Trump Infrastructure Plan Already Prompting Skepticism in Many Quarters

President Trump’s State of the Union speech and a leaked outline of his infrastructure package last month produced no shortage of opinions about what the administration has in mind for one of his major policy priorities. Many from across the transportation and public policy communities and from across the political spectrum have expressed serious concerns about the shape the package may be taking. Here’s a roundup of some of the reaction so far.

What We Know So Far

A number of speeches, briefings and documents from the last couple of weeks begin to shed at least some light on what the administration has in mind for their long-awaited infrastructure package. Among them:

The Leaked Document

A document leaked to Axios and Politico and posted January 22 appears to be an internal six-page summary of a larger White House infrastructure plan that could still be undergoing changes for eventual release. It includes a series of “funding principles” and “principles for infrastructure improvements.” In the funding principles section, the document says an infrastructure incentives initiative would be created that “encourages state, local and private investment in core infrastructure by providing … grants.” The program would account for 50 percent of the total appropriation under the plan. Another 10 percent would go to a program to fund “innovative and transformative infrastructure projects based on a competitive basis.” Twenty-five percent of the total appropriation would go to a “rural infrastructure program.” The document’s principles for infrastructure improvements include items like “allowing states flexibility to toll on interstates and reinvest toll revenues in infrastructure.”

 

Trump Remarks to Mayors/Gribbin Briefing

In remarks to the U.S. Conference of Mayors January 24, President Trump said his infrastructure plan would result in about $1.7 trillion in overall investment over the next decade, a larger figure than circulated previously. At a separate meeting with the mayors on January 25, White House lead infrastructure advisor D.J. Gribbin said the infrastructure package would not include endorsement of a gas tax increase or any other plan to raise revenue to make possible the $200 billion of new federal spending expected to be part of the $1.7 trillion plan. He suggested that cuts in last year’s budget to programs like Amtrak and transit could help pay for the package. While suggesting that those dollars could be repurposed, Gribbin said the administration is not proposing to eliminate the Highway Trust Fund or state revolving funds. “So the major delivery mechanisms for funding infrastructure should remain in place,” he said.

Further Reading:

 

State of the Union

The President’s remarks included just six statements about infrastructure. In addition to calling on Congress to produce a bill that generates at least $1.5 trillion in infrastructure investment and using federal dollars to leverage additional state, local and private investment, Trump called for streamlining the permitting and approval process for transportation projects.

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White House Fact Sheet

The White House issued a fact sheet to amplify the President’s State of the Union remarks on infrastructure. Among the document’s bulleted points that seemed to confirm what was in the leaked document: “Half of the new infrastructure funds would go towards incentivizing new state and local investments in infrastructure. President Trump’s plan will empower state and local authorities to prioritize infrastructure projects based on their community’s needs. … A quarter of the Federal funds will be dedicated to addressing rural infrastructure needs prioritized by state and local leaders.”

Republican Retreat

Axios reported that this week’s Republican Congressional Retreat in West Virginia included discussion of a possible gas tax increase to pay for infrastructure. But many observers continue to believe a tax increase is unlikely this year since it would come on the heels of last year’s huge tax cut.

Further Reading

The Major Concerns

While the administration has yet to officially release a full version of their infrastructure package, a variety of concerns already have been expressed about the details that have emerged so far. Among them:

The plan is light on details so far, particularly about how it would be funded.

The New York Times reported that White House officials want the increased infrastructure spending to be offset by budget cuts but they’re not offering any details on where the cuts would come from. “The officials said Mr. Trump would leave it up to Congress — where there is little consensus about how to pay for such a plan — to figure out the details, giving lawmakers wide latitude in creating what would need to be a bipartisan bill against the backdrop of the midterm elections,” the newspaper reported. The president of the AFL-CIO, Richard Trumka, called the lack of a plan “sort of pathetic.” Ohio Sen. Sherrod Brown told the paper “accounting gimmicks don’t build bridges.” Senate Minority Leader Chuck Schumer said “Unless we get real dollars, we will not build the infrastructure we need.”

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Who should pay for infrastructure?

Robert Puentes, who heads the DC-based Eno Center for Transportation, told The Christian Science Monitor recently that “A lot of this [state-level emphasis] is based on a phenomenon that's happening across the country, where states and cities and metro areas are raising their own taxes” to pay for infrastructure projects. … But “not all projects … are right for private investment,” and some communities that need investment don’t have money at hand to pay for it from taxes or user fees like tolls. A recent report from the Brookings Institution examines the increasing role localities are paying in transportation investment and how federal and state policymakers can do more to support local efforts.

Further Reading

 

Fears that the package could amount to little more than a “bait and switch”

Jacob Leibenluft of the Center on Budget and Policy Priorities wrote this week that “(Trump’s) agenda to date suggests that we should be on the watch for a “bait and switch” at the heart of his proposal — proposing a high-profile new initiative with one hand while taking away important funding from infrastructure with the other. … Even as the White House focuses on the trillion-dollar number, the actual federal commitment will be only a small fraction of that, and it may be poorly targeted. And the Administration has made clear, in its fiscal year 2018 budget and other public statements, that it intends to pursue simultaneous cuts to other infrastructure spending — putting forward cuts that, even when combined with a new initiative, would eventually reduce annual federal funding for surface transportation over time.”

