United States: President Unveils Plan To Rebuild America's Infrastructure

On February 12, 2018, President Donald Trump announced his administration's long-awaited framework for rebuilding infrastructure in America. The 53-page white paper, entitled "Legislative Outline for Rebuilding Infrastructure in America" (the "Plan"), sets out the White House's proposal to dedicate federal dollars, empower and encourage local spending, and attract significant private sector investment in a wide range of infrastructure project initiatives. In particular, the Plan proposes a federal investment of $200 billion into the nation's infrastructure in order to stimulate at least $1.5 trillion in new infrastructure investment over the next 10 years. The Plan also proposes to shorten the approval process for certain projects (as highlighted in the president's State of the Union address)1 and train the American workforce of the future.

The scope of the Plan is ambitious and includes financing initiatives for a wide array of infrastructure projects. In addition to addressing traditional infrastructure needs such as roads, bridges and airports, the Plan also seeks to spur investment in other assets, including drinking and wastewater systems, waterways, water resources, energy, rural infrastructure, public lands, veterans' hospitals, and brownfield and Superfund sites. At the core of the Plan is a commitment of $200 billion in federal funds, which is expected to jump-start significant local and private sector investment in projects. It is not expected to be a stand-alone source of grant funding. The Plan calls for significant state and local funding, along with private sector participation. The proposed $200 billion is to be divided among a number of programs, including:

  • Infrastructure Incentives Program — $100 billion would be dedicated to the creation of an "Infrastructure Incentives Program" from which states and localities may seek grants for individual projects based on the achievement of pre-agreed milestones. This $100 billion would be divided in specific amounts and administered by the U.S. Department of Transportation, the U.S. Army Corps of Engineers and the Environmental Protection Agency. Grant applications will be evaluated on various criteria, the most important being the ability of the proposed project to secure and commit nonfederal and sustainable revenue for other infrastructure investments and for that particular project's long-term operations and maintenance. The Plan also sets out a number of other guidelines limiting the potential amount of any one incentive grant.
  • Rural Infrastructure Program — $50 billion would be devoted to a new Rural Infrastructure Program, 80 percent of which would be allocated to state governors—giving states flexibility to prioritize their communities' needs. Twenty percent of the funds are proposed to be reserved for rural performance grants within eligible asset classes. Additionally, a portion of the funds noted above would be set aside for tribal infrastructure and U.S. territories.
  • Transformative Projects Program — $20 billion would be set aside to provide federal funding for "bold, innovative, and transformative infrastructure projects." This funding would support projects that "are capable of generating revenue, would provide net public benefits, and would have a significant positive impact." Applications for disbursement of these funds are to be administered by the Department of Commerce.
  • Infrastructure Financing Programs — $20 billion would be used to advance major, complex infrastructure projects by increasing the capacity of existing federal credit programs, with $14 billion to be divided among the Transportation Infrastructure Finance and Innovation Act program (TIFIA), the Water Infrastructure Finance and Innovation Act program (WIFIA), the Railroad Rehabilitation and Improvement Financing program (RRIF) and the Department of Agriculture Rural Utilities Service Lending Program), and increasing the use of Private Activity Bonds (PABs) which accounts for the remaining $6 billion. Additionally, other enhancements are being proposed to the PABs program including a broadening of the types of projects eligible for funding, an elimination of the Alternative Minimum Tax preference for PABs and a removal of the state and transportation volume caps on PABs.
  • Federal Capital Financing Fund — A $10 billion dollar commitment would be used to create a revolving credit facility to permit the federal government to acquire assets it might otherwise be required to lease pursuant to various appropriations and scoring regulations.
  • Public Lands Infrastructure and Federal Real Property Dispositions — Various adjustments are being proposed to streamline the operations and maintenance and disposition of federal infrastructure assets.

It must be noted that converting the Plan into legislation will be an uphill battle. Shortly after President Trump's announcement, Senate Minority Leader Charles Schumer announced that the Plan will "put unsustainable burdens on our local government." The Plan places a much greater emphasis on state, local and private funding for infrastructure rehabilitation than has been the case in the past, when the federal government typically contributed 80 percent of the cost of projects. At the same time, the administration has substantially reduced the federal income tax deductibility of state and local taxes the Plan is intended to encourage.

It appears that innovative public-private partnerships (PPPs) will be needed to fill this gap and qualify projects for federal funding. PPPs can be used in infrastructure projects beyond the traditional toll road and airport development projects, but there are PPP naysayers on both sides of the aisle. Finally, earlier this month, Democratic Party leaders released their own infrastructure proposal, "A Better Deal to Rebuild America," which calls for $1 trillion of federal investment in infrastructure, albeit without many details.

Despite the lack of bipartisanship currently gripping Washington, the announcement of the Plan will begin a much-needed discussion regarding the future of America's infrastructure, which is in dire need of repairs and investment.

Conclusion

The coming weeks are sure to be filled with many proposals and counterproposals from congressional, state and local leaders and industry experts, along with media commentary. Attorneys from a wide variety of Duane Morris practice areas, such as Finance; Real Estate; Trial; Energy, Environment and Resources; and Construction will monitor developments closely and provide updates and analysis through Alerts, blogs and Twitter

Footnotes

1 From the 2018 State of the Union address: "Tonight, I am calling on the Congress to produce a bill that generates at least $1.5 trillion for the new infrastructure investment we need. Every federal dollar should be leveraged by partnering with state and local governments and, where appropriate, tapping into private sector investment—to permanently fix the infrastructure deficit. Any bill must also streamline the permitting and approval process—getting it down to no more than two years, and perhaps even one."

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Akin Gump Strauss Hauer & Feld LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Akin Gump Strauss Hauer & Feld LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions