tourism sectors. China, Japan, South Korea, and Southeast Asian countries are the main sources of foreign investment in Cambodia.

Cambodia's garment industry, largely run by companies from China, Hong Kong, and Taiwan, forms a growing pillar of the nation's economy, employing roughly 800,000 workers and constituting about 40% of the nation's GDP. Since 2000, Cambodia has risen from being the 39 th -largest exporter of textiles and apparel to the 15 th largest in 2016, according to World Bank trade data. Garment and footwear products constitute about 80% of Cambodian merchandise exports, with 43% reportedly going to the EU and 29% to the United States.

Economic development has brought social and environmental costs. Hundreds of thousands of Cambodians reportedly have been displaced as government, business, and foreign entities, often in collusion, have confiscated their land and homes, sometimes forcibly or without proper compensation, to make way for agricultural, mining, logging, tourism, and urban development projects. Although forced relocations have continued, the number of cases reportedly has declined in recent years. Cambodia has one of the highest deforestation rates in the world and illegal logging continues, due to strong demand for wood from China and Vietnam, corruption, and suppression of environmental activists.

Labor relations have shown some signs of strain in recent years, particularly as the garment industry has developed. Garment workers participated in large-scale demonstrations for higher wages in 2013-2014, which coincided with antigovernment demonstrations led by the CNRP. Cambodia's National Assembly adopted a new Law on Trade Unions in 2016, which some analysts say imposes greater restrictions on labor rights. In August 2017, the Cambodian government announced that it would enact a national minimum wage law, which some analysts surmise was done to boost labor support for the CPP.

In 2017, U.S.-Cambodia bilateral trade was worth nearly $3.46 billion, including $3.06 billion in Cambodian goods exported to the United States. Although China surpassed the United States as Cambodia's largest trading partner in 2012, the United States remains the largest single overseas market for Cambodian merchandise exports. According to the U.S. International Trade Commission, over half of U.S. imports from Cambodia in 2017 were knitted or crocheted clothing.

Some Cambodian products, including handbags and travel goods, receive preferential or duty-free tariff treatment under the U.S. Generalized System of Preferences program. Some policymakers have considered suspending GSP treatment upon certain Cambodian exports to the United States worth about $400 million annually in order to pressure Hun Sen into reversing his suppression of democracy. Other experts argue that restrictions on Cambodian exports may hurt Cambodian workers and encourage Cambodia to seek even closer relations with China, while it is uncertain whether such economic sanctions would weaken Hun Sen politically.

Cambodia acceded to the World Trade Organization in 2004, and the Kingdom has made commitments to reduce tariffs and fulfill other obligations by 2018 as a member of the Association of Southeast Asian Nations (ASEAN) Free Trade Area. Cambodia also is a party to the proposed Regional Comprehensive Economic Partnership (RCEP), a trade pact that includes the 10 ASEAN member states and 6 other Indo-Pacific countries, including China. Negotiations to reach a final agreement are expected to continue in 2019.

The PRC has become Cambodia's largest economic benefactor at a time when major ODA donors have become increasingly critical of Hun Sen's authoritarian policies. China's economic support has lessened the influence of foreign assistance conditions imposed by Western aid donors and given Hun Sen more political room to maneuver, both domestically and internationally, according to some analysts. In return, Cambodia has appeared increasingly willing to accommodate or support Beijing's positions on various regional issues, including territorial disputes in the South China Sea. Cambodia is said to be the Southeast Asian country upon which China exerts the greatest influence, and to be China's "most reliable partner in Southeast Asia."

According to one assessment, China has provided Cambodia about $15 billion in assistance and concessionary loans over the past two decades, and around 42% of the kingdom's external debt is owed to China. PRC foreign assistance to Cambodia, which has included development financing and grants, Chinese-built infrastructure, government buildings, and sports facilities, as well as support for public health and education, has become a dominant influence on the Kingdom's development. A PRC entity is constructing one of Cambodia's largest development projects, a $3.8 billion deep-water port on the Gulf of Thailand.

By some accounts, China is the largest foreign investor in Cambodia, with cumulative investment of between $14 billion and $16 billion. Major sectors for Chinese investment include agriculture, garments, hydropower, infrastructure, mining, and tourism. According to one report, China accounted for nearly 30% of investment capital in Cambodia in 2016, while that from the United States constituted less than 4%.

Cambodians have expressed mixed views about China's economic influence. Some say that Chinese investments and infrastructure have brought tangible economic benefits and spurred economic development. Cambodian social and political activists have expressed concerns about Chinese economic projects, including their quality, effects on the environment, and lack of transparency. Furthermore, many Cambodians have been evicted from their homes to make way for Chinese-backed economic projects, or their communities have been adversely affected by an influx of Chinese businesses, workers, and tourists.

Domestic and regional demand for energy and foreign investment largely from China have driven hydropower projects in Cambodia and neighboring countries. Chinese firms reportedly have invested roughly $2 billion in the construction of seven dams in the Kingdom. Many experts have warned about environmental degradation and ecological damage, loss of fish stocks, displacement of communities, and adverse effects on livelihoods due to unregulated hydropower projects on the Mekong River. A proposed, Chinese-backed, 2,600-megawatt hydropower project, the Sambor Dam, would dwarf other dams in Cambodia. According to a government-commissioned report that reportedly was leaked in 2018, the Sambor megadam, if built, would have devastating impacts on food security in the region, particularly in Cambodia and Vietnam. Experts say that it would block fish migrations between southern Laos and Cambodia's Tonle Sap Lake, destroy fish habitats, and prevent sediment from flowing downstream and fertilizing agricultural areas in the Mekong Delta.

Beijing has become a principal provider of military assistance to Cambodia, extending loans and military equipment, including small arms, tanks, trucks, helicopters, and aircraft, to the Royal Cambodian Armed Forces. China reportedly also has provided military education and training and sponsored exchanges of senior military leaders. Some analysts see PRC-Cambodian military cooperation as a response to growing security ties between the United States and Vietnam. Since 2016, China and Cambodia twice have carried out Golden Dragon , a joint military exercise involving over 400 People's Liberation Army (PLA) and RCAF soldiers involved in combat, counterterrorism, UXO removal, humanitarian, and disaster response exercises. The two countries reportedly plan a larger Golden Dragon event in 2019.