President Donald J. Trump announced in his first State of the Union address Tuesday (Jan. 30) that he would push Congress to pass a $1.5 trillion infrastructure package—even larger than the $1 trillion that the administration had been promising—and would work to eliminate delays from regulatory processes.
The infrastructure section of the speech was not particularly detailed, but a fact sheet issued by the White House notes that Trump’s proposal “will generate at least $1.5 trillion in infrastructure investment over the next decade.” Half of all federal funds under the plan would be used to incentivize state and local investment in infrastructure, the White House says.
President Donald J. Trump announced in his first State of the Union address Tuesday that he would push Congress to pass a $1.5 trillion infrastructure package.
The actual amount of federal investment the president is proposing is unclear; in the speech, he referenced leveraging private investment “where appropriate.” The White House says a quarter of federal funds under the plan would be directed toward rural projects, which some have worried would lose out in a model based on public-private partnerships, which tend to favor urban, high-traffic projects that will provide return on private investment in the form of fees like tolls.
According to the White House, Trump’s push will include action to address permitting delays, which the administration blames in part for the country’s infrastructure-work backup. The administration cites a 2014 Government Accountability Office report estimating that complex highway projects take a median of seven years in the environmental review process. Trump says he would like to limit the permitting process for infrastructure projects to two years or less.
Trump signed an executive order last year calling for a two-year maximum for environmental reviews on major federal projects, and establishing a system of “One Federal Review,” in which one agency is to take the lead on permitting for a given project.
Leaked Draft. Last week, news site Axios published what it said was a leaked draft of the infrastructure plan, which addresses highway projects, water infrastructure projects, Veterans Affairs work and land revitalization, including brownfield and Superfund site cleanup.
If the leaked document accurately represents the bill, 50 percent of federal funding appropriated under the plan would go toward an “Infrastructure Incentives Initiative,” which would provide grants to state and local governments for “core infrastructure projects.” Grants under the program would supply up to 20 percent of the funding for a given project.
Industry Response. Industry players have been behind the push for new infrastructure funding since Trump’s inauguration last year and continue their vocal support for a solution to the country’s funding problems.
We are looking forward to seeing the President’s infrastructure plan and working closely with the administration and Congress to advance a robust, long-term infrastructure bill,” said AASHTO executive director Bud Wright.
“We are pleased that President Trump continues to highlight the need for additional federal investment in infrastructure,” said Bud Wright, executive director of the American Association of State Highway and Transportation Officials. “AASHTO has for years called for a long-term strategy to shore up the Highway Trust Fund in order to maintain federal investment in surface transportation. We are looking forward to seeing the President’s infrastructure plan and working closely with the administration and Congress to advance a robust, long-term infrastructure bill that supports needed reforms such as streamlining project delivery in ways that also protect our natural resources.”
The federal gasoline tax, the primary source of funding for the Highway Trust Fund, has remained at 18.4 cents per gallon since 1993. Trump has hinted in the past that he is open to raising the tax; Congressional Republicans have long opposed an increase.
PLA Concerns. Associated Builders and Contractors Inc. and a coalition of industry interests recently petitioned the administration, ahead of the expected construction boom brought on by the infrastructure plan, to remove requirements for project labor agreements on federal projects.
“If the construction industry grows at a modest two to three percent rate over the next few years and an infrastructure bill resulting in an additional $1 trillion worth of construction is added into the equation, the industry could need to fill an additional one million more jobs as early as 2020,” the organization wrote in a letter to Trump. “Therefore, it makes little sense to continue a policy that artificially restricts the vast majority of skilled American labor and qualified contractors from competing to deliver to taxpayers the best possible product at the best possible price.”
The coalition has fought mandatory PLAs since the administration of former President Barack Obama issued an executive order encouraging the practice on federal projects. PLAs are made before hiring on a project, and involve an agreement with local labor organizations regarding wages, benefits and other factors in hiring. Critics say mandatory PLAs on government projects unfairly exclude non-union shops.
The White House has not specified whether PLAs will be addressed, either as part of the infrastructure bill or separately.