DALLAS – Transportation advocates are cautiously encouraged by remarks by budget director Mick Mulvaney that President Trump’s fiscal 2018 budget will include $200 billion of new direct federal funding for infrastructure to stimulate $1 trillion of private investments.

“When you see details of our budget, what you’ll see is a $200 billion number for infrastructure, with the understanding that there will be a 5:1 leverage ratio on that,” said Mulvaney, director of the Office of Management and Budget, at an event on Thursday sponsored by the Institute of International Finance.

“We’re certainly going to spend some money,” Mulvaney said. “The president wants a trillion dollars worth of work on the ground and we’re going to give it to him.”

OMB Director Mick Mulvaney: “The president wants $1 trillion worth of work on the ground and we expect to give it to him."
OMB Director Mick Mulvaney: “The president wants $1 trillion worth of work on the ground and we expect to give it to him."

Details of the infrastructure proposal will be unveiled later this year, Mulvaney said.

“I don’t think you’ll see specifics to be voted on until fall, he said.

Mulvaney said the lack of a vote in Congress on a repeal of the Affordable Care Act before lawmakers left for the Easter recess disrupted the administration’s legislative outlook.

“We sort of looked at this in a particular order,” he said. “We thought that healthcare would go first, then tax reform, and then infrastructure.”

Marcia Hale, president of Building America’s Future, said the timetable outlined by Mulvaney, with the first congressional action on the package not coming until fall, is more realistic than earlier projections that the legislation would be unveiled in May.

“The administration will need some time to build up support for an infrastructure plan,” Hale said. “They could do it with just Republican votes, but a bipartisan approach would be a better way. It will take the new administration some time to build up trust among the Democrats in Congress.”

“We are delighted about them putting that much money in there,” she said. “It has to be large to do what we need to do.”

The infrastructure proposal by the Trump campaign in October 2016 that relied on private investments stimulated by $137 billion of federal tax credits would not be enough, Hale said.

“We’re adamant that there must be some true federal funding,” Hale said. “Private sector investments can be helpful but that can’t be the main effort. It won’t do everything that we need to do.”

There may not be enough time left this year to take up an infrastructure bill, said Nick Yaksich, director of governmental relations for the Association of Equipment Manufacturers.

“The congressional schedule is slipping away and they still have to deal with healthcare and tax reform,” Yaksich said. “I think 2018 would be more realistic.”

Congress works only on deadline pressure, which was removed in late 2015 by the passage of the five-year Fixing America’s Surface Transportation Act, he said.

“The push is going to have to come from 1600 Pennsylvania Ave. [the White House] and President Trump is pretty good at that,” Yaksich said.

There is a good likelihood of a major infrastructure proposal within the next year, Yaksich said.

“The president has been talking about infrastructure, so we’re very, very encouraged to hear it from the money guys like Mulvaney,” he said. “I’m convinced it can be done. An infusion of private capital and an infusion of government spending would be a win-win for the country.”

The talk on Capitol Hill about infrastructure being a bipartisan issue be derailed by disputes over where to find the $200 billion being proposed, said Carl Davis, research director at the Institute on Taxation and Economic Policy.

“Improving our nation's infrastructure is a popular goal, but negotiations
often break down over how to pay for it. There are no guarantees that this
proposal is going to unite lawmakers,” he said.

Rural lawmakers are more dubious about public-private partnerships than are urban ones, Davis said.

“There are serious limitations in seeking to fix our nation's infrastructure with private financing,” he said. “Lawmakers in rural areas and those concerned about the pitfalls inherent in turning our public infrastructure over to private companies are going to need to be convinced.”

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