As part of their 2019 budget proposal, the Trump administration has released a $200 billion infrastructure plan designed to “stimulate 1.5 trillion in investment over 10 years,” reduce the approval process for projects to two years or less, increase investment in rural infrastructure, and “empower State and local authorities.”
The 55-page plan calls for:
- An incentives program that would use $100 billion in federal grants to spur state and localities to ramp up investment in infrastructure such as “surface transportation and airports, passenger rail, ports, and waterways, flood control, water supply, water resources, drinking water facilities, wastewater facilities, stormwater facilities, and browfield and superfund sites.” The administration wants funds to be distributed only on the condition that states and localities hit progress milestones.
- A $50 billion rural grant program for capital investments in transportation, broadband, water and waste treatment, water resources, and power and electric facilities. 80 percent of the funds would be distributed to states based on a formula that weights miles of rural roads and percentage of rural populations.
- $20 billion for “transformative projects” that would have a “significant positive impact on the Nation, a region, state, or metropolitan area.” These funds would be for “ambitious, exploratory, and ground-breaking projects that have significantly more risk than standard infrastructure projects.” A third of the funds would be used for projects in still in the early demonstration phase.
- Another $20 billion would be set aside for credit programs designed to enable state and local governments to finance large-scale infrastructure projects under terms “more advantageous than in the financial markets.” Included in this section is an expansion of the EPA’s authority to finance federal flood mitigation, hurricane and storm damage reduction, navigation, environmental restoration, and restoration of aquatic ecosystems, along with more credit to incentivize state and local action in these areas. The Trump administration also calls for increasing “flexibility and broaden eligibility” to facilitate private investment in infrastructure.
- Lastly, the Trump administration calls for selling more federal assets, including the Ronald Reagan National and Dulles International airports, and creating a new $10 billion revolving fund used to buy more modern federal property.
U.S. Transportation Secretary Elaine Chao recently said the administration is considering raising the gasoline tax to pay for its plan. The tax is currently 18.4 cents and has not been raised since 1993. House Transportation and Infrastructure Committee Chairman Bill Shuster noted that his state of Pennsylvania greatly benefits from the gas tax. He explained to Fox News that “every dollar a taxpayer in his largely-rural district pays in petrol taxes, they receive $1.70 in return.” Many groups are critical of the idea, arguing that raising the gas tax would hurt middle class and those earning low-incomes — a “1 percent increase would take $1 billion out of consumers’ pockets.”
Democrats are highly critical of the Trump administration’s plan, as their own calls for $1 trillion in investment. On Trump’s plan, Rep. Peter DeFazio (D-Ore.), the ranking member of the House Transportation and Infrastructure Committee, told The Hill: “This is not a real infrastructure plan — it is simply another scam, an attempt to sell our nation’s infrastructure and create windfall profit for Wall Street while rolling back environmental protections.”
Senate Minority Leader Charles Schumer (D-N.Y.), said: “This is the kind of plan you’d expect from a president who surrounds himself with bankers and financiers and wealthy people who don’t mind paying a $20 toll every time they go to work. It’s a plan designed to reward rich developers, large banks, and the president’s political allies, not to rebuild the country.”
Furthermore, the Democrats argue that the proposed $200 billion is the result of infrastructure cuts elsewhere in the proposed 2019 budget. Rep. John Garamendi (D-Calif.), a member of the House Transportation and Infrastructure Committee, said: “It’s not new money. It is the repurposing of existing programs. They’ve moved the money from existing programs to their new programs and say they got $200 billion over 10 years. No, they don’t. It’s the same $200 billion that would be spent on ongoing programs.”
Organizations focused creating a sustainable built environment are also critical. In a statement, Smart Growth America wrote:
“While the president calls for new resources for rural communities to support brownfields and broadband, he simultaneously proposes draconian funding cuts to critical federal programs that these local communities depend on, including HOME Investment Partnerships, Community Development Block Grants and the TIGER competitive transportation grant program.” Furthermore, “these proposals fail to recognize that the 21st century movement of people and goods requires a multimodal and interconnected approach that leverages both public and private sector investment and innovation.”
And the American Planning Association (APA) wrote:
“As expected the proposal calls for $200 billion in federal spending over a decade to leverage a purported $1.5 trillion in total investment. However, the budget slashes or eliminates a series of existing infrastructure programs leaving many to see the administration’s opening bid as merely shifting resources and providing no new support. The proposal also envisions a dramatic shift to relying more heavily on state and local funding. APA has called for new infrastructure investment as a top legislative priority, but has repeatedly noted that any new program should not come at the expense of existing tools and resources.”
Environmental and conservation groups are also very concerned about any effort to gut environmental regulations. Alison Cassidy, a vice president at the Center for American Progress, a liberal think tank, wrote: “the Trump plan would require significant changes to at least nine environmental laws, including the National Environmental Policy Act (NEPA), Clean Air Act, and Clean Water Act.”
Furthermore, if the Trump administration is really concerned about the cost of slow environmental reviews, the answer may be to fully fund the bureaucracies charged with making approvals. The Trump administration should instead “implement laws already on the books and ensure that the agencies involved with environmental review were fully funded. Over the past six years, Congress has enacted three major laws overhauling the environmental review process—but these laws haven’t been fully implemented yet.” An ASLA panel from last year reached similar conclusions.
However, the American Society of Civil Engineers (ASCE), which have given American infrastructure a D+ rating and call for $4 trillion in infrastructure investment, was more positive. ASCE President Kristina Swallow said: “The Trump Administration’s plan is a solid first step in having a real conversation about solutions for the nation’s aging infrastructure and a path to address our infrastructure investment deficit.”
Trump’s budget proposal also calls for cutting the budgets of the Environmental Protection Agency (EPA) by 34 percent, the department of housing and urban Development (HUD) by 18 percent, and the department of transportation by 19 percent. But given Congress ignored the Trump administration’s last spending blueprint, we can assume they will again.