White House releases budget framework for infrastructure

The Trump Administration last week previewed its much-anticipated plan to invest $1 trillion in the nation’s infrastructure, releasing a six-page fact sheet on the principles guiding its infrastructure initiative alongside FY18 budget documents. But the outline reveals the White House plan includes less than $1 trillion in new direct federal infrastructure spending, as it intends to count annual appropriations for several existing programs toward the $1 billion total.

The fact sheet explains that the Trump Administration plans to “reevaluate the role of the Federal Government in infrastructure investment,” in part by exploring whether additional responsibilities should be delegated to the states. In particular, it calls out “an unhealthy dynamic” it says has been created by the broad availability of federal infrastructure funds, as “state and local governments delay projects in the hope of receiving Federal funds.” In response, the Administration will use its infrastructure initiative to “fix underlying incentives, procedures, and policies,” because “providing more Federal funding, on its own, is not the solution to our infrastructure challenges.”

In terms of funding, the plan proposes to achieve $1 trillion in infrastructure investment in large part by leveraging federal investments and incentivizing private investment in projects.  To that end the fact sheet notes that the president’s FY18 budget includes $200 billion in spending related to the infrastructure proposal, but this sum includes FY18 funding requests for the Water Infrastructure Finance and Innovation Act (WIFIA) and other programs that would likely be in line for federal dollars even in the absence of a new infrastructure initiative.

According to the summary, as the Trump Administration develops policy and regulatory changes, and seeks statutory proposals working with Congress, funding infrastructure will focus on proposals that fall under the following key principles:

1. Make Targeted Federal Investments. Focusing Federal dollars on the most transformative projects and processes stretches the use and benefit of taxpayer funds. When Federal funds are provided, they should be awarded to projects that address problems that are a high priority from the perspective of a region or the Nation, or projects that lead to long-term changes in how infrastructure is designed, built and maintained.

2. Encourage Self-Help. Many States, tribes and localities have stopped waiting for Washington to come to the rescue and have raised their own dedicated revenues for infrastructure. Localities are better equipped to understand the right level – and type – of infrastructure investments needed for their communities, and the Federal Government should support more communities moving toward a model of independence.

3. Align Infrastructure Investment with Entities Best Suited to Provide Sustained and Efficient Investment. The Federal Government provides services that non-Federal entities, including the private sector, could deliver more efficiently. The Administration will look for opportunities to appropriately divest from certain functions, which will provide better services for citizens, and potentially generate budgetary savings. The Federal Government can also be more efficient about disposing underused capital assets, ensuring those assets are put to their highest and best use.

4. Leverage the Private Sector. The private sector can provide valuable benefits for the delivery of infrastructure, through better procurement methods, market discipline, and a long-term focus on maintaining assets. While public-private partnerships will not be the solution to all infrastructure needs, they can help advance the Nation’s most important, regionally significant projects.

Congressional leaders have yet to commit to a timeframe for considering a major infrastructure package, and it is not clear to what extent any plan that may be developed on Capitol Hill would reflect the priorities of the Administration’s outline.

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