Obama budget has $5 billion for infrastructure bank

WASHINGTON (Reuters) - U.S. President Barack Obama called for the creation of a National Infrastructure Bank in his budget released on Thursday, saying it would “expand and enhance existing federal infrastructure investments.”

“The mission of this entity will be to not only provide direct federal investment but also to help foster coordination through state, municipal and private co-investment in our nation’s most challenging infrastructure needs,” according to budget documents.

The budget, which must be approved by Congress, requests $5 billion (3.5 billion pounds) for the bank in fiscal year 2010 which starts October 1, and anticipates that it will receive $25.2 billion from then through 2019.

For more than a year Congress has mulled creating what many have called a “Federal Reserve of Infrastructure,” which would use seed money from the federal government to establish an independent board for giving capital project grants to state and local governments.

When meeting with U.S. governors in December before he took office, Obama said the bank would be a top priority. During his campaign, he said an independent bank should receive $60 billion over 10 years from the federal government.

Reporting by Lisa Lambert, editing by Jackie Frank