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Inframation News
March 27, 2018
A federal appropriations bill signed into law by President Donald Trump boosts spending on transportation projects, and provides significantly more money on the WIFIA program for water projects.

The massive, USD 1.3tn Omnibus Spending Bill provides spending increases to both highway, transit and airport programs.

Highway programs will receive an eight percent increase over FY 2017 levels, totaling USD 46.7 billion. Transit programs receive a six percent hike from 2017 levels. The Airport Improvement Program also receives a major boost of USD 1bn, a 30% increase. The USD 1bn increase is the largest since the 2009 American Recovery & Reinvestment Act, according to an analysis from the American Road and Transportation Builders Association.

The Transportation Investment Generating Economic Recover, or TIGER program, also receives a significant funding boost, increasing from USD 500m to USD 1.5bn for FY18.

The WIFIA program, administered by the Environmental Protection Administration (EPA), also receives a major funding hike, from USD 30m to USD 63m in FY18. The loan program is modeled on the Department of Transportation’s TIFIA loan program, and is expected to lead to more water and wastewater P3 projects.

“It’s really a vote of confidence in the program,” said Tommy Holmes, legislative director for the American Water Works Association.

The bill also includes USD 6.83bn for the Army Corps of Engineers, an increase of USD 789m from FY17. The bill also requires the administration to include six new studies and five new construction starts in the Corps work plan, according to the American Association of Port Authorities.   

There is no direct funding for the Gateway Program in the bill. Gateway, which would rehabilitate one tunnel and build a new tunnel between New York City and New Jersey, has served as a point of contention between Trump and Senate Majority Leader Charles Schumer (D-NY) over the level of federal funding support for the project. 

Congressional negotiators reached an agreement on the bill on 21 March, and the bill passed both houses on 22 March. President Trump signed the bill on 23 March. The compromise measure boosted defense spending by USD 80bn over previously authorized levels, while domestic spending programs increased by USD 63bn, to attract support from both Democrats and Republicans.

On the road
With government operations now funded until the end of September, a White House official confirmed media reports that Trump will travel to Ohio this Thursday (29 March) to speak, with infrastructure one of the topics.

In his infrastructure blueprint released in early February, Trump proposed spending USD 200bn over 10 years to incentivize infrastructure spending by states and private investors.

Marcus Lemon, shareholder at Polsinelli, and chair of the Infrastructure and P3 Practice at Polsinelli, says Trump’s advocacy will be crucial for an infrastructure bill’s passage.

“The president’s support for the infrastructure plan is critical, not only to show that it is a priority for the administration, but also to show what he envisions as an acceptable package for his signature,” Lemon said.

Congress has a full agenda and a limited time frame to address that agenda, according to Stephen A. Martinko, government affairs counselor at K&L Gates. But, he noted that there was skepticism on Congress’ ability to pass major tax reform legislation in 2017, and that happened.

A major stumbling block may continue to be finding a way to pay for the USD 200bn the bill calls for. An increase in the federal fuel tax seems unlikely, Lemon said, but notes that other innovative options, such as “repurposing” of funds from other programs and repatriation revenue are potential options.

He also noted that the Omnibus Spending Bill included multiple elements benefitting transportation and infrastructure that could be used as an argument against additional spending

“Any increase in federal spending for infrastructure seems highly unlikely without a corresponding offset in another program, or an innovative funding source,” Lemon said.