House Democrats Unveil New $760 Billion Infrastructure Plan

House Democrats on Wednesday unveiled a five-year, $760 billion proposal to make new investments in the nation’s infrastructure—including roads, transit, broadband internet networks, harbors, airports and water systems. 

But as with the other sweeping public works proposals that lawmakers and the Trump administration have put forward in the past few years, finding a viable pathway to pay for this new spending on infrastructure upgrades promises to be a challenge.

This latest plan is outlined in a 19-page “framework” that recommends funneling money through many existing federal programs. Investing in projects that are environmentally friendly and “resilient” to the effects of climate change is emphasized throughout the proposal.

It comes during an election year and as President Trump is facing an impeachment trial in the U.S. Senate that Democratic lawmakers pushed for. Even so, House Speaker Nancy Pelosi said Democrats do not intend for their infrastructure effort to yield "message bills.” 

“We are hoping that we will have the support of the Republicans and the president,” she said.

U.S. Rep. Peter DeFazio, an Oregon Democrat who chairs the House Transportation and Infrastructure Committee, charged that the nation has been “living off the legacy” of infrastructure built in the Eisenhower era. “It's falling apart,” he said. “It needs to be rebuilt."

"We have a tremendous opportunity here,” he added. 

The Democrats’ plan would devote $434 billion to highway and transit programs over the five-year timeframe, including $319 billion for roads, $105 billion for transit and $10 billion for safety initiatives.

Revamping existing “formula” funding programs so that they prioritize maintenance and improvements to existing infrastructure is one of the plan’s tenets, as is bolstering the authority that local metropolitan planning organizations have to administer funds.

Expanding passenger rail is another transportation priority that the framework identifies.

The plan also calls for allocating about $50 billion for sewer, stormwater and other water infrastructure through existing programs like the Clean Water State Revolving Fund. It would devote about $25 billion to drinking water programs as well.

And it specifically proposes creating a new Environmental Protection Agency program to help local governments detect and treat water pollution from industrial chemicals known as PFAS, while also providing an “initial infusion” of about $1 billion to help communities dealing with contamination issues.

Coming up with additional funding for any infrastructure plan is likely to be a hurdle.

Key Republicans have offered little indication during Trump’s tenure that they would support a gas tax hike that might help to shore up the Highway Trust Fund—an important pot of federal dollars for road and transit projects that has faced shortfalls in recent years.

A five-year surface transportation funding bill that was passed when President Obama was still in office is set to expire at the end of this September. The deadline is likely to generate more discussion about the Highway Trust Fund in the months ahead.

Even if the gas tax were raised, it would probably not go to support investments in non-transportation infrastructure like drinking water and sewer systems. Some of the spending that the Democrats propose could be supported by other existing taxes and fees. For instance, DeFazio alluded to the possibility of raising an airport “passenger facility charge” that has not gone up since 2001. 

“I would hope there'd be some combination of user fees and bonding,” DeFazio said as he discussed possible funding options.

He noted that the U.S. Treasury can borrow money at very low interest rates and said that if this money is directed toward something like a bridge that will last 100 years, it should not be counted on the government’s balance sheet as a single-year expense.

“We need to look at this like a capital investment,” he said.

Rep. Richard Neal, a Massachusetts Democrat who chairs the tax-writing House Ways and Means Committee, described infrastructure investments as “sorely needed” and said that he thinks “there’s some room” to arrive at a bipartisan agreement on a public works package.

“I think it's really important that we not volunteer a revenue stream until the administration reaches an agreement with us,” he said.

Neal later added: "I think that what we're looking for here is an agreement that we can then take to the public between the two sides on how best to pay for it. So there's not one-upmanship."

The federal government is not flush with budget surpluses at the moment.

Projections that the Congressional Budget Office released on Tuesday show that the federal budget deficit is expected to be $1 trillion in 2020 and that it will average $1.3 trillion over the coming decade—these are high levels compared to the past 50 years.

CBO also estimates that the nation’s debt will rise from nearly $18 trillion this year to about $31 trillion by 2030. 

As a point of reference, federal spending in the current 2020 fiscal year is expected to be around $4.6 trillion.

Trump has shown an interest in developing an infrastructure package since his early days in office. His administration put forward a highly anticipated public works plan in February 2018, but it failed to gain serious momentum on Capitol Hill.

Senate Democrats in March of 2018 proposed paying for $1 trillion of infrastructure investments by rolling back parts of the Republican-supported tax legislation approved at the end of the prior year.

In the summer of 2018, now-retired congressman Bill Shuster, then the Republican chair of the House Transportation and Infrastructure Committee, put forward an infrastructure measure that called for phasing in a gas tax increase of 15 cents per gallon over three years, along with a variety of other proposals. It, too, fell by the wayside.

Last year, Trump and Democratic leaders agreed to move ahead with discussions about a $2 trillion public works package. But that effort fell apart in a matter of weeks as the two sides sparred over unrelated issues involving the Democratic push to investigate the president.

Rep. Sam Graves, the top Republican on the House Transportation and Infrastructure Committee, this week highlighted a set of GOP principles for the reauthorization of the expiring surface transportation bill.

One is to address the sustainability of the Highway Trust Fund. The Republican principles say that the status quo of the fund relying predominantly on fuel taxes will not work in the long run. Graves has previously expressed interest in a fee based on vehicle miles traveled.

Cutting “red tape” with project permitting and reviews, ensuring that there’s funding for rural projects and giving states flexibility with infrastructure programs are among the other GOP principles.

“I may not agree with all of the principles in the majority’s outline, but as the Republican leader of this Committee, I expect to play a constructive role in the development of infrastructure bills before us this year,” Graves said responding to the Democratic proposal. 

“Any serious effort toward enacting infrastructure legislation must incorporate Republican principles as well,” he added.