You might be inclined to forgive the somewhat beleaguered President Joe Biden for making the most out of his two recent legislative wins in the signing of the $1.2 trillion Bipartisan Infrastructure Framework and the House of Representatives’ passing of the Build Back Better bill. As a result, at the signing of the BIF, the president seemed more than a little overjoyed.
“Things are going to turn around in a big way,” he began, not exactly tempering expectations. “For example, because of this law, next year will be the first year in 20 years American infrastructure investment will grow faster than China’s. We’ll once again have the best roads, bridges, ports and airports over the next decade.”
There’s no faulting the ambition and the sense of accomplishment, but as Infrastructure Investor’s New York Forum heard last week, while the signing of the bill could be transformative, other major step changes are also needed.
“Just giving the money is not enough,” Morteza Farajian, executive director at the Department of Transport’s Build America Bureau, told delegates. “Someone needs to identify these projects, take them through the permitting process, creating local support, be properly procured and get shovels in the ground in a timely process.”
DJ Gribbin, founder of consultancy Madras and a former special adviser on infrastructure to President Trump, added: “Can we actually get the money out the door in a timeframe that is sensible in terms of what the public thinks is sensible?”
The appointment of Mitch Landrieu, former mayor of New Orleans, as a senior adviser and coordinator of the infrastructure spend, is a start on this front, although he will need to address some more basic problems first. As Farajian noted, more than half the states in the US have never used the Transportation Infrastructure Finance and Innovation Act, a 1998 programme to provide credit assistance for transport projects.
The BIF has been celebrated in some quarters for finally bringing the asset recycling concept to a codified infrastructure law and paving the ways for public-private partnerships backed up by value for money assessments. However, if a majority of states have failed to take advantage of more basic financing programmes over the past 20 years, those opening champagne bottles over a big federal spend combined with private investment models might well want to put them back on ice, or at least buy a cheaper bottle.
Yet, as was mentioned in the Forum’s conference hall and on the sidelines, plenty might well be storing that more expensive bottle for the $1.9 trillion Build Back Better Act. If – and, at the time of writing, that remains quite an ‘if’ – the bill is passed by the Senate, it would provide more than $140 billion to extend tax incentives for renewables while also introducing new tax credits for energy storage and a much-needed boost for high-voltage transmission lines.
With the bill’s future still in the balance, the president gave a more cautious welcome to the House’s passing of the Build Back Better Act than the BIF. What is clear, though, is the US has been given a fighting chance to build a cleaner, more sustainable and modern infrastructure. Now the hard work starts.