Finally, it's infrastructure week.
President Joe Biden and a bipartisan group of 10 senators today announced that they'd reached an agreement to spend $1.2 trillion, including $579 billion in new funds, over eight years on transportation, waterways, and broadband internet.
"We have a deal," said Biden outside the White House. "None of us got all we wanted."
A White House fact sheet says that $312 billion of the new funding would be spent on transportation, including $109 for bridges and roads, $49 billion on public transit, $66 billion on passenger and freight rail, and $25 billion on airports.
Electric vehicle infrastructure will get another $7.5 billion, as will electric buses and public transit. There's also $20 billion for an "infrastructure financing" program that will, per the White House's fact sheet, "leverage billions of dollars into clean transportation and clean energy."
Sen. Mark Warner (D–Va.) said that the $20 billion will be used to attract $180 billion in private financing for infrastructure, reports The New York Times. That sounds similar to President Donald Trump's plan to use $200 billion in federal funding as seed money to spur $1.3 trillion in infrastructure investments from state and local governments and private infrastructure companies.
Ports and waterways would get $16 billion more under the plan. There would also be another $11 billion in spending on safety projects.
Another $266 billion will go toward "other infrastructure," including $65 billion for broadband, $55 billion for water infrastructure, and $73 billion for electrical grids.
How will all this be paid for? That's a good question.
Biden has already committed to not raising taxes on Americans earning under $400,000. His administration has said this rules out a gas tax increase or similar user fees. His initial proposal to pay for infrastructure with a corporate tax hike was a non-starter with Republicans.
The fact sheet his administration put out today lists a number of possible pay-fors that both sides could agree on, without actually attaching numbers to how much money any of these would generate.
They include repurposing unspent COVID-19 relief funds, including unused unemployment insurance dollars; extending expiring customs fees; using 5G spectrum auction proceeds; selling off some of the government's strategic reserve of oil; and public-private partnerships.
Warner, the Times reports, also said that the package would include $40 billion in funding for the IRS, which would then be used to go after unpaid taxes. This, he claims, will bring in $100 billion in new revenue. (The Committee for a Responsible Federal Budget estimates that $40 billion in new IRS funding would bring in only $60 billion in new revenue.)
The White House also asserts that the infrastructure package will partly pay for itself through the "macroeconomic impact of infrastructure investment." The fact sheet includes no mention of imposing fees on electric vehicles, which Sen. Susan Collins (R–Maine) had suggested as a way of funding infrastructure.
Washington Post reporter Jeff Stein tweeted out harder numbers on all these pay-fors:
OK source confirming main pay-fors in bill:
- $100 billion net from IRS enforcement ($40B in new spending)
- $100B public private partnerships
- $80B UI "program integrity"
- $65B spectrum sales
- $60B dynamic scoring
- $30B in toll credits
- $25B in recouped UI ARP supplement
— Jeff Stein (@JStein_WaPo) June 24, 2021
As more details about the package are firmed up, we'll hopefully get more information on how Congress is supposed to pay for this new spending.
A lot of the spending figures released today will likely change as lawmakers get to work actually drafting a bill. Both the House and Senate are currently working on a five-year surface transportation bill that has to pass by September when the authorizations for most transportation programs expire.