President Trump unveiled his much-anticipated infrastructure plan for the nation in his first State of the Union address last night, asking Congress to produce a bipartisan package that generates at least $1.5 trillion in investment. He put an emphasis on need for federal dollars to be leveraged by state and local government funding, as well as private sector investment. Finally, he declared a desire to streamline the permitting and approval process to no more than two years.
The President specifically expressed his desire to the “permanently fix the infrastructure deficit” through collaboration among the federal, state, and local governments and the private sector. ASCE puts this funding deficit at $2 trillion and agrees that increased investment amongst all levels of government and the private sector is the key solution to raise the grades and improve our nation’s infrastructure.
Infrastructure often falls on the back burner, and the President’s focus on it during the State of the Union is a promising step to push Congressional action. ASCE released a statement from President Kristina Swallow, PE, which said in part, “Congress should seize this opportunity to provide better infrastructure to the American people in a bipartisan fashion by closing the infrastructure deficit, as President Trump proposed. Infrastructure investment is one area where both Democrats and Republicans agree. I urge Congress to develop legislation that increases federal investment in infrastructure, including fixing the Highway Trust Fund.”
As the speech was being delivered, the White House released a fact sheet of the President’s infrastructure vision, which you can read here. Highlights include:
- 50% for the “Infrastructure Incentives Initiatives,” which would provide grants to state and local governments to encourage private investment. These grants would only make up 20% of the project costs and would be chosen based on factors such as potential return on investment. Furthermore, one state would not be able to receive more than 10% of the total grant money available.
- 25% for the “Rural Infrastructure Program,” which would be distributed as block grants and must be used for projects in rural areas with a population of less than 50,000.
Although last night’s proposal fails to identify clear sources of revenue and does not specify how much federal funding will be provided, President Trump has previously stated that he plans to invest $200 billion in federal funds, with the remaining money to come from state and local governments and private entities.
Finally, ASCE remains concerned that the proposal does not address the nearly insolvent Highway Trust Fund. Our nation’s surface transportation infrastructure accounts for more than three-quarters of the overall infrastructure investment deficit, and bolstering the Trust Fund would go a long way toward closing that gap. The Fund’s primary revenue source, the federal motor fuel tax, has not been raised since 1993 and inflation has cut its real value by 40%. Congress has shored up the fund with $140 billion in general fund transfers since 2008. Between 2021 and 2026, the nonpartisan Congressional Budget Office estimates Congress will need to provide an additional $121 billion to the Highway Trust Fund just to meet current obligations and maintain existing spending levels. To ensure adequate and stable funding for America’s highways, bridges and transit systems the Trust Fund needs a long-term, sustainable revenue source.
Last March, ASCE released its 2017 Infrastructure Report Card, giving the nation’s overall infrastructure a grade of “D+,” with an investment gap of $2 trillion.