GOP wants to spend a quarter of what the White House has proposed on infrastructure

Senate Republicans’ $568 billion infrastructure proposal is a shadow of the Biden administration’s $2.3 trillion plan, and room for compromise lies primarily in how both sides define infrastructure.

On Thursday, Republican lawmakers unveiled their plan for infrastructure, defining the term to cover roads and bridges, public transit systems, rail, water and wastewater, ports and inland waterways, airports, broadband and water storage and safety.

“This is a robust package when we look at where we’re focusing our infrastructure needs,” said Sen. Shelley Moore Capito, R- W. Va., during a press conference Thursday.

Sen. Shelley Moore Capito, R- W. Va., along with other Republican lawmakers introduced their infrastructure outline on Thursday.
Bloomberg News

The outline includes $299 billion for roads and bridges, $61 billion for public transit systems, $35 billion for drinking water and wastewater infrastructure, $17 billion for inland waterways and ports, $44 billion for airports and $65 billion for broadband infrastructure among others.

That would be paid for through user fees, unused federal spending and would preserve the 2017 Tax Cuts and Jobs Act — including extending the cap on the state and local tax deduction and not increasing corporate or international taxes. President Biden’s American Jobs Plan would increase the corporate tax rate to 28% from 21% in order to pay for infrastructure.

”Let’s not forget that a billion dollars is an enormous amount of money and $568 billion is a very, very generous offer in dealing with infrastructure,” said Sen. Roger Wicker, R-Miss., during the press conference “It will get us a long way to where we want to go in a five year plan.”

Ed Mortimer, vice president of transportation and infrastructure at the U.S. Chamber of Commerce, called the GOP outline an important step, but not close to the end yet.

“It shows that there are bipartisan discussions and that both Democrats and Republicans want to find solutions to address America’s infrastructure,” Mortimer said.

There is bipartisan agreement for physical infrastructure and that the bill should be paid for, Mortimer said.

“Focusing on roads and bridges, transit, aviation — the transportation parts of this, I think there is bipartisan agreement that those all have to be included,” Mortimer said.

Biden’s plan includes that physical infrastructure, but is much broader including affordable housing among other things.

If the GOP proposal was enacted into law, it would be the biggest investment in traditional infrastructure ever made, Mortimer said.

“It’s a significant proposal in our view,” Mortimer said. “This is a continuation of a conversation and there’s going to be many more reiterations of this before we get to a final solution.”

Capito suggested on Thursday repurposing unspent dollars from the pandemic “that are no longer considered an emergency” to be spent on infrastructure.

“We do not agree that ARPA (American Relief Plan Act) funds should be used specifically for not just relief, but also preparing people for recovery,” said Emily Brock, director of the Government Finance Officers Associations’ federal liaison center. “While some of that might mean investing in capital infrastructure in their communities, that’s a decision for the local decision makers to decide how to spend it and provide relief for the future.”

The ARPA money has not yet been disbursed, nor has the U.S. Treasury released guidance.

“The cart and the horse are in misalignment,” Brock said.

Senate Republicans’ fact sheet dubbed “The Republican Roadmap” also mentioned federal funding should flow in part through the “utilization of financing tools,” though no specifics were given.

Congressional Democrats have yet to release an infrastructure bill, but Brock expects it to be similar to the Move America Forward Act from last summer. That bill from House Democrats would have permanently reinstated Build America Bonds and tax-exempt advance refundings as well as expanded the issuance of private activity bonds. That bill died in the then-Republican-controlled Senate.

“We see bonds playing a role in both of them, we’ve just received more assurances from folks on the American Jobs Plan side that recognize the municipal bond,” Brock said. She added that doesn’t mean Republicans won’t support municipal bond provisions and said many municipal bond provision bills have bipartisan support.

There is an effort on both sides to define infrastructure, marking an effort of cooperation across both sides of the aisle, Brock said.

“As you’re looking at the specific areas that they’re thinking about adding into their plan, cooperation could be seen throughout that, Brock said. “The volumes and levels of contribution in each category just differ pretty broadly.”

Democratic lawmakers plan to release their infrastructure plan in mid-May.

The American Public Transportation Association were disappointed by Republican lawmakers’ plan.

“This proposal cuts transit funding by $4 billion and is a major step backward for communities that want to rebuild their economy and reimagine their future,” APTA said.

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