Transportation And Infrastructure Outlook For Next Congress

President-Elect Joe Biden’s recent presumed victory in the general election will push forward major shifts in US policy across a wide array of issues, including transportation and infrastructure.

Broadly, Biden and his transition team have indicated a desire to work with Congress in early 2021 to enact a large-scale infrastructure package, which would include what is viewed as “traditional” infrastructure – i.e. roads, bridges, transit, etc. – but it would also likely include language relating to ports, airports, schools, broadband access, water infrastructure, and clean energy projects, and could move as a combined package or as pieces of a number of bills.

There is also broad bipartisan support in Congress for a comprehensive infrastructure package; however, there are significant differences of opinion on major issues between Republicans and Democrats, such as what elements should be included, the size of the package, and how to pay for it.

House Democrats have shown support for far-reaching climate- and environment-related language, which they would likely push in a broad infrastructure package.

In July, on a strictly partisan vote, House Democrats passed a $1.5 trillion infrastructure package (the Moving Forward Act – H.R. 2), which House Transportation and Infrastructure Chairman Peter DeFazio (D-OR) has discussed with the Biden transition team.

Keep in mind that H.R. 2 included language that would allow EV charging stations to be installed at rest areas, expands the controversial EV tax credit and creates $1.4 billion grant program for states and localities to deploy EV charging stations along alternative fuel corridors.

Republican lawmakers adamantly opposed H.R. 2 and with President-Elect Biden likely facing a divided government next Congress, there will be limits on what Democrats are able to accomplish with regard to electrification.

In addition to infrastructure, the 117th Congress will have to address surface transportation reauthorization.

The one-year extension of the Fixing America’s Surface Transportation (FAST) Act – authorizing highway, transit, rail, and vehicle safety programs – expires in September 2021.

House Democrats included a surface transportation title in the Moving Forward Act, and House Republicans released their own proposal (the STARTER Act), which will serve as a starting point for their interests in any conference negotiations.

Meanwhile in the Senate, Environment and Public Works Chairman John Barrasso (R-WY) and Ranking Member Tom Carper (D-DE) passed the bipartisan America’s Transportation Infrastructure Act out of committee by unanimous consent.

These bills will likely serve as the starting points for surface transportation reauthorization discussions in the respective chambers. Should an infrastructure package move, it is possible that surface transportation reauthorization will be included.

However, the key question for both infrastructure and surface transportation reauthorization remains the same: how will Congress pay for such a bill, and what action will be taken to find a sustainable, long-term revenue source for the Highway Trust Fund (HFT)? Will electric vehicles (EVs) finally pay into the HFT?

The current state of the economy and previous COVID-relief packages indicate a greater willingness by Congress to deficit spend on infrastructure as a next step in recovery from the pandemic; however, historically, surface transportation bills have been primarily user financed.

Stay tuned.

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