DALLAS -- The question of how President Trump plans to fund his proposed $1 trillion infrastructure program remains unresolved after he provided no new specifics of the proposal in his address to a joint session of Congress on Tuesday night, transportation experts said.
Trump briefly cited the $1 trillion, 10-year infrastructure renewal proposal released by his presidential campaign in late October but did not add any additional details.
The plan would not provide any new federal funding for transportation projects but instead would rely on $137 billion of federal tax credits to leverage up to $100 billion per year of private investments in public infrastructure over the next 10 years.
"Crumbling infrastructure will be replaced with new roads, bridges, tunnels, airports, and railways gleaming across our beautiful land," Trump told the lawmakers. "To launch our national rebuilding, I will be asking the Congress to approve legislation that produces a $1 trillion investment in the infrastructure of the United States — financed through both public and private capital — creating millions of new jobs."
Trump should explain how projects lacking a revenue stream would be financed under his proposal, Fitch Ratings said in a report released Wednesday.
"More clarity is still needed on how non-revenue-generating projects will be financed as the opportunities for investment in user-fee-supported infrastructure will be only a limited subset of the overall need," Fitch said.
The funding is the most important but unresolved question about the Trump proposal, said Pat Jones, executive director of the International, Bridge, Tunnel and Turnpike Association.
"We must work hard to have an open and robust conversation about how to pay for this vital infrastructure," Jones said. "The question of how to pay for this plan can quickly become a sticking point. Let's pay for the infrastructure we need."
The lack of specifics in Trump's speech is a signal that infrastructure renewal will be deferred, said Bob Poole, director of transportation policy at the Reason Foundation.
"An infrastructure bill will have to come after Congress deals with Obamacare repeal and replace, and large-scale tax reform," Poole said. "Those are both major, time-consuming issues, so it is not realistic to expect a large and many-faceted infrastructure bill to have time on the congressional agenda until after those battles are completed."
Trump's focus on infrastructure makes it likely that the issue will at least be discussed seriously in Congress this year, said Jack Basso, principal and transportation financing consultant at Peter J. Basso & Associates LLC and former chief operating officer of the American Association of State Highway and Transportation Officials.
"The good news is that infrastructure has been front and center with the president during the campaign and since," Basso said. "On the other side, we still don't have any details."
Expect some action on a legislative proposal this year, even if there is not a vote on a final bill until 2018, Basso said.
"Two days ago, I would have said it's unlikely this year," he said. "But during the speech, the president made it pretty clear that something has to happen."
Having the president talking about infrastructure renewal is a good thing, said Nick Yaksich, senior vice president for government affairs at the Association of Equipment Manufacturers.
"The speech was short on details and that is a concern," Yaksich said. "It's the age-old question: How do you pay for it? We know there is sufficient private capital out there to invest in infrastructure, and there is a need for the investment."
A major part of the solution would be to find a revenue source for the Highway Trust Fund to bolster the fuel taxes dedicated to it, Yaksich said.
"Congress and the administration need to address the shortfall in the Highway Trust Fund," he said. "That is a huge concern for us."
