Understanding the Infrastructure Bills

Investopedia – August 11, 2021

By a vote of 69 to 30, including 19 Republicans and all 50 Democrats, the U.S. Senate passed a $1.2 trillion infrastructure package, known as the Infrastructure Investment and Jobs Act, on Tues., Aug. 10, 2021.1 Following passage, the proposed legislation was sent to the House of Representatives where further adjustments are expected. Should the bill pass, the House and Senate will need to consolidate their respective versions for a final bill to go to President Biden for his signature.

Tuesday’s bill is one of two pieces of infrastructure legislation under consideration in the Senate. In addition to the $1.2 trillion bipartisan bill, a second $3.5 trillion Democratic proposal is in play.

On Aug. 9, Senate Majority Leader Chuck Schumer addressed this second bill in a letter to colleagues saying, “I will immediately move to the FY2022 Budget Resolution with reconciliation instructions.”2 Reconciliation means the $3.5 trillion bill could pass the Senate by a simple majority vote avoiding the risk of a filibuster. And some House progressives had said they would not support the bipartisan plan unless the Senate moved quickly on the second bill.

Then, just before 4 a.m. Wed. morning, the Senate passed the blueprint of the $3.5 trillion second bill on a party-line vote of 50 to 49.3 The next step in the budget reconciliation process is that the House of Representatives will have to pass an identical budget resolution. Only when that happens can the Senate Democrats attempt to pass the $3.5 trillion bill by a simple majority using the budget reconciliation process.

Here is what is in both bills and what happens next.

What’s in the $1.2 Trillion Bipartisan Bill

The 2,702-page bipartisan bill contains just $550 billion in new spending. The $1.2 trillion figure comes from including additional funding normally allocated each year for highways and other infrastructure projects. The new spending consists of:4

$110 billion for roads and bridges. In addition to construction and repair, the funding also helps pay for transportation research at universities, funding for Puerto Rico’s highways, and “congestion relief” in American cities.

$66 billion for railroads. Funding includes upgrades and maintenance of America’s passenger rail system and freight rail safety, but nothing for high-speed rail.

$65 billion for the power grid. The bill would fund updates to power lines and cables, as well as provide money to prevent hacking of the power grid. Clean energy funding is also included.

$65 billion for broadband. Includes funding to expand broadband in rural areas and in low-income communities. Approximately $14 billion of the total would help reduce internet bills for low-income citizens.

$55 billion for water infrastructure. This funding includes $15 billion for lead pipe replacement, $10 billion for chemical clean-up, and money to provide clean drinking water in tribal communities.

$47 billion for cybersecurity and climate change. The Resilience fund will protect infrastructure from cybersecurity attacks and address flooding, wildfires, coastal erosion, and droughts along with other extreme weather events.

$39 billion for public transit. Funding here provides for upgrades to public transit systems nationwide. The allocation also includes money to create new bus routes and help make public transit more accessible to seniors and disabled Americans.

$25 billion for airports. This allocation provides funding for major upgrades and expansions at U.S. airports. Air traffic control towers and systems would receive $5 billion of the total for upgrades.

$21 billion for the environment. These monies would be used to clean up superfund and brownfield sites, abandoned mines, and old oil and gas wells.

$17 billion for ports. Half of the funds in this category would go to the Army Corps of Engineers for port infrastructure. Additional funds would go to the Coast Guard, ferry terminals, and reduction of truck emissions at ports.

$11 billion for safety. Appropriations here are to address highway, pedestrian, pipeline, and other safety areas with highway safety getting the bulk of the funding.

$8 billion for Western water infrastructure. Ongoing drought conditions in the western half of the country will be addressed through investments in water treatment, storage, and reuse facilities.

$7.5 bill for electric vehicle charging stations. The Biden administration asked for this funding to build significantly more charging stations for electric vehicles across the nation.

$7.5 billion for electric school buses With an emphasis on bus fleet replacement in low-income, rural, and tribal communities, this funding is expected to allow those communities to convert to zero-emission buses.

What’s in the $3.5 Trillion Democratic Proposal

The Democratic FY2022 Budget Resolution Agreement Framework memorandum is designed to enact President Biden’s Build Back Better agenda. This proposal, often referred to as an investment in human infrastructure, is far-reaching and ambitious. It lists the following amounts and areas to be addressed:5

$135 billion for the Committee on Agriculture Nutrition and Forestry Funding to be used to address forest fires, reduce carbon emissions, and address drought concerns.

$332 billion for the Banking Committee Including investments in public housing, the Housing Trust Fund, housing affordability, and equity and community land trusts.

$198 billion for the Energy and Natural Resources Committee. This would develop clean energy.

$67 billion for the Environment and Public Works Committee. These monies would fund low-income solar and other climate-friendly technologies.

