Trump Infrastructure Plan Would Pay For A Fraction Of Investment
It’s a year later than first promised, but President Trump finally announced his long-awaited infrastructure plan at the White House today, flanked by governors, mayors, and other state and local leaders. Calling the condition of the country’s roads, bridges, ports, tunnels and water systems “horrendous,” Trump says his plan “will spur the biggest and boldest infrastructure investment in American history. The framework will generate an unprecedented $1.5- to $1.7-trillion investment in American infrastructure.”
But the word “generate” is not the same as “spend,” as the Trump administration’s plan proposes to allocate just a fraction of that ambitious goal, $200 billion over 10 years, with most of the rest of the funding burden shifted onto states and local governments.
It’s a radical departure from how federal transportation and infrastructure programs have doled out funding in the past.
Chicago Transit Authority President Dorval Carter, who served in high-ranking positions in the Federal Transit Administration and the U.S. Dept. of Transportation, says when building new transit projects, “historically you look to get about 50 percent of that from the federal government.”
But as the CTA looks to expand one of its busiest train lines and extend its Red Line rapid transit service 5.3 miles into neighborhoods on Chicago’s South Side that are currently underserved by transit at a cost of an estimated $2 billion, Carter may come up nearly empty-handed in Washington.
That’s because if Congress approves the Trump infrastructure plan, that historical 50-50 funding model for transit projects would be thrown out the window, and most projects would require states and local agencies like the CTA to come up with at least 80 percent of the revenue, in order to get, at most, a 20 percent federal match.
For highways, that means the White House plan would completely flip the current 80-20 federal to state and local funding split for many projects.
That flip in financing “probably is not going to work,” former Transportation Secretary and ex-Rep. Ray LaHood, R-Ill., told us on NPR’s Morning Edition Monday. “That idea just probably won’t work because the states and local governments don’t have any money,” LaHood said.
“The lack of federal investment is nothing new,” says Columbia, S.C., Mayor Steve Benjamin, who was at the White House for today’s announcement.
“I would love to see a more significant and robust investment in water and sewer infrastructure, in roads and bridges and schools and hospitals coming from the federal government, and anything short of that, yes, is a disappointment.”
But Benjamin says he’s looking at the bright side, that at least a conversation about investing in infrastructure is now beginning, and he hopes Congress will beef up the federal involvement. He’s also encouraged by the effort to streamline the federal environmental review and permitting process, which the president says his plan will cut from 5-10 years, to just two.
But what worries Benjamin most of all is that the $200 billion that is in the Trump plan comes from budget cuts to transit, community development block grants, and other programs that cities like his rely upon.
“It’s important to build roads and bridges,” says Benjamin, but “it’s also important to give people ladders of opportunity so they can earn a living and house their families and feed their families. So cutting those programs is a non-starter for us.”
The American Society of Civil Engineers, which gives the country a near-failing grade of D+ for the shoddy condition of highways, railways, seaports, airports and water and sewer systems, is another group encouraged that there finally is a detailed infrastructure proposal. ASCE president Kristina Swallow, a civil engineer and program manager for the city of Las Vegas, says “it’s great to know that the leadership of our country recognizes the fact that we have been underspending on infrastructure for decades and that it’s hurting our families economically.”
But she, too, is disappointed with the size of the president’s proposed investment.
“$200 billion is a good starting point for a conversation but it is insufficient,” Swallow says, noting that the nation needs an investment of $2 trillion more than what’s currently budgeted just get the nation’s infrastructure into decent shape. “We are going to figure out a way to find additional funding if we’re really going to meet the needs of our communities.”
Swallow and others point out that cities, counties and states have already been boosting funding for infrastructure on their own because of a lack of adequate federal funds. More than 30 states have raised their gasoline or other taxes in recent years to try to meet infrastructure needs.
Swallow is also concerned about what’s missing in the Trump proposals — a plan to ensure future spending builds more sustainable infrastructure to withstand the impacts of climate change.
“We don’t have enough funding to build it twice,” Swallow says, “And so we have to have a long term view when we build out infrastructure and we have to look at what we’re dealing with today but what we might be looking at tomorrow.”
Many Democrats in Congress are already dismissing the Trump infrastructure plan.
Sen. Tom Carper of Delaware, the top Democrat on the Senate Public Works Committee, says Trump’s “infrastructure plan is unrealistic, inadequate and irresponsible.”
Oregon Congressman Peter DeFazio, the top Democrat on the House Transportation and Infrastructure Committee, calls the president’s plan “embarrassingly small,” and one that “shifts the (financial) burden to cash-strapped States and local governments.”
DeFazio also critizes the Trump plan for cutting “more than $168 billion from existing transportation and infrastructure programs to pay for Wall Street and foreign investors to toll our roads,” and worries that “it would gut bedrock environmental, clean water, and clean air protections under the guise of speeding up projects.”
Republicans might not be so willing to go with a plan that shifts the infrastructure funding burden to state and local taxpayers, but some members of the GOP caucus are also loathe to raise federal revenues, especially the gas tax, which hasn’t been increased in 25 years and currently falls short of raising enough money for existing transportation programs.
But some members of Congress might be willing to embrace the Trump administration’s plan, if it’s truly supplemental to current infrastructure funding programs, as White House aides say it is intended to be.
“This is an interesting dynamic of additional money where they’re trying to change behavior through a different way of supporting more state, local and private” investment in infrastructure, says Mike Friedberg, a former top Republican staffer on Transportation and Appropriation Committees, who is now a lobbyist and advisor on transportation and infrastructure issues in Washington.
He says the administration is making a concerted effort to shift away from a system in which Washington dictates what projects are funded and how they are funded.
“We need to come up with something that’s different and this is a good attempt,” Friedberg says.
But he acknowledges the effort won’t get far if the current funding shortfall in the Highway Trust Fund isn’t addressed and this plan doesn’t bring in new money.
He’s also encouraged by senior White House officials saying that this is not “a take it or leave it proposal,” but rather, “This is the start of a negotiation.”
“You’re seeing there’s an appetite for fixing structural problems,” says Friedberg, “and this president, he’s not an idealogue about this and wants to get stuff done with infrastructure.”
As for whether the infrastructure plan is dead on arrival on Capitol Hill, as some suggest, Friedberg says “it’s not dead (but) it has a steep hill to climb.”
