Early in 2021, the question of what to include in infrastructure legislation was the subject of considerable debate. President Biden and other Democrats support a broader list of what should be included in an infrastructure package than Republicans do. The Biden Administration started this year’s serious infrastructure discussion with the proposal detailed in his American Jobs Plan which includes categories of what they call “human infrastructure.” Senator Shelley Moore Capito (R-WV) and her Republican Senate colleagues led the Republican Party’s negotiations with the White House and proposed their own infrastructure package that included a narrower set of physical infrastructure categories.
Two congressional groups each offered bipartisan proposals that include fewer categories than the American Jobs Plan but more than Senate Republicans’ plan. In the Senate, the Common Sense Coalition (CSC), a group of ten Democrats and ten Republicans led by Senators Joe Manchin (D-WV) and Susan Collins (R-ME), have addressed infrastructure. Senators Kyrsten Sinema (D-AZ) and Rob Portman (R-OH) led the infrastructure sub-committee of that larger bipartisan Senate group that developed a package that was then endorsed by the CSC as a whole. In the House, the Problem Solvers Caucus (PSC), a group of 29 Democratic and 29 Republican representatives led by Congressmen Josh Gottheimer (D-NJ) and Brian Fitzpatrick (R-PA) developed a bipartisan proposal (go here and here for more details on their proposal).
The question of what to include has become less pressing because of two more recent events. First, President Biden announced on June 24th that he had agreed with the Common Sense Coalition (CSC) on a “Bipartisan Infrastructure Framework” to guide the negotiations to finalize the details of infrastructure legislation. The agreement announced by the White House follows CSC’s more limited list of what to include in bipartisan infrastructure legislation. The categories in President Biden’s American Jobs Plan not included in the bipartisan framework are generally categories that President Biden has called “human infrastructure” like caregiving for aging Americans and those with disabilities. The White House has pledged to pursue these human infrastructure categories in separate legislation. President Biden further explained that this separate legislation will also include his American Families Plan. The $1.8 trillion American Families plan includes support for child care, paid leave, universal preschool, and free community college. It appears clear that this second legislative package could only pass through budget reconciliation, a procedural mechanism that would allow Democrats to advance it on a purely party-line basis if all 50 Senate Democrats and virtually all Democrats in the House agree.
The second recent event that has made the question of what to include less pressing is that the Senate passed the bipartisan infrastructure bill negotiated by President Biden and the Common Sense Coalition on a bipartisan vote of 69 to 30 on August 10th. That bill is now before the House of Representatives. There is broad agreement that the House will not re-examine the list of what is included in the Senate bill.
We have updated the brief to reflect these more recent developments. The brief provides benchmarks helpful in considering how much is appropriate to spend in each of the 11 categories of infrastructure included in the bipartisan Senate bill supported by the Common Sense Coalition and President Biden. If you would like to know more about the case for and against a large investment in each category, you can click on the link to that information.
There is significant bipartisan support for a historic increase in federal infrastructure investment. Democrats generally believe the increase should be much more than Republicans do. The prospects that bipartisan legislation will pass improved significantly when the Senate passed the Common Sense Coalition and President Biden bill that would invest $550 billion in total new spending over five years (about $1.2 trillion with baseline spending). Still, many Democrats in Congress believe the number should be much higher and many Republicans believe it should be lower.
The passage of the bipartisan Senate bill came after months of serious negotiations. Initially, those negotiations were primarily between President Biden and Senate Republicans. President Biden’s American Jobs Plan initially called for $2.25 trillion in new infrastructure spending over ten years. In negotiations with Senate Republicans, he then reduced the proposed overall spending to $1.7 trillion (about $2.5 trillion including the baseline amount the federal government already expects to spend over that time).
Senator Shelley Moore Capito (R-WV) and her Republican colleagues in the Senate initially proposed $174 billion in new spending above the federal baseline over eight years. Their revised proposal after negotiations with President Biden included $298 billion in total new spending over eight years ($928 billion if you include baseline spending over that period).
The Problem Solvers Caucus had proposed $619 billion in new federal spending over eight years ($1.25 trillion with baseline spending).
Finally, perhaps the greatest remaining differences are about how to pay for more infrastructure spending. This is one area where the bipartisan bill that the Senate passed may not be the final word. One of the options the House may consider is to include more provisions for how to fund the infrastructure investment along with other investments as part of the budget reconciliation bill. Two of the largest funding sources in the Bipartisan Infrastructure Framework that President Biden and the Common Sense Coalition negotiated are (1) closing the tax gap between what is paid and what is owed and (2) repurposing unused COVID relief funds.
President Biden’s Made in America Plan is the companion to the American Jobs Plan that proposes ways to pay for the new infrastructure investments. It identifies increased corporate taxes as the primary funding mechanism. President Biden has indicated he will continue to advocate for these new revenue sources in the second legislative package that will also include his American Families Plan and the human infrastructure categories not included in the Bipartisan Infrastructure Framework. Senate Republicans’ infrastructure roadmap proposes two mechanisms to pay for new infrastructure spending that are not included in the Bipartisan
Infrastructure Framework. First, Senate Republicans suggest that those who use infrastructure bear the costs for it in the form of increased gas and diesel taxes and other user fees. Second, they propose that we streamline permitting processes to save money and make the infrastructure investments go further.
The original Common Sense Coalition proposal included user fees and taxes but they agreed to drop those in the negotiations with President Biden. The Problem Solvers Caucus proposal for how to pay for infrastructure was detailed in their 20-page infrastructure report that preceded their proposal for what to include and how much to spend. It also includes provisions from both President Biden’s and Senate Republicans’ plans, as well as other innovative mechanisms.