Can municipalities meet their funding needs in 2025?

The Bond Buyer’s 2025 Infrastructure Report surveyed 104 municipal finance investors and sell-side experts, as well as issuers and public-sector professionals, on a variety of topics including primary infrastructure areas for investing, influences on financing outlooks for 2026, market fluctuations and more.

Top findings from the report

• Roads/bridges and water and sewer have remained and water and sewer as the top areas that were either the most critical infrastructure initiatives or where U.S. cities and towns needed investment over the next five years.

  Sixty-one percent of investors put roads and bridges in the top spot, followed by 57% of sell-side professionals. Fifty-three percent of issuers and public-sector experts marked the area as highly important, but not the top.

  In a previous report, published by The Bond Buyer in January based on a survey of 110 industry experts, 65% of aggregated respondents said roads and bridges were the top market area in need of investment, followed by 52% who identified water and sewer.

  The No. 1 area which issuers and public-sector respondents identified as in need of investment was water and sewer, with 57% in agreement. Fifty-two percent of investors and 47% of sell-side experts said this area was the second-most important.

  Other areas to note include public transit, schools, renewable energy and airports.

  Key takeaway: Roads/bridges and water and sewer have remained top areas in need of investment over the last few years.

  What’s on the horizon for municipal financing?

  Looking across the next five years, 34% of respondents in the South were the most optimistic about the outlook of achieving critical infrastructure needs for cities and towns in the U.S.

  By comparison, only 20% of those in the Midwest were hopeful of meeting these needs in the same time frame, and likewise for 27% of Northeasterners and 0% of Westerners.

  Ten years out, those in the Northeast (38%) accounted for the greatest share of optimists on whether critical infrastructure needs would be met. For those in the Midwestern (33%) and Western (32%) regions, the greatest share of optimists were looking beyond 10 years.

  The earlier report found that most respondents were optimistic (56%) to some degree about these needs being met when looking more than 10 years into the future.

  Key takeaway: Municipal finance professionals in the South were the most optimistic about hitting funding goals sometime in the next five years.

  Shooting for the moon…

  President Trump’s One Big Beautiful Bill Act made investments into space infrastructure a new opportunity for municipal finance. But not all areas of the market are ready for spaceport projects. 

  Thirty-three percent of respondents said that the legal and tax counsel sector of the industry is either very or mostly ready for investing in space projects. That share drops to 20% for investors, 19% for non-legal consultants and advisors, 13% for regulators and 12% for issuers.

  Fifty-one percent of respondents said regulators were the least ready for this type of investment activity. Close behind were issuers, with 46% identified as not ready, followed by non-legal consultants and advisors (37%), investors (36%) and legal/tax counsel (22%).

  Key takeaway: Regulators are the party least ready for investments in space infrastructure.