Trump’s Infrastructure Plan: Modest Federal Incentives, Facing Long Odds

WASHINGTON — President Donald Trump on Monday will propose offering $100 billion in federal incentives to encourage cities and states to invest in road, bridge and other building projects, the centerpiece of a plan to spur $1.5 trillion in infrastructure spending over the next decade without devoting significant federal money.

The proposal, to be unveiled the same day as Trump’s 2019 budget, faces long odds on Capitol Hill, where members of both parties — particularly Democrats — are skeptical of any plan that fails to create a dedicated new funding stream to address the nation’s crumbling infrastructure. Lawmakers are also doubtful that such a small federal investment will be sufficient to spur an infrastructure spending boom.

The president, who plans to invite Democrats and Republicans to the White House this week to call for a sweeping bipartisan infrastructure initiative, will propose to devote a total of $200 billion in federal dollars to the program, according to senior White House officials who previewed the plan on the condition of anonymity. Half of that amount would go toward matching funds that states and cities commit to financing their own infrastructure projects.

Trump’s plan, the officials said, would also provide $50 billion in block grants to governors to fund rural infrastructure projects, and a $20 billion increase in loans and bonds to finance transportation, water, rail and other projects. A major element of the proposal would be to speed the approval of such projects to two years, the latest in a series of attempts by the Trump administration to reduce government regulations, including a host of environmental restrictions, that corporations say are costly and burdensome.

The blueprint represents Trump’s long-awaited strategy for fulfilling a campaign promise to spearhead a $1 trillion effort to rebuild the nation’s dilapidated infrastructure and create thousands of jobs in the process. The effort was relegated to the back burner during the president’s first year in office, as his White House struggled without success to overhaul the health care system and then threw its energy and political capital into pushing through a $1.5 trillion tax cut along party lines.

Over a period of months, Trump’s top economic advisers, led by Gary D. Cohn, the director of the National Economic Council, repeatedly said a concrete infrastructure proposal was coming but no such plan had materialized, despite heavily promoted events like White House “infrastructure week.”

Now, White House officials say they are ready — after months of what they characterized as behind-the-scenes meetings with members of both political parties — to push through a plan that they concede will not be enacted without the support of both Democrats and Republicans.

The odds of such a bipartisan effort coming together in the current political environment are long. White House officials said the new spending would be offset by unspecified cuts elsewhere in the budget, which are all but certain to be roundly criticized by Democrats. Many infrastructure experts consider the ratio Trump’s aides are proposing for a public-private plan — essentially creating $6.50 in private investment for every federal dollar spent — to be largely out of reach. And the president plans to leave it up to lawmakers, who are deeply divided on how to finance any infrastructure effort, to decide on key questions such as whether to enact a gas tax to pay for it or slash other types of spending.

“The president has said that he is open to new sources of funding,” a senior White House official told reporters Saturday, speaking on condition of anonymity to describe the plan in advance of its release. “We will be quite flexible in terms of how we accomplish those objectives.”

The plan also proposes $20 billion for so-called “transformative programs,” described by the official as “next-century” infrastructure, and it would set aside $10 billion for a capital financing fund to handle projects that the federal government is currently building.

To expedite the building of infrastructure projects, Trump will propose a new “one agency, one decision,” model in which one federal agency would take the lead in moving a project through the permitting process within 21 months, with final action within three months after that. The official said the White House wanted to shorten the process while preserving environmental protections that exist under current law.

But progressive groups and public interest organizations rushed to condemn the plan Sunday, arguing Trump was trying to gut environmental rules under the guise of an infrastructure initiative.

“President Trump’s infrastructure proposal is a disaster,” Shelley Poticha, the managing director of the Healthy People & Thriving Communities Program at the Natural Resources Defense Council, said in a statement. “It fails to offer the investment needed to bring our country into the 21st century. Even worse, his plan includes an unacceptable corporate giveaway by truncating environmental reviews.”

Business groups, however, broadly praised the president’s forthcoming proposal, saying it represents a long overdue investment that would provide a boost to U.S. companies.

“In calling for a substantial, $1.5 trillion investment, President Trump is providing the leadership we have desperately needed to reclaim our rightful place as global leader on true 21st century infrastructure,” said Jay Timmons, the president and CEO of the National Association of Manufacturers. “There is no excuse for inaction, and manufacturers are committed to ensuring that America seizes this opportunity.”