President Donald Trump pledged to introduce a massive $1 trillion infrastructure plan during his first 100 days in office. Now in Trump’s thirteenth month in office, the construction industry still is waiting for a plan that it can embrace.
In this article, ASA Chief Advocacy Officer E. Colette Nelson answers the most frequently asked questions she gets from ASA members on this issue.
Question: The media reports that President Trump has backed off the proposal he made during the campaign to fund his infrastructure program through public-private partnerships. Why the big change?
Nelson: The President and his advisors seem to have realized that P3s are not feasible for many types of infrastructure projects. That is, P3s lend themselves to revenue-based infrastructure assets which offer the private investor a chance of high returns with relatively low risk (e.g., toll roads). Private investors will be less attracted to projects in low population areas—the very areas that President Trump carried in the 2016 election.
Question: Does that mean that President Trump is going to ask Congress for direct federal spending for infrastructure?
Nelson: Apparently, though I would suggest that the President and the construction industry need to temper their expectations. Congressional deficit hawks already are swallowing hard to support what is likely to be a budget-busting tax reform package. They’re unlikely to also support a massive spending package for infrastructure.
Question: I’ve also read media reports that the President expects state and local governments to pay for his infrastructure plan. What do you think?
Nelson: I think this is another opportunity for the President and the construction industry to manage their expectations. According to a report from the National Association of State Budget Officers, 33 states are going to miss their budget targets for the 2017 fiscal year. NASBO also reported that 23 states made budget cuts during the fiscal year. This doesn’t sound like states will be willing or able to finance the President’s infrastructure plan.
Question: Why is the burden on the Republicans? Why don’t the Democrats put forth a plan?
Nelson: They have. In January 2017, Democrats released a 10-year infrastructure plan that would require $1 trillion of direct federal spending. On Oct. 4, the New Democrat Coalition lay out a three-step plan to revitalize our outdated infrastructure titled Fund it, Fix it, Foster it. These plans are considered to be the Democratic starting point for negotiations with the Trump Administration.
Question: With all of these delays, do you have an opinion on when we might see real movement on an infrastructure program?
Nelson: Congressional leaders continue closed-door discussions on their own plans. But I wouldn’t expect to see any construction under a new infrastructure program until late 2018 or early 2019, if then.
