Trump administration's infrastructure
plan taking shape
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[January 18, 2018]
By Ginger Gibson and David Shepardson
WASHINGTON (Reuters) - The Trump
administration is finalizing its long-awaited infrastructure plan, which
would push most of the financing of projects to private investment and
state and local taxpayers, according to sources familiar with the
proposal taking shape.
President Donald Trump, who spoke frequently of improving U.S.
infrastructure during his 2016 campaign, may preview the plan in his
Jan. 30 State of the Union address, but details are not expected until
afterward, the sources said.
Two people briefed on it said it would likely recommend dividing $200
billion in federal funding over 10 years into four pools of funds. The
administration is structuring the plan to encourage $1.35 trillion in
state, local and private financing to build and repair the nation's
bridges, highways, waterworks and other infrastructure, one source said.
The U.S. Chamber of Commerce, the largest business lobbying group in
Washington, is pushing for the administration to fund infrastructure
projects and is even backing a 25 cent increase in the federal gasoline
tax to make that happen, an official with the organization said.
It is unusual for a business group to call for a tax increase, but the
Chamber argues that it is necessary to fund critical infrastructure
projects. Tom Donohue, the Chamber's president, is expected to make four
recommendations in a speech on Thursday to reiterate its call for an
infrastructure deal.
The numbers in the Trump plan are still in flux and could change before
he unveils it. The prospects of winning approval in Congress are
uncertain given that Republicans have only a 51-49 majority in the
Senate.
Many Republicans want to use private-sector investment to finance
infrastructure projects to avoid increasing the national debt. Democrats
believe that government money is necessary to produce such a large
package.
COST-SHARING
Under the Trump plan being shaped, the largest share of the federal
money - $100 billion - is expected to go toward cost-sharing projects
with local governments, similar to grants.
The goal would be to reduce the ratio of federal funding, which often
now is 80 percent, by awarding funds only to projects that are able to
provide more local funding or leverage private investment, said a
business lobbyist familiar with the discussion.
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Some $50 billion would be earmarked for rural projects, the lobbyist
said. Those funds would help governors on projects like roads,
broadband access and replacing aging lead pipes. Including a pool
for rural infrastructure could also reduce concerns among some
Republican senators who fear rural areas may be unable to attract
private investments.
Twenty-five billion dollars would go toward existing federal
infrastructure loan programs that seek to spur private investment,
the lobbyist said.
The final $25 billion would be designated for so-called
transformative projects - an effort being dubbed "American Spirit"
projects. They could include high-speed trains or the Gateway
Tunnel, the stalled proposal to build a new rail connection between
New York City and New Jersey.
The plan may not deliver any additional federal money than in years
past. The proposal could take $200 billion from existing spending
plans – although the administration has not yet committed to whether
it would come from existing programs or whether the money would be
found elsewhere.
The administration is unlikely to rule out any forms of funding -
including increasing the federal gas tax or creating a vehicle
mileage tax, which would put electric cars that now use the roads
but do not consume much gasoline on the same footing as cars with
internal combustion engines, sources said.
Donohue, the Chamber of Commerce president, is also expected to
recommend expanding the ability of states to access private
investment funds to complete projects, reducing the federal
permitting process and addressing state and local permitting rules.
He will call for more federally backed workforce training -
including creating an apprenticeship task force. As part of that,
Donohue will reiterate the Chamber's call for passing comprehensive
immigration reform, a proposal where business has been at odds with
the Trump administration.
(Reporting by Ginger Gibson and David Shepardson; Editing by Damon
Darlin and Peter Cooney)
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