The Bipartisan Infrastructure Deal - What's in it?

A bipartisan group of 10 senators reached a deal with the White House to spend $973 billion over five years, and $1.2 trillion if continued over eight years. It leaves out many of President Biden's top priorities for "human infrastructure" such as child care, elder care, and education. 

Construction Dive reports that the new plan focuses on funding for the following:

 - Roads

 - Railways

 - Bridges

 - Water facilities

 - Broadband internet

As the bipartisan negotiations were going on, a key issue was how to pay for the plan, with Republicans opposed to undoing any of their 2017 tax cuts and Biden against raising the gas tax. The proposal will now be funded by:

 - Increased tax enforcement

 - Unused unemployment insurance

 - Unused coronavirus relief funds

 - State and local funds for broadband

 - Sales from the Strategic Petroleum Reserve

An article in Politico stated that the Senate Republicans who negotiated the infrastructure deal with President Biden celebrated on Thursday but awoke angry on Friday. They were frustrated that Biden explicitly tied his signature on a bipartisan infrastructure bill to a separate Democrats-only measure. 

The Washington Post reports that by Saturday, things seemed to go smoother when Biden decided he will sign the bipartisan infrastructure package even if he is unable to bring his party together for a separate bill that includes other Democratic spending priorities.

The American Society of Civil Engineers gave the nation's roads a poor grade in its 2021 report, saying that 40% of the system is now in poor or mediocre condition. Bridges, schools and much of the key infrastructure in the U.S. doesn't score much better.

According to a White House fact sheet, the proposal for transportation includes:

 - Roads, bridges, major projects: $109 billion

 - Passenger and freight rail: $66 billion

 - Public transit: $49 billion

 - Airports: $25 billion

 - Infrastructure financing: $20 billion

 - Ports and waterways: $16 billion

 - Safety: $11 billion

 - Electric vehicles: $7.5 billion

 - Electric busses/transit: $7.5 billion

 - Reconnecting communities: $1 billion

The proposal for infrastructure includes:

 - Power including grid authority: $73 billion

 - Broadband: $65 million

 - Water: $55 billion

 - Resilience: $47 billion

 - Environmental remediation: $21 billion

 - Western water shortage: $5 billion

The Biden administration has long said that any infrastructure plan should support the growth of union jobs, but ABC supports open competition that does not restrict projects to using only union workers.

"ABC remains concerned with the two-pronged approach emerging from Democrats in Congress and the Biden administration, which would seek to pair this agreement with a subsequent effort to use the budget reconciliation process to enact partisan tax hikes and restrictive labor policies concurrent with a potential bipartisan agreement."

CEO of Associated Builders and Contractors | Michael Bellaman

Transport Topics News states that the new infrastructure plan could give companies with ties to the construction industry a solid foundation for growth.

Companies such as Caterpillar, with its heavy machinery, and construction materials company Vulcan Materials could see years of additional business as roads and bridges are rebuilt and buildings are modernized. Both companies' shares rose June 24, after the bipartisan deal was struck. Smaller construction-related companies benefited as well: Dycom, which provides contractor services to construction companies, rose nearly 6%.

Makers of cranes, bulldozers and other machinery are still only part of the bigger picture. Companies that make asphalt, concrete and other road and building materials are in a good position with any future infrastructure spending. Vulcan Materials and Martin Marietta Materials are among the biggest makers of aggregates in the U.S.

Paint and coatings makers like Sherwin-Williams and PPG Industries are also in a good position to take advantage of any ramped up government spending. Bridges need paint and other coatings to stay hardy against the elements, while roads and buildings also need a significant amount of paint.

According to the Star Tribune, even small construction companies will see a boost. Shares of Granite Construction of Watsonville, CA, shot up nearly 5% Thursday and posted another 4% gain Friday. The company has a market value of just under $2 billion.  

For Construction Pros states that the House plans to consider during next week the INVEST in America Act, which contains a five-year, $584 billion surface transportation bill. It is expected to pass with mostly Democratic votes. Senate Majority Leader Chuck Schumer is planning to move the bipartisan infrastructure package on a dual track with a broader budget reconciliation package containing additional Democratic priorities.

White House.gov reports that the infrastructure plan will grow our economy, create jobs, improve living standards, reduce climate pollution and ensure more Americans can participate fully and equally in our economy. 

Democracy requires compromise and the historic Bipartisan Infrastructure Framework will make life better for millions of Americans, create a generation of good-paying union jobs and economic growth, and position the U.S. to win the 21st century, including many of the key technologies needed to combat the climate crisis.