Washington doesn't agree on much these days, but you'd be hard-pressed to find anyone who doesn't agree that America's infrastructure is falling apart.
The Trump administration has proposed a $1.5 trillion plan in response. It's the first step toward the fulfillment of President Donald Trump's campaign promise to fix America's roads, ports and other important transportation and utility systems. Trump expressed the possibility of some bipartisanship agreement on the infrastructure issue last year, but the proposal has already raised some eyebrows.
Here are three things you need to know:
While the plan may be valued at $1.5 trillion, that doesn't mean its coming from new federal spending. In fact, only $200 billion in federal funding is included, which will come from spending cuts elsewhere. That leaves the state and local governments responsible for footing most of the bill.
The plan would put $100 billion toward programs that would match local spending in an 80/20 split, with state and local governments putting up at least 80 percent of the funding for a given project, with the federal government putting up the remaining 20 percent. That effectively flips the traditional cost-sharing associated with infrastructure projects, putting most of the burden on local governments.
With higher expectations at the local level, state and local tax increases could result. Revenue generating programs like toll roads could also be a possibility.
Rural areas in the country have been especially neglected when it comes to infrastructure, Trump told reporters on Monday. His plan aims to improve it with $50 billion in the form of block grants for things like broadband internet access, improved water, waste and power services and flood management. Theoretically, state and local officials would apply for those block grants the way they traditionally would for most federal grant programs.
The Trump administration wants to increase the amount of public-private partnership involved in rebuilding the nation. To spur that growth, the plan proposes $20 billion for federal loan programs and private activity bonds. But what Trump sees as an incentive, his critics see as a handout.
"This is not a real infrastructure plan — it’s simply another scam, an attempt by this administration to privatize critical government functions, and create windfalls for their buddies on Wall Street," said Rep. Peter DeFazio (D-OR), the top Democrat on the House Transportation Committee, as reported by Business Insider.
Private-public partnerships have become something of a norm across much of the developing world. The European Union engaged in hundreds of billions of dollars worth of infrastructure projects that involved private and public cooperation from 2000 to 2015, most of which involved transportation projects like building roads.
Trump met with local mayors and state officials on Monday to discuss his proposal, but his first hurdle will be convincing leaders on Capitol Hill to follow his proposal and give him a bill to sign. The administration is expected to see some push-back from Democrats due to the spending cuts and shortened environmental review process included in the proposal. There may also be some resistance from Republicans who will not want to support an additional spending measure on top of Trump's already unbalanced budget proposal.