Further Reading

 

The package has suffered delay after delay

Lawmakers on both sides of the aisle have reportedly expressed frustration as the release of the infrastructure proposal has been pushed back time and again over the course of the last year.

Further Reading

 

Concerns that streamlining permitting and approval processes would erode environmental protections

While the President continues to call for streamlining the permitting and approval processes that can cause decade-long delays on transportation projects, efforts have been underway to achieve this over the last several years thanks to policies enacted under the last two federal surface transportation authorization bills. Some analysts say in streamlining these processes further it is important to ensure that environmental concerns can still be safeguarded, that the same level of public and stakeholder input can be maintained as projects are developed, and that projects are not invested in that are outdated in their purpose or design as the nation seeks to build a 21st century infrastructure.

Further Reading

 

Fears that 2018 politics ultimately will derail the infrastructure package

Transportation consultant Dennis Powell predicts in an op-ed for The Hill that “in a month or two, the infrastructure issue will slowly fade into the background as Republicans refuse to raise taxes on the heels of their tax cuts, and Democrats will not risk exposure of raising taxes in a year when they think they can regain majority control in Congress.”

Further Reading

Concerns for Specific States

There are also concerns being expressed about how specific states might fare in the Trump infrastructure package.

  • CBS News asked “Does Trump’s infrastructure plan go far enough to help states like Tennessee?” Among the concerns: tolling is illegal in Tennessee and the state doesn’t borrow money to build infrastructure, the piece notes. "Since they're looking at public-private partnerships, and leveraging federal dollars, we won't be a player in that," said John Schroer, the state's transportation commissioner.
  • The Associated Press reported recently on the challenges states like Missouri and Arkansas could face: ““The Trump administration has issued a charge that sounds a lot like ‘show me the money,’” said Missouri Department of Transportation Director Patrick McKenna, who is president of the Mid America Association of State Transportation Officials. … To participate in Trump’s plan, Missouri likely would have to ask voters to raise taxes for transportation, McKenna said. That’s because the state transportation department already is spending at a deficit of roughly $80 million a year to meet its current federal highway match. Neighboring Arkansas is in a similar predicament. Gov. Asa Hutchinson’s budget proposal seeks to transfer $16 million from surplus general revenue to the transportation department in order to meet its current federal highway allotment. Qualifying for Trump’s plan could require a new revenue source. “We’re shaking the couch cushions out to see where we can find the rest of it,” said Republican state Rep. Dan Douglas, who has backed various unsuccessful transportation funding bills.”
  • Colorado road builders don’t like what they’ve heard about the package so far, The Denver Post reported recently. But Gov. John Hickenlooper and other state officials hope a lackluster effort from Washington could help break the gridlock in the state legislature over state transportation funding this year.
  • Officials in New York and New Jersey are concerned about what one of the President’s infrastructure plan principles could mean for the Gateway project, which seeks to build a new rail tunnel under the Hudson River to connect New Jersey to Penn Station, Politico reported. That principle seeks to limit future federal transportation grant awards to 20 percent of total project cost. Such a limitation would require the two states to come up with much more of the $13 billion the tunnel project is expected to cost than originally envisioned.
  • The Weekly Standard reported that: “Maine Sen. Angus King said he was worried that low-density states like his would not be able to handle the burden of increased tolling that may occur under public-private partnerships advocated by the White House. Traditionally, said King, the federal government covers the bulk of expenditures for states, and if state governments would have to provide 80 percent under Trump’s plan, “that’s putting a real burden on the states that I’m not sure many of them are going to be able to meet.””

Transportation Interests Weigh In

Officials from many of the transportation stakeholder groups and elsewhere have offered their thoughts on the President’s infrastructure plan in recent days. Among them:

  • Bud Wright 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."
  • Paul Skoutelas of the American Public Transportation Association: “Recent news reports stated the Trump Administration was considering eliminating some public transit federal funding to help pay for an infrastructure initiative.  That action would be a step backwards and counterproductive, as well as harmful to the economy and to the tens of millions of people who depend on public transportation. Additionally, APTA supports the Chamber of Commerce’s position that the federal gas tax, which has not been raised since 1993, should be increased to help pay for surface transportation infrastructure needs. Funding for public transportation relies on a strong federal, state, and local partnership. Infrastructure has always been a bipartisan issue and now is the time for both parties to come together to strengthen our nation’s infrastructure and create a prosperous future.”
  • Patrick Jones of the International Bridge, Tunnel and Turnpike Association: “We need an ‘all of the above’ approach to infrastructure investment. We need direct federal investment; we need the states to invest; and we need to give states the flexibility to toll in places where it makes sense to them. … Tolling is a tool in the toolbox. It can involve the public sector, or the private sector, or both. America needs a variety of solutions. Federal investment, state investment, and tolling are all part of the highway infrastructure funding solution.”
  • Pete Ruane of the American Road & Transportation Builders Association: “The ball is in Capitol Hill’s court. If scientists can clone monkeys, Congress ought to be able to figure out how to raise federal dollars to fix the Highway Trust Fund and modernize our choking National Freight Network. Those are the top two infrastructure priorities.”
  • Chris Spear of the American Trucking Associations: “Roads are not a partisan issue – they’re driven on by Republicans and Democrats alike. As both sides of Capitol Hill know, modernizing our infrastructure will require a substantial investment – actual, real revenue. America cannot be rebuilt with funding gimmicks and finance schemes.”
  • Further Reading