$1.8 trillion for the Finance Committee This part of the bill is for investments in working families, the elderly, and the environment. It includes a tax cut for Americans making less than $400,000 a year, lowering the price of prescription drugs, and ensuring the wealthy and large corporations pay their fair share of taxes.

$726 billion for the Health, Labor, Education, and Pensions Committee This addresses universal pre-K for 3- and 4-year-olds, childcare for working families, tuition-free community college, funding for historically black colleges and universities, and an expansion of the Pell Grant for higher education.

$37 billion for the HSGAC Committee. This would electrify the federal vehicle fleet, electrify and rehab federal buildings, improve cybersecurity infrastructure, reinforce border management, invest in green-materials procurement, and invest in resilience.

$107 billion for the Judiciary Committee. These funds address establishing “lawful permanent status for qualified immigrants.”

$20.5 billion for the Indian Affairs Committee This addresses Native American health programs and facilities, education programs and facilities, housing programs, energy programs, resilience and climate programs, BIA programs and facilities, Native language programs, and the Native Civilian Climate Corps.

$25 billion for the Small Business Committee This provides for small business access to credit, investment, and markets.

$18 billion for the Veterans Affairs Committee. This funds upgrades to veteran facilities.

$83 billion for the Commerce Committee. This goes to investments in technology, transportation, research, manufacturing, and economic development. It provides funding for coastal resiliency, healthy oceans investments, including the National Oceans and Coastal Security Fund and the National Science Foundation research and technology directorate.

A Possible Timeline

While Democrats and Republicans alike have praised the bipartisan infrastructure bill, there remain significant challenges to be addressed before the money starts flowing.

Aug. 10, 2021—Immediately after passing the bipartisan bill, the Senate voted 50 to 49 to begin debate on the $3.5 trillion infrastructure bill.6

Aug. 11, 2021—Senate Democrats passed the $3.5 trillion budget resolution 50 to 49.3 Democrats in the House and Senate now begin the time-consuming task of drafting a final product.

Aug. 23, 2021—House Majority Leader Steny Hoyer sent a “dear colleague” letter to House members Aug. 10 stating that the House would “return to session the evening of Aug. 23, 2021” to consider the anticipated Senate budget resolution ($3.5 trillion bill). Hoyer said the House would remain in session “until our business for the week is concluded.”7

Sept. 15, 2021—The memorandum outlining the $3.5 trillion plan recommends that congressional committees “submit legislation to the Committee on the Budget by September 15 to carry out this section, though this date is not binding.” As recently as Aug. 6, Speaker Nancy Pelosi reiterated her position that she would not take up either bill in the house until the Senate passes both of them.8

Infrastructure Prognosis

If the Senate were to pass, through reconciliation, the $3.5 billion infrastructure bill—or Speaker Pelosi and House Democrats decided to waive their mandate to consider both bills at the same time—an infrastructure bill could land on President Biden’s desk sooner, rather than later. If things don’t fall perfectly in place, the process could be long and arduous.

Regardless of the final outcome or timeline, the Senate passage of the bipartisan infrastructure bill is generally seen as a win for the Biden administration. President Biden, in remarks Tuesday afternoon pointed to the “big picture” aspect of the day’s vote saying, “We’re on the cusp of an infrastructure decade that I truly believe will transform America.”9

By JIM PROBASCO

Article Sources:

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1. Senate.gov. “On Passage of the Bill (H.R. 3684, As Amended ).” Accessed Aug. 10, 2021.
2. Politico.com. “Letter from Chuck Schumer to Colleagues on Aug. 9, 2021.” Accessed Aug. 10, 2021.
3. Congress.gov. “S.Con.Res.14 – A concurrent resolution setting forth the congressional budget for the United States Government for fiscal year 2022 and setting forth the appropriate budgetary levels for fiscal years 2023 through 2031.” Accessed Aug. 11, 2021.
4. U.S. Senate. “H. R. 3684 – Infrastructure Investment and Jobs Act.” Accessed Aug. 10, 2021.
5. Democrats.Senate.gov. “FY2022 Budget Resolution Agreement Framework.” Accessed Aug. 10, 2021.
6. Senate.gov. “On the Motion to Proceed (Motion to Proceed to S. Con. Res. 14 ).” Accessed Aug. 10, 2021.
7. MajorityLeader.gov. “Dear Colleague on the August Work Period.” Accessed Aug. 10, 2021.
8. Speaker.gov. “Transcript of Pelosi Weekly Press Conference Today – Aug. 6, 2021.” Accessed Aug. 10, 2021.
9. Whitehouse.gov. “Remarks by President Biden on the Senate Passage of the Bipartisan Infrastructure Investment and Jobs Act.” Accessed Aug. 10, 2021.

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