American Job Funding | National Infrastructure Plan
On Wednesday, March 31, President Biden presented a national infrastructure plan intended to improve the U.S. transportation systems and begin a more pronounced shift to clean energy. Titled the American Jobs Plan, the proposal calls for approximately $2 trillion in funding. While many praise the ambition of the plan, others are concerned about the manner in which the government will have to pay for it.
Following the $1.9 trillion coronavirus relief plan approved earlier in March, this initiative aims to create more jobs, renew infrastructure, and combat climate change. The next initiative from the White House will tackle improving education, broadening healthcare coverage, and expanding paid leave.
Overall Project Funding | Infrastructure Plan
The White House recognizes the need to overhaul the U.S. infrastructure, which ranks 13th globally for overall quality. The American Jobs Plan would provide funding for various industries and priorities, many of which would impact construction and manufacturing. Examples of the estimated expenditures follow:
- $650 for domestic infrastructure – including $213 billion for building and renovating affordable and sustainable housing, including energy-efficient structures, and $137 billion for building and upgrading community colleges, early learning centers, and public schools
- $621 billion for transportation infrastructure – including $174 billion for electric vehicles and charging stations; $115 billion to upgrade U.S. highways, bridges, and roads; $85 billion to expand and improve public transit; $80 billion for freight and passenger railways; and $42 billion for airports, ports, and water transit
- $580 billion for overarching economic development – including $100 billion for workforce development (funding for job training, apprenticeships, and career pathway programs) and $300 billion to boost small businesses and manufacturing
- $400 billion for the caretaking of the elderly and disabled
In addition to improving infrastructure, the plan aspires to unify the nation and mobilize its people to confront climate change, invest in American job opportunities, and support communities as they make the transition to clean energy.
Concerns about Taxes and Government Control
Paying for the plan will require an increase in corporate taxes from 21% to 28%, as well as increasing U.S. corporations’ minimum global tax rate from 13% to 21%, canceling fossil fuel companies’ federal tax breaks, and bolstering corporation tax enforcement. Many business leaders, including the U.S. Chamber of Commerce, are worried that the proposed tax increases would counteract the anticipated infrastructure improvements.
Neil Bradley, Executive Vice President and Chief Policy Officer for the U.S. Chamber of Commerce, explained, “Properly done, a major investment in infrastructure today is an investment in the future, and like a new home, should be paid for overtime – say 30 years – by the users who benefit from the investment. We strongly oppose the general tax increases proposed by the administration, which will slow the economic recovery and make the U.S. less competitive globally – the exact opposite of the goals of the infrastructure plan.”
Beyond the tax, concerns is a wariness of government oversight. Although in solid support of a comprehensive infrastructure investment, the Associated General Contractors of America (AGC) expressed reservations about possible federal stipulations: “AGC welcomes the sorely-needed public and private construction investment that can generate long-term benefits for our economy, communities, and national security. However, AGC remains concerned about the possibility of unpredictable and impracticable federal requirements being attached to those investments that, in turn, could significantly diminish its buying power and create barriers to full and open competition.”
Future Legislation Decisions
Lawmakers expect to be debating the merits and defects of the American Jobs Plan for some time. There is a bipartisan congressional group that recognizes how critical it is to revamp the nation’s infrastructure. However, many Republicans will oppose the initiative due to the necessary corporate tax increases, and some of the more liberal Democrats do not believe that the proposal goes far enough. Getting this legislation passed by both the House and Senate could be challenging, but White House officials say that a wide-ranging outreach effort is underway.
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Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.