Investment banker Felix Rohatyn, who helped rescue New York City from its mid-1970s financial crisis, has agreed to sit on the board of New York State's $25 billion infrastructure bank, Governor Andrew Cuomo said on Tuesday.
Rohatyn is a former U.S. ambassador to France who now serves as a special advisor to the chief executive of Lazard. His decision to help guide the infrastructure bank could help Cuomo get his "New York Works Fund" off the ground.
The state's new infrastructure bank aims to tap private capital to build and repair the state's crumbling roads and bridges.
"I don't believe it's my role to create jobs," Cuomo said at a Citizens Budget Commission dinner. Instead, government should "levitate and facilitate private sector growth" to spur job creation, he said.
Hedge funds, investment banks and pension funds have raised billions of dollars in the past few years to invest in the country's infrastructure, partly because this sector offers the potential for steadier returns than other assets.
Infrastructure banks, by offering grants or loans or guaranteeing loans, entice developers to take on the risks of new construction projects.
A multi-billion dollar plan to build a new Tappan Zee Bridge across the Hudson River just north of New York City is expected to be one of the state's first and biggest candidates for tapping private investors.
The existing bridge, built in the 1950s, has deteriorated badly, and once it is replaced might be turned into a "greenway" for pedestrians.
(Reporting By Joan Gralla; Editing by Kim Coghill)