White House rolls out new infrastructure plan as part of 2019 budget
The long-awaited national infrastructure plan was rolled out today by the White House as part of its fiscal year 2019 budget. Entitled, the “Legislative Outline for Rebuilding Infrastructure in America,” this plan is comprised of various ideas and themes that have been echoed by the White House since Donald Trump took over as President in January 2017.
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The long-awaited national infrastructure plan was rolled out today by the White House as part of its fiscal year 2019 budget.
Entitled, the “Legislative Outline for Rebuilding Infrastructure in America,” this plan is comprised of various ideas and themes that have been echoed by the White House since Donald Trump took over as President in January 2017.
And it comes shortly after Trump’s State of the Union speech, when he touted the expected benefits of the proposed $1.5 trillion remedy for the nation’s infrastructure woes.
“I am calling on the Congress to produce a bill that generates at least $1.5 trillion for the new infrastructure investment we need, Trump said in late January. “Every Federal dollar should be leveraged by partnering with State and local governments and, where appropriate, tapping into private sector investment -- to permanently fix the infrastructure deficit. Any bill must also streamline the permitting and approval process -- getting it down to no more than two years, and perhaps even one.”
Some specifics of the White House’s national infrastructure plan, culled from the White House’s official plan and media reports include:
- a $200 billion investment from the federal government over a ten-year period
- a $100 billion infrastructure incentives program to maximize investment in infrastructure to increase economic growth and attract non-Federal revenue streams dedicated to state, local, and private investment in infrastructure;
- a $50 billion rural infrastructure program to improve the condition and capability of rural infrastructure through capital improvements and outcomes-driven planning efforts that enhance private sector productivity , modernize existing infrastructure systems, and prioritize projects essential for efficiency and safety, with 80% of allocated funds provided to the governor of each state via formula distribution;
- $20 billion in infrastructure financing plans to advance major, complex infrastructure programs such as airport and non-Federal waterways and ports financing options, expanding Railroad Rehabilitation and Improvement Financing and the Water Infrastructure Finance and Innovation Act Funding and broaden program eligibility;
- provide states the flexibility to toll on interstates and reinvest toll revenues in infrastructure;
- provide states flexibility to commercialize Interstate rest areas;
- incentivize the development of effective and efficient water infrastructure and full life-cycle asset management to improve water infrastructure
Trump’s comments last month about improving infrastructure permitting improvements received considerable attention in the White House’s plan.
The plan takes steps to augment the current process, viewed by many as cumbersome, in various ways by “protecting the environment and also delivering projects in a less costly and more time effective manner by creating a new, expedited structure for environmental reviews, and delegating more decision making to states and enhancing coordination between state federal reviews and authorizing pilot programs through which agencies can experiment with innovative approaches to environmental reviews while enhancing environmental protections.”
James Burnley, a partner at Washington, D.C.-based law firm Venable LLP and former Secretary of Transportation under the late President Ronald Reagan, said that streamlining the environmental review and permitting processes is something not only feasible but also something Trump has already executed upon.
“An executive order was put out last summer that directed federal agencies to do all they could within existing laws, with a target of trying to get review processes done, from start to finish, in two years. I don’t know if additional proposed statutory changes will be locked in. It would not surprise me if they do so, but they have not waited is my point.”
Burnley added that late last summer the White House moved to the extent they could of the existing law to direct agencies to do such streamlining, which he said was significant in itself, and does not receive the attention that it should.
“Going forward, if they are successful…in shortening review times, that could be transformative for many projects,” he noted.
Walter Kemmsies, Managing Director, Economist and Chief Strategist for JLL’s U.S. Ports, Airports and Global Infrastructure Group, was on the same page as Burnley, regarding proposed changes in the permitting process.
“This is not being approached unreasonably,” he said. “It is really saying that these processes cannot take 15 years, it is just ridiculous. But it also cannot be six months either, with two-to-three years being the maximum length needed and speed things up. This is what attracts the money and it is critical and will prevent money from being squandered on things that may not be needed, with the shortening of the permit process lowering the risk of return profile.”
As per the usual, when it comes to infrastructure planning, are concerns over how it will be funded, and it is again no exception this time around.
Ex-DOT head Burnley said that this plan provides a sophisticated use of leverage of federal funds, which is building on existing programs that are already, in a limited way, make leverage available.
“There is no question that programs like TIFIA and RRIF can be effective in attracting state, local, and private capital to infrastructure projects,” he said. “The proposal seems to be creating the idea of such leverage very aggressively and that’s a good thing. It really could be a healthy augmentation of resources over all that are available for infrastructure. I don’t think there will be much resistance on that at all from Congress. There will be a spirited debate with a lot of rhetoric. But at the end of the day a package along the lines of what is being proposed may be irresistible to a large majority in both houses.”
But a Wall Street Journal report noted that even though the White House said it will raise $200 billion through spending cuts in the White House budget, that budget is largely obsolete after Congress recently signed off on a plan to break budget caps and spend $300 billion more than originally planned over the next two years, coupled with the recent two-year government funding agreement potentially pushing U.S. deficits above $1 trillion by 2019 and subsequently reduce the Congress’s odds of getting an infrastructure deal done this year.
About the AuthorJeff Berman, Group News Editor Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
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